Burberry and Louis Vuitton lose counterfeiting case in Singapore
Burberry and Louis Vuitton have lost their appeal in the Supreme Court of Singapore in a trademark dispute against a local shipping company.
The Court of Appeal, the upper division of the Supreme Court, issued the decision on Monday, January 7.
The fashion brands accused Megastar Shipping of trademark infringement, alleging it had handled counterfeit goods in Singapore that were intended for Indonesia.
Customs authorities in Singapore seized the goods, which were shipped from China, in March 2013. According to the ruling, the goods were intended for export to Batam, Indonesia.
Singapore Customs found over 15,000 counterfeit items inside two sealed containers. Megastar Shipping, the defendant in the case, was listed on seaway bills and arrival notices as the consignee of the goods.
Proceedings against Megastar began in April 2013. The plaintiffs cited the Trade Marks Act (TMA), which states that a person infringes a trademark if he or she imports or exports goods which use the mark without the consent of the proprietor.
The High Court, the lower division of the Supreme Court and which originally heard the case, found in 2017 that Megastar was not the importer of the counterfeit goods, and was only intended to handle the goods in transit to their intended destination in Indonesia.
According to the ruling, it was not in dispute that Megastar was unaware it was handling counterfeit goods, or that any of the goods in the containers bore the plaintiffs’ trademarks.
The High Court also ruled that an intention to export the goods, which were seized upon arrival in Singapore, was not sufficient cause to prove trademark infringement under the TMA.
Burberry and Louis Vuitton appealed against the decision. According to the Court of Appeal, the case centred around the questions of to what extent the TMA regulates infringing goods in transit which are not intended for the Singaporean market, and who is liable for the infringement.
The appeals court ruled that the protection of IP rights had to be balanced against extending liability for infringement to “honest commercial persons who happened to be tangentially involved” in the shipping of counterfeit goods.
To establish liability, the court found, the plaintiffs had to prove that the defendant had knowingly intended to import or export goods bearing the marks. According to the ruling, as Megastar had no reason to suspect that the cargo contained luxury goods bearing the marks of the brands in question, there was no evidence that they had infringed the companies’ IP.
The court dismissed the appeal with costs.
WIPR contacted Burberry and Louis Vuitton for comment, and Burberry declined to comment on the ruling.
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