Transcript Mediation: Its Practice & Procedure

Enforcing your Intellectual
Property Rights
By
Lee Swee Seng
LLB, LLM, MBA
ADVOCATE & SOLICITOR
CERTIFIED MEDIATOR
PATENT AGENT
NOTARY PUBLIC
Copyright
www.leesweeseng.com
[email protected]
1
Intellectual Property


Intellectual Property (IP) has become a
significant area of focus in law.
Now companies have begun to
understand the importance of extracting
the maximum value from their IP in
terms of managing license and other
contractual arrangements.
2


Malaysia is also taking greater steps in
protecting IP by the proposed creation of IP
Courts and the 9th Malaysia Plan which will
include measures to promote franchising.
To protect IP rights, Malaysia has local
legislation like the IP Corporation of Malaysia
Act 2002, Trademarks Act 1976, Patents Act
1983, Copyright Act 1987, Industrial Design
Act 1996, Layout Designs and Integrated
Circuit Act 2000, Geographical Indications Act
3
2000 and Optical Discs Act 2000.
Intellectual Property Rights





Main IP Rights:
Patents
Copyright
Trademark
Industrial Designs
Trade Secret & Confidential Information
4
Patents



Patent Act 1983
Patent Regulations 1986
Provides 20 years legal protection to
patent holders which includes
exploitation of the patents, the
assignment or transfer of rights and
license contract.
5
Patents




The Act was revised in accordance with
the Paris Convention and TRIPS
Agreement
The Patent Act provide for the patent
enforcement by the Enforcement Division
of the Ministry of Domestic Trade and
Consumer Affairs.
The Division will conduct the necessary
investigations and prosecutions.
Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS) is a treaty administered by the World Trade Organization (WTO)
which sets down minimum standards for many forms of intellectual property (IP) regulation
6
Patents


In accordance with TRIPS, the Patent
Act provides a protection period of 20
years from date of filing an application
Similarly a utility innovation certificate
provides for an initial period of 10 years
from the date of filing an application
7
Patent Infringement


Once a patent has been granted,
exploiting without the consent of the
proprietor is an infringement.
In the case of a product patent and
process patent, any making, disposal,
import, the use without consent would
be an infringement.
8
Patent Remedies




Injunction
Damages or account of profit
Order of delivery up or destruction
Declaration that the patent is valid and
has been infringed
9
Patent - Enforcement


Entitlement to damages from date of
publication.
Plaintiff must show not only the act
infringed the patent but the claims in the
form in which they were contained in the
application immediately before
publication
10
Copyright





Copyright Act 1987
Copyright (Licensing) Regulations 2000
protects : literary works, musical works,
artistic works, films, sound recordings,
broadcasts and derivative works
protection lasts for authors lifetime and
50 years after his death
for sound recordings, protections
11
subsist for 50 years
Copyright



Act also provides for the performer’s rights in
a live performance which subsists for 50
years.
Copyright is infringed when an unauthorized
person reproduces, makes for sale or hire,
distributes, possess, exhibits in public, etc.
The Act provides enforcement by the
Enforcement Division apart from the police.
12
Copyright owners to take
precaution



Copyright owners are advised to make
sure:
authors’ name appears on all copies of
literary, dramatic, musical works, etc
publisher’s name appears on all copies
copyright owner’s name and date of first
publication and the country of first
publication appears on sound
recordings and computer programmes13
Copyright owners to take precaution

Anti-counterfeiting devices to aid
solicitors executing Anton Pillar Orders,
police officers executing search and
seizure warrants and Enforcement
Division Officers who are looking for
counterfeit copies, to detect the genuine
copy.
14
Remedies for Infringement of
Copyright




2 ways:
Public enforcement
enforcement by the police, customs
officers and Enforcement officers from
the Ministry of Domestic Trade and
Consumer Affairs.
Private enforcement
civil action taken by private individuals
15
to enforce their copyright through Court.
Remedies for Infringement of
Copyright

Interlocutory Remedies;
Court can issue interlocutory orders to
prevent substantial injustice being done
in the meantime.
16
Remedies for Infringement of
Copyright



Courts can issue:
Interlocutory injunction
Anton Pillar Order
Norwich Pharmacal Order
17
Copyright - Injunction


Interlocutory injunction is sought to
preserve the status quo pending
hearing in Court.
It may be a ‘prohibitive order’ which
prevents the Defendant from performing
certain acts in the interim ie. Destroying
the infringing copies.
18
Copyright Various orders of injunctions


A ‘mandatory order’ is to ask the Defendant to
carry out some act ie. Asking Defendant to
deliver up the infringing works to the Plaintiff.
In deciding to grant an interlocutory
injunction, the Court will follow the principle
laid down in American Cyanamid v Ethicon
Ltd by the House of Lords which was applied
in Keet Gerald Francis v Mohd Noor [1995]
1 CLJ 293.
19
Copyright - Injunction


The principle laid down in American
Cyanamid ie. A serious issue to be
tried, balance of convenience and is the
damages adequate for the Plaintiff.
The Court will consider the balance of
convenience test and if the balance of
convenience is equal the Court will
either maintain status quo ie. injunction
should stay or look into the merits.
20
BASKIN ROBBINS INTERNATIONAL CO. &
ANOR. V. AVONDAY SDN. BHD.
[1992] 2 CLJ 201 (Rep) [1992] 2 CLJ 1198


This is an application by the Plaintiff for
an interlocutory injunction to restrain the
Defendant from selling Defendant’s ice
cream using the mark USA 31.
To apply for an interlocutory injunction,
the Plaintiff has to satisfy certain
requirements under American
Cyanamid case.
21
BASKIN ROBBINS INTERNATIONAL CO. &
ANOR. V. AVONDAY SDN. BHD.
[1992] 2 CLJ 201 (Rep) [1992] 2 CLJ 1198

Hashim Yeop Sani J mentioned the
case Prof Dr. A Kahar Bador & Ors v
N Krishnan & Ors [1982] CLJ 630
(REP), stating that an interlocutory
injunction is merely provisional and
does not conclude a right. If a person
can show that he has a fair question to
raise as to the existence of the right
which he alleges he may be entitled to
22
it.
BASKIN ROBBINS INTERNATIONAL CO. &
ANOR. V. AVONDAY SDN. BHD.
[1992] 2 CLJ 201 (Rep) [1992] 2 CLJ 1198



The Court went on to apply the
principles in American Cyanamid.
The Court is satisfied that the claim is
not frivolous or vexatious and there are
serious issues to be tried.
As to whether damages would be an
adequate remedy, the Court opined that
if the Plaintiff succeeds at the trial
without this injunction, it would not be
possible to assess the amount of
23
BASKIN ROBBINS INTERNATIONAL CO. &
ANOR. V. AVONDAY SDN. BHD.
[1992] 2 CLJ 201 (Rep) [1992] 2 CLJ 1198


damages they would have suffered as it
would not be possible t o account the
number of customers that they had
thereby been deprived of.
However the injunction is not to put an
end to the Defendant’s ice cream
business. They can still market their
product before they decided to adopt
24
BASKIN ROBBINS INTERNATIONAL CO. &
ANOR. V. AVONDAY SDN. BHD.
[1992] 2 CLJ 201 (Rep) [1992] 2 CLJ 1198


the impugned mark USA 31.
Thus the Court opines that the balance
of convenience lies in allowing the
injunction as it would not do a greater
harm to the Defendant.
Another factor is that the Plaintiff
applied promptly hence the issue of
statues quo being preserved only
existed before the Defendant began
25
SAP(M) Sdn Bhd v I World
HRM Net Sdn Bhd & Anor
[2006] 2 MLJ 678


The Second Plaintiff is the owner of the
copyright in a business application
software programme.
The First Plaintiff is the second Plaintiffs
exclusive distributor of the software in
Malaysia.
26
SAP(M) Sdn Bhd v I World HRM
Net Sdn Bhd & Anor
[2006] 2 MLJ 678
their business in that manner.
 The Court allowed the Plaintiff’s
application for an interlocutory injunction
against the Defendant.
 The alleged breach that the First
Defendant and the Second Defendant
had infringed the copyright in the said
software by
27
SAP(M) Sdn Bhd v I World
HRM Net Sdn Bhd & Anor
[2006] 2 MLJ 678

communicating the software to a third
party without the Plaintiff’s consent.
The Plaintiffs are applying for an interim
injunction to restrain the Defendants
from using the Plaintiffs software and
also to stop them from infringing the
Plaintiff’s copyright in
28
SAP(M) Sdn Bhd v I World
HRM Net Sdn Bhd & Anor
[2006] 2 MLJ 678
the said software.
 The Court allowed the Plaintiff’s
application for interlocutory injunction as
it would surely damage the Plaintiff’s
goodwill and reputation as any
disruption of service would make the
customers lose confidence in the
Plaintiff’s software.
29
SAP(M) Sdn Bhd v I World
HRM Net Sdn Bhd & Anor
[2006] 2 MLJ 678


The damage suffered would be
irreparable and monetary compensation
would not be an adequate remedy.
The balance of convenience favours the
Plaintiff who will not be able to control
the licensing of the software if the
interim injunction is not granted.
30
SAP(M) Sdn Bhd v I World HRM
Net Sdn Bhd & Anor
[2006] 2 MLJ 678

Although there was delay in the
application for the interim injunction.
The Defendants were not prejudiced as
the delay was due to ‘ongoing
negotiations’. (Larut Consolidation
Bhd v Khoo Ee Bee [1997] 5 MLJ 77delay for 2 years was excused)
31
“Delay defeats Equity”

Evercrisp Snack Products (M) Sdn
Bhd & Anor v Sweeties Food
Industries Sdn Bhd [1979] 1 LNS 19
The Plaintiff applied for an interlocutory
injunction that the Defendants be
restrained until the trial of the action of
passing off.
32
Evercrisp Snack Products (M) Sdn Bhd &
Anor v Sweeties Food Industries Sdn Bhd
[1979] 1 LNS 19

But the Court HELD that there was
unreasonable delay in applying for the
relief and the delay was not
satisfactorily explained thus dismissing
the motion to apply for an interim
injunction.
33
Copyright - Anton Pillar Order

The Anton Pillar Order was named after
the case, Anton Pillar KG v
Manufacturing Process [1976] 1 Ch
55 whereby it permits the Plaintiff to
enter the Defendant’s premises to
inspect the relevant documents and to
remove them (search & seizure).
34
Copyright - Anton Pillar Order

In the case above, the Court opined that
there must be a balance between the
Plaintiffs claim that the evidence may be
destroyed and the Defendants claim
that there should be no invasion of
privacy.
35
Copyright - Anton Pillar Order

To apply for Anton Pillar Order, the
Plaintiff must show he has a strong
prima facie case, the damage caused is
very serious, there is clear evidence the
Defendants have in their possession the
incriminating document and real
possibility that they may destroy the
materials.
36
CopyrightNorwich Pharmacal Order

The Norwich Pharmacal Order which
originated from Norwich Pharmacal
Co. and Others v. Commissioners of
Customs and Excise[1973] 2 All ER
943 aids the Plaintiff to compel a third
party to reveal information so the
Plaintiff may ascertain the actual
wrongdoers.
37
CopyrightNorwich Pharmacal Order

The House of Lords HELD that where a
person is innocently involved in the
wrongdoing act of a third party, he is
under a duty to assist the Plaintiff by
releasing the identity of the wrongdoers
but the he may not be liable to the
Plaintiff.
38
ESPL (M) Sdn Bhd v Harbert
International EST Sdn Bhd
[2003] 3 CLJ 864


The Plaintiff had obtained by way of exparte application a Norwich Pharmacal
Order and an Anton Pillar Order against
the Defendant.
In the light of the above facts, the
Defendant applied to set aside the said
Orders on the following grounds:
39
ESPL (M) Sdn Bhd v Harbert
International EST Sdn Bhd
[2003] 3 CLJ 864


a) The Norwich Pharmacal Order
should have been made inter parte
instead of ex parte.
b) The Plaintiff who after having failed to
subpoena the Defendant to produce
documents, decided to apply for
Norwich Pharmacal Order, was clearly
committing an abuse of the process of
the court.
40
ESPL (M) Sdn Bhd v Harbert
International EST Sdn Bhd
[2003] 3 CLJ 864


c) In respect of the application to set
aside the Anton Pillar Order, the Plaintiff
could not show any risk that there is a
risk of the documents being destroyed.
Therefore, the Court arrived at the
decision that the Defendant’s
application to set aside be granted.
41
Copyright - Final Remedies



After liability for copyright has been
established, the Court may grant final
remedies:
Permanent injunction
Order for delivery of infringing copies
Inquiry to damages or an account of
profit
42
Copyright - Damages

The basic measure for damages is the
depreciation caused by the
infringement, exploitation of the
copyright owner’s work, ‘going market
rate’, applicable royalty rate, etc.
43
Copyright - Damages

Since copyright infringement is a tort,
rules of causation and remoteness will
apply ie. Whether loss was in fact
caused by infringement and whether
loss was foreseeable.
44
Copyright - Damages


If the copyright work is circulated in the
market, then the Plaintiff may calculate
damages via loss of profits.
The Plaintiff has the option to choose
whether he wants an account of profits
or having damages assessed.
45
Copyright - Damages

The Plaintiff may ask the Defendant to
account for his profits made via sale of
infringing copies and to have them
confiscated.
46
Copyright - Offences


In addition to civil suit, s41 Copyright
Act 1987 made certain infringing acts an
offence.
The provision covers sales, distribution,
possession, exhibition, imports of the
infringing copy shall be guilty of an
offence and shall on conviction be liable
to a fine of not less than two thousand
47
Copyright - Offences
ringgit and not more than twenty
thousand ringgit for each infringing
copy, or to imprisonment for a term not
exceeding five years or to both.
48
Copyright - Offences

Any person who causes a literary or
musical work to be performed in public
shall be guilty of an offence under this
subsection unless he is able to prove
that he had acted in good faith and had
no reasonable grounds for supposing
that copyright would or might thereby be
infringed [s41(3)]
49
Copyright - Offences


s44 allows an Inspector to enter into
premises with a warrant to search and
inspect infringed goods and to seize
and remove them under s45 but a list
must made of the goods seized as
required under s46.
Remedies under criminal proceedings
are fines and jail sentences and not to
recover monetary compensation.
50
Prosecution of Copyright
Infringements


Operations conducted by enforcement
officers together with representatives
from the copyright industry.
Surprise inspections and raids with the
aid from the Police and RELA (Peoples
Voluntary Corps) to ‘protect’ the
enforcement officers while they search
and seize infringed items or products.
51
Prosecution of Copyright
Infringements


Various bodies involved;
BSA, RIM(Recording Industry of
Malaysia), MPA(Motion Pictures
Association of America), IFPI
(International Federation Phonographic
Industry), PPM (Public Performance
Malaysia) & MACP (Music Authors
Copyright Protection).
Sources from xvi [2002] 4 MLJ Prosecution of copyright infringements :s42
52
Prosecution of Copyright
Infringements


Total of 45,241between 1999-2002
inspections and raids were conducted
nationwide by various enforcement
officers, police, customs, Ministry of
Home Affairs, FINAS (National Film
Developing Corporation) and local
authorities.
Sources from xvi [2002] 4 MLJ Prosecution of copyright infringements :s42
53
Prosecution of Copyright
Infringements


s42 states that an affidavit or statutory
declaration (SD) may be made by
owners and agents and both are
admissible in criminal and civil
proceedings.
Sources from xvi [2002] 4 MLJ Prosecution of copyright infringements :s42
54
Trademark




Trade Marks Act 1976
Trade Marks Regulations 1997
The Act provides protection for
registered trademarks and service
marks.
It is a sign that distinguishes the goods
and services of one trader from those of
another.
55
Trademarks







According to MyIPO (Intellectual Property
Corporation of Malaysia), trademarks exhibits
the following function:
origin function
choice function
quality function
marketing function
economic function
The Intellectual Property Division (IPD) was established on the 27th October 1990 under the jurisdiction of The Ministry of
Domestic Trade and Consumer Affairs Malaysia. The division is responsible for the development and management of intellectual
property system in Malaysia. Prior to its establishment, it was known as the 'Pejabat Pendaftaran Cap Dagangan dan Jaminhak'
under the jurisdiction of The Ministry of Trade and Industry.
56
Trademark


As for trademark, the period of
protection is 10 years, renewable for
every period of 10 years thereafter [s41
TM 1976]
However protection is difficult and
tedious as owner must convince the
Court that the infringing act misleads
the public and secondly the infringing
goods and services may be mistaken
from this own goods and services.
57
Infringement of Trademark


Section 38 of the Trade Marks Act 1976
A registered trademark is infringed by a
person who is not a registered
proprietor when he uses a mark which
is identical with it or so nearly
resembling it as it likely to deceive or
cause confusion in the course of the
trade.
58
Electro Cad Australia Pty Ltd &
Ors v Mejati RCS Sdn Bhd & Ors
[1998] 3 MLJ 422


The plaintiffs launched this suit to
protect their Stopcard Auto Theft Device
(Stopcard).
The use by the defendants of the
trademark “Stopcar” which is very
similar to that of the Plaintiffs’
“Stopcard” is an appropriation of
Stopcard’s goodwill.
59
Electro Cad Australia Pty Ltd &
Ors v Mejati RCS Sdn Bhd & Ors
[1998] 3 MLJ 422

The High Court granted the following
orders against all the defendants:
a) a declaration that Stopcard is the
owner of the goodwill in the trade name
“Stopcard” in Malaysia
60

b) an injunction to restrain defendants
from manufacturing, selling or dealing
with their product “Stopcar” which
possesses features identical or similar
of the Plaintiff’s product “Stopcard”.
61
Electro Cad Australia Pty Ltd
& Ors v Mejati RCS Sdn Bhd
& Ors [1998] 3 MLJ 422


c) delivery up or destruction upon oath
all documents in the possession of the
Defendants or under the control bearing
the word “Stopcar”
d) damages to be assessed by the
Deputy Registrar
62
Alternative enforcement of
Trademark


Trade Descriptions Act 1972 (TDA) is
enforced by the Ministry of Domestic
Trade and Consumer Affairs.
TDA regulates the descriptions in
relation to goods and services.
63
Trade Description Act 1972

TDA prohibits the making of false trade
descriptions ie. In the course of trade;
apply a false trade description to any
goods or supply or offer to supply any
goods to which a false trade description
is applied.
64
Parkson Corp Sdn Bhd v
Fazaruddin Ibrahim
[2002] 4 CLJ 18


The Respondent obtained a Trade
Description Order under s16 Trade
Description Act 1972(TDA) and prayed
for assessment of damages.
The Appellant appealed against the
assessment of damages.
65
Parkson Corp Sdn Bhd v
Fazaruddin Ibrahim
[2002] 4 CLJ 18


The Court of Appeal HELD that
Parliament intended to criminally punish
the infringer and not to make an order
under s16 to award damages.
The Court opined that there can be no
assessment of damages unless there is
an order awarding damages, and in this
case there isn’t any thus allowing the
appeal.
66
Trade Description Act 1972


The owner may apply to Court for an
Order declaring the infringing trade
mark as a false trade description under
TDA known as a Trade Description
Order (TDO).
A Trade Description Order is not an
injunction order but a declaratory order
which deems the infringing trade mark
as a false trade description.
67
Trade Description Act 1972



The owner has to establish a case of
trade mark infringement or passing off
before the Court grant the TDO.
Application for TDO proceeds on an exparte basis.
In recent cases, some Courts have
directed the applicant to advertise the
fact that he is applying for a TDO.
68
Trade Description Order



Time and cost is saved as it is usually a
fraction of that of a civil suit.
Actual enforcement and prosecution of
the offence is conducted by a
government agency at no cost to the
rights owner.
TDO is an order in rem (against the
world at large) and has a lifespan of 5
years.
69
Original Label Enforcement
Trade Description (Original Label)
Order 2002


With effect of January 2003, Ministry of
Domestic Trade and Consumer Affairs
has been gazetted to provide all
copyright owners and persons
authorized by the owners shall put
original label on original optical disc
before entering the market.
This is to protect copyright owners and
fight piracy activity.
70
Original Label Enforcement
Trade Description (Original Label)
Order 2002

Under this order, enforcement officers
may arrest without a warrant any person
suspected of having committed an
offence whether at permanent or open
premise.
71
Enforcement of the Trade
Description Order


The Enforcement Division has the
authority to take action on its own
accord and also to take action based on
complaints lodged by person who
suspects trademark infringement or
passing of action.
When complaint is lodged, Enforcement
Division will study merits of the case.
72
Enforcement of the Trade
Description Order

If there is doubt as to whether the goods
bearing the allegedly false trade
description may violate the TDA, the
Enforcement Division will require the
rights owner to obtain a TDO prior to
taking action.
73
Powers of Enforcement
Division provided under the
Trade Description Act 1972




Enter premise [s28]
Seize and detain goods [s28]
Order offender to produce relevant
books and documents [s28A]
May compound the offence or
prosecute the offender [s28B]
74
Trade Description Order

Prosecution is conducted by the
Enforcement Division and at its own
cost, thus rights owner is not party to
the prosecution and not entitled to any
damages.
75
Acushnet Company v Metro Gold
Manufacturing [2006] 7 CLJ 557


US golf equipment manufacturer
Acushnet, which owns Titleist trade
mark in Malaysia, obtained summary
judgment against a local company
Enforcement division of the Ministry of
Domestic Trade and Consumer Affairs
raided the Defendant’s premises and
seized several items bearing the Titleist
trade mark.
76
Acushnet Company v Metro Gold
Manufacturing [2006] 7 CLJ 557


The Plaintiff sued the Defendant for
trade mark infringement and requested
for a permanent injunction, order for
delivery, records of all parties who
supplied the Defendant with the
infringing goods and damages.
The Defendant claimed that they had
purchased the goods from a company
known as Zonson Sports (M).
77
Acushnet Company v Metro Gold
Manufacturing [2006] 7 CLJ 557


The Court HELD that there was
infringement of the Plaintiff’s trade mark
as it was identical to the Plaintiff’s.
There was no evidence that Zonson
was an agent of the Plaintiff and
nonetheless the Defendant had failed to
conduct any due diligence with regards
to the representations made by Zonson
and cannot shift the burden onto the
78
Acushnet Company v Metro Gold
Manufacturing [2006] 7 CLJ 557


The Court further HELD that by
disposing of the goods, Zonson was
itself infringing the Plaintiff’s trade mark.
It is not open to the Defendant to claim
innocence, since there is no such
defence in trademark law.
79
Maju Perak Tepung Beras Sdn Bhd v
Tiga Gajah Cho Heng Sdn Bhd
[2001] 3 CLJ 241



Dispute about the use of a trademark.
Both sides claim right to use it, but
Respondent is the registered user and
later obtained a trade description order
(TDO).
The Appellant applied to set aside TDO
and even tried to rectify through the
Register of Trademarks which both
failed.
80
Maju Perak Tepung Beras Sdn Bhd v
Tiga Gajah Cho Heng Sdn Bhd
[2001] 3 CLJ 241

The Appellant argued that ex-parte TDO
is flawed because it failed to identify the
sufficient infringing trademark as
required under s16 Trade Descriptions
Act 1972.
81

As followed in Re Chuan Kuan Sang
[1992] 4 CLJ 2104 and Cho Heng Rice
Vermicelli Factory Co Ltd [2000] 8
CLJ 85, the applicant under s16 of the
Act is obliged to identify clearly and
specifically the contravening trade mark.
82
Maju Perak Tepung Beras Sdn Bhd v
Tiga Gajah Cho Heng Sdn Bhd
[2001] 3 CLJ 241

The Court opined that a TDO can only
be given against specific infringing trade
marks if particulars of the trademark
offender be known and such offender
would have to made party in
proceeding.
83
Maju Perak Tepung Beras Sdn Bhd v
Tiga Gajah Cho Heng Sdn Bhd
[2001] 3 CLJ 241



The Court HELD that there is no other
description of the mark either by
reference to colour or other
distinguishing feature.
Merely annexing a mark to the order
without proper description does not
satisfy the requirement of s16 of the Act.
The Court allowed the appeal hence
setting aside the TDO.
84
Passing Off - Enforcement


Plaintiff may issue a letter before action
to demand Defendant to cease all
tortious act immediately.
The letter will provide adequate details
of the Plaintiff’s intellectual property,
identify tortious act and to demand him
to cease all acts.
85
Passing Off - Enforcement


It may include a demand providing
particulars of the infringing articles like
the quantity in stock or delivery up for
destruction.
The letter also may include
compensation for wrongful acts and
even demand a public apology.
86
Passing Off - Enforcement


Damages will generally include a loss in
trade or a damage to the Plaintiff’s
goodwill.
Plaintiff must provide evidence of a loss
of sales or a dip in transactions and
have the Court to draw inferences
based on the result of the Defendant’s
act.
87
Passing Off - Remedies


An order of an inquiry is to permit the
Court to assess the amount of damage
suffered by the Plaintiff due to the
Defendant’s wrongful act.
A Plaintiff may also apply for an account
of profits of the Defendant.
88
Passing Off - Remedies

It is an equitable remedy granted by the
Courts and it involves a calculation into
the Defendant’s profits made from his
wrongful acts.
89
Passing Off - Remedies


However an account of profits involves
detailed investigation of the Defendant’s
books and cost of such investigation
and as such not commonly resorted.
A related cause of action to passing off
is defamation ie. Injurious or malicious
falsehood.
90
Industrial Designs



Industrial Designs Act 1996
Industrial Designs Regulations 1999
It covers features of shape,
configuration, pattern or ornament
applied to an article by any industrial
process.
91
Industrial Designs


Pattern or ornament – eg. textile pattern
applied to the fabric by painting or
weaving
Shape or configuration – eg. readymade garment by making the article in
that shape or configuration.
92
Remedies on Industrial
Design




Injunction
Either damages or an account of profit
An order for delivery up or disposal
Registered industrial design are
protected for an initial period of 5 years
which may be extended for another two
5 year terms, totaling to a period of 15
years.
93
Trade Secret & Confidential
Information

If employees are found to have divulged
confidential information while in
employment or after having left the
employment, the employers have the
right to require the employee or former
employee to stop divulging the said
information and to return any
documents related to the said
information.
94
Trade Secret & Confidential
Information - Remedies




Remedies available to the employers:
Interlocutory Injunctions
Mandatory or prohibitory injunction
(final)
Passing off
Damages in conspiracy
95
Yeohata Industries Sdn Bhd
& Anor v Coil Master Sdn
Bhd & Ors [2001] 6 CLJ 418

The Plaintiffs alleged the Defendants
unlawfully used the confidential
information relating to the production,
operation and marketing of Yeohata to
profit themselves and therefore applied
for interlocutory injunction to restrain the
Defendants from using the confidential
information.
96
Yeohata Industries Sdn Bhd
& Anor v Coil Master Sdn
Bhd & Ors [2001] 6 CLJ 418


The Court HELD that the Plaintiffs were
in a better position to pay damages in
the event the Defendant succeeded at
the trial and the balance of convenience
favours the granting of injunction.
The risks that other companies could
unlawfully use the confidential
information to manufacture and market
a similar machine like Yeohatas and the
97
possibility
Yeohata Industries Sdn Bhd
& Anor v Coil Master Sdn
Bhd & Ors [2001] 6 CLJ 418

that the Defendants and their foreign
partner had conspired to injure the
Plaintiffs business constituted special
factors that required an injunction relief.
A mandatory injunction was granted as
it would be just and equitable that the
Plaintiffs interest be protected to avoid
irreparable damages.
98
Electro Cad Australia Pty Ltd
& Ors v Mejati RCS Sdn Bhd
& Ors [1998] 3 MLJ 422

The Plaintiffs claimed for specific
performance as against the first
Defendant of the confidentiality
agreement, action in passing off and
damages on the basis of conspiracy by
Defendants to obtain information from
Plaintiffs and to utilize it to manufacture
a product identical to the Plaintiffs
product and damages in conversion.
99
Electro Cad Australia Pty Ltd
& Ors v Mejati RCS Sdn Bhd
& Ors [1998] 3 MLJ 422


The Court HELD allowing the Plaintiffs
claims as the Defendant had divulged
confidential information and trade
secrets for their benefit.
The Plaintiffs were also granted an
injunction over the Second Defendant
for breaching his fiduciary duties to not
obtain a business advantage over the
Second Plaintiff.
100
Electro Cad Australia Pty Ltd
& Ors v Mejati RCS Sdn Bhd
& Ors [1998] 3 MLJ 422


The law of passing off is related to the
protection of the goodwill associated
with a business. The Second Plaintiff
has done extensive advertising
campaign hence generating a goodwill
in their product.
Thus the adoption by the Defendants of
the trademark in relation to a product
101
Electro Cad Australia Pty Ltd &
Ors v Mejati RCS Sdn Bhd & Ors
[1998] 3 MLJ 422
identical to the Plaintiffs was done with
intention of appropriating the Second
Plaintiffs goodwill and to pass off the
Defendants products as that of the
Second Plaintiffs.
102
Can intellectual property
misappropriation constitute a criminal
act?


Criminal sanctions are often warranted
to ensure sufficient punishment and
deterrence and to curb wrongful activity.
Violations of intellectual property rights
often involved no loss of tangible assets
as they do not even require any direct
contact with the rights holder.
103
Software Piracy Business Software Alliance



The term software piracy covers
different activities:
illegal copying of programmes.
counterfeiting and distributing software.
even sharing a programme with a
friend.
104
Business Software Alliance


Endorsed by the Ministry of Domestic
Trade and Consumer Affairs.
Provides the BSA Software Audit
Programme 2006 which encourages
organizations to conduct a software
audit on all computers and servers
ensuring the software is adequate,
correct and legal.
105
Companies worldwide suffers
billions in losses



EU/US step up efforts to fight piracy &
counterfeiting.
According to FBI, Interpol and World
Organization and the International
Chamber of Commerce estimates,
roughly 7-8% of world trade was in
counterfeit goods which was equivalent
to as much as USD512 billion in global
lost sales.
Bernama.com 2 Feb 2007 by Tengku Noor Hamsiah
106
Recent Raids conducted

“Computer software worth RM115,300
seized” [The Star, Friday May 19 2006]
Enforcers raided an architect firm in
Kota Kinabalu and seized 26 illegal
copies of software and 7 computers
worth RM21,000/-.
107
Recent Raids conducted in KL
city

“Bukit Bintang no longer hub for pirated
software” [The Star, Saturday February
17 2007]
Raids (Ops Helang) were conducted
from 5 December 2006 to 6 February
2007 on 82 premises at 4 shopping
complexes in 2 months.
108
Recent Raids conducted in KL
city
The complexes involved are Sg. Wang,
Low Yatt Plaza, Imbi Plaza and Berjaya
Times Square.
28 arrests were made and RM2.3
million worth of CDs and 9 vehicles
were seized.
109
United States Trade Representative
(USTR) 2005 “Special 301” Annual
Review of IPR Protection - Malaysia


Malaysia is not doing enough to curtail
the high piracy rates for optical media
and is a substantial exporter of
counterfeit and pirated products.
No protection for pharmaceutical and
agricultural chemical test data from
unfair commercial use.
110
USTR 2005 “Special 301” Annual
Review of IPR Protection - Malaysia


USA copyright industry estimated its
losses in Malaysia at approximately
USD188 million in 2004.
Drug counterfeiting is a growing
problem in Malaysia.
111
IP Court to solve IP matters




The Government will establish an
Intellectual Property (IP) Court by this
year(2007).
The move is to eradicate piracy and
counterfeiting activities.
Intellectual Property Corporation of
Malaysia (IPC) is organizing seminars
for prosecuting officers to enhance their
knowledge in IP laws.
Bernama.com 23 May 2006
112
IP Court to solve IP matters



Main IP laws dealing with criminal
provisions are Copyright Act that dealt
with piracy and the Trade Descriptions
Act 1972 that dealt with counterfeiting.
The Domestic Trade and Consumer
Affairs may amend the copyright laws to
prosecute landlords or premise owners
who allowed their tenants to sell
counterfeit products.
Bernama.com 23 May 2006
113
Factories warned if producing
unauthorized optical disc



The Government warned licensed optic
disc factories nationwide that they
would be closed down if caught
producing pirated video or music discs.
Between 2001 and 2006 18 Sept, 902
raids were conducted on these factories
and recorded 39 cases of various
offences.
Article - Sept 25 2006 Sun2Surf(theSun)
114
Factories warned if producing
unauthorized optical disc




40 optical disc production machines
worth RM72.6 million were seized.
In the first 6 months of 2006, Ministry
officers conducted 179,195 raids
nationwide.
39,346 cases were recorded involving
the arrest of 1,948 vendors for selling
pirated discs worth RM475 million.
Article - Sept 25 2006 Sun2Surf(theSun)
115
Factories warned if producing
unauthorized optical disc


According to statistics gathered by 6
local authorities in Klang Valley, 166
raids were made on vcd/cd sales centre
in their respective areas, where 214,091
discs worth RM1.1 million were seized.
Article - Sept 25 2006 Sun2Surf(theSun)
116
Piracy v Counterfeiting


Piracy describes the act of reproducing
movies, music, books and other
copyrighted works without permission
from the copyright owner or illegitimate
copying.
Counterfeit describes fake goods or
goods packed so as to resemble the
original.
117
Types of Piracy

1) Piracy in the home.
2) Copying of sound recordings from an
audiotape onto a compact disc.
3) The use of copying machines to
make copies of literary works.
4) Home copying of sound recordings
5) Home copying of broadcasts.

Flint, A Userguide to Copyright




118
Types of Piracy



6) Home copying of computer
programmes and video games.
7) Commercial piracy and
counterfeiting-industrial designs and
artistic works ie. Tennis rackets, golf
club, shirts printed with patterns which
copy registered designs, etc.
Flint, A Userguide to Copyright
119
Types of Piracy



8) Piracy of broadcasts and cable
programmes ie. Receiving a programme
in a broadcasts or cable programme
with intent to avoid payment.
9) Commercial piracy and
counterfeiting-cinematograph films ie.
Copying an original feature film from its
35mm version onto video tapes.
Flint, A Userguide to Copyright
120
Types of Piracy



End user or corporate copying
Counterfeiting
Hard disk loading-OS installed without
supplying original CDs, end user license
agreement, certificate of authenticity,
etc
121
Types of Piracy


Mischannelling-distribution of software
under special discount licenses and
then redistributed to others who do not
qualify for these licenses
Internet Piracy
122
The position in Malaysia



Criminal Sanctions for IP are available
under:
Copyright Act 1987
Trade Description Act 1972
Optical Disc Act 2000
123
S 41 of the Copyright Act 1987




Any person who during subsistence of
copyright in a work or performers’ right:a) makes for sale or hire any infringing copy;
b) sells, lets for hire or by way of trade,
exposes or offers for sale or hire any
infringing copy;
c) distributes infringing copies;
d) possesses, otherwise that for his private
and domestic use, any infringing copy;
124
S 41 of the Copyright Act 1987





e) by way of trade, exhibits in public any
infringing copy;
f) imports in Malaysia, otherwise that for his
private and domestic use, any infringing copy;
g) makes or has in possession any contrivance
used or intended to be used for the purposes of
making infringing copy;
h) circumvents or causes the circumvention of
any effective technological measures;
i) removes or alters any electronic rights
management information without authority;
125
S 41 of the Copyright Act 1987


j) distributes, imports for distribution without
authority, works or copies of works in respect
of which electronics rights management
information has been removed or altered
without authority,
shall, Unless he is able to prove that he
acted in good faith and had no reasonable
grounds for supposing that copyright or
performers’ right would or might thereby
be infringed, be guilty of an offence.
126
Trade Description Act 1972(TDA)



The TDA prohibits the making of false trade
descriptions.
The TDA makes it an offence for any person
to, in the course of trade:
(1) apply a false trade description to any
goods or
(2) supply or offer to supply any good to
which a false trade description is applied
Hence, in some way it includes counterfeit
products.
127
Optical Disc Act 2000 (OPA)


The OPA establishes a licensing and
regulatory framework for all processes or
activities that are involved in manufacture of
optical disc.
This Act aims to reduce piracy of IP by
requiring all makers of optical disc to obtain
licenses from both the Ministry of
International Trade and industry and the
Ministry of Domestic Trade and Consumer
Affairs
128
Optical Disc Act 2000 (OPA)



Under this Act, any person who manufactures
optical disc without a valid license or
manufactures optical disc in a place other
than the licensed premises commits an
offence.
The Act also requires the licensee to cause
the optical disc to be marked with the
manufacture code.
Failure to do so will amount to an offence.
129
Offences under Optical Discs
Act 2000 - Statistics


s4 ODA 2000(producing OD without
license):
2004 - 6 cases and RM13.5 million in
seizure value
2005 - 7 cases and RM27.5 million in
seizure value
Annual Report of Ministry of Domestic Trade and Consumer Affairs
130
Offences under Optical Discs
Act 2000 - Statistics
s19 ODA 2000(producing OD without
displaying the Plant Code):
2004 - 4 cases and RM1.9 million in
seizure value
2005 - 5 cases and RM300,000/- in
seizure value
 Total of 22 cases and RM43.2 million in
seizure [2004-2005]


Annual Report of Ministry of Domestic Trade and Consumer Affaris
131
Conclusion



Malaysia provides a well established
framework in the protection of IP rights.
Owners of IP rights should also remain
proactive in enforcing their IP rights against
infringement,
In view of the growing importance in
Malaysia, investment in the protection of IP
rights has become increasingly vital to protect
the competitive advantage accorded by IP
rights.
132
END
Assisted by:
Kenneshwaran Kandiah
LLB(Hons)
Sum Wai Hoe LLB(Hons) CLP
133