The High Court in Kuala Lumpur has dismissed an injunction filed by Chatime frachisor La Kaffa International Co Ltd against its former franchisee Loob Holding Sdn Bhd to forbid them from selling similar products as theirs.
The injunction filed on 17 February was dismissed by Judicial Commissioner Wong Kian Kheong, who ruled in oral judgement that it would cause great risk of injustice to Loob Holding and its business and also associates.
“Its 161 Tealive stores and sub franchisees will have to close shop.”
“The lives of its 800 staff, third parties associated with the business, the shops’ landlords, suppliers and creditors will be adversely affected,” he said as quoted by Free Malaysia Today.
Loob Holding CEO, Bryan Loo then took to social media to share the good news.
“Tealive operations can continue as usual after today’s High Court decision. The Court did not grant an injunction seeking to stop or interfere with our Tealive business. Let us now focus on serving our customers to the best of our ability and let our products and passion speak for themselves. Thank you for being part of our journey. Together, we are lagi strong!,” read the post.
With the injunction being dismissed, Tealive can now continue its business as usual and is free to legally operate in Malaysia, but the decision is still subject to the Singapore International Arbitration Centre’s outcome on the arbitration.
The court also ordered Loob Holding to disclose its monthly gross sales to assist in the Singapore arbitration proceedings.
The dispute between La Kaffa and Loob Holding started in December 2016 when the Taiwanese company prematurely terminated its agreement between the two parties despite having more 20 years left on the deal.
Following the contract termination, Loob Holding had then created its own tea brand known as Tealive, while La Kaffa had appointed a new local master licensor, Will Group, to run its franchise business in Malaysia.