Supreme Court rules on use of criminal actions to combat trademark squatters

Section 11 of the Thai Trademark Act BE 2534 (1991), as amended by the Trademark Act (No 2) BE 2543 (2000) and the Ministerial Regulations, provide rules and procedures for filing trademark applications in Thailand. Among other things, a trademark applicant or its agent must provide a declaration of ownership to confirm that it is the owner or the lawful holder of the trademark applied for. The declaration of ownership is attached to the application form and is deemed to be a confirmation of such declaration upon execution of the application form and filing with the Trademark Office.

The Trademark Act (Section 107) also provides for criminal sanctions against an applicant who makes a false statement on the declaration of ownership to the registrar:

“Any person who makes a false statement to the registrar or board in an application, opposition or other document filed concerning an application for registration, amendment of a registration, renewal of a registration or cancellation of the registration of a trademark, service mark, certification mark or collective mark, or a licence pertaining to a trademark or service mark, shall be liable to imprisonment not exceeding six months or a fine not exceeding Bt10,000 or both.”   

While trademark squatting has been a big challenge in Thailand for more than 10 years, the legal remedy used to combat trademark squatting is to initiate a cancellation or invalidation action before the Board of Trademarks or the Intellectual Property and International Trade Court (IP & IT Court). Several Supreme Court precedents regarding trademark cancellation or invalidation actions involving trademark squatters have been rendered over the years; however, Section 107 is silent on the use of criminal actions to combat trademark squatters and it remained doubtful whether such an option is available.

The decision of the Supreme Court in Kabirski & Co v T&C Project Co Ltd (Judgment No 14301/2557, March 24 2015) provides a precedent regarding the use of criminal actions to combat trademark squatters in Thailand.

Plaintiff Kabirski & Co filed a criminal lawsuit against the defendants based on Section 107, claiming that the latter had made false statements to the registrar by filing two trademark applications for the mark G KABIRSKI. During the filing process, the defendants declared in bad faith to the registrar that they were the owners of the mark as filed and had the right to apply for registration. In fact, the defendants were aware that the mark belonged to the plaintiff and that the plaintiff had a better right to the mark. The defendants intended to provide a false declaration in an attempt to take possession of the plaintiff’s trademark. The IP & IT Court dismissed the plaintiff’s case. The plaintiff filed an appeal petition with the Supreme Court.

The Supreme Court held that, even though the submission of a false statement to the registrar during the prosecution process is subject to criminal liability under the Trademark Act, the owner of the mark was not considered as an injured person and was not entitled to initiate a lawsuit based on this ground against the applicant. The Supreme Court further held that such an offence is an offence against the registrar or the Board of Trademarks and, therefore, only the state (through the police and the public prosecutor) can initiate an action against the offender.  

The Supreme Court also suggested that, while a criminal action is not available in these circumstances, the owner of the mark may initiate a cancellation action in the form of a civil lawsuit before the court.

This Supreme Court judgment provides clear direction that a civil action is the only option available under Thai law for a trademark owner seeking to combat trademark squatting.

Nuttaphol Arammuang, ZICOlaw (Thailand) Ltd, Bangkok