PUTRAJAYA (Nov 1): In a battle of biscuits, the Federal Court here ruled that the Huasin Food Industries Sdn Bhd-made Lex-branded biscuits have infringed the trademark held by Munchy Food Industries Sdn Bhd for its Lexus-branded biscuits after Malaysia’s highest court was satisfied with the fact that Munchy Food has exclusivity over the registered Lexus trademark, which Munchy Food has held since Jan 23, 1998.

The three-member apex court bench, which delivered the verdict in October 2021, was satisfied there is merit in Munchy Food's appeal in setting aside the Court of Appeal's decision and reinstating the High Court's earlier decision that Munchy Food has exclusivity over the registered Lexus trademark.

Justice Datuk Seri Hasnah Mohammed Hashim said: “I am satisfied that the plaintiff (Munchy Food) has exclusivity over the registered trademark and (that the trademark) will not create a monopoly by the company (Munchy Food) of the biscuits.”

The bench, led by Justice Datuk Seri Mohd Zawawi Salleh, included Justice Datuk Harmindar Singh Dhaliwal.

All three judges were unanimous in their decision on Oct 5, 2021 that Munchy Food has exclusivity over the registered Lexus-branded biscuits trademark.

A copy of the Federal Court’s written judgement has been published online.

Justice Hasnah said: “Munchy Food need not seek as an option before commencing an action for trademark infringement and/or passing-off to vary its registered trademark as remedy under any circumstances especially if the trademark of [the] defendant [Huasin Food] is not registered.”

Munchy Food was represented by Shearn Delamore & Co lawyers Indran Shanmuganathan, Sim Sook Eng and Elisia Engku Kangon.

Meanwhile, Huasin Food was represented by Skrine lawyers Khoo Guan Huat, Kuek Pei Yee, Melissa Long Lai Peng and Gooi Yang Shuh.

Indran, when contacted by theedgemarkets.com, confirmed the outcome of the Federal Court hearing and that Huasin Food is required to pay RM50,000 in costs to Munchy Food.

According to Indran, Huasin Food, which has been instructed to refrain from using the name Lex in the company’s biscuit packaging, has also been ordered to not use any trademark or packaging that is similar to Munchy Food's Lexus-branded biscuit packaging.

“The apex court also ruled that the damages are to be assessed by the High Court,” Indran said.

He said Huasin Food "has to change the brand (Lex)".

The Munchy Food-Huasin Food dispute dates back to 2015.

Munchy Food initially filed the lawsuit against Huasin Food after Munchy Food received a complaint in August 2015 from a customer who wrongly associated Huasin Food's Lex-branded biscuits with the ones produced by Munchy Food under the Lexus biscuit brand.

Huasin Food in September 2015 tried to register the Lex biscuit brand in Malaysia, a move which Munchy Food opposed.

Munchy Food subsequently filed the suit in the High Court against Huasin Food, alleging that Huasin Food had infringed Munchy Food’s trademark.

In response, Huasin Food filed a counterclaim to the suit against Munchy Food.

The High Court ruled that Huasin Food’s Lex-branded biscuits had infringed Munchy Food’s Lexus-branded biscuit trademark.

According to the High Court, Huasin Food’s Lex-branded biscuits could be passed off as Munchy Food’s Lexus-branded biscuits.

The High Court also dismissed Huasin Food’s counterclaim against Munchy Food.

In the Court of Appeal, Huasin Food, which had appealed against the High Court's decision, however, dropped its appeal over its unsuccessful counterclaim against Munchy Food.

Huasin Food also accepted the Court of Appeal’s proposition that both Munchy Food and Huasin Food's trademarks can co-exist.

The Court of Appeal, which ruled in Huasin Food's favour, said the High Court failed to consider the issue of the totality of evidence and ought to have allowed the trademarks in dispute to co-exist. 

The Court of Appeal also gave an opportunity for Huasin Food and Munchy Food to settle their dispute based on the trademark co-existence provision.