On September 8 2009, McDonald’s lost an eight-year legal battle against the use of ‘McCurry’ by a local Indian restaurant after the Malaysian Federal Court unanimously denied further leave to appeal after McDonald’s loss before the Court of Appeal.
The court action was first filed by McDonald’s in 2001 in the High Court against McCurry Restaurant for passing off of its well known prefix ‘Mc’ in connection with food products and services.
McDonald’s asserted that it had created the prefix ‘Mc’ as a source/trade identifier for its goods and services and having first use of the same in Malaysia in 1982. On these grounds, McDonald’s claimed that the use of the same prefix by McCurry Restaurant, and the combination of red and white on its signage, would misrepresent, deceive and confuse the public into the false belief that McCurry Restaurant was somehow associated with McDonald’s.
In its defence, McCurry Restaurant denied McDonald’s monopoly over the prefix ‘Mc’ which it argued was a common surname. Moreover, McCurry Restaurant offered a completely different range of food and drinks distinct from fast food i.e. Malaysian or Indian cuisine. McCurry Restaurant also claimed that the ‘McCurry’ trade mark was created based on the abbreviation of ‘Malaysian Chicken Curry’ and that it was never the intention of McCurry Restaurant to misrepresent or ride on McDonald’s goodwill and reputation.
The High Court, in 2006, took a robust position and accepted the concept of an extended form of passing off. The court held that where there is erosion to the distinctiveness of a brand name, which occurs by reason of its degeneration into common use as a generic term, there is presence of passing off without the necessity to prove confusion. This concept of passing off without the need to establish confusion is akin to trade mark dilution principles, which until the decision of the High Court was not a concept accepted within the realm of either trade mark or passing off law in Malaysia.
The Court of Appeal however disagreed with High Court’s decision in April 2009. Gopal Sri Ram JCA held that “the so-called extended tort [of passing off] is nothing more than the common law adapting the tort of passing off to new and different circumstances” and that it is still an essential element of the tort to establish misrepresentation. In reversing the High Court’s decision, the Court of Appeal held that based on the totality of the evidence, reasonable persons would not associate the business of McCurry Restaurant with McDonald’s and hence no passing off was established.
The Court of Appeal’s decision ended an attempt by the High Court to extend the concept of dilution to an action in passing off. It will remain to be seen if the above case would spur a consideration for the inclusion of an anti-dilution right to extend the scope of protection for well known trade marks in Malaysia when the Trade Marks Act is amended.
Chew Kherk Ying
Partner
Tel: +603 2298 1933
E: kherk.ying.chew@wongpartners.com
Sonia Ong
Associate
Tel +603 2298 7931
E: sonia.ong@wongpartners.com