Moon Man Case - SG High Court’s 1st Decision on the Simplified IP Dispute Resolution Process

The dispute in OC 466 revolves around the rights to a top-grossing Chinese film titled “Moon Man”

Introduction

Litigation, as we know, is a costly endeavour that parties must be prepared to make in order to ascertain and/or preserve their respective legal rights in the courts. This is even more so for intellectual property (“IP”) litigation given its specialised and highly technical nature.

Less well-resourced parties such as individuals or small and medium enterprises (“SMEs”) may often find themselves caught between a rock and a hard place – deciding whether to spend money and litigate, or to simply give up fighting for its IP rights. This is especially the case in David and Goliath scenarios where big Multi-National Corporations would strong arm SMEs into submission with tumultuous legal costs.

With the newly introduced Simplified Process for Certain Intellectual Property Claims (the “Simplified Process”), David can now take on Goliath. Resource-strapped parties now have greater access to justice by ensuring that costs and time are spent in an expeditious manner, proportionate to the complexity and value of the claim.

In Tiger Pictures Entertainment Ltd v Encore Films Pte Ltd [2023] SGHC 138 (“Moon Man”), the Singapore High Court fleshed out the relevant factors that the Courts may take into consideration in determining the applicability of the Simplified Process.

Facts of Moon Man

The claimant is a Chinese company that was the exclusive licensee in respect of a top-grossing Chinese film titled “Moon Man”. The Defendant, on the other hand, was a Singaporean company in the business of distributing films in Singapore and other Southeast Asian countries. The parties entered negotiations with one another over WeChat and e-mail to discuss the basic terms for the distribution of the Chinese film in Singapore.

However, the parties were unable to come to an agreement on the key terms and did not execute any formal written agreement to distribute the Chinese film. Despite this, the Defendant proceeded to release the film on the basis that the terms discussed during the negotiations constituted a binding distribution agreement.

The Claimant brought a claim against the Defendant based on copyright infringement. The Defendant denied this and raised two counterclaims against the Claimant for (1) an alleged groundless threats of copyright infringement; and (2) an alleged copyright infringement of separate film.

The Claimant brought the claim under the Simplified Process (Part 2 of the Supreme Court Judicature (Intellectual Property) Rules (the “SCJ(IP)R”)) while the defendant filed the present summons on the applicability of the Simplified Process.

The High Court’s Decision

As this was the first case in Singapore invoking the Simplified Process, the learned judge Dedar Singh Gill (the “Judge”) set out his reasons in full for dismissing the Defendant’s application and allowing the Claimant’s claim to proceed under the Simplified Process.

How the Simplified Process is Triggered

The Judge articulated two ways in which the Simplified Process under Part 2 of the SCJ(IP)R may be triggered:

(1)   Rule 5 of the SCJ(IP)R: A claimant may trigger the application of the Simplified Process by filing and serving the form electing for Part 2 to apply and abandon any claim for monetary relief in excess of SGD 500,000. A defendant who intends to make a counterclaim can then indicate whether it agrees or disagrees with the application of the Simplified Process (Rule 5(2) of the SCJ(IP)R).

(2)   Rule 6 of the SCJ(IP)R: The Court, on its own motion or on the application of a party, order for the Simplified Process to apply. Given that the claimants may unilaterally trigger the application of the Simplified Process through Rule 5 of the SCJ(IP)R, defendants to an action are likely to be the primary parties availing themselves of the process in Rule 6 of the SCJ(IP)R.

In both instances, the Court will only make an order for the Simplified Process to apply if, after considering the relevant conditions under Rule 4(1) of the SCJ(IP)R, it finds that the claim is a suitable one. The conditions listed in Rule 4(1) of the SCJ(IP)R are cumulative conditions which must be fulfilled:

(a)   The dispute involves an intellectual property right;

(b)   One of the following conditions applies:

    i. the monetary relief claimed by each party (whether in relation to an intellectual property right or otherwise) in the action does not or is not likely to exceed SGD 500,000;

       ii. all parties agree to the application of Part 2; and

(c)   The case is otherwise suitable for Part 2, having regard to the following matters

       i. Whether a party can only afford to bring or defend the claim under this Part;

      ii. The complexity of the issues;

      iii. Whether the estimated length of the trial is likely to exceed 2 days; 

      iv. Any other relevant matter.

Application to the present case

In finding that the Simplified Process was applicable to the present case, the Judge made the following findings:

First, the dispute between the parties revolved around a claim for copyright infringement. It is therefore clear that the first condition set out in Rule 4(1) was satisfied.

Second, the Judge found that the action was unlikely to exceed SGD 500,000 as the Claimant had filed the requisite form, abandoning its claim for any monetary relief above SGD 500,000. The Judge also found that the monetary relief claimed for the counterclaims would not exceed SGD 500,000 as the defendant had failed to particularise its purported losses.

In any case, the Judge opined that the Defendant had no locus standi to make a claim for copyright infringement as it was neither the owner nor the exclusive licensee of the separate film. The Judge also held that there was no indication of any loss being sustained as a result of the Claimant’s copyright infringement threats. In fact, the Defendant proceeded to screen the film in Singapore which made it clear that the threats did not cause the Defendant to suffer any losses in any way. In the premises, the second condition was also satisfied.

Last, the Judge held that the analysis under the third condition “necessitates a consideration of all the factors in totality”. The Judge also emphasised that a party only being able to afford to bring or defend a claim under the Simplified Process “will very much favour the application”.

On the facts, the court found that the case was suitable for the Simplified Process because:

(1)   the issue to be determined was fairly straightforward – whether there is a legally binding agreement between the parties to distribute the film;

(2)   the trial is unlikely to take more than 2 days because the Claimant’s sole witness was willing to travel to Singapore to attend the trial in person, and the Defendant’s need to call, inter alia, an expert witness to testify on the trade custom for distributing films would not contribute to the central issue. Further, the cross examination of the other witnesses the Defendant intended to call would be relatively short given that all communications between the Claimant and Defendant took place over WeChat and e-mails; and

(3)   the quantum of the Claimant’s claim was within the limit of the Simplified Process since the Claimant asserted that the total gross box office revenue which the Defendant reaped amounted to at a minimum SGD 153,905.54.

Based on the following factors, the Judge dismissed the Defendant’s application and found that the present case was an appropriate one for the Simplified Process to apply.

Key Takeaways

The introduction of this new Simplified Process opens avenues of recourse for less well-resourced parties to assert, protect, and defend their IP rights. The Court’s robust control over proceedings allows parties to manage the cost of IP dispute resolution. In fact, the Judge in Tiger Pictures cautioned future litigants that “parties should not be allowed to hold the Courts hostage by insisting on dragging a relatively simple matter through the normal route”.

So how does this all come into play as part of your global IP strategy? The Simplified Process offers an expeditious and cost-friendly dispute resolution regime for a party to obtain a judgment in Singapore. The speed at which a judgment can be rendered under the Simplified Process could be used as leverage in obtaining a global settlement of a multi-jurisdictional dispute for a fraction of what it would have cost under the “normal” system/track.

At That.Legal LLC, we specialise in the protection, management and commercialisation of intellectual property rights.

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Disclaimer

This article does not constitute legal advice or a legal opinion on any matter discussed and, accordingly, it should not be relied upon. It should not be regarded as a comprehensive statement of the law and practice in this area. That.Legal LLC represents neither party in this dispute and is not privy to any confidential information pertaining to the parties. All facts stated herein are compiled from publicly available sources. If you require any advice or information, please speak to a practicing lawyer in your jurisdiction. No individual who is a member, partner, shareholder or consultant of, in or to any constituent part of That.Legal LLC accepts or assumes responsibility, or has any liability, to any person in respect of this article.