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Singapore Sufficient Goodwill for Passing-Off Claim, Despite Sales Figures

Hai Tong Co Pte Ltd, a Singapore company, is engaged in the business of importing, exporting and distributing cosmetic products under the LADY ROSE brand and has registered that mark in Class 3. Ventree Singapore Pte Ltd imported ROSE LADY brand cosmetic products from VOV Cosmetics in South Korea and distributed the products in Singapore.

Upon discovering that Ventree had been distributing ROSE LADY products, Hai Tong instituted proceedings for infringement and passing off before the High Court. While upholding the infringement claim, the court dismissed the passing-off claim, finding that Hai Tong had “trivial” goodwill and had failed to adduce sufficient evidence to demonstrate likelihood of damage.

Cross-appeals were filed to the highest court in Singapore, the Court of Appeal. It granted both the infringement and the passing-off claims. Hai Tong Co (Pte) Ltd v. Ventree Singapore Pte Ltd et al., [2013] SGCA 26 (Mar. 15, 2013).

With respect to infringement, the Court of Appeal held that:

  1. The mark LADY ROSE was not descriptive. It went beyond merely describing the product and served to distinguish it as to its origin.
  2. The marks were similar despite the fact that Ventree had used the ROSE LADY mark alongside the VOV mark. The Court also clarified that secondary product identifiers can indeed function as trademarks.
  3. The goods on which the respective marks were used were identical.
  4. There was a likelihood of confusion.

With respect to passing off, the Court of Appeal disagreed with the High Court. It found that:

  1. Hai Tong had sufficient goodwill, as it had developed a sustainable business over a period of more than four decades, notwithstanding less-than-impressive sales figures of the LADY ROSE products in Singapore.
  2. The elements of misrepresentation and damage were established.

This decision is significant, as the Court of Appeal clearly articulated the tests to be employed in the determination of trademark infringement and passing off. Further, in holding that Hai Tong had sufficient goodwill, the Court laid emphasis on the quality, as opposed to mere quantity, of the evidence.

Although every effort has been made to verify the accuracy of items in the INTA Bulletin, readers are urged to check independently on matters of specific concern or interest.