Most people have used search aggregators and online travel agents like Skyscanner to look for the cheapest flight among several flight operators, or Agoda to book the room with the most value for money among hundreds of hotels. Simply key-in your search parameters and the names (and oftentimes logos) of dozens of service providers and operators would invariably be displayed in a neatly organised list, allowing you to compare and consider all possible offerings at a glance. Gone are the days of having to laboriously go to each individual service provider’s platform or website, and navigate between different web browser tabs to make an informed decision as to which is the best deal.
While these search aggregator services have made the consumer experience a much more pleasant one, how many have stopped to consider whether this is permitted? Specifically, whether they are allowed to just take the names and logos of their competitors and showcase them
en masse, without getting prior express consent from those service providers?
Well, in the recent case of
Malaysia Airlines Sdn Bhd & Anor v AirAsia Com Travel Sdn Bhd (KLHC Suit No. WA-22IP-14-03/2022), the High Court was faced with this very question. The High Court considered the rather novel issue of whether, under the Trademarks Act 2019, the prerequisite for trademark infringement of “use” of an alleged offending mark must mean “use as a trademark”, and answered this in the negative.
Fight of the Conchords
The parties in the suit are no strangers to most Malaysian air-faring public. The 1
st and 2
nd Plaintiffs operate airline transportation services under their respective brands and registered trademarks “Malaysia Airlines” and “Firefly”. The Defendant, meanwhile, is not the operator of the “AirAsia” airline transportation service but is one of the entities within the AirAsia Group (now known as Capital A Berhad) which operates an e-commerce platform known as the ‘AirAsia SuperApp’.
The AirAsia SuperApp is, as given away by the name, a super app (akin to Grab or WeChat) which combines multiple services or ‘mini apps’ all under one platform. A super app’s services can range from e-commerce to transportation services to even banking facilities. In this case, the AirAsia SuperApp has four main categories of services, one of them being ‘Travel’ which offers for sale, among other travel and lifestyle services and products, flight tickets.
Therein lies the rub – for the AirAsia SuperApp offers not only AirAsia flight tickets but also flight tickets of
other flight operators, including the Plaintiffs. Hence, whenever a user searches for flight tickets based on some pre-set parameters on the app (such as place of departure, destination, dates, etc.), the AirAsia SuperApp will display the flight inventories for all airlines that offer flights corresponding with those search parameters. The flight inventory data would be gathered either directly from the airlines themselves or indirectly through aggregate channels. Crucially, however, is the fact that the names and logos of these flight operators, including the Plaintiffs’ registered trademarks, would be displayed on the AirAsia SuperApp along with the flight inventories. At the same time, AirAsia’s own trademarks would appear on each page of the AirAsia SuperApp that is viewed.
An interesting detail in this case is the fact that at one point after the launch of the AirAsia SuperApp, the Defendant had actually emailed the Plaintiffs seeking authority to ‘promote, market and distribute’ the Plaintiffs’ airline tickets on the app. Despite not receiving any response, the Defendant nevertheless proceeded to offer the Plaintiffs’ airline tickets on its app.
The Plaintiffs thus sued the Defendant for trademark infringement and ancillary causes of action.
1
For context, among other elements which must be proven for a claim in trademark infringement under section 54 of the Trademarks Act 2019 is “use”. In other words, a plaintiff must demonstrate that the defendant has used a sign which is identical to or similar with the plaintiff’s registered trademarks. In this case, the Defendant did not dispute that the trademarks displayed on the AirAsia SuperApp are identical or similar to the Plaintiffs’ ‘Malaysia Airlines’ and ‘Firefly’ marks.
The Defendant’s principal defence was essentially that the display of the Plaintiffs’ trademarks on the AirAsia SuperApp does not constitute trademark infringement as the Defendant’s use of the Plaintiffs’ trademarks was not “use in a trademark sense”. The reasons for this were that the display of the offending marks on the AirAsia SuperApp did not affect the essential function of the Plaintiffs’ registered trademarks, which is to denote origin or distinguish the Defendant’s own services – given that the display is alongside the Plaintiffs’ flight inventories and denotes the travel services offered by the Plaintiffs, not the Defendant. Further, the Defendant’s services are offered under and by reference to the AirAsia marks which are displayed on each page of the app. Thus, the display of the offending signs was not use of them as a trademark.
Malaysian Hospitality Begins In The Courtroom
Ultimately, the High Court rejected the Defendant’s arguments and held that there is no requirement for “use” to be “use in a trademark sense” or “use as a trademark” in order to amount to infringement of a registered trademark, for several reasons.
Firstly, the High Court held that it would be contrary to trite principles of statutory interpretation to construe “use” in section 54 of the Trademarks Act 2019 to mean “use as a trademark”. In comparison with the previous trademark infringement provision, the phrase “use as a trade mark” which was expressly contained in section 38 of the repealed Trade Marks Act 1976 has now been omitted from section 54 of the Trademarks Act 2019. Thus, the High Court held that it must give effect to the words intentionally used by Parliament which “clearly decided” to omit from the succeeding Act.
The High Court further traced what it called the “evolution” of Malaysian trademark law and found that Parliament had “purposely omitted” the words “use as a trademark” in section 38 of the repealed Trade Marks Act 1976 and replaced them with just “use” and further added subsection (3) to section 54 which provides a list of instances as to what acts constitute infringement.
Section 54(3) of the Trademarks Act 2019 lists the following as instances where a person “uses a sign”, i.e. if the person:
The High Court held that its duty is limited to interpreting the words actually used by the Legislature and to give effect to the plain and ordinary meaning of those words, not to read words into the statute unless there are clear reasons for doing so. The High Court thus found that there is no basis to construe the word “use” in section 54 of the Trademarks Act 2019 as “use as a trademark”.
Further, the High Court considered the issue of whether the Defendant’s use of the offending signs would result in a likelihood of confusion on the part of the public, one of the crucial elements for establishing trademark infringement. It was found that, while it is true that the AirAsia Marks would always be present and displayed throughout the AirAsia SuperApp, as the Plaintiffs’ flight inventories are offered and sold on the app which constantly bears the AirAsia marks, users “
would in no doubt” be under the impression that there is some form of collaboration, association and/or agreement between the Plaintiffs and the Defendant that the Plaintiffs’ flight tickets are legitimately being offered on the AirAsia SuperApp.
Finally, the High Court considered and dismissed the other defences raised by the Defendant, including those under sections 55(1)(b)(i)
2, 55(1)(c)
3 and 55(3)(c)
4 of the Trademarks Act 2019. The High Court also rejected an ancillary defence raised by the Defendant that obtaining the Plaintiffs’ flight inventories from either the Plaintiffs’ authorised agents or third-party aggregators was common practice among online travel agents in the travel industry. It was held that “
Others do it too so why can’t I?” is not a valid defence in law to a claim for trademark infringement.
Now Every Use of A Trademark Can Be Infringing
The case is the first published judgment in Malaysia which has decided on the issue of whether “use” of an alleged infringing mark must mean “use as a trademark” in order to amount to trademark infringement.
The effect of this decision could be potentially far-reaching as it, in essence, means that a trademark will be infringed so long as there is use of it in the course of trade, even if the usage clearly denoted the registered proprietor as the origin of the goods and services rather than the alleged infringer. After all, there was (seemingly) no doubt that the flight tickets bearing the Malaysia Airlines or Firefly trademarks being offered on the AirAsia SuperApp were, at the end of the day, the flight tickets of Malaysia Airlines and/or Firefly, not those of AirAsia.
Whether this decision affects one of the essential functions of a trademark, which is to act as a badge or indicator of source or origin of a particular good or service, remains to be seen. Any unintended consequence ought to be mitigated by the fact that the plaintiff must still prove that the offending sign is being used in respect of the same or similar goods or services and there must exist a likelihood of confusion. That said, the part of the High Court’s judgment in this case which found that users would be under the impression of a “collaboration, association and/or agreement” between the Plaintiffs and the Defendant, may be seen as expanding the scope of trademark infringement. Reason being that the conventional understanding in trademark law is that mere association is insufficient for confusion.
Separately and notably, the High Court in this case had considered various authorities from UK/EU and Singapore which have held that there can only be infringement of a trademark where the use by the alleged infringer offends the essential function of a trademark which is to guarantee the identity of origin, and that a sign must be used as a trademark in order for there to be infringement under the trademark laws of those jurisdictions. However, the High Court pointed out that it is not bound by those foreign cases and declined to follow them, in interpreting our local trademark law.
This leads to an interesting development in our local trademark law which seemingly branches off from other common law jurisdictions like the UK and Singapore. The wordings in both section 27(2) of Singapore’s Trade Marks Act 1998
5 as well as section 10(2) of the UK’s Trade Marks Act 1994
6 are substantively similar to section 54(2) of our Trademarks Act 2019
7, the latter of which has been found in another High Court decision to be in
pari materia with our section 54 (
Bestinet Technology Sdn Bhd v MYFWM System Sdn Bhd & Ors [2022] 9 MLJ 694). Despite the fact that there is no express use of the word “use as a trademark” in both foreign statutes, the Courts in those jurisdictions nevertheless saw it fit to impute this requirement into their trademark law’s legislative framework.
Another interesting aspect of this case is the Learned Judicial Commissioner’s finding that if an alleged infringer’s act does not fall within any of the situations set out in limbs (a) to (h) of section 54(3) of the Trademarks Act 2019, “
there would be no infringement”. The High Court has, in effect, construed section 54(3) to be an exhaustive list. However, on the facts of this case, the High Court found that infringement under limb (e), i.e. offering or supplying services under the sign; limb (g), i.e. using the sign on a commercial document in any medium; and limb (h), i.e. using the sign in advertising, had occurred when the Plaintiffs’ trademarks were used on the AirAsia SuperApp. Although the High Court did not make a
ratio of general applicability, the fact that the High Court found the AirAsia SuperApp’s use of the Plaintiff’s trademarks falls within limbs (a) to (h) of section 54(3) leaves open the question as to whether the widespread practice of displaying third party trademarks in online sales on digital platforms or on social media would constitute an infringement of trademark under the Act.
Case commentary by Gooi Yang Shuh (Senior Associate) of the Intellectual Property Practice of Skrine.