The Issue of Intellectual Property Protection

From the previous assignment, we have look into the cases involving McDonald Corporation and Future Enterprise PTE LTD, we have also introduced the basic intellectual property laws and how they are inter-related to one another. In this assignment, we will analyze the Singapore Laws that is related to the cases involved, and then we will provide recommendation to give our client a better idea of the rules and regulations they should abide.

Summary of the cases

McDonald Corporation and Future Enterprise PTE LTD, core-operating unit of Food Empire Holding Limited, are involved in two law cases during the period of 2003 to 2007. McDonald lost the first case in 2003 as the mark used by Future Enterprise is visually different from McDonald Corporation. Furthermore, Future Enterprise has its eagle device while McDonald Corporation has its golden archer. Therefore, the color scheme, font, and typeface on the mark of the Future Enterprise is very different from the one used by McDonald Corporation. McDonald Corporation sued Future Enterprise again in 2005 for amending the logo of MacCoffee by dropping the eagle device. McDonald Corporation has won this court case against Future Enterprise as there is a higher chance of confusion that will occur in the public and both products names are relate to coffee beverages.

Both cases mentioned above are inter-related with each other as both cases involved the Intellectual Property Law of Trade Mark Act (TMA) where s15 of the TMA is highly emphasized. In the midst of both cases, both McDonald Corporation and Future Enterprise have made various appeals to the cases and this shows that both companies have the great intention and desires to protect their own trademarks. The connection between both cases shows that McDonald wanted to monopolize their trademark as far as food and beverages were concerned. Future Enterprise which also wanted to conserve its right of the prefix Mac in the same industry tried it's best to maintain its position.

Description and Analyze of the Singapore Law Involved

In the case study, the Singapore Law that involved is mainly the Trademark and Passing off laws under the Intellectual Property Law. The laws involved can be classified into two main categories of Common Law and Statute Law.

Statute Law Involved: (Refer to appendices Section A, A: 1 for definition of Statute Law)

The Statute Laws that are applicable in the following case are Section 12(1), Section 15 and Section 23(1) of the Trade Marks Act (Cap 332, 1992 Rev Ed). Below are the descriptions of the different section of laws involved and the reasons why it is involved:

Section 12(1):

Any person claiming to be the proprietor of a trade mark used or proposed to be used by him who is desirous of registering it shall apply in writing to the Registrar in the prescribed manner for registration in Part A or B of the register.

Reason:

McDonald Corporation claims that Future Enterprise's marks were not made in good faith as it has adopted a naming convention of using the prefix Mac follows by a food or beverage descriptive. This is similar to McDonald Corporation naming convention for their products, which McDonald Corporation feels that Future Enterprise is making use of similar naming convention to promote their products.

Section 15:

It shall not be lawful to register as a trade mark or part of a trade mark any matter the use of which would, by reason of its being likely to deceive or cause confusion or otherwise, be disentitled to protection in a court of justice, or would be contrary to law or morality, or any scandalous design.

Reason: McDonald Corporation claims that the naming convention and the using of the prefix Mac adopted by Future Enterprise would likely to deceive or cause confusion among the public. McDonald Corporation feels that the consumers may be misled thinking that Future Enterprise's mark is a series of mark belonging to McDonald Corporation.

Section 23(1):

Except as provided by section 25, no trade mark shall be registered in respect of any goods or description of goods that is identical with or nearly resembles a trade mark belonging to a different proprietor and already on the register in respect of:

    The same goods;

    The same description of goods; or

    Services or a description of services, which are associated with those goods or goods of that description.

Reason:

McDonald Corporation claims that Future Enterprise's mark is identical and has a near resembled to their trademark. McDonald Corporation also claims that Future Enterprise's marks are associated with their goods in respect of restaurant and catering services as McDonald Corporation regards Food and Beverages is associated with hotel or restaurant service.

Common Law Involved: (Refer to appendices Section A, A: 2 for definition of Common Law)

There are quite a number of Common Laws involved in our case study, we will look into the major cases that are referred to in corresponding to the different sections of Trade Mark Act that are involved. (Refer to appendices Section A, A: 3 for other cases referred (Common Laws))

Case refers corresponding to Section 12: (Refer to appendices Section A, A: 4 for the summary of the case)

Tiffany & Co v Fabriques de Tabac Reunies SA [1999] 3 SLR 147 (folld)

McDonald Corporation referred to the mentioned case as a support to enhance the claim that Future Enterprise's mark is not made in good faith, claiming that Future Enterprise was making use of the prefix Mac to promote their products to the public through the association to McDonald Corporation. Case refers corresponding to Section 15: (Refer to appendices Section A, A: 4 for the summary of the case)

McDonald's Corporation v McBagel's Inc (85 Civ 7868, 10 December 1986) (refd)

McDonald Corporation referred to the mentioned case as a support to enhance the claim that using the prefix Mc or Mac as a naming convention will result confusion in the public to think that Future Enterprise's products that has the name mark of Mac is associated to McDonald.

Dispute and Resolution Mechanism:

Singapore has its own hierarchy of Courts when dealing with Criminal and Civil Law. (Refer to appendices Section A, A: 5 for the diagram of Singapore's hierarchy of Courts)

Singapore Law system is very strict and serious to trade mark offences, it has imposed a fine of up to $100,000 and/or imprisonment for a maximum term of 5 years for criminal liability in infringement act. For civil infringement, the court can award statutory damages of up to $1million. Usually, the High Court in the hierarchy of Singapore Court system will deal with intellectual property disputes and infringement.

Referring to the Case Study, the case is dealt in High Court but due to appeal, the case is later brought into the Court of Appeal in resolving the case.

Laws and their relevancy to the case

Relevant laws and their application:

    Under s12(1) of the Act - that the respondent's claim to proprietorship of the three marks was not made in good faith as it had copied the common distinctive prefix of the appellant's family of marks, namely, Mc;

    Under s15 of the Act - that the registration of the three marks would likely deceive or cause confusion to the public; and

    Under s23(1) of the Act - that the application marks were identical with or nearly resembled the trade marks belonging to the appellant.

    Fairness and unfairness:

First case: (Refer to appendices Section B, B: 1 for Scenario of first case)

It was decided in the first case that McDonald was unable to stop Future Enterprise form producing their products due to infringements of trademarks. I believed that the decision was fair as many evidence was provided to prove that Future Enterprise had made an effort to make their products distinctive to prevent confusion to the public.

The evidence, from the article says that the products Future Enterprise produced were packaged with an eagle logo and it was sold mainly at NTUC FairPrice and Mustafa supermarkets in Singapore. This evidence enhances the point that Future Enterprise and McDonald were selling products targeted at different audiences from different markets.

Furthermore, the article also showed that Future Enterprise has had its own product logos and color schemes different from McDonald. This point further showed that the marks were different whether it is in the aspects of appearance, sound or concept. Thus, it proves that customers/consumers had more ways to differentiate between the products of these 2 organizations, which further enhance the fairness of the judgment for this case.

Last but not least, McDonald further protested that it had spent millions of dollars to create goodwill for it Mc series of marks, but evidence showed from the article says that Future Enterprise had also spent substantial time and resources in order to gain recognition from global market leaders. Therefore, it is fair to say that Future Enterprise did not cause loss whether in goodwill or financial damages, thus I think it is fair to say that fair judgment were made in this case.

Second case: (Refer to appendices Section B, B: 2 for Scenario of second case)

In the second case, Future Enterprise was brought up to court by McDonald again as they wanted to update their product design by dropping off their eagle logo. McDonald felt that their marks and naming conventions would be relatively similar which could cause confusion if Future Enterprise were to take out the distinctive eagle logo.

Evidence from the article says that the two names sounded and looked too alike, and a substantial amount of average Singaporean would be confused with these two products. And also, the concept too was proved to be similar - whether it is the products they are selling or the locations that they are selling the products.

But, in our own opinion, we felt that there was unfairness presented in this judgment. In the first Court case between McDonald and Future Enterprise, it was judged that there were too many differences between McDonald and Future Enterprise - whether it is in their logo, the products they sells or the audience they targeted. Thus, MacCoffee was able to be registered as a trademark and McDonald's appeal were dismissed. Yet, in the second court case, Future Enterprise loses the chance for its MacCoffee to be registered as a trademark name as they decided to drop their distinctive eagle logo.

The first case stated that there were unanimous decisions in believing that products from Future Enterprise were not similar, whether in visual, sounds or concept, in comparison with products from McDonald. And also, evidence from the first case stated that the audience they targeted was remarkably different and the products they sold were also different.

The judgment of the second case said that their marks were too similar and it would cause confusion after they drop the eagle logo. The appeals were dismissed with $10,000 payment made from Future Enterprise to McDonald. We felt that this judgment were unfair as there were contradictions which existed within this two cases.

The products they sold were relatively different, ready-to-drink beverages from McCafe, and 3-in-1 coffee mix from MacCoffee. This presented a huge contrast between the products sold by the 2 organizations. Also, since it was decided in the first court case that the logos, type font, color schemes and targeted audiences were different for products of this 2 organizations, it should be brought up in the second case too in order to ensure fairness in this case. Thus they should take it into consideration of all these differences in the second court case rather than just concentrating on the similarities caused by the removed logos.

Steps to further protect intellectual property rights

For McDonald Corporation:

Increase the monopolization of the prefix "Mc" into other service area that their business might want to expand into or have influence on. This is because the use of "Mc" is only subjected to McDonald in hotel and restaurant service and they might consider the use of this prefix into other service area thus, McDonald can maintain the rights of this prefix in other areas and future companies won't make use of the prefix in the same service area.

For Food Empire Holdings:

Food Empire Holdings could distinguish itself to McDonalds on the MacCoffee and McCafe by using back their earlier registered mark which appears below an eagle device, on its coffee products. This eagle device can play a part in determining whether the application mark is the same as McDonalds. (Refer to appendices Section B, B: 1 for the picture of Food Empire packaging)

Recommendation

As a consultant engaged by a big advertising company Do-It-Right Limited, we are responsible to report on the state of intellectual property protection in Singapore and to generally advise them whether there is an inherent and prevailing culture that respects other person's intellectual property rights. Thus, to start with it, we will recommend Do-It-Right Limited Company to advice their multinational clients to understand their own country intellectual property laws and the procedures of registering the trademark.

In Singapore Intellectual Property Law, it is categorized into 6 main areas of: Copyright and Neighboring Rights, Industrial Designs, Patents, Confidential Information/Trade Secrets, Trade Marks and Passing Off. These are the 6 main areas under that Intellectual Property Law where the client ought to have a general knowledge of as understanding the laws in each area will be able to help clients to know the ways or methods to safeguard their intellectual properties by knowing which the areas of laws they should look into.

To further protect client's intellectual property rights, it is a best advice for client to register their product.

For Example:

If an organization know that their property or design can be register under the Trademark protection, it is best to register in order to be under law of protection instead of limited protection. This is to ensure when an issue arise of a rival company "copying" the organization product or design.

Organization in this case can use passing off law to protect their rights but this will result them to have limit law of protection if they fail to register their product design.

Moreover, Trademark Law offer a great degree of protection comparing to Passing Off Law as Passing off Law require the breaching of Goodwill, Misrepresentations and Damage in order for the Law to take into consideration or effect. Thus in conclusion, it is important for Client to register their product or design under the Intellectual Property Law of protection to have more coverage of protection

Lastly, we will also advice them to research on their competitors' logo and name to avoid any misinterpretation and misunderstand of their own logo and name to their competitors'. It is strongly recommended to use a unique and distinct design for their logo and name, which will lessen the chances of their competitors imitating their name and logo.

Conclusion Through our case study on Mc Donald Corporation and Future Enterprise, we have a deep understanding about Intellectual Property Law in Singapore and how it can truly save guard our own personal property. We are also able to analyze the cases and discuss whether the Singapore Courts had made a right judgment. We had gained knowledge of Singapore Courts dealing with cases that involved the Intellectual Property Rights and know the importance of Intellectual Property that under the coverage of law to protect the important asset of an organization.

References

1McDonald's Corp v Future Enterprises Pte Ltd <http://www.singaporelaw.sg/rss/judg/46507.html> 2Food Empire Holdings Ltd <http://www.food-empire.com/corp1.htm> 3 McDonald's - Wikipedia, the free encyclopedia <http://en.wikipedia.org/wiki/McDonald's> 4 Welcome to McDonald's <http://www.mcdonalds.com/>

5 McDonald's Singapore <http://www.mcdonalds.com.sg/history.htm> 6 Singapore Intellectual Property Law#section5 <http://www.singaporelaw.sg/content/iplaw2.html#section5>

7 Trademark - Wikipedia, the free encyclopedia <http://en.wikipedia.org/wiki/Trademark>

8 Passing off - Wikipedia, the free encyclopedia <http://en.wikipedia.org/wiki/Passing_off>

9 McDonald's Corp v Future Enterprises Pte Ltd <http://www.singaporelaw.sg/rss/judg/46507.html>

10 Rules of Court <http://app.supremecourt.gov.sg/data/doc/ManagePage/97/roc_o87.htm>

Appendices

Extra Information Section A: A: 1 - Statute Law Statue Law is written law that is created by governing authority like the parliament in the form of legislation to state out the civil order of the country and to implement and clarify the policies and operations of the government. Statute Law is also the law that state the consequences or punishments for committing a certain criminal or civil crime such as the Trademark Act or Passing off Act; new law can be introduced and existing law can be taken away in order to accommodate to the nation. A: 2 - Common Law Common Law is unstated or unwritten law that is created by judges through court decisions. The decisions made by the judges on current case will depend on the decisions made in similar previous cases that took place. In other word, similar infringements and disputes, that have taken place in previous cases, will result the current case to follow the decisions and reasoning that being used. Common Law system is complicated, as the decisions made in previous cases will affect the law in future cases and is totally distinguish from Statute Law. Moreover, the decisions made are bounded within a limited given jurisdiction. E.g. Decisions made in higher court such as Court of Appeal will affect the decisions in lower court. A: 3 - Case(s) referred to (Common Law):

Australian Woollen Mills Limited v F S Walton and Company Limited [1937] 58 CLR 641 (refd)

Auvi Pte Ltd v Seah Siew Tee [1992] 1 SLR 639 (folld)

Bali Trade Mark [1969] RPC 472 (refd)

Beck Koller Company (England) Limited, In the Matter of an Application by [1947] 64 RPC 76 (fold)

Brown Shoe Company Inc, Application by [1959] RPC 29 (folld)

Carnival Cruise Lines Inc v Sitmar Cruises Ltd [1994] 120 ALR 495 (folld)

Compatibility Research Ltd v Computer Psyche Company Ltd [1967] FSR 63 (refd)

Future enterprise Pte Ltd v Tong Seng Produce Pte Ltd [1998] 1 SLR 1012 (refd)

Genette Trade Mark [1968] RPC 148 (folld)

Harrods Limited v Harrodian School Limited [1996] RPC 697 (refd)

Karu Pty Ltd v Jose [1994] 30 IPR 407 (folld)

Kellogg Co v Pacific Food Products Sdn Bhd [1999] 2 SLR 651 (folld)

Lever Brothers Ltd v Bedingfield [1899] 16 RPC 3 (folld)

Lifestyle 1.99 Pte Ltd v S$1.99 Pte Ltd [2000] 2 SLR 766 (folld)

McDonald's Corporation v McBagel's Inc (85 Civ 7868, 10 December 1986) (refd)

McIndians, In the matter of an application to register the mark (UK Patent Office 16 August 1996)(refd)

McMint, Opposition by McDonald's Corporation to the registration of the trademark (Australian Trade Mark Office, 7 November 1997) (folld)

McSalad and McFresh, Opposition by McDonald's Corporation to the registration of the trademark (Australian Trade Mark Office, 1 May 2000) (not folld)

McVeg, Opposition by McDonald's Corporation to the registration of the trademark (Australian Trade Mark Office, 10 November 1997) (folld)

PB Foods Ltd v Malanda DairyFoods Ltd (1999) 47 IPR 47 (distd)

Pianotist Company, In the Matter of an Application by (1906) 23 RPC 774 (folld)

SEMIGRES Trade Mark [1979] RPC 330 (folld)

Shell Co of Australia Ltd v Esso Standard Oil (Australia) Ltd (1963) 109 CLR 407 (folld)

Shell Co of Australian Ltd v Rohm & Haas Co (1949) 78 CLR 601 (refd)

Smith, Hayden & Coy Ld, In the Matter of an Application by (1946) 63 RPC 97 (refd)

Soldan Holding + Bonbonspezialitaeten GmbH, Re Application by (Singapore Trade Marks Registry, 20 July 2001) (refd)

Sports Café Ltd b Registrar of Trade Marks (1998) 42 IPR 552 (folld)

Super Coffeemix Manufacturing Ltd v Unico Trading Pte Ltd [2000] 3 SLR 145 (folld)

Tiffany & Co v Fabriques de Tabac Reunies SA [1999] 3 SLR 147 (folld)

UNIMAX Trade Mark [1979] RPC 469 (folld)

Vitamins Ld's Application, In the Matter of [1956] RPC 1 (folld)

Wagamama Ltd v City Center Restaurants plc [1995] FSR 713 (refd)

Yuen Yu Kwan Frank v McDonald's Corporation [2001] WL 1422899 (refd) A:4 - Summary of cases for Common Laws Summary of Case refers corresponding to Section 12: Tiffany & Co opposed the registration of the mark Tiffany by Fabriques de Tabac Reunies SA on cigarettes though; Tiffany & Co has no monopoly in cigarettes industries. This may results in confusion as the entire word mark Tiffany was being copied over and the public might think that the cigarettes sold is produced or has connection to Tiffany & Co upon seeing the Tiffany band of cigarettes. Summary of Case refers corresponding to Section 15:

McDonald Corporation objected the use of McBagel in bagel bakery restaurant, as it would create confusion in public that people might think that McBagel is somehow associated with McDonald Corporation. Moreover, a survey was conducted and numerous people believed that McBagel was associated to McDonald Corporation due to the use of the prefix Mc. A.5 - Diagram of Singapore's hierarchy of Courts

Section B:

B: 1 - Scenario of first case:

McDonald had wanted to stop listed Future Enterprises from distributing products named 'MacNoodles', 'MacTea' and 'MacChocolate'. However, the court of appeal decided in a unanimous decision that the three trademarks were not deceptively similar to McDonald's Mac or Mc prefix. Thus in this case, the laws of protecting trademarks did not help McDonald to stop Future Enterprise from distributing their products, and also Future Enterprise were able to win this case as they did not breach the law of passing off.

B: 2 - Scenario of Second case:

The dispute continues as Future Enterprise, a subsidiary and core unit of listed Food Empire Holding decided to updates it product design, MacCoffee to drop its original eagle design. McDonald objected as the similarity now existed when Future Enterprise decides to take out its distinct eagle design.

After objection arose, Future Enterprise appealed for the MacCoffee brand to be registered as trademark, which in the end the appeal was dismissed. The laws of protecting trademark in this case were being carried out. MacCoffee were not distinct enough to be registered as a trademark, thus the appeal was dismissed. Also, after removing the eagle design, it was judged that goodwill was breach in terms of causing confusion to the public with similar products. Thus McDonald had successfully won this case with the appeal and Future Enterprise appeals were all dismissed and they were to pay a sum of $10,000 to McDonald to cover their loss.

Section C: C: 1 - Pictures of Food Empire MacCoffe packaging

Old Packaging New Packaging

    Schedule of Meeting

Date

Discussion

28th May 2008

    Analyze the cases - Facts - Inter-relationship

    Tasks allocated to each of the members

30th May 2008

    Discuss the research done - Singapore Laws (Statute Law & Common Law) - Singapore Courts - Intellectual Property Rights

    Started the report writing

5th June 2008

    Continuation of the report

    Modification of report - Error Checking - Rephrasing

9th June 2008

    Finalization of the report

    Work Plan

    3.1 Description of Assignment

The objective for this final report gives us more understanding of the Singapore Laws that can be applied to these two cases. We are able to apply our basic knowledge learned in the lecture to discuss whether the cases had been judge fairly.

3.2 Team Members

Nur Afidah Binte Afandi, Mark Heng Kok Hoong, Teo Lay Hoon, Goh Kok Jui Kelvin, Chai Guo Wei

    Problems encountered and Solutions 4.1 Problem: Time Consume Solution: Planning out the schedule what we should do first and what should we do next helps to cut down the time wastage.