PETALING JAYA: OldTown Sdn Bhd has categorically refuted and denied all allegations from Jiangsu G&L Food & Beverage Management Co Ltd (G&L) that it has ever committed or intended to commit contract fraud, and its assertion that the closure of its licensed OldTown cafes in China were related to a trademark dispute.
“This remains a contractual matter only,“ OldTown said in a statement today.
G&L was granted the right by OldTown Bhd’s indirect wholly owned unit Shenzhen Kopitiam Asia Pacific Ltd (SZKAP) to operate OldTown White Coffee within Jiangsu province, to use the trademark “OldTown” and to develop it into franchising business.
Last week, G&L said SZKAP was under criminal investigation by the Chinese Public Security Bureau for suspected contract fraud.
In response to this, OldTown said several of the outlets in Jiangsu province were already closed due to poor management of the business by the licensee prior to any allegation of trademark dispute.
“As a company that prides itself with its integrity, we are disappointed to see these baseless allegations being leveled in the media and will be taking the necessary steps to protect our brand and our reputation,“ OldTown added.
OldTown clarified that in December 2018, Ai Chang Investment Limited, through a declaration, and power of attorney had begun the process of assigning their trademark for the operations of Café outlets to OldTown’s wholly owned subsidiary Kopitiam Asia Pacific Sdn Bhd (KAP).
“OldTown has been in constant communication with the relevant authorities both in China and Malaysia to resolve these disputes in accordance to the law.”
In a follow-up statement today, G&L reiterated that SZKAP is being investigated by the Chinese Public Security Bureau for suspected contract fraud, not trademark infringement.
According to China’s National Intellectual Property Administration (CNIPA) website, Ai Chang applied for “OldTown” trademark on March 12, 2013 in the category of goods/services applying to cafes, restaurants, fast food, bar services in China. Ai Chang received the certificate of trademark with CNIPA on Aug 14, 2014, for use of trademarks from Aug 14, 2014 until Aug 13, 2024. KAP had applied for “OldTown” trademark for café/restaurant goods/services category in China but was rejected by CNIPA.
“With the full knowledge that they do not own the trademark “OldTown” in China, SZKAP signed license agreement with G&L in May 2016, granting the rights to operate OldTown White Coffee within Jiangsu province, to use the trademark “OldTown” and to develop it into franchising business,“ said G&L.
G&L said Ai Chang reported to the local Administration for Industry and Commerce in April 2018, that G&L infringed their “OldTown” trademark, which forced G&L to shut down all operating OldTown White Coffee outlets.
“OldTown Bhd, as one of the leading F&B corporations in Malaysia, should be held fully responsible for the damages and losses faced by franchisees,“ G&L said.
Franchising rights were also given to Xiamen Kuaike Investment Management Co Ltd, another Chinese company in FuJian in March 2017.
To date, all OldTown White Coffee outlets in mainland China have been shut down.
OldTown was delisted from Bursa Malaysia on April 4, 2018 after Dutch coffee company JDE gained control of OldTown via its indirect unit Jacobs Douwe Egberts Holdings Asia NL BV. It was listed for less than seven years on the local bourse.
