In the recent decision of City Chain Stores (S) Pte Ltd v. Louis Vuitton Malletier  SGCA 53 (“City Chain v LVMH”), the Singapore Court of Appeal (“Court”) considered the issue of the types of use of a trade mark that would constitute an infringement of a registered trade mark under the Singapore Trade Marks Act (“the Act”). After reviewing the relevant authorities, the Court indicated its preference for the approach that the infringing use had to be use as a trade mark.
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LVMH, the claimant in this case, is a well-known purveyor of luxury goods. The defendant, City Chain, is a prominent watch retail chain in Southeast Asia. LVMH alleged that City Chain had infringed their registered “Quatrefoil” flower trade mark by using it on City Chain’s watches. Indeed, the same “Quatrefoil” flower trade mark was applied on LVMH’s own watches.
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The Court found that the flower signs applied on City Chain’s watches were similar to the LVMH’s “Quatrefoil” flower trade mark.
The Court went on to consider in its decision the requirement of use of an infringing sign as a trade mark, and the two main approaches to the issue.
The traditional narrow approach, in line with English precedents, was that the trade mark had to be used as an illicit trade mark or identifier of trade origin by the infringing party in order to sustain an action for trade mark infringement.
However, in more recent decisions, which the Court termed the broader Community approach, the European Court of Justice found that infringing use was defined as use which was liable to affect the functions of the registered trade mark, in particular the essential function of guaranteeing to consumers the origin of the goods. This was a significant departure from the traditional approach conceptually - it could encompass wider uses of the trade mark such as use to create the impression that there was a material link between the goods concerned and the trade mark proprietor.
The Court found that adopting either approach led to the same conclusion that there was no infringement of LVMH’s “Quatrefoil” flower trade mark.
The Court took the view that City Chain did not use the flower signs on its watches as a trade mark, but rather as a mere decoration. As such, there was no trade mark use of the flower sign and thus there was no infringement on the traditional narrower approach.
The Court then went on to consider whether there would be infringement on the broader Community approach. The Court found that City Chain’s use of the flower signs did not create a likelihood of confusion on the part of the average consumer as to the origin of their watches.
The Court, in its decision, also weighed the two approaches and concluded that their preferred approach was the traditional narrow approach that infringing use must be of a trade mark use.
The Court reasoned that the broader Community approach would lead to increased uncertainty as it was not always clear when non trade mark use would affect the functions of the trade mark, and this uncertainty may be exploited by powerful proprietors in marginal cases against third parties who were unable to sustain a prolonged legal battle. Also, the requirement of use was more conceptually consistent with the provisions of the Act. For example, revocation for non-use and the defence of acquiescence both indicated that use as a trade mark was a fundamental element of trade mark protection.
While the Court’s expressed preference for the narrow approach was obiter, it is likely that future decisions would follow the narrow approach.
As such, claimants should examine the contextual use of the infringing mark prior to commencing an action for trade mark infringement. In City Chain v LVMH, the Court found that the flower signs applied on City Chain’s watches were similar to LVMH’s “Quatrefoil” flower trade mark, but that there was no uniformity in the use of the flower, which was varied and inconsistent. Consequently, the Court found that City Chain was not using the flower signs as a trade mark. On this basis, LVMH’s claim under the narrow approach would necessarily fail.