Courtroom Chronicles: The Battle of IP Rights - Chapter 13

Case: Bestinet Technology Sdn Bhd v. MYFWM System Sdn Bhd & Ors [2022] 3 CLJ 373

Key Details of the IP Case:

Bestinet Technology Sdn Bhd filed a lawsuit against MYFWM System Sdn Bhd and others for trademark infringement, passing off, unlawful interference with trade, and conspiracy to injure. The case centred around the defendants’ use of the “MyFWMs” mark, which the plaintiff claimed was confusingly similar to its registered trademark “FWCMS” a system Bestinet had developed for managing foreign workers in Malaysia.

Trademark in Dispute:

"MyFWMs"

Legal Arguments and Rulings:

1. Trademark Infringement:

While the IP Court found that the defendants' "MyFWMs" mark closely resembled Bestinet’s "FWCMS" trademark in concept and appearance, the court did not find trademark infringement. The court ruled that the plaintiff had not proven the "likelihood of confusion on the part of the public," a requirement under Section 54 of the Trademarks Act 2019.

2. Passing Off:

The IP Court allowed the plaintiff’s claim for passing off. Bestinet successfully demonstrated that it had acquired substantial goodwill associated with the "FWCMS" mark, and that the defendants’ use of the "MyFWMs" mark misrepresented the source of the services, causing damage to Bestinet’s goodwill.

3. Unlawful Interference with Trade:

Since the IP Court upheld the claim for passing off, it also ruled in favour of Bestinet for unlawful interference with trade, as the defendants’ actions disrupted Bestinet’s business.

4. Conspiracy to Injure:

The IP Court found that the defendants had conspired to injure Bestinet by using a similar mark, which resulted in the tort of passing off and interference with trade. The court concluded that the defendants had acted together to harm Bestinet’s business.

Practical Implications:

This case emphasises the importance of protecting your intellectual property and business goodwill, especially in competitive industries. While the court did not find trademark infringement, it did uphold the claims of passing off and conspiracy to injure. Companies should ensure that their trademarks are distinctive and take immediate action against competitors who attempt to benefit from confusingly similar marks. Strong branding and effective legal safeguards are crucial for maintaining a competitive edge and protecting a company’s reputation.

The case also highlights the legal concept of "passing off" where a business can protect its reputation and goodwill even if a trademark is not directly infringed. Businesses should be vigilant and assert their rights to prevent others from misrepresenting their products or services.

My Comments:

This ruling serves as a critical reminder that safeguarding intellectual property goes beyond trademark registration. Businesses must actively protect their goodwill and take swift action when competitors misuse their brand in a way that could mislead consumers. The court’s decision reinforces the need for robust legal strategies to prevent competitors from exploiting similarities in branding, even when there is no direct trademark infringement.

If you have any questions regarding the article, please feel free to contact our managing partner, Eugene Yeong.