Supreme Court Lifts Injunction on Samart Scratch Cards

The Supreme Court on Tues­day temporarily lifted an injunction against Cambodia Samart , clearing the way for the mobile phone company to launch its own version of a prepaid billing system using scratch cards.

The company had been blocked from implementing its plan because of legal action taken by its top competitor, MobiTel.

Although a final decision on the injunction is pending, Samart General Manager Somchai Lertwisettheerakul hailed the high court’s decision as a victory.

“We won,” Somchai said Tues­day. “The truth came out.”

With the barrier lifted, Samart will launch a promotional campaign for its scratch cards next month, Somchai said.

Sok Siphana, secretary of state at the Ministry of Commerce, which includes the government’s intellectual property division, said the decision sends the right message to foreign investors. “It’s good news,” he said. “If intellectual property is not protected, the Ministry of Commerce will have a hard time convincing multinational corporations to come here.”

Because it was believed Mobi­Tel’s scratch card was patented with the Ministry of Industry, Mines and Energy in June, the Municipal Court issued an injunction against Samart to prevent it from launching its own scratch card billing system this summer. An appeals court agreed with the lower court.

It turned out, however, that MobiTel did not have a patent and only had applied for one, according to the Ministry of Industry. The patent case has been combined with the injunction case and a final decision will determine whether Samart will be allowed to proceed with its scratch card plan. The case is pending in Supreme Court.

Iain Williams, general manager of MobiTel, said he is satisfied enough that the Supreme Court did not throw out the injunction permanently. “If we win the patent case, then the injunction will be reimposed,” Williams said.

Samart and some intellectual property experts argued that nobody could own a patent to the scratch card because the system is widely used in Thailand and other countries.

“When the case started, it sent a wrong message,” Sok Siphana said. “Hopefully the court’s decision will be maintained. Foreign investment is so important to Cambodia, and one of the most important criteria is intellectual property. We have to prove ourselves worthy that intellectual property will be protected.”

But Ping Siv Lay, deputy director of the technical department of the Ministry of Industry, has maintained that Samart should not be allowed to promote its version of the scratch card until a final decision has been made as to whether MobiTel deserves a patent for its scratch card.

Ping Siv Lay could not be reached for comment Tuesday.

A Western economic analyst said the Supreme Court’s decision was “oddly normal,” referring to criticisms that courts are corrupt and do not support the rule of law. “The court could be telegraphing that it’s going to lift the injunction permanently, or it could decide that in the end, Samart is wrong and it will have to pay damages,” the adviser said.

Despite the realization that MobiTel didn’t have a patent, the municipal court at the end of September found that Samart violated the injunction order be­cause it launched the Samart card—a temporary, alternative option to the scratch card.

While MobiTel’s scratch card bears a hidden 10-digit code number customers scratch to reveal and then dial into their phones, the 12-digit code number on the Samart card is sealed in a packet.

The municipal court said the Samart card is still too similar to a scratch card and found the mobile phone company in contempt of court. Samart had 30 days to recall all the Samart cards on the market.

Samart did not recall the cards, hoping the Supreme Court would find in its favor before the 30-day deadline, which it did, at least temporarily, Tuesday. (Additional reporting by Chea Sovirak)

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