Bali's KU DE TA beach club finally wins back its name
A consortium of Indonesian and foreign entrepreneurs that had established an iconic Bali beach club concept and ended up suing in Singapore have won on appeal. At issue was how an informal business group did not control and manage its brand as the business grew. This allowed some of the partners to give a licence for the brand, leading to a rival multi-million dollar KU DE TA club atop the Marina Bay Sands casino in Singapore.
A group of businessmen came up with the concept for and established the original KU DE TA beach club in Bali in 2000. It became the leading venue on this island. They had only a basic contract and some of them began registering trademarks with little consistency abroad. Some marks ended up in a company called Nine Squares, run by several of the partners. Later on, other businessmen secured a spurious licence from Nine Squares and opened the club at the Marina Bay Sands.
Litigation started in 2010. One case involved whether the Singapore KU DE TA marks were held by their owner Nine Squares on trust for the original partners. If not, it was argued that they were invalid. There were also disputes elsewhere. The final appeal dealt with the strength and validity of the licence to the club operator in Singapore.
Meanwhile, the Singapore business and other KU DE TA marks had been acquired by LV Capital Asia, the investment arm of LVMH, who announced an extravagant global expansion plans for the brand. Arguably, this was rather curious for a leading brand owner, given the suspicious background of the brand.
The final appeal decision in late May ruled that the licence was illegal and an earlier decision had ruled that the partners were the true owners of the trademarks. The court thus found that the Singapore club had infringed the partners’ trademarks and other rights. This will lead to a large claim for damages and a large payment of their costs.
The Singapore club will be rebranded CE LA VI, a play on the French expression ‘C'est La Vie’. The Hong Kong club due to open next month will also adopt the new name. No doubt the investors carefully planned a fall-back position were they to lose.
The KU DE TA owners should recover a lot of money, although their legal fees will have been extraordinary. Hopefully, now the partners can rebuild this brand into the global business it perhaps deserves.
Nick Redfearn, Rouse, Indonesia
Copyright © Law Business ResearchCompany Number: 03281866 VAT: GB 160 7529 10