Deacons wins Hong Kong Intellectual Property Case of the Year

13 January 2014, Intellectual Property, Legal Alert by Charmaine Koo

We are pleased to report that Deacons has successfully represented the Tsit Wing Group, Hong Kong's leading tea and coffee supplier, in Tsit Wing (Hong Kong) Co Ltd & Ors. v TWG Tea Co PTE Ltd and Anor. [2013] HKCFI 1179; HCA 2210/2011. The case has been awarded, by "Managing IP Magazine" as Hong Kong's "Case of the Year 2013". Partner in charge of the case, Charmaine Koo, has also been awarded "Best in IP Litigation" in Asia at the Euromoney Legal Media Group Asia Women in Business Law Awards 2013.

Brief Case Summary:

  • Deacons secured an emphatic win for the Tsit Wing Group in a trade mark infringement and passing-off action against TWG Tea Company Pte Ltd (a Singaporean tea supplier and operator of tea salons) and its Hong Kong subsidiary.
  • The Tsit Wing Group is a long-established family business (founded in Hong Kong in 1932) and the proprietor of numerous trade mark registrations containing the acronym "TWG" ("Tsit Wing Group") in Hong Kong and overseas. The Tsit Wing Group is a major supplier of tea and coffee products to hotels, restaurants, fast food chains, cafes and retail outlets under the "TWG" trade marks.
  • The defendants started the business of operating tea salons and wholesale and retail of teas in Singapore since 2008. They opened a tea salon and retail shop in the IFC Mall in Hong Kong using a sign incorporating the acronym "TWG".
  • Complex issues arising in the case include whether "international reputation" is a defence; whether a distinction can be made between use of a mark in the allegedly luxury end of a market versus use in a more modest setting; the availability of the "own name" defence; and the impact of knowledge of third parties' marks in and impact of adopting different litigation strategies in different countries.
  • In a 64 page judgment, Deputy High Court Judge Saunders considered in detail the law on the assessment of similarity, the likelihood of confusion and passing off, finding the defendants liable for trade mark infringement and passing off.
  • The high profile Hong Kong decision is part of an on-going international dispute and the complexity was such that the case was set down for a 14 day trial, with Queen's Counsel from the United Kingdom representing both the plaintiffs and defendants. The case involved 6 substantive interlocutory hearings including applications for an interim injunction, appeal against the same, speedy trial and specific discovery.

Business Impact

  • The case demonstrates the importance of conducting brand clearance and thorough due diligence before a trade mark is adopted. Businesses that intend to expand overseas must ensure that they conduct appropriate clearance searches against a proposed mark, in all jurisdictions of potential interest, to assess the potential infringement of third party rights. The judge remarked that "it would have been a simple matter, at the time the company name was chosen…well knowing the importance of any sign chosen, to have undertaken an international trade mark search to ascertain whether or not the acronym TWG might already be in use by someone in respect of tea."
  • The decision also highlights the need to have a global intellectual property strategy. Disputes and litigation in one jurisdiction may have an impact on conflicts in other jurisdictions and matters must be reviewed from an international perspective. Cases need to be managed holistically and counterparts in all jurisdictions should work together to ensure that a client's global interests are protected.
  • The court found that in the Hong Kong litigation, the defendants had adopted a position that was in direct contradistinction to the position adopted in the process of trade mark registration and opposition in some other jurisdictions, which led to the defendants' evidence being discredited.
  • Parties to this type of litigation should also consider carefully what type of evidence to adduce and how best to manage any evidence gathering exercise. In particular, the case is a cautionary reminder that any survey evidence must comply with the strict guidelines set out in the case law, to avoid criticism by the Court. The judge placed no weight on survey evidence adduced by the defendants, commenting that the surveys "fell a long way short of the necessary standard to give them any value in evidence".

The case was handled by Deacons Partner Charmaine Koo with the assistance of Associate Janice Law and Trainee Samantha Yung.
A link to the full judgment can be found here:

http://legalref.judiciary.gov.hk/lrs/common/search/ search_result_detail_frame.jsp?DIS=88231&QS =%28tsit%7Cwing%29&TP=JU