MGM RESORTS INTERNATIONAL AND OTHERS v. MGM INTERNATIONAL HOTEL GROUP LTD

HCA 2092/2013

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 2092 OF 2013

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JUDGMENT
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1. This is an application for summary judgment in respect of a claim for infringement of trademarks and passing off.

2. Apart from the filing of the Amended Defence by the defendant’s former solicitors, the defendant has not filed any affirmation to oppose the plaintiffs’ application.  One day before the hearing, the court has received a letter from the defendant asking for an adjournment of the hearing.  However, since the defendant, being a corporation, cannot act by itself without the leave of the court, I do not entertain the application.  The defendant does not appear in today’s hearing, and so I will treat the defendant as absent.

3. The 1st plaintiff together with its subsidiaries including the 2nd and 3rd plaintiffs (“the Plaintiffs’ Group”) have been one of the world’s leading global hospitality companies, operating a portfolio of resort brands.

4. The 1st plaintiff is the controlling shareholder of the 2nd plaintiff which is a public-listed company in Hong Kong. The 3rd plaintiff is the principal subsidiary of the 2nd plaintiff.  It owns and operates “MGM Macau”, a five-star casino and hotel resort in Macau.

5. The 1st plaintiff has been at material times registered various trademarks comprising “MGM” and “美高梅” in Class 25, 35, 36, 41 and 43 in the Trade Marks Registry in Hong Kong (“the Trademarks”).  It has also registered various trademarks comprising “MGM” and “美高梅” in the Mainland.

6. The 1st plaintiff has at all material times licensed its trademark rights including but not limited to the Trademarks comprising “MGM” and “美高梅” to the 2nd and 3rd plaintiffs for use in Hong Kong.

7. Since 2007, the plaintiffs have expended considerable efforts in marketing, advertising and promoting the brand and casino and hotel resort business by reference to “MGM” and “美高梅” in Hong Kong in building up and acquiring substantial and valuable goodwill and reputation in the “MGM” and “美高梅” marks in Hong Kong which have become well and favourably known to the public in Hong Kong.

8. The defendant is a limited company incorporated in Hong Kong on 17 April 2009 under its present name “MGM International Hotel Group Limited” (美高梅國際酒店集團有限公司). Mr Jia Wenchun (“Jia”) is the defendant’s sole director and shareholder and appears to be residing in the Mainland.  The nature of business of the defendant is stated in its business registration documents to be “Hotel Investment & Management”.

9. On 14 March 2012, the defendant held a signing ceremony at the Kowloon Shangri-La Hotel in Hong Kong and displayed a banner bearing the name “美高梅國際酒店集團”.  During the said signing ceremony, Jia on behalf of defendant signed a contract with another company known as “湘潭德仁房產” to jointly develop and operate a hotel known as “美高梅湘潭酒店”.

10. The defendant has also produced and used name cards with a Hong Kong address and bearing its English name and Chinese name and also a logo (“the Logo”) which contains “MGM”, “美高梅” and a lion-like logo which is confusingly similar to the 1st plaintiff’s Trademark No. 301846279.

11. The defendant’s name has also been referred to in a website and the pamphlets for the promotion of a hotel known as “Orient MGM International Conference and Exhibition Hotel” (東方美高梅國際會展酒店) (“the Orient Hotel”) which is stated to be managed by the defendant with a reference to “MGM” as part of the management team.

12. The defendant has filed an authorization letter dated 2 September 2013 with Fengtai Branch of Beijing Administration for Industry and Commerce (北京巿工商行政管理局豐台分局) whereby it purported to authorize a company known as “東方集團投資控股有限公司” to use “美高梅” in setting up a company known as “北京東方美高梅國際酒店管理顧問有限公司”.

13. On 31 October 2013, the 1st plaintiff issued the present proceedings against the defendant.  The 2nd and 3rd plaintiffs joined in the proceedings later.

14. Since the commencement of the proceedings, the Chinese name of the Orient Hotel on the said website has been changed from “東方美高梅國際會展酒店” to “東方美高美國際會展酒店” and the Logo has been replaced by a different logo with the removal of the Chinese name “美高梅” and the insertion of the word “Orient” in front of “MGM”.  However, there are still references to “MGM”, “MGM Hotels”, “美高梅” and “美高梅酒店” in the said website.

15. Since around February 2014, another website has been uploaded and published onto the internet website for the promotion of the Orient Hotel.  It is stated in the said website that the Orient Hotel is managed by the defendant with references to “MGM”, “MGM Hotels”, “美高梅” and “美高梅酒店” in the said website.

16. In December 2014, the name of the defendant was referred to in a website for the promotion of the hotel “湘潭美高梅國際大酒店”. Further in the said website, “美高梅品牌” and the properties of the Plaintiffs’ Group including MGM Grand, City Center, Vdara, Aria Resort and Casino, the Crystal and Veer Towers were used to describe the origin of the brand.

17. Based on the facts of the present case, it is clear that summary judgment should be granted in favour of the plaintiffs.

18. The Plaintiffs’ Group is a well known leading hospitality group in the world and the 1st plaintiff is the owner of the various trademarks comprising “MGM” and “美高梅” in Hong Kong.  The plaintiffs’ goodwill and reputation in the “MGM” and “美高梅” marks in Hong Kong, which are undoubtedly well known to the public in Hong Kong, cannot be disputed.  There has not been any affidavit or evidence adduced by the defendant to challenge the same.

19. On the other hand, the defendant is a company newly incorporated in Hong Kong as late as in 2009 with a name almost identical or at least confusingly similar to plaintiffs’ name in English and Chinese, namely, “MGM International Hotel Group Limited” and “美高梅國際酒店有限公司”.

20. This is a classic case of a shadow company being set up to mislead the public into believing that the defendant company is somewhat associated with the plaintiff (see: Power Dekor (Hong Kong) Ltd v Power Dekor Group Co Ltd [2014] 1 HKLRD 845, per Zervos J at para 6 and Exxon Mobil Corporation v USA Exxon Mobil Oil Ltd, unreported  HCA 2188/2013 (15 January 2014) per Zervos J at para 5).

21. It is indisputable that the defendant has in the course of trade or business used “MGM”, “美高梅”and the Logo which are identical or confusingly similar to the Trademarks.  Further, the plaintiffs have enjoyed substantial goodwill in relation to the use of the Trademarks, and the use of identical or confusingly similar trademarks by the defendant is likely to cause confusion on the part of the public.  Hence, there is clearly no defence to both the claims for infringement of the Trademarks and passing off.

22. In the Amended Defence, the defendant claims that it was set up by a company known as “MGM Mirage Hotel Management Consulting Limited” (“MGM Mirage”) and was authorized by MGM Mirage to develop hotel management business in Mainland China and it used “MGM” because it was part of the name of MGM Mirage.  However, the defendant did not provide any details of MGM Mirage or the basis upon which it was alleged that the defendant was set up by MGM Mirage.

23. In its answers to the plaintiffs’ request for further and better particulars, the defendant asserted that MGM Mirage was incorporated in California in the United States, but it did not have any information as to the date of incorporation of MGM Mirage or the date when its name was first used.

24. The plaintiffs conducted a search in the corporate files of the Secretary of State of California and there was no entity found bearing the name “MGM Mirage Hotel Management Consulting Services Limited” in the State of California.  Neither has the defendant supplied any information to substantiate its defence in this regard.  Hence, there is absolutely no merit in such contentions.

25. For the above reasons, I grant summary judgment in favour of the plaintiffs for the relief claimed in the Amended Statement of Claim.