Who owns the intellectual property rights over the Little Rascals? The creator Huang Yulang or Culturecom, the company he created and later sold?
Introduction
The 1980s is the golden era for Hong Kong comics. Little Rascals (小流氓), later retitled as Dragon and
Tiger Heroes (龍虎門) (collectively referred to as “Little
Rascals” below), is undoubtedly one of the most iconic comic series in Hong
Kong. Mr Huang Yulang (“Mr Huang”),
a comic artist widely recognized as the godfather of Hong Kong comics, is commonly
known to be the creator of Little Rascals.
However,
whether the comic artists always have intellectual property
rights over their comics? Culturecom Limited & Anor v Jade Dynasty
Publications Limited & Ors
[2023] HKCFI 805 may shed some light on this.
Facts
Mr
Huang first published the Little Rascals series in 1970. In 1980, Mr Huang
founded the 1st Plaintiff, then known as part of the “Jademan”
group. In 1983, the 1st Plaintiff took over the comic book
publishing business previously carried on by Mr Huang and continues to carry on
a publishing and intellectual property licensing business today.
In
1986, the 1st Plaintiff was listed on the Hong Kong Stock Exchange.
Subsequently, Mr Huang resigned as a director the 1st Plaintiff in
1989. Mr Huang sold all his shares in the 1st Plaintiff in or around
1991 and ceased to have any relations with the “Jademan” group, which was later
renamed and known as the Culturecom group.
From
2000 to 2020, Mr Huang and his related companies signed a number of license
agreements with the Plaintiffs (“License
Agreements”), under which the Plaintiffs granted licence to Mr Huang and
his companies to produce, publish and distribute Little Rascals, related works
and merchandises.
The
relationship between the Plaintiffs and Mr Huang deteriorated since
2012 and the Plaintiffs terminated the License Agreements in 2020. Nonetheless,
Mr Huang and his companies continued to publish works in relation to Little
Rascals.
The
Plaintiffs applied for interlocutory injunctive relief against the Mr Huang and
his related companies (“Defendants”)
for (1) infringement of the 1st Plaintiff’s copyright in Little
Rascals, (2) the tort of passing off and (3) infringement of the 1st
Plaintiff’s trade marks.
The
Plaintiffs’ case is that the 1st Plaintiff was assigned the
intellectual property rights subsisting in and relating to Little Rascals (“Little Rascals IP Rights”) from Mr
Huang when it took over his publishing business in 1983 although the assignment
could not be located. The 1st Plaintiff is the registered owner of
the Little Rascals and Dragon and Tiger Heroes trade marks.
On
the contrary, the Defendants contended that Mr Huang, instead of the 1st
Plaintiff, owns the Little Rascals IP Rights.
Decision
The
Honourable Mr Justice Lok allowed the Plaintiffs’ application for interlocutory
injunctive relief for the following reasons:
1.
The inability of the Plaintiffs’ present owners to access the historical
records and documents should not be exploited to the Defendants’ advantage as
they only acquired the Plaintiffs in 1991.
2.
There is much other evidence showing that the Little Rascals IP Rights had
been assigned or transferred to the 1st Plaintiff, for instance:
a.
The listing prospectus of the 1st Plaintiff stated that since
1984 the Plaintiffs group began to license its publications in Singapore and
Malaysia. If the Little Rascals IP Rights had not been transferred or assigned
to the 1st Plaintiff, it could not have granted such licenses.
b.
There were express acknowledgements in the License Agreements that the 1st
Plaintiff is the owner of the Little Rascals IP Rights.
c.
The Defendants have not produced any evidence to show that they have
asserted the Little Rascals IP Rights.
3.
Based on the parties’ dealings, the Defendants are estopped from denying
the 1st Plaintiff’s ownership or asserting Mr Huang’s ownership of
the Little Rascals IP Rights.
4.
The Plaintiffs would suffer irreparable damage from the Defendants’
continuing infringing acts.
5.
On the other hand, the Defendants had acknowledged the Plaintiffs’
ownership of the Little Rascals IP Rights for over 20 years until recently and
would unlikely suffer any irreparable damage from the interlocutory injunctive
relief.
Takeaway
This
case serves as a reminder that the original content creator does not always own
the intellectual property rights in his/her work. The formal assignment is not
the only piece of evidence that the Court takes into account in deciding
whether the intellectual property rights have been assigned. Content creators
should be mindful of the issue of intellectual property ownership when dealing
with publishers and other commercial counterparties.
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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. |
Published by ONC Lawyers
© 2023 |