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2021 MarsdenLR 122
FEDERAL COURT PUTRAJAYA
MUNCHY FOOD INDUSTRIES SDN BHD – Appellant
Versus
HUASIN FOOD INDUSTRIES SDN BHD – Respondent
[Civil Appeal No: 02(f)-85-11-2019(W)]
Honest concurrent use is irrelevant to trademark infringement actions when the defendant's mark is unregistered; distinct marks cannot coexist without prior remedy measures.
Headnote:(A) Trade Marks Act 1976 – Sections 14(1)(a), 19, 20, 38, 44 – Trade mark infringement – The appeal centered on whether honest concurrent use under the Trade Marks Act is pertinent in an infringement action when the defendant's mark is unregistered – The High Court found in favor of the plaintiff – The Court of Appeal's decision reversed this – The Supreme Court reinstated the High Court's ruling, stating the defendant had failed to prove honest concurrent use and that registered marks must not be varied prior to infringement actions. (Paras 5, 12, 40, 55)
(B) Passing-off – Distinction from trade mark infringement – Both claims require different legal standards, with passing-off not needing to establish actual deception but merely a likelihood of confusion. (Paras 30, 52)
Facts of the case: The plaintiff asserted infringement of its registered LEXUS mark by the defendant's LEX mark, resulting in public confusion over their biscuit products. The High Court upheld the plaintiff's claim. (Paras 4, 10)
Findings of Court: The plaintiff's marks are distinctive and capable of distinguishing its products – The defendant's mark was held to infringe upon the plaintiff's marking. (Paras 12, 55)
Issues: Determination of the relevancy of honest concurrent use in trademark infringement and the implications of the variation remedy before pursuing an action. (Paras 2, 43)
Ratio Decidendi: The appellant's mark establishes exclusivity under trademark law; the variations proposed by the defendant were considered irrelevant to the infringement claims. (Paras 54, 55)
Result: Appeal allowed; High Court's decision restored.
Introduction
[1] This appeal concerns an alleged infringement of a trademark. The crux of the issue in this appeal is whether honest concurrent rights under the Trade Marks Act 1976 (" TMA ") and variation of a registered trade mark under the Trade Marks Act are relevant considerations that need to be taken into account in an action for trade mark infringement and/or passing-off.
[2] On 22 October 2019, this court granted the plaintiff leave to appeal against the decision of the court of Appeal in respect of these two questions of law:
Question 1
Is honest concurrent rights under the Trade Mark Registration system a relevant consideration in an action for trade mark infringement and/ or passing-off where the trade mark of the defendant is not registered?; and
Question 2
Is variation of a registered trade mark a remedy that a plaintiff should seek as an option before commencing an action for trade mark infringement and/or passing-off even if the trade mark of the defendant is not registered?
[3] For the purpose of this judgment, the parties will be referred to as they were in the High court, namely the appellant as the plaintiff and the respondent as the defendant.
The Factual Background
[4] The plaintiff, Munchy Food Industries Sdn Bhd is a manufacturer and seller of biscuits and confectionary since its incorporation in 1991. The plaintiff's house brand is "munchy's" trade mark (Munchy's House Brand).
[5] The plaintiff has various trademarks, one of which is the plaintiff's LEXUS mark which was registered on 23 January 1998 (registration no 98013537) used on packages of plaintiff's Lexus biscuits.
[6] The plaintiff's LEXUS Products are packaged as follows:
[7] Sometime in August 2015, the plaintiff received a complaint from its customer who had wrongly associated the defendant's biscuit with that of the plaintiff's.
[8] The defendant also produces and sell all kinds of confectionary items, one of which is the LEX biscuit. The defendant uses a combined mark comprising of stylised "Lex" in a circular design with a curved stalk of wheat for the defendant's cream sandwich biscuit products. The defendant's Lex products are packaged as below:
[9] On 25 September 2015, the defendant applied to the Registrar of Trade Marks (Registrar) to register the defendant's Lex Mark. The plaintiff filed an opposition to the defendant's trade mark application.
[10] The plaintiff subsequently brought an action in the High court for trade mark infringement and passing-off against the defendant. The plaintiff claimed that the defendant had infringed the plaintiff's registered trade mark under s 38(1)(a) TMA by using the trade mark LEX which is deceptively similar to the plaintiff's trade mark in relation to its products which include biscuits and/ or cream sandwich. The plaintiff's claim for passing-off was premised on the defendant's trade mark which are confusingly similar to the plaintiff's trade mark.
[11] The defendant filed a counterclaim pursuant to s 45(1)(a) TMA for a court order to remove LEXUS Registered Mark from the Register based on the grounds that: (i) that the public is likely to be deceived and/or confused between Plaintiff's LEXUS Mark and Toyota's LEXUS Mark pursuant to the first limb of s 14(1)(a) TMA read with s 37(b) TMA and/or (ii) that the plaintiff's LEXUS Mark is not distinctive of plaintiff's Biscuits within the meaning of s 37(c) TMA . In the present case, it is pertinent to note that Toyota is not a party in this case and Toyota's LEXUS mark is not used for the biscuits produced by the plaintiff.
The High court
[12] The High court found in favour of the plaintiff and held that the defendant's trade mark infringes the plaintiff's trade mark and the defendant's Lex products passes off on the plaintiff's Lexus Products. In deciding so, the learned High court Judge addressed the defendant's counterclaim first, for the reason that if the defendant succeeds to remove the plaintiff's LEXUS Mark from the Registe
