Member Articles
Pre-Trial Injunction - Preservation of the Status Quo
Related Articles inRetail & Distribution
More Retail & Distribution Aricles → Latest Firm's PressShearn Delamore & Co. A case note by Elyse Diong Tze Mei. INTRODUCTION The recent case of Bellini Resources (M) Sdn Bhd v Mohamad Zaini bin Md Taha1 sets out the criteria for the preservation of the status quo pending trial where the ownership of a trade mark is in dispute. FACTS The company plaintiff (the Company) registered the “CAP LESONG” mark in respect of: “ … cooking oils, edible oils and fats, meat, fish, poultry and game, meat extracts, preserved, frozen, dried and cooked fruits and vegetables, jellies, jams, compotes, egg, milk and milk products.” in Class 29 in Malaysia on 16 January 2015 (“Disputed Mark”). Prior to his dismissal as a director of the Company, the defendant (“MZMT”) recorded an assignment of the Disputed Mark from the Company to himself. There was no board resolution to approve the disposal of the Disputed Mark to MZMT. The Company filed a suit against MZMT on the grounds that it did not consent or authorise the assignment of the Disputed Mark to MZMT and that MZMT had breached his fiduciary duty and trust (“Plaintiff’s Suit”). The Company made an ex-parte application for the following interim orders against MZMT under Order 29 Rule 1 of the Rules of Court 2012 (“Ex-Parte Application”) pending the full disposal of the Plaintiff’s Suit:
THE LAW ON EX-PARTE INJUNCTION Order 29 Rule 1 of the Rules of Court 2012 (“ROC”) allows for an application for the grant of an interim injunction to be made before or after trial of a cause or matter. An injunction is a judicial order restraining or compelling a person to stop or to do certain acts. The High Court applied the principles laid down by the Court of Appeal in Keet Gerald Francis Noel John v Mohd Noor bin Abdullah2 for an interim injunction application:
An application for an interim injunction can be made inter-partes or ex-parte. An ex-parte interim injunction can only be made in circumstances of extreme urgency3 where an inter-partes application is not viable. The applicant is also under the obligation to make full and frank disclosure of all relevant material facts, including facts which are not in the applicant’s favour4. Unless revoked or set-aside earlier, an ex-parte interim injunction is valid only for 21 days from the date it was granted and an inter-partes hearing must be fixed within 14 days from the date of order5. The High Court allowed the Company’s ex-parte application on the grounds that there were bona fide serious issues to be tried, the balance of convenience lies in favour of the Company and there was a need to preserve the status quo of the matter. The High Court found that the following were serious issues to be tried:
BALANCE OF CONVENIENCE The High Court in considering where the balance of convenience lies took into account that the Company’s business is inextricably linked to the use of the Disputed Mark and that it is highly probable that MZMT or his representatives may attempt to cancel or dispose of the Disputed Mark to a bona fide third party. The judge took note of the fact that MZMT after having been dismissed as a Director had, without the knowledge of the Company, written to JAKIM on the Company’s letterhead to cancel the use of the Disputed Mark on the Company’s products. The judge was of the view that the damage to Company’s business will be disproportionately higher than the damage that MZMT may suffer as a result of the interim injunction. Further, the Company had undertaken and was in a financial position to pay the damage suffered by MZMT as a result of the interim orders should the Company not succeed in its claims at trial. STATUS QUO The High Court in this case recognised the importance of maintaining and preserving the status quo of the Disputed Mark by preventing MZMT from transferring or disposing the ownership of the Disputed Mark to a third party pending the disposal of the case at trial. FULL AND FRANK DISCLOSURE The High Court was further satisfied that the Company had complied with the requirements under Order 29 Rule 1 of the ROC for full and frank disclosure. CONCLUSION An interim injunction is an important and useful tool for trademark owners to effectively stop the continuation of an alleged infringement as well as to prevent unauthorised disposal, transfer or assignment of ownership of a trademark. Taking legal action may diminish or avoid irrevocable impact and damage caused by the alleged infringer.
For further information regarding intellectual property law matters, please contact our Intellectual Property Practice Group.
|
Footnotes:
|
Related Articles in
Retail & Distribution
- COVID-19 Measures in Dubai and Abu Dhabi
February, 2021 - Why Indemnification Provisions Are Too Important to Leave to the Lawyers
February, 2021 - Significant Buy American Amendments are Here
February, 2021 - Major Changes Coming to Prop 65 “Short-Form” Warnings
February, 2021
More Retail & Distribution Aricles →
Latest Firm's Press
Shearn Delamore & Co.