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KUALA LUMPUR: Jiangsu G&L Food & Beverage Management Co Ltd (G&L) said OldTown Bhd should be held fully responsible for damages and losses faced by franchisees in China like itself.
This came after the formerly Bursa Malaysia-listed coffee maker, which is said to be under criminal investigation for suspected contract fraud in China, had categorically refuted and denied all allegations from G&L that it had ever committed fraud and that its brand of cafes in China had been closed due to a trademark dispute.
“We would first like to clarify that Shenzhen Kopitiam Asia Pacific Ltd (SZKAP), an indirect wholly-owned unit of OldTown Bhd, is being investigated by the Chinese Public Security Bureau for suspected contract fraud, not trademark infringement,” G&L said in a statement yesterday.
It added that G&L in June 2018 reported to China’s Public Security Bureau that SZKAP with the full knowledge that they do not own the trademark “OldTown” in China granted the trademark to China’s franchisees with franchise fees and brand royalties, causing losses and damages to franchisees.
“The Public Security Bureau (PSB) has determined that this meets the criteria of [a] criminal filing for contract fraud. PSB has since opened an investigation into SZKAP on contract fraud.
“G&L expressed that OldTown Bhd, as one of the leading food and beverage corporations in Malaysia, should be held fully responsible for the damages and losses faced by franchisees,” the company said.
G&L, which claimed it had the right to operate OldTown White Coffee outlets within the Jiangsu province, alleged last Tuesday that SZKAP, an indirect wholly-owned unit of OldTown, was under criminal investigation by the Chinese Public Security Bureau for suspected contract fraud.
G&L claimed SZKAP was the one who granted the company the right to operate OldTown White Coffee within the Jiangsu province in May 2016, to use the trademark “OldTown”, and to develop it into a franchising business.
More at https://www.msn.com/en-sg/money/topstories/oldtown-fully-responsible-for-our-losses-claims-gandl
