Law Made Simple

Intellectual Property Law

Note 4 0f 7 Notes

Trademark

Universiti Kebangsaan Malaysia

Fakulti Undang-undang
PHD Program in Law

Musbri Mohamed

DIL; ADIL ( ITM )

MBL ( UKM )

1
What does a trademark do?

A trademark provides protection to the owner of the mark by ensuring

the exclusive right to use it to identify goods or services, or to
authorize another to use it in return for payment. The period of
protection varies, but a trademark can be renewed indefinitely beyond
the time limit on payment of additional fees. Trademark protection is
enforced by the courts, which in most systems have the authority to
block trademark infringement.

In a larger sense, trademarks promote initiative and enterprise

worldwide by rewarding the owners of trademarks with recognition and
financial profit. Trademark protection also hinders the efforts of unfair
competitors, such as counterfeiters, to use similar distinctive signs to
market inferior or different products or services. The system enables
people with skill and enterprise to produce and market goods and
services in the fairest possible conditions, thereby facilitating
international trade.

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Trademarks make it easier for consumers to quickly identify the source
of a given good. Instead of reading the fine print on a can of cola,
consumers can look for the Coca-Cola trademark. Instead of asking a
store clerk who made a certain athletic shoe, consumers can look for
particular identifying symbols, such as a swoosh or a unique pattern of
stripes. By making goods easier to identify, trademarks also give
manufacturers an incentive to invest in the quality of their goods. After
all, if a consumer tries a can of Coca-Cola and finds the quality lacking,
it will be easy for the consumer to avoid Coca-Cola in the future and
instead buy another brand. Trademark law furthers these goals by
regulating the proper use of trademarks.

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What kinds of trademarks can be registered?

The possibilities are almost limitless. Trademarks may be one or a

combination of words, letters, and numerals. They may consist of drawings,
symbols, three- dimensional signs such as the shape and packaging of
goods, audible signs such as music or vocal sounds, fragrances, or colors
used as distinguishing features.

In addition to trademarks identifying the commercial source of goods or

services, several other categories of marks exist. Collective marks are
owned by an association whose members use them to identify themselves
with a level of quality and other requirements set by the association.
Examples of such associations would be those representing accountants,
engineers, or architects. Certification marks are given for compliance with
defined standards, but are not confined to any membership. They may be
granted to anyone who can certify that the products involved meet certain
established standards. The internationally accepted "ISO 9000" quality
standards are an example of such widely-recognized certifications.

4
As a result of being a member of the Paris Convention and the
TRIPs Agreement, Malaysia amended its Trade Mark Act
1976 to incorporate its international obligations to protect
well-known marks in 2001.

The following protection was extended for well-known marks

in Malaysia under the Trade Marks Act 1976: -

In respect of same goods or services, section 14(1)d of the

Act stipulates that the registration of a mark or part thereof
will not be allowed if it is identical or so nearly resembles a
mark, which is well-known in Malaysia for the same goods or
services.

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Under section 70B(1) of the Act 1976, a proprietor of a trade mark that
is entitled to protection under Article 6bis of the Paris Convention or the
TRIPs Agreement as a well-known mark, is entitled to restrain the use
of the marks used in the course of trade in Malaysia:-
    i) without the proprietor’s consent
    ii) if it resembles essential parts or is identical to the proprietor’s
mark, in respect of the same goods and services, where the use is
likely to deceive and cause confusion.

Protection under this section is available as long as the trade mark is

well-known in Malaysia, regardless, of whether it is registered or not. It
also extends protection whether or not the proprietor of the well-known
mark carries on business in Malaysia, or has any goodwill in Malaysia.
This section applies only if the conflicting trade mark is used on the
same goods or services as that of the well-known trade mark.

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In respect to different goods or services,
section 14(1)e of the Act states that the
registration of a mark or part thereof will
not be allowed if it is identical or so
nearly resembles a mark which is well-
known in Malaysia in respect to different
goods or services, provided that the use
of the mark in relation to those goods or
services would indicate a connection to
the proprietor of the well-known mark
and that the interests of the proprietor of
the well-known mark are likely to be
damaged by such use.

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Requirements and types of evidences to qualify
as well-known mark

One must prove that their mark is a well-known

mark by virtue of their extensive advertisements,
usage and registrations worldwide/in Malaysia and
their exceptional reputation worldwide. In
determining whether or not the mark is indeed a
well-known mark in Malaysia, the account of
knowledge of the trade mark in the relevant sector
of public, and not the public at large, in relation to
the specific channel of trade is taken into
consideration.

8
Scope of protection of well-known marks in Malaysia

Since there are no special or separate filings for well-known marks in

Malaysia, trade mark applications for well-known marks claiming goods
or services that are used in connection with the channel of trade have to be
filed in the usual manner like all other trade mark applications.

The trade mark application will be examined in the similar fashion as

other trade marks. In the event of objection or other third parties raising
opposition against the application, the applicant, by satisfying the criteria
of the well-known mark under Regulation 13B, may rely on the protection
of well-known marks, to defend their trade mark. In case they want to
protect their trade mark across the board in all classes of goods and
services, besides the class of goods and services in which the well-known
mark is actually used in, the proprietor has the option of relying on
defensive trade mark protection under Section 57 of the Act 1976.

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How is a trademark registered?

First, an application for registration of a trademark must be filed with the

appropriate national or regional trademark office. The application must
contain a clear reproduction of the sign filed for registration, including any
colors, forms, or three-dimensional features. The application must also contain a
list of goods or services to which the sign would apply. The sign must fulfill
certain conditions in order to be protected as a trademark or other type of mark.
It must be distinctive, so that consumers can distinguish it as identifying a
particular product, as well as from other trademarks identifying other products.
It must neither mislead nor deceive customers or violate public order or
morality.
Finally, the rights applied for cannot be the same as, or similar
to, rights already granted to another trademark owner. This may
be determined through search and examination by the national
office, or by the opposition of third parties who claim similar
or identical rights.

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How extensive is trademark protection?

Almost all countries in the world register and protect trademarks. Each
national or regional office maintains a Register of Trademarks which
contains full application information on all registrations and renewals,
facilitating examination, search, and potential opposition by third parties. The
effects of such a registration are, however, limited to the country (or, in the
case of a regional registration, countries) concerned.

In order to avoid the need to register separately with each national or regional
office, WIPO administers a system of international registration of marks.
This system is governed by two treaties, the Madrid Agreement
Concerning the International Registration of Marks and the Madrid
Protocol. A person who has a link (through nationality, domicile or
establishment) with a country party to one or both of these treaties may, on
the basis of a registration or application with the trademark office of that
country, obtain an international registration having effect in some or all of the
other countries of the Madrid Union.

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A well-known invented mark may be registered as a defensive mark
for other goods and services in respect of which the mark is not
registered or used for i.e. dissimilar goods or services, as explained in
Section 14(1)(e) of the Act, above. The use of the mark thereafter in
relation to other goods and services would likely indicate a
connection in the course of trade to the registered proprietor of the
well-known mark.

A defensive mark must have an established reputation for certain

goods or services for which it is already registered, and the proprietor
must be able to show that if the public saw it on other goods or
services they would be likely to think, incorrectly, that it indicated a
trade connection with him, or with a registered user of his.

12
The applicant may register for a defensive mark in
respect of any goods and services, provided they
own an existing registration. The defensive mark
has to be associated with the registered mark.
Registration of a defensive mark is immune to
cancellation action for non-use of the mark and
will not be required to show proof of use of the
mark for the purposes of renewing the registration,
so long as the main registration is in force. By
undertaking this measure, it is possible to take out
infringement action against unlawful use of the
well-known mark, as the use of the defensive mark
on dissimilar goods or services without consent
would amount to infringement action.

13
Well-known marks can be protected for goods and
services used in connection with the trade through
normal application and registration of a trade mark
in Malaysia. Since the protection of well-known
marks is fairly in its infancy stage in Malaysia and
is gradually going through further development, it
is prudent that the initial precautionary measures
are taken by the proprietors of well-known marks
by filing a defensive trade mark application for
their well-known mark in all classes of goods and
services, to ensure no future identical or similar
trade mark applications are filed in Malaysia. This
would certainly be the first step to deter
infringement against their well-known mark as well
as at the same time create awareness of the well-
known status of its marks.

14
Intellectual Property Rights (IPRs), in particular trademarks have
taken on increased importance in the current Internet-driven,
knowledge based society, due in part to the growth of the Internet as
an information/technological medium.

Association of Southeast Asian Nations (ASEAN) notes that IP and

IPRs creation, commercialization, and protection have assumed an
increasingly profound and unprecedented influence on the social,
economic and technological progress of interdependent economies
around the world.

Whilst the importance of copyright and patents (the other limbs of

IPRs) cannot be discounted, trademarks arguably have a wider
audience as people are increasingly ‘brand harmonized’ through
advertisements and other marketing instruments including the Internet.
Brands such as Coca Cola and Microsoft are common palace to the
normal consumer.

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The trademark, which also serves as the name of the brand, is
extremely valuable as the reputation gained through use of the name,
over decades are contained in it. A study undertaken by Interbrand
in 2003 ranked; Coca Cola (valued at US$70 billion), Microsoft
(valued at US$65 billion) and IBM (valued at US$52 billion) to be
the world’s top three brand names.

The question may be whether, such ‘values’ are justified but bearing
in mind the cost spent by these companies in research, development,
advertising and marketing are astronomical (figures show that Coca-
Cola and Microsoft, spent US$2.774billion and US$11.455billion in
2007 on sales and marketing expenses), logically they should be
granted the right to use and protect their name against others who
sought to capitalize on their reputation.

16
The formation of the World Intellectual Property Organization (WIPO) and the
subsequent conception of the Madrid Agreement and Madrid Protocol have provided
options for international registration. Brand owners now have the option to apply for
registration in as many countries as they wish (as long as the country is a signatory
of the respective agreement; Singapore is a signatory of the Madrid Protocol)
however, the International Registration System under the Madrid Agreement or
Protocol, only serves as a one-stop-shop for registration application. The actual
registration and examination process is undertaken by the respective national
registry. Clearly this does not fully solve the problem faced by brand owners as
countries tend to have different laws, furthermore, not all countries are signatories of
Madrid. The European Union (EU), have managed to adopt more enhanced, but
scaled down (in terms of countries) version of the International system. The
Community Trade Mark System (CTM) allows the single registration of a
trademark, if successful, has effect in the entire EU territory. The EU further
provides the brand owner with both national and EU-level enforcement avenues.
This reduces time as well as cost, allowing brand owners to manage their trademarks
effectively instead of requiring a huge portfolio for the same trademark.

17
Trade Mark Use on the Internet – A Malaysian Perspective

In order to ensure the validity of a trade mark , it is a requirement that the

owner of the mark put their trade mark to use to indicate a connection in the
course of trade to the goods or services applied for.

While there are no decided court cases in Malaysia on the subject of use of a
trade mark over the Internet as yet, decisions under the new Malaysian
Dispute Resolution Procedure (MYDRP) are a useful guide to how the
Malaysian courts may approach this issue. The MYDRP is modeled closely
on ICANN’s UDRP and disputes under the MYDRP are heard by the
Panelists at the Regional Centre for Arbitration Kuala Lumpur (RCAKL). The
MYDRP governs only “.com.my” websites. Recent Panel decisions such as
NEP Holdings (Malaysia) Bhd. v Liew Bin Dian t/a C & C Network and
Volkswagen Group Singapore Pte. Ltd. v Webmotion Design have both
made reference to the trade mark on the Internet. These decisions signify a
trend towards accepting use over the Internet as “use” for trade mark
purposes, as far as domain name disputes are concerned.

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However, if the web server is located outside the relevant jurisdiction or the
website has a country specific ccTLD or the website simply caters to
another jurisdiction, the answer may be different. In the UK case of 800-
Flowers Trade Mark it was held that a globally accessible website does
not prima facie constitute use in the trade mark sense within the United
Kingdom. The case further held that the question of use would very much
depend on the circumstances, particularly the intentions of the website
proprietor and what the average visitor comprehends upon accessing the
website. Trade mark owners should note that the 800-Flowers case suggests
that the provision of interactive facilities by the website owner may
constitute use. If a consumer accesses a website and orders goods or
services as a result of the advertisement or information on the website, this
could arguably amount to use of the mark. This reasoning was also followed
in the subsequent case of Euromarket Designs Incorporated v Peters &
Anor.

19
Amendments will be made to the outdated Trade Marks Act
1976 which is currently based on the United Kingdom Trade
Mark Acts of 1983 (which was duly repealed and replaced
with the Trade Marks Act 1994 for compliance with EU
Directive on trade mark laws). The amendments according to
Assoc Prof Rohazar of MyIPO, would include the registration
of non-traditional trade marks such as sounds, smells and
motion. She also added that MyIPO is looking to cut back red
tape in the application procedures. Although the TRIPS
agreement made an impact on the Malaysian Trade Marks Act
such as the introduction of protection of well-known marks
and heightened border security measures, the Act is in need of
updating and removal of procedural set backs.

20
Malaysian IP laws and IPR enforcement is now going under
much needed scrutiny and any amendments made will have
to maintain the balance of public and private rights that suit
the Malaysian people. As foreign trade increases and
lobbying continues from powerful countries for various
changes to be affected, the task of striking a balance of
rights and obligations falls on the MyIPO. It appears the
proposed amendments would be welcomed by all as the law
serves its purpose best when equipped with clarity and
justice.

21
In Malaysia a trade mark owner can enforce his rights in a
number of ways. A effective means of enforcement against
an infringer of a trade mark or a person liable for passing
off, would be to obtain a Trade Description Order (TDO).
This is provided by virtue of section 16 of the Trade
Description Act 1972 (the Act).

A TDO declares a particular trade mark or get up a false

trade description, and the officers of the Ministry can then
seize goods affixed with the marks or get up declared as
such and prosecute the manufacturers and/or the sellers.
The two key points that will to be considered amongst
others is the applicant for the TDO must have exclusive
use of the trade mark and the infringing trade mark must
be identified with sufficient precision.

22
In a recent decision the Malaysian High Court
in the case of Abercombie & Fitch Co. &
Anor V Fashion Factory Outlet KL Sdn Bhd
& Ors [2008] 4 MLJ 127, held that sale of
goods bearing a trademark over the Internet or
via a website is recognized as use of the
trademark.

23
The Malaysian High Court, in Yong Sze Fan & Anor v Sharifah bt Mohd
Tamin & 4 Ors [2008] 5 AMR 163 had an opportunity to consider an
application for an order that a trademark registered by the Malaysian
Trademark Registry be expunged (cancelled) from the Register under the
provisions of the Malaysian Trade Marks Act 1976.

The Applicants here claimed that they were the first users of the registered
trademark TAMIN and thereby they claimed that the 1st Respondent’s
trademark registration TAMIN was therefore wrongfully registered in the
Malaysian Trademark Registry. In support of their application, the
Applicants adduced evidence of the first use of their mark which they
claimed was since 1990 as well as their extensive sales and promotion of
products using the said mark in Malaysia.

24
In Syarikat Zamani Hj Tamin Sdn Bhd & Anor v Yong Sze Fun &
Anor (at page 298) where it was stated: -

"It is trite law that the first to use the mark in Malaysia would prevail.
Otherwise it would result in an anomaly in the law in the sense that the
first an original use is defeated by a subsequent user"

The discretion was therefore applied in favour of the Respondent due their
first use of the trademark and also the Respondents’ continued use of the
trademark to date. The Judge held that the Respondents use of the
trademark would not cause confusion and deception in the market.
This therefore, is an important decision setting some principles that the
Intellectual Property Court in Malaysia will follow as regards the law to be
applied expungement of trademarks.

25
In order to serve as a trademark, a mark must be distinctive -- that is, it must be
capable of identifying the source of a particular good. In determining whether a
mark is distinctive, the courts group marks into four categories, based on the
relationship between the mark and the underlying product: (1) arbitrary or fanciful,
(2) suggestive, (3) descriptive, or (4) generic. Because the marks in each of these
categories vary with respect to their distinctiveness, the requirements for, and
degree of, legal protection afforded a particular trademark will depend upon which
category it falls within.

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The use of a mark generally means the actual sale of a product to the
public with the mark attached. Thus, if I am the first to sell "Lucky"
brand bubble-gum to the public, I have acquired priority to use that mark
in connection with the sale of bubble-gum (assuming that the mark
otherwise qualifies for trademark protection). This priority is limited,
however, to the geographic area in which I sell the bubble gum, along
with any areas I would be expected to expand into or any areas where the
reputation of the mark has been established. So, for example, if I sell
pizza in Boston under the name "Broadway Pizza," I will probably be
able to prevent late-comers from opening up a "Broadway Pizza" within
my geographic market. But I will not be able to prevent someone else
from opening a "Broadway Pizza" in Los Angeles.

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The other way to acquire priority is to register the mark
with the Patent and Trademark Office with a bona fide
intention to use the mark in commerce. Unlike use of a
mark in commerce, registration of a mark with the PTO
gives a party the right to use the mark nationwide, even
if actual sales are limited to only a limited area. This
right is limited, however, to the extent that the mark is
already being used by others within a specific
geographic area. If that is the case, then the prior user
of the mark retains the right to use that mark within that
geographic area; the party registering the mark gets the
right to use it everywhere else. So, for example, if I
register the mark "Broadway" in connection with the
sale of pizza, the existing "Broadway Pizza" in Boston
retains the right to use the name in Boston, but I get the
right to use it everywhere else.

28
The rights to a trademark can be lost
through abandonment, improper
licensing or assignment, or genericity. A
trademark is abandoned when its use is
discontinued with an intent not to
resume its use. Such intent can be
inferred from the circumstances.
Moreover, non-use for three consecutive
years is prima facie evidence of
abandonment. The basic idea is that
trademark law only protects marks that
are being used, and parties are not
entitled to warehouse potentially useful
marks.

29
In considering trademark registration kindly remember that the
strongest trademarks are used very extensively by the owner. The
mark should be on your letterhead, business cards, e-mail
signatures, and anywhere else it may be appropriately used. A mark
is strongest when it is recognized by most people in your
marketplace, whether it be local, national, or worldwide.

Musbri Mohamed

February 2011

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