To what extent overseas decisions and findings can support disputed trademark application in local court?
Introduction
As
the trademark registration system in most jurisdictions only confer territorial
protection, often time trademark owners would seek to have their trademarks registered
in multiple jurisdictions to extend their exclusive rights to use the
trademarks globally. However, the successful registration in a jurisdiction
would not necessarily mean the same in another. If a trademark application is
opposed in Hong Kong, would the Hong Kong Court consider the findings of
foreign courts and authorities in support of the application? A recent judgment handed down by the Hong
Kong Court of First Instance (the “Court”),
樂氏同仁藥業科技集團有限公司 v 中國北京同仁堂(集團)有限責任公司 [2022]
HKCFI 2512 provides useful guidelines in this respect.
Background
The
Applicant applied for the registrations of 2 trademarks containing the words and/or
logo “樂氏同仁” (the
“Subject Marks”) in Hong Kong (the “Applications”). The Applications were
disputed by the Opponent, being the owner of the well-known “同仁堂” (Tong Ren Tang) and “北京同仁堂” (Beijing tong Ren
Tang) marks on, inter alia, the
ground of bad faith under s.11(5)(b) of the Trade Marks Ordinance (the “TMO”).
The Court first considered the history of the Applicant and the Opponent. The
trade name Tong Ren Tang was first used by the Yue’s Family to sell Chinese
medicine in China with a history dating back to the Ching Dynasty in 1669. Due
to historical reason, the 13th generation of the Yue’s family restarted
their business in Taiwan with traditional family recipes of Chinese medicine in
1949. While some of the family members remained in the Mainland operating Tong
Ren Tang, the Mainland business was later taken over by a state-owned
enterprise after the Cultural Revolution. Since then the Yue’s family lost all
tangible and intangible assets of their family business in the Mainland.
The
Applicant was established by the 14th generation of the Yue’s
family, Mr Yueh Chueh Hsin (“Mr Yueh”)
as an attempt to regain the Mainland market. Mr Yueh used the trade name “樂氏同仁” (Yue’s Tong Ren) to continue
his family business and successfully had its trade marks registered in the
Mainland and Taiwan.
Grounds
of opposition
The
Opponent argued that, inter alia, (1) the Applicant’s application was made in
bad faith as it must have known about the Opponent and its business when filing
the trade mark applications, given that the Opponent had become well-known to
the public with over 2,000 shops in the Mainland. (2) The Chinese name “Tong
Ren” was not a necessary name in the pharmaceutical industry and the Applicant
should have no reason to adopt the same as part of the Subject Marks; and (3) the
words “Royal Herbalist since 1669” in the Subject Marks also revealed the
intention of the Application to mislead the public that the Subject Marks are
related to the Opponent.
Decision
of the Hearing Officer
The
hearing officer of the Intellectual Property Department (the “Hearing Officer”) agreed that the
Opponent’s marks had a certain degree of fame and goodwill at the date of the Applications.
She also doubted whether the alleged Yue’s family were indeed related to the
Applicant and had granted authorization to the latter to use the trade name
“Yue’s Tong Ren”. She queried whether the business of the Applicant had any
fame outside Taiwan and considered that Yue could also have used other names
without using the words “Tong Ren” when it apply to register the Subject Marks
for goods unrelated to Chinese medicine. In conclusion, the Hearing Officer opined
that the Applicant had intentionally applied for marks including the name Tong
Ren for the purposes of trading off the reputation of the Opponent and
intentionally causing confusion to consumers.
Dissatisfied
with the Decision, the Applicant appealed to the High Court.
Decisions
Principles
on bad faith
The
legal principles on bad faith as set out in Owndays
Co Ltd v Professional Optometrist Ltd & Ors [2019] HKCFI 3147 were
not disputed by the parties. The major principles were as follows:
1. the relevant date for assessing whether an application to register a
trade mark was made in bad faith is the application date;
2. bad faith includes not only dishonesty, but also “some dealings
which fall short of the standards of acceptable commercial behaviour observed
by reasonable and experienced men in particular area being examined”;
3. a person is presumed to have acted in good faith unless the contrary
is proved. The standard of proof is on the balance of probabilities, but cogent
evidence is required due to the seriousness of the allegation. The tribunal
must make an overall assessment, taking into account all the factors relevant
to the particular area; and
4. lack of honest belief and bad faith are two different concepts. The
test is whether one acted in bad faith and not whether one acted under an honest
belief.
Findings
of foreign courts and authorities
The
Court considered that the hearing officer’s decisions were contrary to the
findings of the Beijing Intellectual Property Court (the “Beijing IP Court”) handed down in 2017, which rejected the opposition
of the Opponent and allowed the Applicant’s registration of two trade marks containing
the words “樂氏同仁” (Yue’s Tong Ren) and “Royal Herbalist”. The Beijing IP Court
accepted that the Applicant’s right to use the “Yue’s Tong Ren” mark derived
from the Yue’s family, and that Yueh was both the founder and the operator of
the Applicant. Although the Beijing IP Court did not elaborate on how the
Applicant obtained such right, the findings remained that there was connection
between the Yue’s Family and the Applicant’s business.
Relevance of findings
of foreign courts and authorities
The
Court admitted that the findings of foreign courts and authorities are
generally not relevant to trademark applications in Hong Kong, in particular
when such findings are about evaluation of similarity of marks and likelihood
of confusion. That is because cultures of different places vary and the
behaviours and impression of a trade mark may differ to an average consumer in
different places. It is not uncommon that the courts and authorities in
different jurisdictions may reach different conclusion on these matters.
Albeit
the foregoing, findings on factual
matters by foreign courts and authorities may be relevant. In the present case,
the Court ruled that the findings of the Beijing IP Court provided evidential
basis to support the Applicant’s evidence that it had considered itself
legitimate to use the Yue’s Tong Ren name by reason of its connection with the “Yue”
Family in Taiwan. The Beijing IP court also accepted that Yueh was the founder
and was involved in the operation of the Applicant, which was also confirmed by
the legal person of the Applicant on oath. The Hearing Officer shall not rely
on respective queries to make a finding of bad faith. It is hence difficult to
support a finding of bad faith on the part of the Applicant when it applied to
register the Subject Marks, not least the trade mark applications are presumed
to be made in good faith unless the contrary is proved.
Because
of the above reasons, the Court set aside the finding of bad faith made by the
Hearing Officer on the Subject Marks.
Key takeaways
As each
jurisdiction has its distinct cultural features, respective courts and
authorities may render different decisions when considering the application of the same trademarks.
Although the finding of foreign courts and authorities on matter of similarity
and likelihood may not support trademark application in Hong Kong, any findings
on facts may however be admitted and considered. When in doubt, trademark
owners shall seek legal advice to have their intellectual property rights secured.
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Important: The law and
procedure on this subject are very specialised and complicated. This article
is just a very general outline for reference and cannot be relied upon as
legal advice in any individual case. If any advice or assistance is needed,
please contact our solicitors. |
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Published by ONC Lawyers
© 2022 |
