The writ of summon brought against Nestle Malaysia by Mad Labs Sdn. Bhd. over intellectual property rights on a QR code system has been dismissed by the KL Hgh Court.
Mad Labs sought RM139 million from Nestle for a QR code system the company used for a trial basis, in delivering the decision the court said Mad Labs does not own any proprietary or intellectual property rights in the QR Code that was generated for trial use by Nestle and the damages on the royalty basis amounting to RM 139,344.262.25 is therefore dismissed.
As for the breach of contract claim, the courts said Mad Labs sole director, Chow Kien Loon was negligent in failing to take all reasonable steps to delink the QR Code and prevent the redirection of traffic via the QR Code to offensive websites. Nestle will assess the damages this caused and will separately decide on the next course of action. The claims that Nestle had reported to MCMC as being malicious or mala fide were also dismissed.
However, on the claim by Mad Labs that Nestle had continued to use the QR code after the trial period without permission, the court has ordered Nestle to compensate Mad Labs with the amount to be discussed separately. On claims of its director, Chow Kien Loon, defaming Nestle, the courts found no such incident and that statements issued by them when viewed in totality, were not defamatory, and thus, Nestle’s claim for defamation is dismissed and claim for unlawful interference with trade has also been dismissed.
Nestle said it will be discussing the matter with its solicitors on the next course of action and will not at this juncture, be able to provide an assessment of whether the High Court’s decision would have any material impact on both the Company’s finance and operations until a thorough review has been fully completed.
