Nestle Malaysia faces US$34mn lawsuit over allegations of unauthorised QR code usage

By Pearly Neo contact

- Last updated on GMT

Nestle Malaysia has been slapped with a written summons over the alleged ‘unauthorised and/or unlawful’ use of a QR code by a technology company, which is suing for the sum of RM139mn (US$34mn). ©iStock
Nestle Malaysia has been slapped with a written summons over the alleged ‘unauthorised and/or unlawful’ use of a QR code by a technology company, which is suing for the sum of RM139mn (US$34mn). ©iStock

Related tags: Nestle, Malaysia, Lawsuit

Nestle Malaysia has been slapped with a written summons over the alleged ‘unauthorised and/or unlawful’ use of a QR code by a technology company, which is suing for the sum of RM139mn (US$34mn).

The summons was served earlier this month by Mad Labs Sdn. Bhd. to Nestle Products Sdn. Bhd., Nestle Malaysia’s national distribution centre and wholly owned subsidiary.

As per the writ of summons and statement of claim published on the Bursa Malaysia (Malaysian Stock Exchange), Mad Labs has sued Nestle Products for the ‘unauthorised and/or unlawful use’​ of its QR Code, particularly via ‘wrongful and/or unlawful utilisation and/or printing’​ of the code on its products and/or packaging.

In addition, it has claimed breach of an ‘implied contract’ ​between the two companies, ‘unjust enrichment’ ​of Nestle Products through the use of its code, and compensations for both services rendered to Nestle Products, and the company’s negligence in using the code.

A list of claims revealed that Mad Labs has also asked for RM139mn (US$34mn) from Nestle Products, in addition to the revealing of information on the products and revenue derived from sales that had the QR code attached to Mad Labs.

This was in addition to a request for an order/injunction for the company to ‘immediately cease and desist’​ from further use of the QR code, and the assessment of other damages and costs.

Nestle Malaysia’s official statement in Bursa Malaysia on the lawsuit is that ‘[Mad Labs’] claim is not justifiable​’, ​and the company ‘will be contesting the claim’.

The company has declined to comment further at this time, telling FoodNavigator-Asia​ that: [Because] this is an ongoing legal matter, we are not able to share further information on the subject beyond what we have disclosed in the announcement on Bursa Malaysia.”

“Our solicitors [are] of the preliminary view that [Mad Labs’] claim is without merit and that Nestlé Products Sdn. Bhd. has strong grounds to defend against their claim.”

“Given the above, [Nestle Malaysia] is of the view that the claim is not expected to have a financial and operational impact to the company. Nestlé Products Sdn. Bhd. is not a major subsidiary of the company.”

Nestle Malaysia vs Mad Labs: Round 2?

This was not the first time Nestle Malaysia has been at loggerheads with Mad Labs.

In December last year, a QR code owned by Mad Labs and printed on several of Nestle’s Maggi products were found to link to malicious or offensive website instead of to the official Maggi website.

Nestle Malaysia lodged a complaint about the incident to the Malaysian Communications and Multimedia Commision (MCMC), leading to the shutting down of Mad Labs’ domain www.madlabs.com.my.

MCMC lifted the suspension on Mad Labs’ internet domain later the same month, after it was informed that the site was ‘under maintenance’​ to resolve the problem.

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