Monday, 10 July 2017

Afro Leo

Circulating with SAIIPL, dotAfrica, ASA and Silverware

Several years ago the irrepressible Dr Madelein Kleyn revived the South African Institute of Intellectual Property Law’s newsletter – “IP Briefs”. Afro-IP is pleased to announce that it will assist SAIIPL and Dr Kleyn disseminate the news through the blog in a bid to make the information more accessible.

We start with this month’s newsletter published just recently. In this issue Prof Karjiker provides his perspective on Herbal Zone v Infitech, a triumvirate of talent from CIPC (Sher-Muhammad Kahn, Christiaan Steyn and Warren Rossouw) unpack shape marks in a comprehensive exposé,  Chezanne Haigh from Kisch IP takes a bite at the Kit Kat four finger decision, Darren Olivier provides tips for franchising, Alessia del Bianco provides an in-house perspective on creative IP management, Darren Margo is relaxed over the latest exchange control amendments, and the editor contributes with a nifty piece on SME’s and IP. You can read them all here.
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On Friday Afro-Buff stuck his horn in it by recording that the world’s largest lithium battery may have been destined for Jamestown, SA when in fact it is actually Jamestown, SA. Huh? .. well the difference between them is roughly an ocean, one SA being in South Africa and the other in Southern Australia.
“The post has since been corrected and I hope, unlike the Bell Pottinger apology, largely accepted” said the red faced buffalo on Friday.
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News on the ASA seems to be getting even better. Those companies supporting them that were listed on the blog on Friday reflected the list of supporters on the ASA website. That page (on their website) lists those supporters that have actually paid. Afro Leo now understands that there are a whole heap more that have pledged but not yet paid! That’s got to be good news. Remember if you want to lend them your support, just send them a note here. C’mon IP firms, a fully functioning ASA is good for you too.
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For those interested in the dotAfrica domain name space developments, Tuesday, 04 July 2017 was the start of .africa’s General Availability phase where anyone can register .africa domains through Registrars listed here: http://registry.africa/registrars/. You can find more information on that development here.

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Finally, Afro-IP is pleased to announce that unlike Liverpool (afraid so, Jeremy Speres), they have some silverware in 2017. News just in is that this little community interested in spreading news and views on African intellectual property is ranked in the Top 100  IP blogs in the World. Considering that there are more blogs than impala in mating season these days, that is no mean feat.
Just remember, if you want to get involved, you can in a number of ways. You can contribute by sending us information to report, by commenting on the blog posts in the comment column, by submitting a guest post (ask for the style guide first), by becoming a regular contributor or by taking up one of the characters. Please just email us here.
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Friday, 7 July 2017

Afro-Buff

ASA update, Pottinger & Guptas, Ethiopia's bootleggers and the world's largest battery

Friday first week of July, Africa’s Dimension Data sponsored Tour de France team lost Mark Cavendish; Wimbledon 2017 features Africans from Tunisia, Zimbabwe and South Africa; FIFA has banned Sudanese football clubs from participating in African football competitions, Africans appear on both teams in the Lords cricket test, and CJ Stander turns out in red in New Zealand.

But the "biggest" news of all involves a small town in the Southern Australia, called Jamestown after Africa born and educated Elon Musk (right) announced that the world’s largest lithium ion battery will be built there! Read more about that here and here.

For those readers following the resurgence of the ASA in South Africa, considerable progress has been made. The following companies have come to the party by pledging between them in excess of R4million  (roughly 50% of their immediate requirements) to help fund the ASA:
JHNet Web Development; McDonald's; Gendel Strategic Marketing Group; J Walter Thompson - Cape Town; TopCo 500; TBWA\Hunt\Lascaris; Brand et al; MAKRO; 99c; King James; Promise Group; Clover South Africa; GWK; Pack Leader Pet Foods; Colgate-Palmolive; Pioneer Foods; KIA Motors SA; MTN; SC Johnson; Boxer Superstores; Joe Public; McCann World Group; Wuma Dog Food; Montego Pet Nutrition. Legal firm ENSAfrica has also pledged its support behind the campaign.


Acting CEO Gail Schimmel is pleased with the progress to date saying that there may soon come a time when she has to close the promotional offer to supporters. Basically, if you want to show allegiance to the appeal for an independent regulatory authority, now is the time.

The Economist ran a story on Ethiopia’s ingenious bootleggers highlighting what they regard as endemic culture of IP theft in the country. They hail ATM style kiosks allowing transfer of pirated music and movies as "the brainchild of three Ethiopian science graduates". East African blogger Afro-Gore says this is opportunism and no different to what has happened elsewhere, eg  Piratebay, and that IP rights have been successfully enforced in Ethiopia. Don't write off Africa's second most populous, and oldest independent country!

Yesterday UK based PR firm Bell Pottinger issued an apology to the citizens of South Africa for spreading fake news that had incited racial violence in their work for Gupta owned Oakbay. To readers not familiar with this story, BusinessLive contains the gist of it  here and the commentary will give you an idea of the vitriol that exists against the firm. Locally, the main banks have refused to work for Oakbay over their unique relationship with the President. Afro-Buff wonders if the legal community, including advocates, will take the lead and refuse briefs to represent Oakbay and/or Pottinger, and whether CIPC could refuse to register their IP?
Error: the original post said South Africa and not Southern Australia in reference to the lithium battery development! "SA"is short for both and there is also a Jamestown in SA. This post has been updated to reflect the correct position - apologies though I am.pleased to say Elon Musk is still African. That is no mistake.

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Tuesday, 4 July 2017

Afro-Corne

The link between passing off & provenance - Guest Post


Darren Margo
Afro-Corne is delighted to receive this handy synopsis on recent case law on passing off from the desks of Darren Margo and Natalie Hill of Margo Attorneys. In this post the authors pick up on the recent Supreme Court of Appeal judgment in South Africa in Herbal Zone v Infitech Technologies which covers that situation where an ex distributor turns competitor, and what is then required to stop that business selling products bearing the same name. It is also a reminder on the importance of registering a trade mark. Read on:

Natalie Hill
There have been a number of cases recently dealing with “passing off”, being Global Vitality v Enzyme Process Africa (2015), Pioneer Foods v Bothaville Milling (2014) and Herbal Zone v Infitech Technologies (2017). In each of these cases, the court has dealt with the requirements that need to be satisfied in establishing a successful claim of passing off. These remain unchanged in the latest series of 3 judgments: the successful applicant must show that he has a reputation in the goods and/or services, that the Respondent has misrepresented to the public that its goods and/or services are the same as those of the Applicant and that due to this misrepresentation, the Applicant has suffered damages.

In both the Enzyme and Pioneer Foods cases, the court found that the Appellants had sufficiently proved that they had a reputation in their various products. However, in the Herbal Zone case before the Supreme Court of Appeal (SCA), the Appellant was not successful – it is an interesting exercise to explore why. To be frank, however, the Herbal Zone judgment was coloured more by the paucity of evidence than it was by any issue relevant to passing off – but where that judgment does present something new and interesting is in the issue of provenance, as we explore below.

In the Herbal Zone case, two issues were dealt with, namely passing off and defamation. For purposes of this article we will deal only with the matter of passing off. In a nutshell, the Appellant argued that the Respondent was guilty of passing off its product PHYTO ANDRO FOR HIM – a herbal supplement. The Respondent had originally been a distributor for the Appellant of the product in question, but this relationship came to an end in 2014 whereupon the Respondent decided to import and distribute a similar product itself and market it under the same name. The evidence that was led by the Appellant created some confusion as to which company held the rights and goodwill in the product. Several players were involved in a confusing, veritable rabbit warren of intersecting rights and allegations. To complicate matters further, neither of the parties had attempted to register the trade mark PHYTO ANDRO FOR HIM before this matter went to court. It appears that only once the relationship had soured between the parties did they both attempt to register the trade mark. [This issue, of which party can lay claim validly to the trade mark, now lies before the Trade Marks Office Tribunal]. Before the SCA, neither party could lay claim to the reputation vested in the trade mark because neither party had proprietorship of the trade mark. As a result, the court then had to look at the issue of provenance. In other words, which company is the primary source of the products in question?

This was the second critical issue that had to be dealt with by the SCA. It deduced from the evidence that the goodwill in the product vested in Herbal Zone International as this company is ultimately where the product originated. To summarise the detail: while one of the Appellants was able to demonstrate that he was the proprietor of another of the Appellants, he could not demonstrate, on the evidence, that the Appellants had built-up goodwill and a reputation in the product. Accordingly, the first hurdle to proving passing off could not be overcome – and the matter ended there.   

The important element to be crystallised from the Herbal Zone judgement is how the courts may rely on the issue of provenance when deciding on the matter of reputation. This places tremendous pressure on the Applicant, if it does not have proprietorship of the trade mark relating to the goods and/or services in question, to show that it has a clear and direct link to those goods and/or services by way of being the source or origin of those goods and/or services. Finally, on this point, it was very interesting to note that the SCA cited, with approval, the view expressed by Webster & Page that, in some circumstances, a person who is not the proprietor of certain goods can still acquire a reputation as indicating that they emanate from him: in which case the goodwill adhering to that name or get-up will vest in him (typically: a distributor of those goods).
Handy indeed, thanks Darren & Natalie

 
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Monday, 3 July 2017

Afro-Corne

Sheer Driving Pleasure: Trade Mark Law Through The (BMW) Cases


The Prof
Prof Wim Alberts contacted our resident rhino to post this piece in which he traverses the African savannah, English countryside and Swedish fjords to establish the true meaning of trade mark infringement, in a beemer. This, prompted by the latest BMW decision to emerge from the UK, just last month. Enjoy the ride:

Introduction


A newcomer to the South African trade mark scene can do much worse than to start off his or her career by analysing all cases involving BMW.  This company aggressively enforces its trade mark rights, and we also benefit from it.  Its cases have often clarified legal points or made new law, also in other areas such as design law.  Apart from other decisions dealing with descriptive use etc, first place must go to the Verimark case however.  Many years ago there was the much-talked-about McDonald’s judgment, a few years ago the Laugh It Off decision was (unfortunately?) dominant, and the most worrisome ruling to the trade mark community.  But Verimark is now truly “well-known”.  And, of course, the vital passage in paragraph 7, known by heart by many candidate-attorneys:

“What is, accordingly, required is an interpretation of the mark through the eyes of the consumer as used by the alleged infringer. If the use creates an impression of a material link between the product and the owner of the mark there is infringement; otherwise there is not.”


Here the court made clear what the test for primary infringement is, and also what the role of the origin function/use as a trade mark in our law is (as clarified later in paragraph 3 of the Commercial Auto Glass ruling).  And Verimark, in paragraphs 13-14, also provided guidance on certain dilution aspects – to what is left of our law in this regard after the Laugh It Off judgment.  


United Kingdom

 
From the recent British case in Bayerische Motoren Werke Aktiengesellschaft v Technosport London Limited it appears that the vigorous enforcement of BMW trade mark rights is a trend that can also be found in other countries. 

The Antogonist

BMW's remaining allegations of infringement of the BMW mark concerned the use of the mark in conjunction with the other side’s trading name "Technosport".  There were three such instances:

 

·        Shirts – the leading light behind Technosport wore shirts with Technosport and the BMW mark on it in various forms

 

·        Twitter account – Technosport had a Twitter account with the user name "@TechnosportBMW"

 

·        The van – Technosport owned a van used in its business with the words TECHNOSPORT – BMW across the top

In relation to the law, the court had regard to Bayerische Motorenwerke AG v Deenik [1999] ETMR 339, where the European Court of Justice was asked whether advertisements such as "Repairs and maintenance of BMWs", constituted infringement of a BMW trade mark under Directive 89/104 to approximate the laws of the Member States relating to trade marks.  The court answered that question in the following way at paragraph 64:

"In the light of the foregoing, the answer to be given to the fourth and fifth questions must be that Articles 5 to 7 of the directive do not entitle the proprietor of a trade mark to prohibit a third party from using the mark for the purpose of informing the public that he carries out the repair and maintenance of goods covered by that trade mark and put on the market under that mark by the proprietor or with his consent, or that he has specialised or is a specialist in the sale or the repair and maintenance of such goods, unless the mark is used in a way that may create the impression that there is a commercial connection between the other undertaking and the trade mark proprietor, and in particular that the reseller's business is affiliated to the trade mark proprietor's distribution network or that there is a special relationship between the two undertakings."


The court stated the central problem as follows (para 18, emphasis added):




Nevertheless, the Roundel was excluded: “I have, however, considered what message the van would convey in the absence of the Roundel, as that is the issue which now divides the parties.”  The court found that the average consumer will see the trading style to have an official link.  One reason is that there is nothing in the sign TECHNOSPORT-BMW to indicate that the sign is being used informatively. Although phrases such as "BMW repair specialist" clearly informs the average consumer to the nature of the business, the inclusion of BMW into the trading style does nothing of that kind. It would have been easy to state "BMW repair specialist", distinct from the word BMW (para 28). 


Also, “the presence of a risk of the kind in question does not depend on it being the universal practice of authorised distributors to use that trading style, although of course many did. The risk exists because the use of a trade mark within a trading style in this way, and without further explanation, is naturally taken by the average consumer as an identifier of the business and the services it provides.” (para 31).


Infringement was also found in relation to use on shirts and in the twitter address.


Comments


The principle that can be derived from the case is that you may describe your type of business with some reference to a trade mark.  However, a third party’s mark should not be used in a manner that creates the impression of the existence of a formal association.  This the court found occurred due to the link made between the name of the business and the BMW trade mark.


It would seem that one may say you are “Specialising in BMWs” or a “BMW Specialist”.  How is it ascertained though that someone is a specialist?  In the medical field for instance, the specialist factually specialises in one field, but also has a formal qualification.
 

To provide a proper perspective on the matter, a brief Swedish excursion is perhaps apposite.  In Aktiebolaget Volvo v Heritage (Leicester) Limited [2000] FSR 253, the respondent was an authorised Volvo dealer for a number of years.  After the termination of the dealership agreement, the mark was still used on signage, prominently, in the format “Independent Volvo Specialist.”  The mark was also used on letterheads.  Reliance was placed on a provision protecting descriptive use.  It was accepted that the use was intended to indicate the purpose of the service.  The question that the court however had to consider was whether the use was in accordance with honest practices in industrial or commercial matters.  In this regard it was held (page 263) that:


“In my judgment the defendant’s use of the word ’Volvo’, comprising the registered trade mark of the claimants, in the context of its having previously for so long been an authorised dealer of Volvos, was calculated to cause at least confusion in the minds of consumers, and probably, indeed, also the belief that there was still, to put it at its lowest, some trading connection between the defendant and Volvo.”


The court had particular regard to the Deenik case.  It was said (page 264) that a proprietor cannot prevent a third party from using his trade mark for informational purposes.  However, the position would be different if the impression is created that there is a commercial connection between the party and the proprietor, and in particular that the reseller’s business is affiliated to that of the trade mark proprietor’s distribution network. 


The important principle stated by the court was (page 265) that the defendant could properly describe himself as a Volvo service specialist, on condition however that a distinction be made between his status as such and that of an authorised dealer.  The matter is then seemingly not controversial, because in the Technosport judgment the court (and BMW) had no problem with the use of "BMW repair specialist" (para 28).

 

Thanks to the Prof ...

 
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Tuesday, 20 June 2017

Darren Olivier

'Fu ck You!' it's registrable in the US

Yesterday the Supreme Court in the United States ruled that the law prohibiting the registration of offensive and disparaging trade marks is against free speech rights. This case has interesting implications for all trade mark registries, especially those in countries or regions where constitutional rights exist. It also effectively puts to bed the REDSKINS trade mark dispute in the United States.
The case involved the attempt to register the mark SLANTS by Asian-American band member Simon Tam. It was rejected by the USPTO, the appeal court found that to be unconstitutional and the Supreme Court has now agreed. Prof Wim Alberts provides an excellent summary of facts, and the implications for the REDSKINS dispute, in this Afro-IP post here.
Like many others Prof Alberts predicted that the US Supreme Court would find reason to disagree with the appeal court and so this decision comes as a surprise to many.
The judges held that:
"A law that can be directed against speech found offensive to some portion of the public can be turned against minority and dissenting views to the detriment of all,"
"Speech that demeans on the basis of race, ethnicity, gender, religion, age, disability, or any other similar ground is hateful; but the proudest boast of our free speech jurisprudence is that we protect the freedom to express the thought we hate," 
In the US, as in most countries, there are laws preventing the registration of offensive trade marks. It is not without controversy as these US cases illustrate. In South Africa, the South African registry ruled against the registration of BUM for shirts in 1970 on such grounds and the irritation of US counsel makes amusing reading. He wrote that he:
"fear(s) very strongly for the intellectual level of (the) South Afrikaner" and describes the Registrar at the time as having "not yet climbed out of the slime in which he was spawned..". You can read it in full here.
Just as there would be no question that BUM would be registrable in South Africa today, one questions whether the Government, even in  contemporary South Africa, should or is able to be the purveyor of moral codes on communication. It's as controversial as it is probably, impossible.
My apologies for the heading but you get my point (and it's also not as offensive as it could have been).
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