Federal Court declines to answer questions on foreign-owned marks

In Meidi-Ya Co Ltd Japan v Meidi (M) Sdn (Case 02-8-2007 (W)), December 4 2008, reported in [2009] 2 MLJ 14), the Malaysian Federal Court has, on technical grounds, declined to answer a number of questions of law pertaining to the doctrine of first use and ownership of a foreign trademark.

Meidi-Ya Co Ltd Japan, a Japanese corporation, owns the trademark MEIDI-YA for baked goods. In 1987 its Malaysian subsidiary filed several applications to register the trademark MEIDI-YA in Roman and kanji characters.
In 1986 Meidi (M) Sdn Bhd, a Malaysian company, filed an application to register the trademark MEIDI-YA FRESH BAKERY (and 'stalks of wheat' design).
Faced with two competing applications for the registration of similar marks, the registrar of trademarks directed that the case be determined by the High Court. The court allowed the registration of Meidi's mark, but without the element 'ya'. It also ordered that Meidi-Ya's application proceed to registration, thus allowing the two marks to coexist.

Meidi appealed to the Court of Appeal and Meidi-Ya cross-appealed. In October 2007 the Court of Appeal held that since Meidi-Ya had failed to show that it was the first user of its trademark and trade name in Malaysia, it had not proved that it owned the MEIDI-YA mark. The court thus set aside the order of the court of instance and declared that Meidi was entitled to apply for the registration of its mark. Meidi-Ya obtained leave to refer a number of questions of law to the Federal Court.

The questions - as reframed with the consent of both parties - were as follows:

  • Whether Meidi-Ya's de minimis use of its name and trademark in Malaysia implied that it had sole ownership of the mark in the country; and
  • Whether Meidi should be allowed to register its mark in light of:
    • Sections 3, 10 and 14(1)(a) of the Malaysian Trademarks Act 1976; and
    • the legislative intent to maintain the purity of the Register of Trademarks.
On September 11 2008 the Federal Court reserved judgment in the case (for further details please see "Federal Court reserves judgment in important case on foreign marks").

In the present decision, the court held that the questions referred to it were not properly framed and thus refused to answer them.

In particular, after reviewing the relevant legal provisions and case law, the court held that for it to answer a question of law, the following conditions must be fulfilled:
  • The decision of the Court of Appeal must raise a point of general principle which has not been previously addressed by the Federal Court; and
  • There must be a prima facie case of success in the underlying proceedings should the point of law be decided in favour of the appellant (in other words, the Federal Court will not decide purely academic issues).
Applying these principles to the case at hand, the Federal Court held that through the questions referred to it, Meidi-Ya was in fact trying to reverse a finding of fact made by the Court of Appeal. Since Meidi-Ya was not the first user of the mark in Malaysia, the court held that both questions were purely academic and dismissed the appeal.

The decision of the Federal Court may not be faulted under the principles of civil procedure. Nevertheless, the IP community was disappointed that the court did not seize the opportunity to shed some light on this significant issue. 

Teo Bong Kwang, Wong Jin Nee & Teo, Kuala Lumpur

Unlock unlimited access to all WTR content