Liwayway Marketing Corp v Oishi Group Public Co Ltd [2017] 4 MLJ 141

Liwayway Marketing Corp v Oishi Group Public Co Ltd [2017] 4 MLJ 141

Federal Court (Putrajaya) 

Trademark Expungement for Non-Use under Paragraph 46(1)(b) Trade Marks Act 1976 & The Whitford Guidelines

1. The Appellant, Liwayway Marketing Corp, is a Philippine company and the registered owner of the trademark ‘Oishi’ in Malaysia for goods and services under Classes 30 and 43 since 2003. The Respondent, Oishi Group Public Co Ltd, is a Thai company that manufactures bottled drinks and began using the ‘OISHI’ mark in Malaysia in 2013. 
2. In 2011, the Respondent’s application to register its ‘OISHI’ mark in Class 32 was rejected by the Registrar of Trade Marks because the Appellant’s mark was already registered, creating a risk of public confusion. 
3. On 19 February 2013, the Respondent applied to the High Court to expunge the Appellant’s trademarks from the register on the ground of non-use under paragraph 45(1)(a) and subsection 46(1) of the Trade Marks Act 1976 (“TMA”). 
4. The Respondent relied on a market survey conducted by Dna Risk Sdn Bhd over a ten-day period (11–22 August 2011) across 260 retail outlets in the Klang Valley, Johor and Penang. The survey concluded that no ‘Oishi’ products were found and interviewees were unaware of them. [paragraph 21]
5. Both the High Court and the Court of Appeal ruled in favor of the Respondent, accepting the survey as prima facie evidence of non-use and ordering the marks to be expunged. 

1. Whether the Respondent qualified as an “aggrieved person” under subsection 46(1) of the TMA to sustain a rectification action.
2. Whether the three-year continuous period of non-use required by paragraph 46(1)(b) of the TMA can be satisfied by evidence covering only a small segment of that duration.
3. Whether the market survey provided by the Respondent was sufficient to establish a prima facie case of non-use, thereby shifting the burden of proof to the Appellant.

(1) Whether the Respondent qualified as an “aggrieved person” under subsection 46(1) of the TMA to sustain a rectification action.

(a) A “person aggrieved” is not just anyone with a passing interest. They must possess a legal interest, right or legitimate expectation in their own mark that is substantially affected by the presence of the registered trademark. 

(b) This person must have either used their mark as a trademark or have a genuine and present intention to use it in a trade similar to that of the registered owner. 

(c) In this specific case, the Court found the Respondent was a subsequent user (commencing use in 2013) compared to the Appellant (registered since 2003) and therefore could not claim to be a person aggrieved for the purpose of rectification.

(d) The Court relied on McLaren International Ltd v Lim Yat Meen [2009] 5 MLJ 741 and Re Arnold D Palmer [1987] 2 MLJ 681 to define the “person aggrieved” test as requiring actual use or a genuine intention to use the mark in the same course of trade. 

(e) The Court further cited LB (Lian Bee) Confectionery Sdn Bhd v QAF Ltd [2012] 4 MLJ 20, which clarifies that a person with only a bona fide intention to use a mark can qualify. Additionally, based on the cited case of Mesuma Sports Sdn Bhd v Majlis Sukan Negara Malaysia [2015] 6 MLJ 465 which was used to emphasize that this interest/right must be legal or lawful and substantially affected by the existing registration. 

(2) Whether the three-year continuous period of non-use required by paragraph 46(1)(b) of the TMA can be satisfied by evidence covering only a small segment of that duration.

(a) Under paragraph 46(1)(b) of the TMA, the Applicant must prove non-use for a continuous period of not less than three years up to one month before the application date. 

(b) This period cannot be truncated or computed segmentally. Evidence covering only a tiny fraction (example: 10 days) of that three-year window is inconclusive because it fails to reflect the factual state of affairs for the remainder of the statutory period. 

(c) The Court applied the reasoning from Lam Soon Edible Sdn Bhd v Hup Seng Perusahaan Makanan (M) Sdn Bhd [2011] 7 MLJ 366, which held that evidence must fairly reflect the factual position of non-use for the entire relevant period. 

(d) In the case of Lam Soon, the Court referred to Lim Yew Sing v Hummel International Sports & Leisure A/S [1996] 3 MLJ 7 and emphasized that a survey must reflect the state of affairs at the time the application to expunge is made to be of any real use.

(3) Whether the market survey provided by the Respondent was sufficient to establish a prima facie case of non-use, thereby shifting the burden of proof to the Appellant.

(a) The burden of proof lies initially with the Applicant to establish a prima facie case of non-use. Only once this prima facie case is made does the burden shift to the registered proprietor to prove “use”.

(b) A market survey is insufficient to establish this prima facie case if it is limited in scope (for example: only surveying Class 30 when the registration covers Classes 29 and 43 as well). It lacks temporal depth (it does not cover the full three-year window). Compliance with the Whitford guidelines does not automatically mean the burden is discharged, the survey’s weight remains a matter of evidential evaluation. 

(c) The Court cited E-Toyo Global Stationery Sdn Bhd v Toyo Ink Sdn Bhd [2005] 1 MLJ 445 and Godrej Sara Lee Ltd v STT (Part 2) [2007] 7 MLJ 164 to establish that the registered owner only needs to show use after the applicant has successfully established a prima facie case of non-use. 

(d) To evaluate the quality of the survey, the Court looked to Imperial Group PLC v Philip Morris Ltd [1984] RPC 293 (the origin of the Whitford guidelines) and Interflora Inc v Marks and Spencer plc [2013] 2 All ER 663, which stated that compliance with guidelines does not automatically discharge the burden of proof, the weight of the evidence remains a matter for judicial evaluation.

1. The Federal Court allowed the appeal and set aside the decisions of the High Court and Court of Appeal.
2. The Court held that the Respondent failed to discharge the burden of proving a prima facie case of non-use because the market survey was statutorily insufficient and inconclusive. Consequently, the Appellant was not required to prove its use of the trademark. The Court also found it unnecessary to answer the specific questions of law posed given the failure of the evidence.

1. To successfully challenge a trademark, a person must provide comprehensive evidence that covers the entire three-year period required by law.
2. The legal burden rests on the challenger to prove that the mark has not been used, rather than the owner proving that it has.
3. Any market surveys submitted as evidence must be statistically significant and follow the strict criteria established by the Whitford guidelines.
4. Courts do not view the law as entirely rigid and will consider whether a mark was temporarily sidelined for legitimate business pivots. For example, pausing production to reformulate a product for Halal compliance can be a valid reason that prevents a trademark from being cancelled for non-use.