Sinco Technologies Pte Ltd. v. Sinco Electronics Co. Ltd.

Background

Sinco Technologies Pte. Ltd. sued Sinco Electronics (Dongguan) Co. Ltd., XingKe Electronics (Dongguan) Co. Ltd., Mui Liang Tjoa, Ng Cher Yong, and Liew Yew Soon. The claims included trademark infringement, false designation of origin, false advertising, trademark dilution, common-law trademark infringement and unfair competition, and state statutory unfair competition. The opinion states that XingKe is the same company as Sinco Electronics and that “XingKe” is the phonetic equivalent of its name.

All parties except Mr. Tjoa filed motions for partial summary judgment. Summary judgment is a decision without a trial when the evidence shows that no genuinely disputed important fact requires a jury’s decision. The court viewed the evidence in the light most favorable to the party opposing each motion.

Sinco Technologies’ Motion

Sinco Technologies sought summary judgment on trademark infringement, common-law trademark infringement and unfair competition, and false designation of origin. It argued that Defendants’ authorized use of the “SinCo” marks had ended when they used the marks for their own competitive purposes. Sinco Technologies also argued that the trademark-infringement factors favored it and that a rule requiring a former infringer to keep a greater distance from the trademark owner applied to XingKe’s use of “XINGKE.”

Sinco Technologies acknowledged that it had given XingKe an oral, geographically limited license to use the trademark. The court found disputed facts about the license’s terms and restrictions, representations made when Sinco Electronics was sold to Mr. Tjoa, and whether Sinco Technologies had permitted unrestricted use of its marks. The court also found factual disputes about whether Mr. Ng and Mr. Liew were Sinco Technologies employees placed at XingKe’s factories to monitor the trademarks. The court denied Sinco Technologies’ motion for partial summary judgment.

XingKe’s Motion

XingKe sought summary judgment on two affirmative defenses. An affirmative defense is a legal reason a defendant argues should defeat or limit the plaintiff’s claim even if the claim’s allegations are otherwise established.

First, XingKe argued that Sinco Technologies had given it a “naked license.” A naked license is a trademark license in which the owner fails to exercise adequate quality control over the licensed goods or services, potentially abandoning the mark. The court found disputed facts about whether the purchase agreement gave Sinco Technologies a contractual right to inspect and enforce quality, whether it actually controlled the quality of XingKe’s products, and whether Sinco Technologies reasonably relied on XingKe’s quality control. The court also noted factual disputes about the role and employer of Mr. Ng and Mr. Liew. The court denied XingKe’s motion for summary judgment on its naked-license defense.

Second, XingKe argued that equitable estoppel barred Sinco Technologies from enforcing the marks. Equitable estoppel generally requires proof that one party misleadingly communicated something, the other party relied on it, and the other party would suffer material harm if the first party later took an inconsistent position. The court found factual disputes about whether Sinco Technologies knew of XingKe’s independent use of the mark in the United States, including through Mr. Ng, Mr. Liew, or Mr. Lim, and whether a later agreement about logos, fonts, and colors replaced the oral license. The court denied XingKe’s motion for summary judgment regarding its equitable-estoppel defense.

Mr. Ng and Mr. Liew’s Motion

Mr. Ng and Mr. Liew sought partial summary judgment on the ground that they could not be individually liable for trademark infringement in their roles as engineers. Sinco Technologies appeared to rely on alternative theories: that they were liable if they were its employees who traveled to the United States and persuaded its customers to buy from XingKe, or that they were liable as XingKe officers or directors if they were XingKe employees. The Individual Defendants argued, among other things, that they acted under their supervisors’ orders and were not directors or officers for purposes of personal liability.

The court stated that whether Mr. Ng and Mr. Liew were employed by Sinco Technologies, XingKe, or both was disputed. The parties also had not squarely addressed which law governed their employment status; the opinion identifies Singapore, China, and United States law as issues raised by the parties. The court denied the Individual Defendants’ motion for partial summary judgment. The opinion states that the case was set to proceed to trial on June 22, 2020, and that the order disposed of Docket Nos. 248, 299, and 319.