McDonald’s Loses Legal Challenge

McDonald’s Corporation (MCD - Analyst Report), a leading fast-food restaurant chain, lost an eight-year-long trademark battle against a family-run Kuala Lumpur restaurant, McCurry, to prevent the latter from using the prefix ‘Mc.’

McDonald’s accused McCurry for infringement its trademark, as the latter uses ‘Mc’ prefix in the name, giving a false impression of being associated with the U.S. fast-food giant. However, McCurry claimed that the name is an abbreviation for Malaysian Chicken Curry, and that it serves a traditional line of foods.

Malaysia’s Federal Court ruled out McDonald’s exclusive right over the use of ‘Mc’ prefix in the country, and said that there was no evidence which shows that McCurry was using the prefix in an attempt to promote itself as being related to McDonald’s. McDonald's has also been asked to pay about $2,900 to McCurry.

However, experts in trademark infringement cases believe that the court’s ruling against McDonald's in Malaysia could put other global companies operating in the region at distress. These brand names and logos are trade symbols, and the use of them by rival companies could confuse consumers and may undermine confidence in global brands.

McDonald’s had earlier in 2001 sued McCurry for the breach of its trademark, and the court in 2006 ruled in favor of the former. McCurry then appealed against the decision, and the Court of Appeal gave its ruling in favor of the Malaysian restaurant in April 2009, which was again challenged by McDonald’s in the Malaysia's Federal Court. The Federal Court on Tuesday, Sep. 8, 2009, passed the verdict in favor of McCurry.

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