Saiko Saibansho Daiichi Sho Hotei [Supreme Court First Petit Bench] February 27, 2003

An English company, Fred Perry Sportswear Ltd. (FPS), held a series of registered trademarks in the well-known Fred Perry clothing brand. In 1994, FPS granted a license to Singapore-based Osea International PTE Ltd. (Osea) to produce, sell, and distribute trademarked Fred Perry products in a contractually defined area that included Singapore, Malaysia, Brunei, and Indonesia. In 1995, another English entity, Fred Perry (Holdings) Ltd. (FPH)—a subsidiary of Hit Union Ltd. (defendant)—succeeded FPS as owner of the trademark rights with respect to most countries. However, Hit Union held the trademark rights with respect to Japan. In 1996, a Japanese importer (plaintiff) imported trademarked Fred Perry products from Osea, which had outsourced the manufacture of the products to a factory in China—a country that was not part of the contractual territory specified by the license. Hit Union placed an ad in the Senken Shimbun newspaper (defendant), claiming that the goods imported by the Japanese company were fake. The importer brought an action against Hit Union, the newspaper, and the newspaper’s publishing company (defendant) to recover for alleged damages to the importer’s reputation. Hit Union counterclaimed for trademark infringement. The court found that the acts of importation constituted infringement. The importer appealed to the Japan Supreme Court.