Bubble tea trial to go to Federal Court
Case moves into final legal avenue
PETALING JAYA: The fight between two leading bubble tea operators will continue to brew as the case moves on to its final legal avenue at the Federal Court.
Loob Holding Sdn Bhd, which runs the Tealive chain of bubble tea outlets, has filed an appeal in the apex court.
On Thursday, the Court of Appeal dismissed its application for a stay of execution of an injunction filed by Taiwanese tea company La Kaffa International Co Ltd that stops Loob from operating a business similar to the Chatime bubble tea brand.
“The company has instructed its lawyers to file for leave to appeal to the Federal Court against the Court of Appeal’s decision given on June 27, 2018 and it has been informed that the application had been filed yesterday,” Loob said in a statement on Thursday evening.
The effect of the injunction order sent bubble tea lovers into a panic, making it a superhot topic in social media.
Some fans even said they would rush out to get the refreshing flavoured fruit teas and milk teas served ice cold or piping hot with chewy tapioca balls, before they are closed.
A dissenting judgment by the Court of Appeal that went unreported said that the interim stay of the injunction sought by Tealive would very likely be for a relatively short period and yet the hardship and inconvenience caused to innocent third parties such as the workers, their family members would simply be too great.
Last month, the Court of Appeal granted an interim injunction against Loob Holding from continuing its operations following an appeal by La Kaffa. The Court of Appeal ruled on June 27 that the injunction was allowed on grounds of breach of post-franchise terms and the return of its properties.
This scenario is not just the fear of losing business, customers, suppliers and goodwill.
Justice Rhodzaria Bujang
In the majority judgment on Thursday penned by Court of Appeal judge Justice Dr Hamid Sultan Abu Backer, a three-member panel of the court ruled that Loob Holding had committed a self-induced misconduct.
“Loob Holding’s strongest point canvassed before us is that the business is ongoing and has expanded. However, they have not produced case laws to support that these grounds are sufficient to seek a stay,” said Justice Dr Hamid Sultan. The second judge on the panel Justice Badariah Sahamid agreed with him.
The dissenting judgment penned by the third judge Justice Rhodzariah Bujang said there were special circumstances to grant a stay of the injunction.
“If the injunction is not stayed pending the leave application, all 179 outlets of Tealive in Malaysia would have to cease operations and all 1,171 of the employees working with Tealive would be out of job. This scenario is not just a mere fear of losing business, customers, suppliers and goodwill”.
“The hardship and inconvenience will not only be suffered by the company but also to the innocent employees and their families which numbered more than a thousand as well as the owners of the premises where Tealive operates.
“There would be no prejudice to La Kaffa if stay is granted because the transgression of its right by Tealive would adequately be compensated by damages,’’ it said.