Sibling rivalry a trademark of enterprises in Taiwan

PHOTO: Sibling rivalry a trademark of enterprises in Taiwan

EAT Seven Bowls is suing Eat Seven Bowls, but it's all in the family.

The founder of a popular maker of savoury glutinous rice and other traditional Chinese dishes is taking the almost identically named business of his younger brother to court, four years after they went their separate ways.

Mr Lee Tung-yuan of Taipei-based Eat Seven Bowls, a trademark he registered in 1986, wants the eatery run by his brother and sister-in-law in Taichung to use its own Eat Seven Bowls trademark and stop using his.

As it is, the two trademarks are easily confused. That of the older Mr Lee is rendered in the Minnan dialect, Chia Qiih Warh , while his brother's uses Mandarin, Chi Qi Wan - with only the character for "eat" rendered differently.

Mr Lee filed an injunction with the intellectual property court last month. He told the China Times newspaper he wished only to protect the reputation of his business, which is much more successful than his brother's.

The Lee brothers, who worked side by side in the early days of the business, are not alone in their fallout: It is not uncommon to find two or more versions of a family-owned eatery in Taiwan, the result of disagreements or power struggles among siblings or uncles and nephews after the family patriarch dies.

The same goes for big family-owned business empires.

The most infamous case in recent years has been the tussle among the nine children by two wives of petrochemical tycoon Wang Yung-ching, founder of Formosa Plastics, who died in 2008 at age 91 without a will.

His oldest son, Winston, has filed multiple lawsuits in the United States, Taiwan, Hong Kong and Bermuda against some of his half-siblings over control of Mr Wang's estimated US$18 billion (S$23 billion) personal fortune.

Such feuds may be more common in Taiwan simply because family-run businesses account for more than 90 per cent of private enterprise on the island and 70 per cent of listed companies, more than those in Hong Kong, mainland China or Singapore, according to the Institute of Directors and Sociologists.

Sociologist Peng Huai-chen of Tunghai University in Taichung said Taiwan's environment is more conducive to family enterprises than the other three economies, despite cultural similarities.

"Early migrants to Taiwan came as a family, unlike the labourers who went to work in Singapore alone," said Associate Professor Peng. "Hong Kong, being a former British colony, has very defined laws and regulations which are less conducive for family businesses," he added. In China, private enterprise was stunted under Communist rule before economic reforms started in the late 1970s.

Family businesses enjoy many advantages over other forms of enterprise, not least of which is dedication and loyalty from executives and stakeholders who are related by blood, and economies of scale for large corporations.

For example, Mr Tsai Chen-yu, the scion of Cathay Financial Holdings, stepped in to co-run the bank with older brother Hong-tu in 2009 after the group registered an unprecedented loss in the global financial crisis. The younger Tsai was to bow out quietly just 16 months later, after the bank returned to an even keel. He spends his days now as a property investor.

But the ties that bind could also handicap a family endeavour as the offspring of the founder fight for control.

Still, sibling rivalry could spur heirs to outdo each other, driving their firms to greater success.

The feuding Wu brothers of the Shin Kong Group, for instance, each has a thriving bank: Taishin earned NT$10.2 billion (S$434 million) last year, the highest in eight years, while Shin Kong reported a net profit of NT$9.82 billion, a rise of 78.7 per cent over 2011.

seokhwai@sph.com.sg

When families fight

WANG FAMILY OF FORMOSA PLASTICS GROUP

Mr Winston Wong, the oldest of petrochemical tycoon Wang Yung-ching's nine children, has been fighting his half-siblings for control of their late father's estate after the patriarch died intestate in 2008, with lawsuits filed in different locations.

WU FAMILY OF SHIN KONG GROUP

The diverse conglomerate was put under the charge of the eldest of four brothers, Tung-chin, after their father died suddenly in 1986 without a will.

But conservative Tung-chin and his upstart third brother Tung-liang struggled to get along, with Tung-liang once ousting Tung-chin as chairman of one of the group's companies in 1996.

The two now run rival banks, Tung-chin the Shin Kong Financial Holding and Tung-liang the Taishin Financial Holding.

THE LEE BROTHERS OF EAT SEVEN BOWLS

Traditional Chinese food product maker Eat Seven Bowls split into two different registered trademarks in 2009 when co-founder Lee Tung-yuan cut business ties with his younger brother Chui-hsin.

But Chui-hsin has continued to use the more established trademark of Tung-yuan, leading the older brother to sue him.


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