THE QUEEN v. WAN WING HIN

IN THE SUPREME COURT OF HONG KONG

APPELLATE JURISDICTION

MAGISTRACY APPEAL NO. 36 OF 1993

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J U D G M E N T

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1. The appellant was convicted before Mr. Ernest Lim sitting in South Kowloon Magistracy of the offence of possession of goods for sale to which a mark so nearly resembling a trade mark as to be calculated to deceive was falsely applied contrary to section 9(2) of the Trade Descriptions Ordinance, Cap. 362. There was also an alternative charge of possession for sale of goods to which a false trade description was applied contrary to section 7(1)(b) of the same Ordinance. He was conditionally discharged upon entering into a recognizance in the sum of $2,000 for a period of 24 months and to pay costs of $500. It is against the conviction he now appeals.

2. The particulars alleged that on the 8th day of July 1991 at High Sharp Producer Company, Room 708, Block B, Bell House, 525-543 Nathan Road, Kowloon in Hong Kong the appellant had in his possession for sale goods, namely, 200 video cassette tapes to which a mark ‘SONYSONIC’ so nearly resembling a trade mark ‘SONY’ as to be calculated to deceive was falsely applied.

3. The facts as found by the learned magistrate are set out in paragraph 3 of the Statement of Findings as follows :

“It is not disputed by the defendant that the trade mark of SONY is a registered trade mark in Hong Kong belonging to Sony Kabushiki Kaisha (Sony Corporation) of Japan and that the Sony Corporation had been its proprietor since 12.8.1982 in Trade Mark No. 2231 of 1983. It is also not disputed that the said brief facts show that sometime on 8.7.1991 customs officers entered the premises at Room 708, Block B, Bell House at 525-543, Nathan Road, Kowloon and found the defendant inside. Upon searching the said premises the video cassette tapes bearing the mark SONYSONIC and carton boxes were found. The defendant was taken to the police station where he gave a cautioned statement. The said statement was agreed other than question/answer 12 and 13.”

4. After a careful review of the law and a long line of authorities, the learned magistrate was satisfied that the charge against the appellant under section 9(2) of the Trade Descriptions Ordinance had been made out. He was in no doubt that the mark SONYSONIC was so nearly resembling the trade mark SONY as to be calculated to deceive and it was falsely applied on the tapes found in the possession of the appellant. The learned magistrate relied in particular on the decision in Rolls Royce Motors Ltd. & Another v. Zanelli and Others (1979) RPC 148. In that case, the defendants bought cars from Rolls Royce Motors Ltd. and after converting them sold them as conversions under the name of Rolls Royce Panache. In granting an injunction to Rolls Royce Motors Ltd., Browne Wilkinson J. had this to say :

“The whole conversion is designed to be a conversion of Rolls Royce and in those circumstances as at present advised I find it difficult to see how they will be able to carry out their trade otherwise than by using the words Rolls Royce in the course of so doing. As such prima facie it seems to me that there would be an infringement of the trade mark.”

5. The appellant who appeared before me in person sought to rely on a judgment of the Chief Justice in The Attorney General v. YAO Ching-pin, Magistracy Appeal No. 758 of 1992. The facts in that case and the offences with which the respondent, YAO Ching-pin were charged are identical to the present one. The appellant informed me that Mr. Yao was in fact the manufacturer from whom he obtained the tapes for sale. In July 1991, customs officers raided the Universal Magnetics Company at Chai Wan of which the respondent, YAO Ching-pin was the sole proprietor. There the customs officers found the goods which the respondent admitted to belong to his company. He intended to sell the video cassette tapes at $12 each. The learned magistrate found that the only similarity between the marks “SONY” and “SONYSONIC” was that of the first two syllables of the composite name of the respondent’s goods. He also found that the composite name clearly distinguishes the respondent’s goods from that of Sony Corporation, the trade mark holder of the mark “SONY”. He further found that there were other marked differences between the two products, for example, the overall appearances in that the genuine “SONY” was one of quality and that of the respondent’s goods was tawdry and there was a differential in selling price.

6. The learned magistrate was not satisfied that a reasonable man in the street would be deceived or confused by the respondent’s product and he was also satisfied that the use of the composite name did not contravene section 7(1)(b) of the Trade Descriptions Ordinance. He dismissed all the four charges brought against the respondent and the Attorney General appealed by way of case stated.

7. The questions of law submitted for determination are :-

          (1) Whether his finding that :

When the two marks are placed side by side, the main idea left by the composite word “SONYSONIC” is so different from the registered mark “SONY” that a reasonable man would be confused that it was a product of the trade mark holder was against the weight of evidence and thereby amounted to an error of law.

          (2) Whether his finding that :

The difference in overall appearance of the respective sample products adduced in evidence and the price differential between them was against the weight of evidence and thereby amounted to an error of law.

(3) Whether the magistrate erred in law in holding that the use of the composite name “SONYSONIC” with respect to the goods was not an indication direct or indirect of manufacture by Sony Corporation.

8. Having carefully considered submissions by counsel for both sides and examined relevant authorities, the learned Chief Justice came to these conclusions. He said at p.9 and p.10 of his judgment :

“Coming now to the first question, in my judgment the answer to the question as phrased must be no. But the wrong question was asked. It may well be that when the two marks are placed side by side, a reasonable man would not be deceived. But the two marks should not be examined as if they have been placed side by side. The authorities make that clear.

If  “the essential features” test was applied, the finding should clearly have been that a reasonable man would be deceived.

As phrased, the answer to the second question, too, is no. But again, the question seems to me to be wrongly phrased. The conclusion which the magistrate came to on the issue of overall appearance is one that he was entitled to draw when he placed the two marks side by side. As to price differential, it was also a conclusion he was entitled to draw on the evidence before him. But the question is not limited to one of overall appearance. The question is one of essential features. If the proper test was applied, the answer should be that a reasonable man would be deceived.

In dealing with the third question, I am content simply to reproduce the written argument of Ms. Opai :-

“ ... the wording of S.2 Trade Descriptions Ordinance is so broad that it is hard to envisage how the word SONYSONIC, picked out in red as to the part SONY, and coupled with the words ‘Made in Japan’ can be anything but an indication of the person by whom the tapes were made - namely SONY Corporation. That being a false trade description, it remains only to find that it is false to a material degree. The indication that a product is manufactured by an internationally known and trusted company must be a material consideration. When that indication is false, it must accordingly be false to a material degree.”

I agree. In my judgment, the answer to the third question is yes.”

9. This decision does not assist the appellant. It is against him. The magistrate in that case had applied the wrong test and wrongly phrased the first two questions.

10. The appeal must therefore be dismissed.