The posh Ku De Ta club at Marina Bay Sands SkyPark may have to change its name after a dramatic Court of Appeal judgment.
The ruling - the latest in what has become a bitter legal battle between business associates - is a major victory for the partners of a beachfront club in Bali that began using the Ku De Ta name in 2000.
The club's partners objected to the name being used by the club in Singapore and attempted to enforce their trademark rights through the courts here. A lower court dismissed their case against Nine Squares, the licensor of the Ku De Ta marks in Singapore, in November last year.
But that decision was overturned in a 71-page judgment delivered by Chief Justice Sundaresh Menon on Monday.
He found that Nine Squares did not own the trademarks and only held them on trust for the Bali partners, who have exclusive rights to use and license the name. He also ordered Nine Squares to transfer registration of the marks to the Bali partners and provide them with an account of all profits it has made from use of the marks.
The appellate court ruling raises two key questions. One is whether the swish Ku De Ta club at Marina Bay Sands gets to keep its name. That would depend on how the Court of Appeal rules on a suit brought in 2010 by the Bali club partners against Ku De Ta SG over unlawful use of the trademark. In 2009, Nine Squares licensed the trademark to Hong Kong businessman Chris Au, who assigned his rights under the licence to Ku De Ta SG.
The other concerns L Capital Asia, an investment arm of French luxury group LVMH Moet Hennessy Louis Vuitton. L Capital now controls Ku De Ta Singapore after buying a 51 per cent stake in its holding company in January this year reportedly for $100 million. L Capital did not respond to requests for comment yesterday.
The ruling may finally draw a line under what has become a costly and complex legal battle.
It centres on Nine Squares, which is owned by Australian businessman Arthur Chondros. He conceived the Ku De Ta name and is also one of several partners of Ku De Ta Bali club.
Nine Squares had registered the Ku De Ta trademarks in Singapore in 2004 and 2009, allegedly without the knowledge of the Bali club partners.
The Bali club partners sued Nine Squares in 2011 after Mr Chondros claimed that it owned the Ku De Ta trademark. They wanted to invalidate its trademark registration of Ku De Ta in Singapore, claiming it was done without their knowledge.
They also alleged that Mr Chondros was in breach of his fiduciary duties to the partners and that he had no right to license the Ku De Ta trademark to the firm that operates the club here.
The partners also demanded an account of all profits that the Singapore club has made since it opened in September 2010.
Those claims were rejected by Justice Judith Prakash in the lower court in November last year.
She had found that the Bali club did not have any goodwill in Singapore in 2004, when the Ku De Ta trademark was registered here, as it was not well-known. That meant that the owners of the Bali club could not prevent others from registering Ku De Ta as a trademark here.
But CJ Menon in the Court of Appeal disagreed in a judgment released on Monday. He ruled that neither Nine Squares nor Mr Chondros owned the trademarks. He pointed to Mr Chondros' "inexplicable" silence to a July 6, 2007, e-mail memorandum from the Bali partners following a meeting clarifying that "any use of the Ku De Ta name by any partner for whatsoever reason must be approved by all partners".
He ordered Nine Squares to transfer ownership of the trademarks to the Bali partners and to provide an accounting of profits derived from the exploitation of the marks, including licensing income it has received.