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Indonesia – Trademark Infringement and Improper Use Due to Similarity in Packaging Leading to Cancellation of Mark in Indonesia

Background

The Plaintiff

PT. Topindo Atlas Asia owns the registered trademark “ tm-infringement” in class 04 under registration number 504089 for goods such as oil lubricants for motorcycles. The Applicant is related to the TOP 1 Oil Products Company that was founded in 1979 in the United States of America by William A. Ryan, with the purpose of providing quality car care lubricants to consumers worldwide.

The Defendant

PT Lumasindo Perkasa, is a well known local lubricant company in Indonesia. On the 10 March 1998, the mark tm-infringement-megatop applied for by PT. Lumasindo Perkasa was allowed registration in the Indonesian Registry under registration number 411000 in Class 4 for the following goods: Oil, Grease for Industrial use, Lubricant, Absorbent substance composition.

The Facts

Prima facie, the marks owned by the Plaintiff and the Defendant are significantly different, and there are no obvious similarities between the said marks. However, the Defendant had produced and sold their products that copied the overall look and feel of the Plaintiff’s mark, as set out below:

Plaintiff Mark:                                        Defendant’s use of their mark:

         tm                                tm-infringement-top2-jp

 

As may be seen above, the Plaintiff’s mark consists of the word TOP in white color on the placed within a red ellipse, with the numeral logo 1 in yellow color, outlined in red, with the words “FORMULA-1” printed at the base of the numeral logo 1. The Defendants had replaced the word “TOP” with its registered trademark “MEGATOP”, and copied all the remaining design elements including the numeral logo 1 in yellow and outlined in red, the red ellipse device, with wording on the base of the numeral logo 1.

Therefore, the use of similar mark on its packaging will affect the entire appearance of both marks’ packaging, as shown below:

 

               tm-infringement-top3-jptm-infringement-top4-jp

 

Lawsuit in The Commercial Court

The Plaintiff filed a lawsuit against Defendant at the Indonesia Commercial Court on the 3 January 2003, on the basis of article 61 Paragraph 2 letter b of Trademark Law No. 2001 which is set out below:

Deletion or Cancellation of a Mark: Article 61(2)(b)

The deletion of a Mark registration on the initiative of the Directorate General may be made if the Mark is used for the kind of goods and or services which is not in pursuant to the kind of goods or services for which the Mark Application for registration was filed, including the use of Mark which is not in accordance with the registered Mark.

The Plaintiff claimed that:

1. The Defendant’s use of the other mark elements together with the registered word mark MEGATOP, i.e. the word MEGATOP in yellow color on red ellipse with the numeral logo 1 in yellow color thereunder, to be used in market, was contradictory to the aforementioned provision of trademark law in Indonesia.

2. Due to the similarities in packaging, the general public will assume and be mislead into believing that the mark MEGATOP is related to the Plaintiff’s.

3. The Defendant’s sought to take advantage of the goodwill and well known status of the Plaintiff’s mark

4. The Defendant’s actions would cause damage to the good reputation the Plaintiff has building in the market

On 29 January 2003, the Defendants filed a response against the lawsuit to the Commercial Court to defend their mark. In their objection they claimed that:

1. They had indeed used the relevant mark for their product sold in market with the one registered in registry without adding or reducing the word mark MEGA TOP.

2.  The use of mark MEGATOP in yellow color on red ellipse with the numeral logo 1 in yellow color thereunder could not be considered as an irrelevant usage with the mark registered in registry since the form of MEGATOP in yellow color on red ellipse with the numeral logo 1 in yellow color thereunder has been filed in Copyright Registry under copyright application number 022693 in 4 April 2002 tm-infringement-top5-jp

 

3. The Plaintiff has tried to confuse the concept of trademarks with that of a product’s packaging, and the Defendant contended that the Court in reviewing the use of a mark in a product must differentiate between the actual mark, and elements of packaging and logo design.

4. the features that are displayed on the packaging of a certain good are not the elements in a mark, and therefore as the provision of law the Plaintiff is relying on does not regulate the packaging form and elements, the Plaintiff has no grounds.

The Commercial Court’s Decision

The Commercial Court handed down its decision on the case on 21 March 2003, by accepting the claims filed by the Defendant, and refusing the entire lawsuit as filed by the Plaintiff. In the Commercial Court’s opinion, the main dispute in this case was the logo tm-infringement-top5-jp  ,which was registered by the Defendants in the copyright registry. The Commercial Court therefore agreed with the Defendant’s argument copyright was applicable in this instance, and that in resolving this matter, the Plaintiff should file an objection on the basis of Copyright Law. Further, on the basis of copyright Law No. 19/2002, the commercial court will be authorized to adjudicate a copyright in July 2003 vide article 78 Law No. 19/2003

Cassation

The Plaintiff upon rejection by the Commercial Court, then filed cassation to the Supreme Court of Indonesia.

In the Supreme Court Judgment No. 016 K/N/HaKI/2003, issued on 1 September 2003, the Plaintiff’s claims on the cassation were partially approved.

The Supreme Court ruled that:

1. The Defendant’s previous argument on filing its mark tm-infringement-top5-jp together with the relevant design and device in the copyright registry is irrelevant, as the copyright in an image is not meant to be “adhered on a product” – the relevant law applicable is that of trademark law.

2. The Supreme Court went on to decide that the use of the mark MEGATOP by the Defendant was irrelevant to its registered form, and therefore cancelled and removed the registered mark “MEGATOP” from the Trademark General Gazette.

3. The Supreme Court also ordered the Defendant’s to pay the Plaintiffs for their legal costs.

Re-consideration Request

The Defendant then filed a re-consideration request to The Supreme Court on the following grounds:

That the Supreme Court had given a wrong decision due to a lack of legal consideration, as well as irrelevant legal consideration, as the Defendant submitted that the basic law to be used in this case was that of the Law of Copyright, and not Trademark law. The defendant further submitted that the Supreme Court had exceeded its authority.

After considering the reconsideration request, the Supreme Court decided to refuse the request as it opined that the proper law to be applied is that of Trademark Law, and not the law of Copyright as asserted by the Defendants. The judgment of the Supreme Court was handed down on the 6 January 2004.

Author’s note:

While there was no Court Ruling that the Defendant’s stop selling the infringing products, an informal search on the Defendant’s website has shown that the Defendant has stopped marketing the infringing packaged products on its website.

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