Case Update

Singapore’s First Action against Unknown Persons on Cyberspace

I am happy to announce that my book “Foong’s Malaysia Cyber, Electronic Evidence and Information Technology Law” was recently featured in the Singapore High Court case of CLM v CLN and others [2022] SGHC 46.

The case had referred to our High Court case of Zschimmer & Schwarz GmbH & Co KG Chemische Fabriken v Persons Unknown & Anor which had quoted my commentary in para [8.098] to [8.100] of my book (reproduced below) regarding actions against persons unknown.

CLM v CLN and others [2022] SGHC 46

The Singapore High Court dealt with two (2) interesting and novel points of law.

First, can stolen cryptocurrency assets be the subject of a proprietary injunction?

Second, does the court have jurisdiction to grant interim orders against persons whose identities are presently unknown?

Brief Facts

The plaintiff had commenced an action to trace and recover 109.83 Bitcoin (“BTC”) and 1497.54 Ethereum (“ETH”) (collectively, the “Stolen Cryptocurrency Assets”) that were allegedly misappropriated from him by unidentified persons (ie, the first defendants), a portion of which has been traced to digital wallets that were controlled by cryptocurrency exchanges with operations in Singapore (ie, the second and third defendants).

The Court granted the plaintiff an ex parte proprietary injunction against the first defendant from, among others, dealing with the Stolen Cryptocurrency Assets, and a worldwide freezing injunction.

Action against persons unknown

The Singapore High Court held that there is nothing in their Rules of Court (Cap 322, R5, 2014 Rev Ed) (“ROC”) that requires a defendant to be specifically named. O 2 r 1 of the ROC expressly provides that even if the commencement of proceedings against persons unknown contravenes the ROC, such a contravention is treated as a mere irregularity, and will not result in the nullification of proceedings unless the court exercises its discretion to order the same.

Like how our Court had relied on O. 89 of the Malaysian Rules of Court 2012, the Singapore High Court held that O. 81 of the ROC allows for a reference to persons unknown in summary proceedings for possession of land.

Hence, the Court held that it has the jurisdiction to grant interim orders against the first defendants, who are persons unknown.

Further, the Singapore High Court held that the description of the first defendant must be sufficiently certain as to identify both those who are included and those who are not. In the present case, the plaintiff has sufficiently defined the first defendant as “any person or entity who carried out, participated in or assisted in the theft of the Plaintiff’s Cryptocurrency Assets on or around 8 January 2021, save for the provision of cryptocurrency hosting or trading facilities“.

Stolen cryptocurrency assets as subject matter of a proprietary injunction

The Singapore High Court held that there is a serious arguable case that the plaintiff has a proprietary interest. Cryptocurrencies are a form of property. The Court adopted the test from the English case of National Provincial Bank Ltd v Ainsworth [1965] AC 1175, which defined the term property rights, and held that-

  1. The first requirement is that the right must be “definable” – the asset must hence be capable of being isolated from other assets whether of the same type or of other types and thereby identified. To this end, cryptocurrencies are computer-readable strings of characters which are recorded on networks of computers established for the purpose of recording those strings, and are sufficiently distinct to be capable of then being allocated to an account holder on that particular network.
  2. The second requirement is that the right must be “identifiable by third parties”, which requires that the asset must have an owner being capable of being recognised as such by third parties. An important indicator is whether the owner has the power to exclude others from using or benefiting from the asset. In this vein, excludability is achieved in respect of cryptocurrencies by the computer software allocating the owner with a private key, which is required to record a transfer of the cryptocurrency from one account to another.
  3. The third requirement is that the right must be “capable of assumption by third parties”, which in turn involves two aspects: that third parties must respect the rights of the owner in that asset, and that the asset must be potentially desirable. The fact that these two aspects are met by cryptocurrencies, is evidenced by the fact that many cryptocurrencies, certainly BTC and ETH, are the subject of active trading markets.
  4. The fourth requirement is that the right and in turn, the asset, must have “some degree of permanence or stability”, although this is a low threshold since a “ticket to a football match which can have a very short life yet unquestionably it is regarded as property”. In this respect, the blockchain methodology which cryptocurrency systems deploy provides stability to cryptocurrencies, and a particular cryptocurrency token stays fully recognised, in existence and stable unless and until it is spent through the use of the private key, which may never happen.

The Singapore High Court held that the balance of convenience lay in favour of granting the proprietary injunction. If it were not granted, there would be a real risk that the first defendants would dissipate the Stolen Cryptocurrency Assets, which would prevent the plaintiff from recovering those assets even if he successfully obtained a judgment in his favour. Conversely, even if the plaintiff’s case were later refuted, the first defendants would only suffer losses arising from their inability to deal with the Stolen Cryptocurrency Assets, which could be compensated by way of damages.

Worldwide freezing injunction

The Singapore High Court also granted the worldwide freezing injunction to restrain the first defendants from dealing with, disposing of, or diminishing the value of, their assets up to the value of the Stolen Cryptocurrency Assets.

The learned Judge was of the view that the first defendants dissipated the stolen assets through a series of digital wallets that appear to have been created solely for the purpose of frustrating the plaintiff’s tracing and recovery efforts, and which had either no or negligible transactions other than the deposit and withdrawal of the Stolen Cryptocurrency Assets.

Moreover, the risk of dissipation in the present case is heightened by the nature of the cryptocurrency: the Stolen Cryptocurrency Assets are susceptible to being transferred by the click of a button, through digital wallets that may be completely anonymous and untraceable to the owner, and can be easily dissipated and hidden in cyberspace.

Ancillary disclosure orders

Ancillary disclosure orders were also made against the second and third defendants to disclose to the plaintiff the current balances of the second and third defendants’ accounts that were credited with BTC and ETC that are traceable to the Stolen Cryptocurrency Assets, and information and documents collected by the second and third defendants in relation to the owners of the relevant accounts in the second and third defendants and details of all transactions involving the relevant accounts in the second and third defendants from the dates on which the stolen assets were credited against the accounts.

Bread & Kaya: 2017 Cyberlaw cases Pt3 – sexual offences against children and computer crimes

By Foong Cheng Leong | Mar 30, 2018
– Sending death threats using someone else’s mobile phone is not OK
– 2018 will mark interesting year for cyber related cases including Uber driver suing Uber

THE first statute in Malaysia to use the term “social media” is part of the law designed to protect children against sexual offences and not any computer crimes related or media related law.

At the same time a bank officer got into hot soup for using their superior’s email account and password. Let’s go through these cases now.


Sexual Offences Against Children Act 2017

The Sexual Offences Against Children Act 2017 was introduced to address the seriousness of sexual offences committed against children in Malaysia. The ultimate object of the proposed Act is to provide for better protection for children against sexual offences and to safeguard the interest and well-being of children and to provide effective deterrence.

One of the laws introduced is the law against child grooming. S. 12 of the Act states that child grooming is an offence punishable with imprisonment of no more than 5 years and liable for whipping. The Act specifically stated that the following amounts to child grooming :-

(a) A communicates with Z, a child via social media by pretending to be a teenager and develops a love relationship with Z with the intention of using Z in the making of child pornography. A never meets Z. A is guilty of an offence under this section .

(b) A communicates with Z, a child via e-mail and befriends Z with the intention that A’s friends C and B could rape Z. A never meets Z. A is guilty of an offence under this section.

This law is also the first statute in Malaysia to use the words “social media”.

Last year, we were anticipating the amendments of the Communications and Multimedia Act 1998. However, the amendments never came. Nevertheless, numerous people were investigated under s. 233 of the Communications and Multimedia Act 1998. Notably, in the case of Mohd Fahmi Redza Bin Mohd Zarin Lawan Pendakwa Raya dan Satu Lagi Kes (Kuala Lumpur Criminal Application No. 44-103-08/2016), the accused was charged under s. 233 of the Communications and Multimedia Act 1998 for publishing an offensive Instagram posting using the username kuasasiswa. The accused filed an application to strike out the charge on the grounds that:-

– s. 233 of the Communications and Multimedia Act 1998 is unconstitutional and/or ultra vires in view of Article 5(1), 8 and 10(1)(a) of the Federal Constitution
– the charge against him acts as and/or has the characteristic of a censorship and therefore in contravention of the objectives of the CMA according to s. 3(3) of the CMA; and
– the charge against the accused is defective as it does not have the details of the parties that were offended by his acts.

The Public Prosecutor applied to have the matter heard before the Federal Court in respect of the issues on the constitutionality of s. 233 of the CMA (in accordance with ss. 30 and 84 of the Courts of Judicature Act 1964. Upon hearing the parties, the High Court referred the matter to the Federal Court for the latter to decide on the following question:-

Whether Section 233(1)(a) of the Multimedia and Communication Act (Act 588) is Inconsistent with Article 5(1), 8 and 10(1)(a) of the Federal Constitution?

However, the Federal Court dismissed the application for non-compliance of the Courts of Judicature Act 1964 (Federal Court Criminal Application No. 06-04-04/2017(W)).

In Nik Adib Bin Nik Mat v Public Prosecutor (Rayuan Jenayah No 42S(A)-39-7/16), the accused was charged under s.233(1)(a) of the Communications and Multimedia Act 1998 for sending indecent and false photos of cabinet leaders titled “Pesta Bogel” on Facebook. He was also charged under s. 5(1)(a) of the Film Censorship Act 2002 for possession of 883 pieces of pornographic videos in his laptop. The Session Court sentenced him to the maximum sentence of 1 year imprisonment for the first offence and another 1 year imprisonment for the second offence.

On appeal, the High Court Judge stated that “cyber offences are serious offences especially the offence at hand, as those offensive materials could be easily disseminated to the public at large within seconds at a touch of a button” and agreed with the Sessions Court Judge that public interest is of paramount importance and should supersede the interest of the accused.

However, the learned High Court Judge was of the view that personal interest of the accused should not be disregarded at all and thus, allowed the appeal against the sentence. The learned High Court Judge took into account the grounds submitted by the accused and held that the misdirection of Session Court on imposing maximum sentence for the first offence warrants the appellate intervention and a special consideration ought to be given so that he can mend his ways and “turn over a new leaf”.

The High Court substituted the original sentence with 1 week imprisonment and a fine of RM3,000 in default 3 months imprisonment for the first charge and for the second charge, a fine of RM10,000 in default 1 ½ years imprisonment.

In Pendakwa Raya v Dato’ Dr Ahmad Ramzi Bin Ahmad Zubir (Rayuan Jenayah No. T-09-15-01/2014), the Respondent was charged with criminal defamation after he had sent text messages containing death threats to various individuals using another person’s (SP5) mobile phone number via an online platform registered in the name of a colleague of the Respondent (SP16). The said online platform allows users to broadcast SMS to numerous mobile numbers via the Internet. The Respondent had changed the sender’s mobile phone to SP5’s mobile number. The Respondent’s convicted by the Sessions Court but his conviction was overturned by the High Court.

On appeal, the Court of Appeal restored the conviction. In the grounds of judgment, the Court of Appeal discussed on the method used to determine whether the SMS was sent by the Respondent. The investigation had showed that the internet protocol address that was used to send the SMS was registered to the Respondent’s internet account. The MAC Address found was the same MAC Address of the Respondent’s router. According to the evidence provided by Cyber Security Malaysia, a MAC Address is a unique number provided by the Internet Service Provider and in order to connect to the Internet, it must be done through a router.

In Pendakwaraya v Charles Sugumar a/l M. Karunnanithi (Mahkamah Majistret Kota Bharu Kes Tangkap No: MKB (A) 83-43-02/2016), the accused was charged under s. s. 424 of the Penal Code for dishonestly concealing money of a scam victim in his bank account knowing that the said money does not belong to him. The victim had befriended a person by the name of Alfred Hammon from UK through Facebook. Alfred Hammon then made the victim transfer money to the accused’s bank account on the pretence that he needed the money to cash his cheque of US$3 million. Alfred Hammon promised that he will return the money together with interest. However, after transferring RM36,300 the victim realised that she was scammed.

The accused claimed that he is not part of the scam. The accused claimed that when he was working as a tour driver, he was requested by his customer to receive money on the customer’s behalf. The accused claimed that he did it to give his customer the best service so that he can attract more customers. He said that he was informed by the customer that the customer’s friend had to transfer money to him so that the customer can continue his tour in Malaysia. The accused said that he did not gain any remuneration or commission from that assistance.

The Magistrate acquitted the accused as the Magistrate found that, among others, the accused’s evidence is consistent and is a credible witness. The Magistrate agree that the accused was made a scapegoat by the customer who took advantage of his goodness and sincerity in giving the best service as a tour driver.

Computer Crimes Act

In Rose Hanida Binti Long lwn Pendakwa Raya (Kuala Lumpur High Court Criminal Appeal No. 42K–(115–124)-09/2016), the appellant was charged under the Computer Crimes Act 1997 (unauthorised access to computer material with intent to facilitate the commission of an offence involving fraud or dishonesty or which causes injury) and s. 420 of the Penal Code (for cheating) for making false claims to his employer, a bank, by using his superior’s account and password to without his superior’s knowledge. She was initially sentenced by the Sessions Court with 4 years of imprisonment and fine of RM260,000 in default of 15 months jail. She appealed the sentence but withdrew it later. Notwithstanding that it had been withdrawn, the High Court Judge exercised his revisionary powers and enhanced the sentence to 6 years and fine of RM260,000 in default of 15 months jail due to the seriousness of the offence.

In Kangaie Agilan Jammany lwn PP [2017] 1 LNS 1640, the accused was charged under s. 5(1) of the Computer Crimes Act 1997 for making modification of the contents of Air Asia’s flight booking system without authorisation. The accused had allegedly used the function “move flight function” in those unauthorised transactions to change, among others, the flight details and customers’ emails for the purpose of notification. The said function is a critical function to allow authorised staff to make changes so that no charges are made to customers.

The accused was given an ID ‘6954’ and password to access Air Asia flight booking system but he had limited access to it. Thus, one of the witnesses, SP4, had given his ID and password to the accused after the accused had requested for it on the ground that the latter is unable to access to the system using his own ID. SP4 did not know that the accused had misused his account. The accused had then used the said account to help his family members and friends to get cheaper flight tickets, among others. Air Asia alleged that it had lost about RM229,100.42 due to the accused’s actions.

In the system log, it was found that the accused had changed the flight schedule and also that there were a few customer email notifications which involved the agent code 6954 which had made the flight changes. Further, there was an incident whereby SP4 was asked by the accused to provide his new password after it had been changed.

The Sessions Court found the accused guilty and had applied the statutory presumption under s. 114A of the Evidence Act 1950 after the accused could not rebut the evidence that the agent code 6954 belongs and used by him.

Under 114A of the Evidence Act 1950, a person is deemed to be a publisher of a content if it originates from his or her website, registered networks or data processing device of an internet user unless he or she proves the contrary. In 2014, this new law sparked a massive online protest dubbed the Malaysia Internet Blackout Day or also the Stop114A.

On appeal, the High Court concurred with the Sessions Court Judge. The High Court Judge also held that s. 114A of the Evidence Act 1950 applies retrospectively notwithstanding that the offence was committed prior to the enforcement of s. 114A as the presumption did not alter the original subject matter and even includes the same subject matter that did not prejudice the accused before and after. In other words, without using such presumption, the Prosecution would still have to prove that the Accused was the person who used his ID and password to access the employer’s system had committed an offence to change the flight schedule without authorisation. On the contrary also by applying the presumption of the law, the Prosecution will still have to prove that the accused alone has a specific ID and password to access the system.


2018 will mark another interesting year for cyber related cases. In late 2017 and early 2018, the following cases have been filed:-

– A Uber driver sued Uber Malaysia Sdn Bhd for non payment of his fees. The interesting question in this case would be whether Uber Malaysia Sdn Bhd is liable to pay such fees or one of Uber’s foreign entities.
– In the Intellectual Property Court of Kuala Lumpur, a brand owner had filed a law suit for trade mark infringement against a web hosting company for hosting a website that sold counterfeit products. The interesting question in this case is whether a webhoster is liable for what their subscribers do.
– In the same Court, a brand owner had also filed a law suit for trade mark infringement against online marketplace operator for using the brand owner’s registered trade mark and allowing their users to sell unauthorised products. The interesting question in this case is whether an online marketplace operator is liable for what their users do on their platform and in particular case, for selling unauthorised products.
– The same Court also granted an application to serve a Writ and Statement of Claim via email and WhatsApp messenger after it could not locate the Defendant at her last known address. Traditionally, when a Defendant cannot be located, Plaintiff would normally ask the Court to allow a notice relating to the lawsuit to be published in the newspaper, among others. We will see more and more substituted service applications to be served electronically.
PKR communications director Fahmi Fadzil filed a civil suit against the Malaysian Communications and Multimedia Commission and Nuemera (M) Sdn Bhd for allegedly failed to protect his personal data which resulted in the leakages of his personal data together with personal information of 46.2 million mobile subscribers. This was one of Malaysians’ biggest data leak.

Finally, the recent introduction this month of the Anti-Fake News Bill 2018 is too important for me to leave till next year to comment!

The word “fake news” is defined as any news, information, data and reports, which is or are wholly or partly false, whether in the form of features, visuals or audio recordings or in any other form capable of suggesting words or ideas.

The law applies to fake news concerning Malaysia or the person affected by the commission of the offence is a Malaysian citizen. Any person who, by any means, knowingly creates, offers, publishes, prints, distributes, circulates or disseminates any fake news or publication containing fake news commits an offence and shall, on conviction, be liable to a fine not exceeding RM500,000 or to imprisonment for a term not exceeding 10 years or to both.

The Court may also order the accused to make an apology. Interestingly, the new law allows civil action to be initiated by a person affected by the fake news publication for an order for the removal of such publication. I will write further on this new law on a separate article. [Postscript: The Anti Fake News Act 2018 is now in force effective from 11 April 2018]

First published on Digital News Asia on 30 March 2018

Battle of the Satay Celup Restaurants

Ban Lee Siang restaurants – used with permission of

Ban Lee Siang is a well known satay celup restaurant in Melaka. It consists of two adjoining shops operated by two different owners who are brothers. The shop was started by their other brother in 1987.

Although both restaurants are named “Ban Lee Siang”, they are both known as Restoran Makanan and Minuman Ban Lee Siang and Restoran Ban Lee Siang. The former was taken over by the Plaintiff in 1997 and the latter was started by the Defendant in 2004.

In 2012, the Plaintiff filed a lawsuit against the Defendant over the use of the name Ban Lee Siang. The Plaintiff alleged that he is the exclusive and registered proprietor whereas the Defendant is merely a licensee. The Plaintiff terminated the licence via a letter.

The Plaintiff’s registered trade mark

However, the Defendant alleged that he is a joint proprietor of the trade mark as he had purchased the business jointly with the Plaintiff and their mother.

The High Court held that:-

1. Based on the evidence provided, the trade mark BAN LEE SIANG was not only sold to the Plaintiff but also to the Defendant and their mother (paragraph 15);
2. The Defendant is a honest concurrent user (pursuant to s. 40(c) of the Trade Marks Act 1976 (TMA)) but also entitled to file an application under s. 20 of the TMA to be a joint proprietor (paragraph 16); and
3. Since the Plaintiff did not object to the use of the trade mark from the date of establishment of the Defendant’s restaurant until the date of the letter terminating the alleged licence, this shows that the Plaintiff had indeed allowed the use of the trade mark. Thus, following s. 40(c) and (dd) of the TMA, there is no trade mark infringement (paragraph 17).

Download: Chua Cheng Kiat b/s Kedai Makanan dan Minuman Ban Lee Siang v Chua Cheng Ho b/s Restoran Ban Lee Siang

Can a franchise agreement be executed before the registration of the franchise in Malaysia?

In a recent High Court case, the Court held that a licence agreement can qualify as a franchise agreement and a licensor cannot offer to sell or provide a franchise until his franchise is registered in Malaysia.

Munafya Sdn Bhd v Profquaz Sdn Bhd

The Defendant operates an Islamic education system or syllabus for preschool children under the name Children Islamic Center (CIC). CIC is a franchise registered with the Ministry of Domestic Trade, Cooperative and Consumerism (“MDTCC”) and also with the Ministry of Education (“MoE”) (collectively referred as the “Ministries”).

Before the said registrations with Ministries, the Defendant entered into a licence agreement granting the Plaintiff the right to operate the CIC.

After the necessary preparation was done, the Plaintiff discovered that CIC was not registered with the Private Education Division of the MoE. The Plaintiff demand proof of registration but the Defendant failed to do so. However, the Defendant subsequently took steps to register CIC with the Ministries. Before the grant of the registrations, the Plaintiff terminated the agreement and demanded for, among others, a refund of RM35,000.

In allowing the Plaintiff’s claim, the High Court held that, among others:-

1. Notwithstanding that the agreement is in essence a licence agreement and the word “franchise” is not pleaded, the Malaysian Franchise Act 1998 is applicable. Under s. 6(1) of the said act, a franchisor shall register his franchise with the Franchise Registrar before he can make an offer to sell the franchise to any person.

2. In view that the Defendant had failed to register its CIC franchise with the Ministries before the signing of the licence agreement, the Defendant cannot offer or give the CIC licence to the Plaintiff. Therefore, the Plaintiff’s termination is not premature.

Symphony Light & Sounds Services Sdn Bhd & Anor v Irwan Shah Bin Abdullah @ D.J Dave & Ors

Kuala Lumpur High Court Suit No.: S-22-1010-2007

The Plaintiffs initiated an action against Defendants for allegedly misappropriating their copyright by way of fraud and deception. The subject matters in dispute are proposals entitled “Malaysia’s 50 years an illuminating Journey”. The Plaintiffs alleged that the Defendants had secretly sent the subject matter to the Ministry of Culture, Arts and Heritage.

The Plaintiff claimed that their concept of “large format lightings, projections and special effects” for the purpose of outdoor audio visual performance is artistic works pursuant to the Malaysian Copyright Act 1987.

The High Court held that Plaintiffs failed to show evidence that such concept is their creation and it is original.

Case dismissed with costs to be taxed.

Download: [Judgement]

Shaifubahrim Bin Mohd (as President and Council Member of Persatuan Industri Komputer dan Multimedia Malaysia (PIKOM) and representing all members of PIKOM) v EM Exhibitions (M) Sdn Bhd & Anor

Kuala Lumpur High Court Suit No: D5 – 22IP – 76 – 2010

Plaintiff is the owner of registered trade mark “PC Fair”. The Defendants in this case had used the trade mark “PC Expo” for their computer exhibition.

Plaintiff initiated an action against the Defendants for trade mark infringement, passing off and breach of confidence.

The High Court dismissed the Plaintiff’s action for trade mark infringement and passing off but allowed the action for breach of confidence.

Download: [Judgement]

Kuang Pei San Food Producs Public Company Limited v Wes Marketing Co Sdn Bhd (No 2)

Sabah and Sarawak High Court Suit No. S22-231-2009-III

Trade mark infringement, passing off and copyright infringement of the brand SMILING FISH. Plaintiff succeeded in trade mark and copyright infringement but not passing off due to failure to prove damage.

Judgement: [Download]

B.Braun Melsungen AG & Anor v Meds Sdn Bhd & Ors

Kuala Lumpur High Court Suit No. D – 22IP – 23 – 2011

Patent infringement – interlocutory injunction – whether claim of invalidation is a serious issue to be tried – whether balance of convenience lies on the Plaintiff due to damage to goodwill and reputation – whether the Defendants, being new in the market and having a small market share, should be restrained.

Download: [Judgement]

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