When passing off is enough to successfully oppose a trade mark


Kat friend Just Wang of Bird & Bird ATMD in Singapore discusses how one can rely on passing off to successfully oppose the registration of a mark.

Can a foreign brand owner with no earlier trade mark registration, nor recognition of its brand being "well known" in Singapore, stop another trader from registering the same brand there? That was the issue considered by The Intellectual Property Office of Singapore's (IPOS) in the opposition matter of U-Manga International Business Co., Ltd v nunufish.com . Relying on proof of a claim of passing off, the answer was “yes”.

Background

"Footpure" is a brand of foot deodorant powder from Taiwan. The Applicant was a sole proprietorship operating Nunufish.com, an online platform selling various personal care products. The Opponent, U-Manga International Business Co., Ltd, was the owner of the registered trade mark "footpure" in Taiwan, but it had not obtained registration for the "footpure" mark in Singapore at the relevant date of the opposition. The Applicant had previously sold the Opponent's goods in Singapore. The Opponent alleged that the Applicant was clearly aware of its rights in "footpure"; indeed, it had registered the "footpure" mark in Singapore a few days after the Opponent terminated the Applicant's licence to distribute its "footpure" products locally. The Opponent opposed the application on two grounds under the Singapore Trade Marks Act:
(a) The use of the "footpure" trade mark constituted of passing off of a protectable unregistered trade mark;

(b)The Opponent's "footpure" mark constituted an "earlier trade mark" as it qualified as a "well-known trade mark", such that registration of the "footpure" mark would result in a likelihood of confusion and/or use would indicate a connection between the respective goods that would be likely to damage the Opponent's interests.
It is noteworthy that the opposition did not proceed on the ground of "bad faith", apparently because the Opponent did not plead the correct operative section under the Singapore Trade Marks Act.

The Registrar's decision

No earlier well-known trade mark

As for the claim that the Opponent's "footpure" mark was well-known in Singapore (which does not require the mark to be registered), the Registrar, considering the evidence as a whole, concluded that it was insufficient to establish that that the "footpure" mark was well-known in Singapore. The Opponent had adduced a few pieces of evidence to show that the "footpure" mark was well-known in Singapore. First, the Opponent showed that the mark was registered in Taiwan and China, and submitted that these were both popular tourist destinations for Singaporeans. Unsurprisingly, the Registrar was unwilling to accept that the mere fact of registration in a foreign country would lead to marks being well-known in Singapore.

The Opponent also produced email conversations where the Applicant expressed confidence that there was a market for the "footpure" product in Singapore. However, the Registrar reasoned that the Applicant's business ambitions and belief in the brand's potential alone did not show that products were well-known. Finally, the Opponent adduced evidence of comments made by customers on an online shopping portal which sold the "footpure" products. These comments included accolades, recommendations and high ratings for the Opponent's products. However, these also included complaints about the goods sold by the Applicant (which included the Opponent's products) being suspected to be counterfeit. Considering the totality of the evidence, the Registrar concluded that "it would be a fantastic stretch to find the mark "footpure" well known". The evidence merely demonstrated that the "footpure" mark was known, but not necessarily well known.

Passing Off

The Opponent was therefore left with the ground of opposition based on passing off under section 8(7)(a) of the Trade Mark Act, which requires proof of the classical trinity of: (1) goodwill, (2) misrepresentation and (3) damage. Neither misrepresentation nor damage was a difficult hurdle to cross in this case. Given that the opposed mark was "practically identical" to the Opponent's "footpure" mark, the reasonable conclusion was that the public were likely to be deceived or confused into thinking that the Applicant's goods were either those of the Opponent, or emanate from a source that is linked to the Opponent. This diversion of custom likewise established the element of damage. The main issue that fell to be considered was therefore whether goodwill existed in the Opponent's business within Singapore.

Based on a review of the principles laid down by the Singapore Court of Appeal in the case of Singsung Pte Ltd v LG 26 Electronics Pte Ltd, the Registrar emphasized that goodwill does not exist on its own, but attaches to a business in the jurisdiction. In particular, goodwill in the context of passing off is concerned with goodwill in the business as a whole, and is not concerned with the constituent elements of the business, such as the marks, logos or get-ups specifically. Such goodwill attaches to a business in the jurisdiction and is manifested in the custom that the business enjoys.

For these reasons, the Opponent faced difficulty in establishing goodwill, where the evidence it submitted could not be traced back specifically to business in Singapore. It succeeded in doing so by adducing various website printouts of an online shopping portal (Qoo10), where the Opponent's goods were sold by a third party distributor long before the Applicant sought to register its mark. Crucially, the website printouts reflected the Opponent's name (U-Manga) on the listing as the source of the "original" "footpure" foot powder. On the basis of this evidence, the Registrar accepted that there was goodwill in the Opponent's business in Singapore. Therefore, the Opponent succeeded in establishing the ground of opposition under the tort of passing off, and the opposed mark was refused registration.

Comment

This case shows that the passing-off ground is a separate and distinct cause of action for opposing registration. To rely on passing off, the Opponent had to establish proof of goodwill in its business in Singapore and this case illustrate the kinds of evidence needed to establish goodwill which relates to business within the jurisdiction. This case also illustrates that evidence that may be sufficient to prove trade mark use may be different from that necessary to prove goodwill which attaches to a business in the jurisdiction.

The case also reinforces the applicable threshold for marks to be regarded as "well-known". Singapore law recognizes that marks can be well-known in Singapore so long as it is well-known to any relevant sector of public in Singapore. Nonetheless, the Registrar emphasized that this does not mean that the threshold for being regarded as well-known is a low one. While the Registrar was willing to find that the "footpure" brand had protectable goodwill in Singapore, it did not find that the mark crossed the threshold to become "well-known".

When passing off is enough to successfully oppose a trade mark When passing off is enough to successfully oppose a trade mark Reviewed by Neil Wilkof on Tuesday, February 06, 2018 Rating: 5

3 comments:

Anonymous said...

I am not entirely sure whether this is an instructive example if the opponent "did not proceed on the ground of "bad faith", apparently because the Opponent did not plead the correct operative section under the Singapore Trade Marks Act" in such a situation. Might be one of these cases where the registrar built a "golden bridge" to arrive at a desired outcome rather than a case where the law was applied consistently and rigourously. Then again, I am not an expert on trademark law in Singapore and just make a guess.

Phuong Nguyen said...

Thank you. It's an interesting case to use the ground of "passing off". I know it's quite difficult to provide the proof of goodwill in a business, especially when the IPR holder has not yet registered the trademark as well as entered into the market.

I don't agree with the comment above that the Opponent can use the ground of "bad faith". I think bad faith can be very effective when the Opponent has their own business in Singapore first. In this case, the Opponent has nothing in Singapore, except some emails providing that the Applicant had used to be the Opponent's local distributor. :)

And, if you're nevermind, I would like to translate this article into Vietnamese for my blog, non-profitably. Thank you.

Eleonora Rosati said...

@Phuong Nguyen: thanks so much for your inquiry regarding translation of this post. If you are interested in this opportunity can you please email theipkat@gmail.com as soon as possible so that we can discuss how you to go ahead with this project? Many thanks.

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