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Eng's Wanton Mee Saga - Who is the Original?
<Reproduced with permission from That.Legal LLC>
Introduction
Did you know that the Eng’s Wantan Noodle outlets that have popped up all over the country are not actually run by the descendants of the late Mr. Ng Ba Eng, the original founder (the “Ng Family”)?
In fact, the Ng Family owns a competing wanton mee business called Eng’s Char Siew Wantan Mee. Both sides claim to be the original.
Eng’s Wantan Noodle is a wanton mee (a local noodle delicacy) shop that has fast become a household name in Singapore, with more than 10 outlets across the island. Famed for its springy noodles, umami sauce and spicy chilli, long-time fans will know that the original Eng’s started off life as a pushcart business that evolved into a hawker stall at Dunman Food Centre, before finally getting its own standalone shop along Tanjong Katong Road.
So, who is the original? How and why do two wanton mee businesses with such similar names co-exist? There is no simple answer to those questions, but we hope to shed some light on the situation, which has been the subject of legal disputes before the High Court and before the Intellectual Property Office of Singapore (“IPOS”):
New Ping Ping Pauline v Eng’s Noodles House Pte Ltd and others [2020] SGHC 271 (the “High Court Case”); and
a trade mark dispute which was heard before the Hearing and Mediations Division of the IPOS – Pauline New Ping Ping v Eng’s Char Siew Wantan Mee [2022] SGIPOS 10 (the “IPOS Case”).
The Facts
In order to properly understand this saga, it is necessary to get to know the main characters of the story and the rough sequence of events.
In the 1970s, Mr. Ng Ba Eng (“Founder Ng”) founded Eng’s Wantan Mee. It started off as a pushcart business before he moved to a hawker stall in Dunman Food Centre. The hawker stall was called “Eng’s Char Siew Wan Ton Mee”. Founder Ng had a son, Mr Desmond Ng, and two daughters (the “Ng Sisters”).
In 2012, Founder Ng joined hands with an investor, Mr. Jason Sim, and opened a standalone shop at 287 Tanjong Katong Road. A company was incorporated to run the business and it was named “Eng’s Noodle House Pte Ltd”. We will refer to it as the Joint Venture Eng’s or JV Eng’s for short. JV Eng’s initially had 2 shareholders – Founder Ng’s son, Desmond Ng and Pauline New, the wife of Mr. Jason Sim – both shareholders held 50% of the shares in the company.
Founder Ng passed away in 2013, only one year after JV Eng’s began operations. In 2015, a new shareholder was added, one Mr. Teng Chai Hai. He was given 5% of the shares, and the remaining 95% was split evenly between Mr. Desmond Ng and Pauline New.
There was no real change on the operational side of things and business continued smoothly until a conflict arose between the shareholders. As the conflict could not be resolved, operations ground to a halt and JV Eng’s officially ceased operations on or around 28 February 2018. We note that the JV Eng’s company was not wound up and continues to exist but has no business whatsoever.
Here is where things get spicy (no pun intended). After JV Eng’s stopped business, a company took over the lease for the 287 Tanjong Katong Road premises and started a business selling, wait for it, wanton mee.
This company was incorporated by one Mr. Thomas Hong (who was involved with the Lao Huo Tang Group) and it was named “Eng’s Wantan Noodle Pte Ltd” (henceforth referred to as the “Franchise Eng’s”). There was a dispute as to the exact nature of the relationship between the Franchise Eng’s and Pauline/Jason, but the Ng Family alleged that Pauline New and Mr. Jason Sim were involved in the setting up of the Franchise Eng’s.
While this was on going, the Ng Family did not remain in idle. On 5 March 2018, the Ng Sisters also incorporated a company named “Eng’s Char Siew Wantan Mee Pte Ltd” (henceforth referred to as the “Sisters’ Eng’s”). Sisters’ Eng’s set up shop at 248/250 Tanjong Katong Road, almost directly opposite the Franchise Eng’s 287 Tanjong Katong Road premises.
Around this time, the Sisters’ Eng’s also applied for the registration of three trade marks between June to July 2018. Images below under the IPOS Case section.
The High Court Case
The High Court case was initiated by Pauline New against the JV Eng’s company, Mr. Desmond Ng, the minority shareholder, the Ng Sisters and the Sisters’ Eng’s company. The bases of the action were, inter alia, breach of fiduciary duty, common law derivative action, and the tort of conspiracy to injure by unlawful means. Pauline New’s claims were dismissed by the High Court and the Court of Appeal upheld that judgment.
To keep this article more IP focused, we will not be delving into the details of these claims and will instead discuss the counterclaim made by the Ng Sisters and the Sisters’ Eng’s against Pauline New – the counterclaim was for the tort of passing off.
Passing Off
The tort of passing off is a common law action which can be used to enforce unregistered trade mark rights. The tort of passing off is meant to protect the goodwill acquired by a business from misrepresentation. It operates to prevent a business from misrepresenting that the goods or services provided by it originate or have some connection/association with the goods or services provided by a different business.
The three main elements that must be proved by a claimant in order to succeed in a claim for passing off are:
goodwill;
misrepresentation; and
damage.
Goodwill may be defined as “the attractive force arising from the business’ name and reputation which brings in customers” – it is what causes customers to be attracted to a business’ goods or services over others.
Goodwill should not be confused with reputation, even though they are not mutually exclusive. Goodwill cannot exist in a vacuum and must be attached to a business while reputation may exist independently without any supporting business. In other words, goodwill is inseparable from the business to which it is attached, while reputation can exist with or without a business.
The Counterclaim in the High Court Case – Passing Off
To satisfy the first element of goodwill in a passing off claim, the Ng Sisters had to prove that goodwill existed in the original Eng’s wanton mee and that they were the owners of the said goodwill. The judge presiding over the case, Justice Valerie Thean (the “Judge”), ruled that goodwill did exist in the wanton mee associated with the late Founder Ng’s recipe and method of preparation.
The Judge held that the owner of the goodwill was Founder Ng until his passing, and that the goodwill “attached” to JV Eng’s for the period that Founder Ng operated his business through the company. The Judge also held that the goodwill was still used by JV Eng’s up until the time it ceased operations (on or around 28 February 2018).
As Founder Ng was the “walking brand” and “the main figurehead which customers identified with”, Founder Ng being the owner of the goodwill till his death was not a particularly contentious issue.
The main issue therefore was whether the Ng Sisters/Ng Family owned the goodwill after Mr Ng’s passing. This was the gist of the counterclaim, with the Ng Sisters’ argument being that, inter alia, the “Family Wantan Mee Business”, along with all the goodwill vested in it, was “meant to be passed down from generation to generation”.
Unfortunately for the Ng Sisters, the Judge held that they were unable to prove that they were the owners of the goodwill and therefore the counterclaim “fails at this threshold step”.
Interestingly, the Judge alluded to the possibility that Desmond Ng could have been the owner of the goodwill because he was so involved with the original Eng’s and the JV Eng’s, but did not make a ruling on this as he was “not a plaintiff in the counterclaim” and there was no assertion in the counterclaim that he was the owner of the goodwill.
For completeness, the Judge also held that “[b]esides failing to establish goodwill, the Counterclaimants did not make out the element of misrepresentation” because if at all, the “entity responsible for any claimed misuse… would have been [the Franchise Eng’s]”.
The IPOS Case
The IPOS Case arose because Pauline New opposed the registration of the three Ng Sisters’ Eng’s trade marks.
The application date for the 1st Name Mark was on 8 June 2018, and the application date for the other two marks were on 31 July 2018 (collectively, the “3 Marks”).
Pauline New’s grounds for opposition were two-fold: based on passing off (Section 8(7)(a) of the Trade Marks Act (“TMA”)) and on bad faith (Section 7(6) of the TMA). The case was presided over by IP Adjudicator Andy Leck (the “Adjudicator”).
Section 8(7)(a) – Passing Off
Section 8(7)(a) of the TMA reads:
“(7) A trade mark shall not be registered if, or to the extent that, its use in Singapore is liable to be prevented —
(a) by virtue of any rule of law (in particular, the law of passing off) protecting an unregistered trade mark or other sign used in the course of trade…”
In essence, if Pauline New could prove that the use of the trade mark to be registered would constitute passing off, the opposition would succeed. The elements of passing off are the same here as those previously mentioned: goodwill, misrepresentation, and damage.
In the High Court Case, the Ng Sisters were the plaintiffs in the passing off counterclaim. In contrast, Pauline New was the “plaintiff” (or rather, the opponent) in the IPOS Case. Hence, Pauline New is the one who bears the burden of proof.
The main issue here was whether JV Eng’s was the owner of the goodwill subsisting in the 3 Marks applied for by the Sisters’ Eng’s (the “Application Marks”).
The Adjudicator relied upon certain rulings made in the written judgement of the High Court Case and came to the conclusion that the goodwill was attached to JV Eng’s for the entire period of its operation (i.e. from on or around 27 February 2012 to 28 February 2018). However, the Adjudicator held that this did not preclude the Application Marks from being registered because, by the time the Sisters’ Eng’s made the applications for the Application Marks (on 8 June 2018 and 31 July 2018 – collectively, the “Relevant Dates”), JV Eng’s had ceased its operations (28 February 2018).
The Adjudicator emphasised that “one of the essential characteristics of goodwill is its inseparable connection to a business” and that “goodwill cannot exist independently and must attach to a business”. Following this logic, the moment JV Eng’s ceased the operation of its business, the goodwill stopped existing and perished. Therefore, as of the Relevant Dates, which were after the date on which JV Eng’s went dormant, JV Eng’s no longer held any goodwill, and thus Pauline’s opposition on this ground failed.
Section 7(6) – Bad Faith
Section 7(6) of the TMA reads:
“(6) A trade mark shall not be registered if or to the extent that the application is made in bad faith.”
The test for bad faith has two elements: an objective element (i.e., that the conduct of the Applicant fell short of the appropriate standard, namely acceptable commercial behaviour observed by reasonable and experienced persons in the particular commercial area being examined) and a subjective element (i.e., that the Applicant knew of facts which, to an ordinary honest person, would have made the latter realise that what the Applicant was doing would be regarded as breaching those commercially acceptable standards).
A bad faith inquiry is a fact-sensitive one that requires a holistic assessment of the facts, and the threshold to prove bad faith is high as the allegation is a serious one.
The Adjudicator found that there was insufficient evidence to make out a case for bad faith, and therefore Pauline New’s opposition based on this ground also failed. The Ng Sisters were the descendants of Founder Ng after all.
If you wish to know more about it, you can read the actual case in depth here.
The Aftermath
As at the date of writing, both parties claim to be the original. Both have applied for trade marks:
The Sisters’ Eng’s appears to have the right to the brand “Eng’s” through their trade marks, but whether they can use their trade marks to stop Franchise Eng’s from using a similar name is quite another matter that may require further litigation. The only thing that is certain is Franchise Eng’s is now all over Singapore and Sisters’ Eng’s is limited to one outlet on the other side of Tanjong Katong Road.
The Moral of the Story
The lesson that we can take away from the Eng’s drama is simple: good fences make good neighbours.
Of course with perfect hindsight vision we could say that if the parties who came together to do business in JV Eng’s had done their IP Due Diligence, it would have been obvious that the legal status of certain IP assets, namely, the goodwill and the trade marks had not yet been resolved.
Nevertheless, these IP assets could have been assigned, licensed, or transferred via a contractual agreement, which may have prevented all this litigation from happening (or most of it at least). The lack of proper legal boundaries resulted in an unnecessary waste of money, time, and resources and it is a costly lesson that everyone should learn from.
That said, the wanton mee served by both the Franchise Eng’s (the Katong outlet) and the Sisters’ Eng’s are different. We recommend that you try both to see which you prefer.
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. 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.
This article has been reproduced with the kind permission of That.Legal LLC (https://www.that.legal/). If you have any queries on this matter or if you are looking for advice pertaining to the protection, management or commercialisation of your intellectual property, feel free to reach out to the team at That.Legal (ask@that.legal)
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