Singapore: Initiatives to Fast-track IP Disputes Coincide with Increased Focus on Distinctiveness

In summary

This article provides an update on two recent trademark decisions in Singapore that discuss the relevance of acquired distinctiveness in the evaluation of mark similarity and the state of the trademarks register in assessing the inherent technical distinctiveness of a mark. It also introduces the main features of a new fast-track option for IP disputes in Singapore.

Discussion points

• Acquired distinctiveness of a mark is irrelevant to the issue of mark similarity and only relevant to the assessment of likelihood of confusion
• State of trademarks register is relevant in inherent distinctiveness assessment
• New fast-track option for IP litigation

Referenced in this article

• V V Technology Pte Ltd v Twitter, Inc [2022] SGHC 293
• Staywell Hospitality Group Pty Ltd v Starwood Hotels & Resorts Worldwide, Inc [2013] SGCA 65
• Fair Isaac Corporation v LAC Co, Ltd [2022] SGIPOS 19
• British Sugar plc v James Robertsons & Sons Ltd [1996] RPC 281
• Part 2 of the Supreme Court of Judicature (Intellectual Property) Rules 2022
• Tiger Pictures Entertainment Ltd v Encore Films Pte Ltd [2023] SGHC 138

Relevance of acquired distinctiveness

Under section 8(2) of the Trade Marks Act 1998, as amended (TMA), a trademark must not be registered if there exists a likelihood of confusion on the part of the public because it is:

• identical or similar to an earlier trademark; and
• to be registered for goods or services identical with or similar to those for which the earlier trademark is protected,

In the seminal case of Staywell Hospitality Group Pty Ltd v Starwood Hotels & Resorts Worldwide, Inc (Staywell),^[1] the Singapore Court of Appeal – the apex court in Singapore – affirmed that a step-by-step approach should be applied in the assessment of whether a trademark falls foul of section 8(2) of the TMA. This is the approach that prevails in Singapore whether the assessment is for the purposes of trademark opposition, invalidation or infringement proceedings.

Under this step-by-step approach, the three requirements of similarity of marks, similarity of goods or services and likelihood of confusion arising from the similarities are to be assessed systematically, with the first two elements assessed individually before likelihood of confusion is assessed comprehensively. This approach is said to be preferred over the global appreciation approach applied throughout the European Union and in the United Kingdom, given its conceptual clarity and close alignment with the wording of section 8(2) of the TMA.^[2]

However, there are two seemingly contradictory propositions in Staywell that have vexed commentators. On one hand, Staywell concludes that a competing sign is more likely to be considered similar to a mark with greater technical distinctiveness,^[3] which takes into account both inherent and acquired distinctiveness, in a marks’ similarity analysis.^[4]

On the other hand, the case concludes that the assessment of marks’ similarity should be undertaken without consideration of any extrinsic matters and that extrinsic matters should only be considered at the stage of the inquiry where the court assesses the effect of the resemblance between the marks on consumers’ perceptions.^[5]

The second statement seemingly contradicts the first because the analysis of acquired distinctiveness necessarily involves the consideration of extrinsic matters (eg, how long-standing and widespread the use of the mark has been, the amounts invested by the proprietor in promoting the mark).

This question was considered by the Singapore High Court in V V Technology Pte Ltd v Twitter, Inc (Twitter).^[6] After considering the authorities, including Staywell, the High Court in Twitter held that acquired distinctiveness should not be considered at the marks’ similarity inquiry stage.^[7]

On a holistic reading of Staywell, the High Court concluded that the Court of Appeal must have intended that only inherent technical distinctiveness was to be taken into account in the marks’ similarity analysis. Accordingly, acquired technical distinctiveness should not be considered at this stage, but should instead be left for the likelihood of confusion inquiry.^[8] This approach accords with the rationale underpinning the step-by-step approach, which reflects the need to distinguish between the issues of the resemblance between the competing marks and the effect of such resemblance.^[9]

Additionally, from the perspective of encouraging economy and efficiency in litigation, this approach would serve to avoid parties adducing irrelevant evidence in proceedings, thereby reducing costs.^[10]

The practical implication of the High Court’s decision is that it will be more difficult for the proprietors of registered trademarks with a low level of inherent technical distinctiveness to enforce their rights in Singapore in blocking a competing sign from attaining registration and in trademark infringement proceedings. Trademark proprietors will not be able to rely on their marks’ acquired distinctiveness through use to argue that they are highly distinctive to lower the threshold for finding that competing signs are similar to their marks.

This can make or break a case given that under the step-by-step approach a finding by the courts or the trademarks registry that the competing marks are dissimilar would mean that the next steps need not be carried out at all. In other words, the matter could be decided without a likelihood of confusion analysis, where acquired distinctiveness becomes relevant.

It remains to be seen how this would affect the success rate of trademark opposition, invalidation and infringement proceedings in Singapore. Meanwhile, the safer bet as always, would be to go with marks which comprise invented and meaningless words, as opposed to marks which can be seen to be descriptive of or have some other relation with the goods or services in question.

Presence of third-party registrations for similar marks relevent in inherent distinctiveness assessment

In Fair Isaac Corporation v LAC Co, Ltd (Fair Issac),^[11] which concerned a trademark opposition proceeding against the mark ‘CLOUDFALCON’ relying on the prior mark ‘FALCON’ that was registered in the same class for similar goods and services, the Singapore Trade Marks Registry considered the issue of whether reliance can be placed on the state of the trademarks register when assessing the prior mark’s inherent technical distinctiveness.

The Singapore Trade Marks Registry held that the state of the trademarks register is relevant for the assessment of inherent distinctiveness. This decision is significant because it is the first in Singapore to have addressed this issue in detail.

The question arose because, in its submissions, the applicant relied on prior registrations of third-party marks consisting of the word ‘falcon’ and other well-known birds (eg, ‘eagle’ and ‘hawk’) to argue that the opponent should not have exclusive right over the word ‘falcon’. In response, the opponent argued that such reliance was irrelevant, citing a passage from the English decision in British Sugar plc v James Robertsons & Sons Ltd (British Sugar) for this proposition.^[12]

In British Sugar, in considering whether the state of the register was relevant to the question of the factual distinctiveness (ie, acquired distinctiveness) of the prior mark, Mr Justice Jacob had this to say:

Both sides invited me to have regard to the state of the register. Some traders have registered marks consisting of or incorporating the word “Treat”. I do not think this assists the factual inquiry one way or the other, save perhaps to confirm that this is the sort of word in which traders would like a monopoly. In particular the state of the register does not tell you what is actually happening out in the market and in any event one has no idea what the circumstances were which led the registrar to put the marks concerned on the register. It has long been held under the old Act that comparison with other marks on the register is in principle irrelevant when considering a particular mark tendered for registration, see eg MADAME Trade Mark ([1996] RPC 541) and the same must be true under the 1994 Act. I disregard the state of the register evidence.

However, British Sugar had been cited out of context, as the High Court of Justice in London had been concerned with the relevance of the state of the register to acquired distinctiveness, not inherent distinctiveness, which was the question in the Singaporean case. The assistant registrar found that, in fact, British Sugar contemplated that the state of the register could be considered when assessing the inherent technical distinctiveness of a mark.

Such an approach would also be consistent with the Singapore Registry of Trade Marks’s practice, where trademark examiners consider other registered marks to determine if a particular word or element is one that other traders may legitimately wish to use on their own goods and services. Additionally, this approach would avoid trademark applicants who are defendants in opposition proceedings from having to conduct costly marketplace investigations to demonstrate that a particular word is being used by other honest traders as a part of their own marks; in turn, this would align with the legislative belief that trademark oppositions should be low-cost proceedings.

New fast-track option for IP litigation

On 1 April 2022, the Supreme Court of Judicature (Intellectual Property) Rules 2022 came into force in Singapore. A key feature is a fast-track option for IP proceedings, the Simplified Process for Certain Intellectual Property Claims (the Simplified Process), which aims to make the IP dispute resolution system in Singapore more accessible – in particular for parties with fewer resources, such as individuals or small and medium-sized enterprises.

Under the Simplified Process, cases are subject to more rigorous court control, and there are stricter limitations on the length of proceedings and caps on the costs and damages recoverable, all of which mirror the features of the Intellectual Property Enterprise Court in the United Kingdom.

There are two main ways through which the Simplified Process may be invoked:

• The claimant may file and serve requisite court forms either to apply the Simplified Process by choice or to abandon any claim for monetary relief in excess of S$500,000.^[13] Notably, notwithstanding election by the claimant, the Simplified Process will not apply if the court considers the claim unsuitable for this route.^[14]
• The Simplified Process will apply where the court considers the claim suitable for the Simplified Process and orders it to apply.^[15] Such an order may be made by the court on its own motion or on the application of a party to the proceedings.^[16]

Apart from the fact that the dispute must involve an IP right, the following criteria must be fulfilled before a claim is considered suitable for the Simplified Process:^[17]

• the monetary relief claimed must not or must not be likely to exceed S$500,000 (unless parties agree to the application of the Simplified Process); and
• the case is otherwise suitable for the Simplified Process, having regard to the following matters:
  • whether a party can only afford to bring or defend the claim under the Simplified Process;
  • the complexity of the issues;
  • whether the estimated length of trial is likely to exceed two days; and
  • any other relevant matters.

Where the Simplified Process applies:

• as far as possible, the court will give directions on all matters necessary for the case to proceed expeditiously and to ensure that the trial is completed within two days at a single case conference;^[18]
• the court will take an active role in identifying the key issues in dispute between the parties and determining which issues are not relevant to the trial; and
• the total costs to be ordered against a party are capped – in particular, the total costs ordered are capped at S$50,000 for trial of the claim and S$25,000 for any bifurcated assessment as to the amount of monetary relief.^[19]

In 2023, the first case involving the application of the Simplified Process came before the Singapore High Court. In Tiger Pictures Entertainment Ltd v Encore Films Pte Ltd (Tiger),^[20] the claimant chose the Simplified Process, electing to abandon its claim for monetary relief in excess of S$500,000. The defendant challenged this election by filing an application for an order that the Simplified Process did not apply to the claim.

The Singapore High Court concluded that the Simplified Process applied to the claim for the following reasons:

• It was uncontroversial that the claim involved an IP right (ie, copyright).
• The Court was satisfied that the monetary relief claimed by each party would not or was not likely to exceed S$500,000 and the claimant had abandoned its claim for monetary relief above S$500,000. The Court was also satisfied that the defendant’s claimed monetary relief would not exceed S$500,000, since it had failed to particularise its purported losses.^[21]
• The issues in the case were neither legally nor factually complex, as the claim had turned on a single question of whether there was a legally binding agreement between the parties that permitted the defendant to distribute a film in Singapore. The facts and evidence that affected the determination of this question was also limited in quantity.^[22]
• The Court found that the estimated length of the trial was not expected to exceed two days. Although the defendant had indicated its intention to call witnesses who would need interpretation services, the Court took the view that any cross-examination of these witnesses would not be lengthy given that they would be testifying on either irrelevant or narrow points. The Court was also not minded to grant the defendant’s request for an expert witness as it would not contribute to the central issue in the claim.^[23]
• The Court considered that the quantum of the claimant’s claim rendered it a suitable case for the simplified process, noting that the lower the quantum of the claims involved, the higher the likelihood that a case would be considered suitable for the Simplified Process.^[24]

This case gives an indication of the factors that the Singaporean courts will consider when deciding if a case is suitable for the Simplified Process.

The Simplified Process provides a cost-efficient and expeditious method of enforcing IP rights to prospective claimants with straightforward claims. At the same time, however, prospective claimants who wish to litigate under the regular track face greater pressure to particularise their losses at an early stage, or justify the applicability of the regular track by reference to the complexity of the issues or the likely length of trial, to avoid the court ordering of its own volition,that the proceedings be transferred to the Simplified Process (which entails caps on damages and costs recovery).

Footnotes