Hugo Boss Trade Mark Management Gmbh & Co. Kg and Others v. Isa Boutique Ltd and Another

HCA 251/2007

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 251 OF 2007

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Coram :  Before Master Levy in Chambers

Date of Hearing :   11 March 2008

Date of Handing Down : 17 March 2008

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R U L I N G

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Introduction

1.This is the ruling on paragraph (1) of the Plaintiff’s summons dated 18^th July 2007. Paragraph 1 is a request for further and better particulars of the Amended Defence.  Due to the time constraint, I had no time to rule on paragraph 1 after hearing arguments, and now reduce the ruling in writing.

2.This is a claim concerning an alleged infringement of registered trade marks of “Boss”, “Hugo Boss”, and “Boss Hugo Boss”.  The primary defence of the Defendants is a defence of parallel import based on section 20 (1) of the Trade Marks Ordinance (Cap. 559).

Principles

3.Before I rule on each of the requests, I should state in general the applicable principles.  Counsel have set out the applicable principles in their skeleton submissions.  I should further add that any particulars required at this stage should only be confined to the issue in the trial on liability, rather than for the purpose of determining damages.

Particulars Sought

4.The Requests are found in a separate document dated 6 July 2007.  There are altogether 11 in total.  Mr. Yan, Senior Counsel for the Defendants objected to all the requests.  I will now deal with them in turn.

Requests 1 and 2 (under Paragraph 7A (a))

(a)  Discussion

5.Paragraph 7A(a) was added to the original defence by amendment.  In it, the Defendants plead that their shops have been specializing in the “retail sale and marketing” of many well-known brands of fashion goods.  In the Request, the Defendant is asked to provide particulars of matters in support of the said specialization (Request 1) as well as of the ‘retail sale and marketing’ (Request 2).

6.Miss Tsang, counsel for the Plaintiffs accept that the brand names referred to in paragraph 7A(a) are not the subject matter of the trade mark infringement disputes. She however submits that the Plaintiffs should be entitled to the particulars as the Defendants have gratuitously volunteered such information.  Miss Tsang submits that as the Defendants have seen fit to include the said information on amendment, the justification for the particulars is even stronger.  She further said that such particulars would show the Defendants’ mode of operation.

7.Mr. Yan objects to Request 1 on the ground that it is asking for evidence, and to Request 2, that of lack of justification.

(b) Ruling

8.I agree with Mr. Yan’s objections.  I am not persuaded by the argument on the ground of gratuitous averment.  Miss Tsang is unable to demonstrate how the averment would be material to the issue in dispute.

9.Furthermore, I would also be disinclined to order particulars as the present forms of the requests are far from being clear and precise.

10.Requests 1 and 2 are disallowed.

Request 3 (under paragraph 7A (c))

(a)  Discussion

11.In this sub-paragraph, the Defendants plead that their stores have also been selling and marketing “Boss”, “Hugo Boss’ and “Boss Hugo Boss” (collectively referred to as “Boss”) fashion clothes and garments since at least 1999.  The particulars sought are in relation to the source of these goods.  Miss Tsang submits that the particulars are relevant to the defence under section 20(1) as they would throw light on whether the goods have been put on the market by or with the consent of the Plaintiffs.  She further relies on Norwich Phacmacal [1]discovery to enable the Plaintiffs to identify other tortfeasors.

12.Mr. Yan contends that paragraph 7A(c) is an admission, and the Plaintiffs are not entitled to particulars.  He further contends that it is totally improper for the Plaintiffs to seek a Norwich Phacmacal discovery through a request for further and better particulars instead of instituting a separate action.

(b) Ruling

13.This sub-paragraph is not a full admission, and the Plaintiffs should be entitled to particulars if they are relevant to the issue in dispute.  I agree that a request for particulars in relation to the source of merchandize is relevant to the pleaded defence.  However, the pleading in this sub-paragraph does not give rise to any averment touching upon the issue of consent.

14.I further disagree that this is a case where the Norwich Phacmacal type of discovery is applicable.  Whilst there may be cases where discovery of other tortfeasors may be ordered, this is not such a case when there is no allegation by the Plaintiffs of the involvement of other tortfeasors whose identities are required for any intended action.

15.For these reasons, Request 3 is refused.

Request 4 (under paragraph 7A(d))

(a)  Discussion

16.By this sub-paragraph, the Defendants aver that the goods their stores have been marketing and selling, be they of other brands or Boss goods, “had been put on the market by or with the consent of the owners of the trade marks”.  It is in respect of this specific averment that the Plaintiffs are seeking particulars.

17.Miss Tsang submits that the Request is relevant as it hinges upon the statutory defence under section 20(1) upon which the Defendants rely.

18.Mr. Yan’s contentions are of two parts.  For the averment relating to goods of other brands, he contends that it is an immaterial averment, and particulars should be declined.  As for the source of the Boss goods, Mr. Yan said that the Defendants have in their answer to the Plaintiffs’ earlier Request for Further and Better Particulars already sufficiently identified the source of being Hugo Boss Italia SPA in Italy.  In the circumstances, he contends that there is nothing more to be given.

(b) Ruling

19.Regarding particulars relating to the goods referred to in paragraph 7(a), which are goods relating to other brands, I agree that they are immaterial averments and no particulars should be given.

20.In relation to the requests in respect of goods referred in paragraph 7(c), they are the goods relating to the trade mark in the claim, and it is in my view relevant.  However, in light of the contention raised, I need to consider whether the Defendants’ earlier answer has sufficiently answered the request currently sought.

21.In paragraph 7(d), the Defendants have alluded to both routes available in the section 20 (1) defence, that is, the defence of goods having been put on the market by the trade mark owner and the defence of the goods having been put on the market with the consent of the trade mark owner.  The Defendants are of course entitled to rely on both routes to establish the defence.  However, they are required to state if this is indeed their case. 

22.Further, the previous disclosure of the source of supplier does not go anywhere near of informing the Plaintiffs what their case really is.  They have not stated whether Hugo Boss Italia SPA is the trade mark owner who has put the goods on the market, or whether Hugo Boss Italia is the trade mark owner whose consent has been given in respect of the goods having been put on the market.  The Plaintiffs should be entitled to the particulars in relation to these matters.

23.Hence, I would order the Defendants to provide particulars to Request 4 in relation to the goods referred to in paragraph 7(c) only.

Requests 5, 6 and 7 (under paragraph 9(c))

(a)  Discussion

24.In paragraph 9(c), the Defendants aver that the hangtags of some of the Boss goods they sold or offered for sale had been tampered with.  The Plaintiffs wish to seek particulars regarding the detail of the tempering such as the reason, time, persons responsible etc.

25.Miss Tsang submits that the particulars are relevant to the issue in dispute as such information could go to undermine the Defendants’ defence by virtue of section 20(2).

26.Mr. Yan contends that the Plaintiffs are not entitled to the particulars as paragraph 9(c) is an admission. 

(b) Ruling

27.Paragraph 9(c) of the Amended Defence pleads to paragraph 13 of the Statement of Claim, in which it is alleged that the Defendants had sold goods bearing the trade marks with partially mutilated hangtags.  Mr. Yan therefore submits that paragraph 9(c) is an admission.

28.Under section 20(2), a defence of parallel import will not succeed if the “condition of the goods has been changed or impaired after they have been put on the market, and the use of the registered trade in relation to those goods is detrimental to the distinctive character or repute of the trade mark”.  As a result, when there is an averment that some of the goods the Defendant having been trading were tampered with, it is necessary for the Plaintiffs, for the purpose of section 20(2), to know when they were tampered with (to establish if they have been tempered with after they have been put on the market), and the overall appearance (in order to find out if the use of such tempered goods is detrimental to the distinctive character) or why they were tampered with (to see if the use is detrimental to the repute).

29.In the circumstances, the Plaintiffs are entitled to the particulars under Requests 5 and 6.  Request 7 is only a repetition of Request 5, and I therefore refuse this request.

Request 8 (under paragraph 9(d))

(a)  Discussion

30.The Statement of Claim has claimed an infringement of 13 registered marks.  It is common ground that 9 of them are marks in respect of services and 4 of them in respect of goods.  In paragraph 9(d), the Defendants deny that the goods they have admittedly traded bore any of those 9 types of marks in respect of services.  Particulars are now sought to ask the Defendants to particularize the types of marks borne by the goods the Defendants traded.

31.The Plaintiffs’ justification for this request is straightforward.  As the Defendants have only pleaded to 9 types of marks in paragraph 9(d), they have therefore failed to particularize their position in relation to the remaining 4 types of marks, which marks the Plaintiffs have claimed in the Statement of Claim.

32.Mr. Yan’s objection is also fairly straightforward.  He contends that as it is a pure denial, the Plaintiffs would not be entitled to any particulars.  Further, he also contends that as the 9 marks referred to in paragraph 9(d) are all marks in relation to services, in respect of which no infringement has been alleged in the Statement of Claim, the request is therefore wholly irrelevant.

(b) Ruling

33.I agree with Mr. Yan that the Statement of Claim has not expressly pleaded a case of infringement of marks in respect of services as paragraphs 12 and 13 of the Statement of Claim have only alleged the Defendants of having used “signs identical” to the marks in relation to “goods”.  If they wish to also include a claim for infringement in respect of the services, they must expressly plead it.

34.The Defendants admit having traded goods bearing marks of the Plaintiffs’ brands.  They have denied in sub-paragraph (d) that the goods they have traded bear any of the service marks set out in the Statement of Claim.  However, it is not clear whether the goods bearing the Boss marks are the 4 types of marks in relation to goods set out in the Statement of Claim, or in relation to other types of marks in relation to goods.  The Defendants are required to state their case with precision. 

35.Thus, the Defendants are required to answer Request 8.

Requests 9 and 10 (paragraph 10 (a) & (c))

(a)  Discussion

36.The Defendants in paragraph 10(a) and (c) plead the statutory defence of parallel imports under section 20(1).  The requests are similar to Request 4, and the reason given is similar.

37.Mr. Yan objects to the requests on the same ground that the Defendants’ answer to the Plaintiffs’ earlier request has already identified the source of the goods they have dealt with.

(b)   Ruling

38.As for the source of supply, I take the view that the Plaintiffs are entitled to the particulars sought for the same reasons given in respect of Request 4 above.

39.Regarding the particulars in respect of consent, I do not agree with Mr. Yan’s contention that it is not necessary to specify which type of consent the Defendants are relying on.  Whilst it is true that the statutory defence sets out four different types of consent, the Plaintiffs are entitled to tie the Defendants’ hands by requiring them to specify which types of consent they are relying on so that the Plaintiffs can adequately prepare for their case.

40.The Defendants are therefore required to answer Requests 9 and 10.

Request 11 (under paragraph 10(e) & (f))

(a)  Discussion

41.The Defendants by these two sub-paragraphs deny that the use of “signs identical or similar to the Trade Marks” is detrimental to the distinctive character or repute of the Trade Marks. The Defendants are now asked to particularize these signs.

42.Miss Tsang submits that these particulars will enable the Plaintiffs to know specifically what signs the Defendants are referring to so that they can determine if infringement has taken place.

43.Mr. Yan contends that the request is misconceived as the Defendants have only pleaded to paragraph 14(2) and (3) of the Statement of Claim, adopting the same words used therein.  There is therefore, Mr. Yan, contends, nothing needs to be clarified.

(b) Ruling

44.In this request, the Defendants are asked to particularize “signs identical or similar to the trade marks”.  Different types of trade mark infringement are identified in section 18.  If a request pertaining to identifying the type of infringement were made, the request may have been justified.  The present form of the request, however, is far from serving this purpose.  Hence, I agree with Mr. Yan that the Defendants are simply repeating the words in the Statement of Claim in paragraph 10(e) and (f).  I am therefore not inclined to allow this request.

45.Request 11 is refused.

Order

46.I grant an order that the Defendants do within 14 days from the date of this ruling provide particulars in relation to the requests which I have allowed above.  As I have only disposed of paragraph 1 of the Plaintiffs’ summons, (and due to the solicitors’ gross underestimation of the required time for the hearing), I decided to adjourn paragraph 2 for paper disposal in lieu of an oral hearing so as not to cause any further delay.  I reserve costs until I dispose the entire summons.

Mr. John M.Y. Yan SC instructed by Messrs. Cheung & Choy for Defendants.

Ms. Jennifer Tsang instructed by Messrs. Twiggy M.H. Liu Law Office for Plaintiffs.

[1] Norwich Pharmacal Co. & Ors. v Customs and Excise Commissioners [1974] A.C.  133