Wednesday, 30 September 2009

Mr Video appeal

Yesterday the Supreme Court of Appeal handed down its decision in the much awaited Mr Video case. This original case was reported on by Afro-IP last year (here) and since that time has had many a practitioner twisted around the logic of the Copyright Act applied to the rental of DVD's under contracts of exclusivity. Those who felt confused will still feel confused - this judgment did not delve deeply into that logic when focusing on the grounds of appeal which were:

a. the standing of Nu Metro (it being contended that Nu Metro had not proved that it had a valid licence to proceed against the Video Group)
b. the Owner's entitlement to order for delivery up; and
c. three issues as to costs

Right: copyright koeksister - before Mr Video (left diagram) after Mr Video (right diagram)

Advocates Ginsburg SC and Marriott had the successful trip to Bloemfontein this time. Sholto-Douglas SC and Gordon, appearing for the Appellants, were not as fortunate as the appeal bench dismissed the appeal on all three grounds finding that:

a. Nu Metro was entitled to join the proceedings as the only local distributor of the Owners in circumstances where the Video Group had conceded to copyright infringement;
b. The judge's discretion to order delivery up of the DVDs was warranted. It was not necessary for the Owners to allege and prove that the making of the article (DVD's) in RSA by the person who as a fact made the article in the USA would have constituted an infringement in RSA. The Judge felt that there was an inference that such infringement would occur (ed- those wanting an explanation of exactly how the infringement occurs under the Copyright Act will be disappointed); and
c. The conduct of the Video Group (eg the flagrant way in which the Group bypassed the coding restrictions) justified an order for a special/higher costs award against them.

The Mr Video facts seem quite antiquated in a copyright space dominated these days by the issues relating to peer-to-peer file sharing concerns, as illustrated in the recent Pirate Bay case in Sweden and its commentary (see here, for instance). The decision does show though that RSA courts recognise and enforce the rights of content creators and are likely to do so whatever the format of the copying or sharing.

Monday, 28 September 2009

Copycat comments: PUMA's failure

Last week Afro-IP reported on Puma's failure to win an infringement appeal - see here. Afro-IP now briefly looks at whether copycat businesses are best fought on dilution grounds and whether devices on shoes are really mere adornment.

left: decorative or distinctive?


1. Was the PUMA case a case to be fought under S34(1)(a) or was it not really one for unfair advantage and detriment under S34(1)(c)?

Copycat businesses make their livelihood as close as possible to the IP protection frontiers of the registered IP holders. Look-a-like or copycat businesses have the advantage of considering the trade mark register before deciding to adopt a potentially similar (but not identical) device, together with a name that is not similar. This allows them to trade without causing "a likelihood of confusion" (the crux of S34(1)(a)) whilst at the same time getting those increased sales that justify their business model. Global Warming successfully did just that.

Under S34(1)(c) it is not necessary to show a "likelihood of confusion". The crux of this infringement section involves showing unfair advantage and detriment to the distinctive character of the complainant's trade mark - more appropriate in this type of case one would have thought. One suspects that the initial sniper-like approach of Puma in only claiming S34(1)(a) was because they were interested in the cost (and time) saving attached to showing a mark to be well known under S34(1)(c). Perhaps I am missing something?

2. One tends to underestimate the importance of devices (eg the Puma device, The Nike Swoosh, the Adidas three stripes) as distinctive markings on shoes. Consider how you recognise and purchase sport shoes - is the device or the wording more recognisable? Perhaps this is why counsel for Global Warming, correctly in my view, did not raise argument that the device was mere adornment (as Judge Harms appeared to hope for)? Afro Leo also feels that the judgment (even if ultimately correct) was a little too quick to conclude that the presence of PUMA word mark in the first registration was necessarily fatal to PUMA's claim, without reasoning its importance within the mark when viewed as a whole.

3. The fact that use of the mark on Global’s packaging differed from that used on the shoe (held to be irrelevant) may well be relevant if it was pleaded as an independent infringing use of the trade to be considered on its own merits. It is not clear from this judgment what the High Court judge had held.

Friday, 25 September 2009

ECJ closer to Adwords decision

The advocate general of Europe's highest court, Poiares Maduro, gave his backing yesterday to Google's controversial AdWords system. The opinion is not binding on the European Court of Justice (ECJ), but the court tends to follow the advocate general's opinion in the majority of cases. Source: World Trademark Review (WTMR).

RSA and other African courts tend take the lead from the ECJ so the advocate general's opinion is a useful guideline for this hotly contested topic. This is what he had to say, according to WTMR:

"Poiares Maduro states that Google has not committed trademark infringement by allowing advertisers to select, through the AdWords system, keywords corresponding to trademarks on the grounds that such selection is not use in the form of a sale of a product or service to the general public. Therefore, this use cannot be considered as being a use made in relation to goods or services identical or similar to those covered by the trademark. Similarly, advertisers themselves do not commit a trademark infringement by selecting keywords corresponding to trademarks. Poiares Maduro also reasons that the sponsored links themselves do not cause trademark infringement as they do not establish a risk of confusion on the part of consumers as to the origin of goods or services. According to the advocate general, internet users are aware that other sites, not just the rights holder's site, will appear in search results. He adds that internet users' access to information concerning the trademark should not be limited to or by the mark owner even if the mark at issue has a reputation."

A final decision from the ECJ is not expected until early next year.

Is Caterham retrospective? RSA decision

Brand enforcement lawyer Candice Spargo alerted Afro-IP to the recent case of Mayo Foundation for Medical Education and Research v Theatre Mayo Clinic Company (Pty) Ltd and Others (1428/2006 ) [2009] ZAGPPHC 110 (14 September 2009) in which the Applicant relied predominantly on passing off, in requesting a change of name.

"The matter was complicated in that the Respondent's use of the MAYO trade mark began in 1974! One of the key issues argued in the matter was that the change in the common law as held in the Caterham case (ed - this case allowed a claim for passing without requiring a physical presence in RSA which had been a major problem for foreign rights holders until then) applied retrospectively. The Applicant argued that despite it not having a physical presence in South Africa at the time of the alleged passing off, the change in law in the Caterham case applied retrospectively, and the Applicant could prove a reputation in SA on that basis. However, Southwood held that the common law principles, as held in Caterham, do not apply retrospectively and the application was dismissed (pages 21 - 24)."

Afro Leo says this must be correct - imagine the floodgates that would open if it did apply retrospectively. It would have been great news for lawyers but difficult to explain to businesses that had chosen names/get-up that were considered lawful at the time.

Wednesday, 23 September 2009

WIPO and Kenya to Collaboration in dissemination of Patent Information

According to a WIPO press release, Kenya’s Minister of Industrialization, Mr. Henry Kosgey, and the Director General of WIPO, Mr Francis Gurry, have signed a cooperation agreement regarding access and dissemination of Kenya’s national patent documents.

According to the release, WIPO has signed similar agreements with other intellectual property offices of developing countries to enhance access to patent information.

Through the patentscope® database hosted by WIPO, it is possible to search through the collection of national patents of various developing countries such as Korea, Singapore, South Africa, Cuba, Mexico, Vietnam, Israel and ARIPO.

One liners

The Kenya Copyright Board has embarked on an intensive campaign against software piracy through sustained and sporadic raids on suspected targets and it is working. (read more here).

CIPRO is no longer publishing Companies and Close Corporation notices in respect of registration, deregistration, amendments, company name changes, restoration, liquidation and conversion in the Government Gazette. Rather the information can be located here.

The Southern African Customs Union (Sacu) has agreed to redouble efforts to resolve outstanding issues in signing trade deals with the European Union (EU) and hinted at the possibility of change in Sacu's structure. Business Day

China does not plan to renew a voluntary two-year restriction on textile exports to South Africa imposed after unions complained that cheap imports were hurting local manufacturers. Business Report.

Despite a Patent Act which precludes software from being patented in South Africa, Microsoft holds more than 300 patents locally, most of them for software processes. My Broadband

Arab IP Centre has been launched by the League of Arab States and is designed to promote intellectual property in the area.

There is evidence that sub-Saharan Africa stands to see the exponential rise the revenues from non-mineral exports through IP based strategies. See DFID support study.

Senegal will this year re-launch the President's Grand Prize for technological promotion and innovation after almost 10 years of dormancy. Read more here.

Friday, 18 September 2009

Thabani Winery appeal decision

It is trade mark appeal fortnight and here is another decision: Jabulani Ntshangase built up and registered the brand, THABANI VINEYARDS & WINERY. Jabu had labels made on behalf of Thabani Wine (Pty) Ltd of which he was a director and a shareholder before coming across a bottle labelled THABANA: CHARDONNAY which he considered as an infringement of his mark. Jabu and his company sought an order from the Court restraining the use of THABANA or any mark similar to THABANI VINEYARDS & WINERY and was successful, a decision which was then taken on appeal. The appellant claimed that the trade mark registration was invalid because Jabu’s registering the marks in his own name was adverse to the Company’s interest and that he had no bona fide claim to the ownership of the trade marks. Furthermore, that the mark (as used ie Thabani) was not the same as the mark (as registered Thabani Vineyards & Winery) and therefore the registered trade mark could be cancelled and/or that Jabu and his company had acquiesced to the use of the mark THABANA through delay. Trade mark enthusiast Msawenkosi Gaxo (Bowman Gilfillan) provides a well written summary of the appeal decision here. Afro Leo thinks the court got it right in dismissing the appeal, but what about you? The case can be located here and is best considered with a glass of your favourite tipple.

Wednesday, 16 September 2009

Copycat success - Puma appeal dismissed

The Supreme Court of Appeal has handed down its second decision in a few days on trade mark issues - one that will be seen as a victory for copycat businesses. Thanks to Debbie Marriott for the tip off.

Puma AG Rudolf Dassler Sport sued Global Warming (Pty) Ltd for trade mark infringement. Two trade marks and a copycat shoe were in issue (see representations here). Puma sought relief by way of an interdict and damages calculated on a notional royalty basis on the basis of section 34(1)(a) of the Trade Marks Act 1993 (in this case: similar mark/identical goods/likelihood of confusion). The High Court, after hearing evidence, dismissed the claim with costs. The Supreme Court of Appeal (per Harms DP, four others concurring) dismissed the appeal in a quick and lucid judgment. Puckrin SC, Joubert and Newdigate SC were in action this time.

The Court held that:

1. "Puma’s reliance of the first registration is doomed because of the prominence on the name PUMA" (see para 7 ).

2. Re the second registration: "As a matter of first impression I came to the same conclusion as did the trial court (ed: ie no likelihood of confusion). Argument did not convince me to the contrary..." (see para 9).

The appeal court did not dispute that "...the likelihood of confusion or deception involves a value judgment; that a global appreciation is required; that regard must be given to the overall impression given by the marks; and that registered trade marks do not create monopolies in relation to concepts or ideas."

For a description of the relevant registrations relied on by Puma see para 3.

Right: Copying cats made easy

The SCA, helpfully, corrected the High Court on a number of other issues which were found to be irrelevant (I) or wrong (W) (paras 10 - 12):

1. that the mark on Global’s packaging differed from that used on the shoe (I);

2. that Puma after instituting action in this case applied for registration of a trade mark that approximated Global’s stripe (I);

3. that Puma did not produce in evidence, as it undertook to do, a shoe with either of these trade marks (I);

4. the subjective intention of Global in adopting the stripe (I); and

5. the claim for notional royalty could not have succeeded in the absence of proof of actual loss (W).

One also felt that the Harms DP would have welcomed the opportunity to decide on the applicability of the ECJ Adidas decision on the South African infringement test (see para 6) ie whether Global's use of device on the shoe was mere adornment or actually a source identifier, and to what extent it matters. It seems a pity that argument was not lead - Afro Leo would have welcomed it too. Further commentry to follow.

Sunday, 13 September 2009

Counterfeit medicine clicks

The World Health Organization (WHO) has stepped up their efforts to combat the creation and distribution of counterfeit malaria pills in Africa. WHO estimates that upwards of 2,000 children a day are being killed as a result of taking these phony medications. (MediaGlobal)

As part of United States efforts to combat transnational crime and promote the protection of intellectual property rights (IPR) worldwide, the State Department has approved eleven projects totaling $3.9 million in Fiscal Year 2009 (FY09) anticrime funds. These funds will enable U.S. law enforcement agencies and diplomatic missions to collaborate in the delivery of criminal enforcement training and technical assistance programs on IPR protection to foreign law enforcement partners. Sub-Saharan Africa Regional is allocated $972,000 for IPR regional workshops for law enforcement officials in West Africa (including Nigeria) and nations belonging to the East African Community (EAC) and Southern Africa Customs Union (SACU), with particular emphasis on fighting the spread of counterfeit pharmaceuticals, including HIV-AIDS drugs. (US department of State)

Rwanda - experts from Health Action International (HAI) Africa, a civil society organization, in conjunction with Oxfam, have warned that, a growing push by countries to enact anti-counterfeit laws could undermine access to affordable medicines in Africa. (allAfrica)

Friday, 11 September 2009

Content war gets nastier - hunger strikes

Readers may recall a story that broke a few months back describing how the content industry in South Africa formed a coalition (TVIEC) to protest against the SABC's IP and payment policies. The coalition staged an uprising which played a big part in forcing SABC board resignations and them begging for a government bail out. The story continues with a hunger strike.

"Accusations, counter-accusations, hunger strike, protests, name-calling, defiance, denialism, late payments, delayed procurement, deferrals and axing. These are just some of the fundamental characteristics of the local content ‘battle for survival' currently being fought between the SABC and the TV Industry Emergency Coalition (TVIEC). And it is turning nastier day after day." (Issa Sikiti da Silva).

Thursday, 10 September 2009

Francis Gurry Helps NCC Celebrate 20 Years

The Nigerian Copyright Commission recently celebrated its 20th Anniversary.  In addition to awarding prizes to the winners from the Commissions Essay Competition, the gala night included a special visit from WIPO Director Francis Gurry. 

With speeches, dance performances, book readings and appearances by many of Nigeria’s dignitaries, the celebration appears to have been a fun time for all.  A lengthy report of the entire evening’s events can be found in an article by The Guardian, available here.

Unpublished apartheid photographs in copyright row

On 26 August the Regional Court of Berlin issued an injunction against the South African picture agency Africa Media Online (AMO). Applicant is the South Africa chronicler Jürgen Schadeberg. The injunction relates to more than 200 unpublished photos of the internationally recognized photographer from the years 1952 to 1959. In 1964 the photographer needed to leave the negatives behind in South Africa, since he was observed by the Apartheid's secret police. At that time he could only leave the country with hand baggage. (Source: 1709 Copyright Blog & Cloud Computing Journal)

Click here for example photographs by Jurgen Schadeberg as published on Google.

Tuesday, 8 September 2009

SCA decision on generic marks - (a) Lotto?

Yesterday the Supreme Court of Appeal handed down its judgment in the Lotto case. The five judge appeal bench, after entertaining argument from Ginsberg SC and Salmon SC (for Online Lottery Services (Pty) Ltd (“Online”) - appellants) and Bowman SC and Du Plessis (for National Lotteries Board (the “Board”) and Uthingo Management (Pty) Ltd (“Uthingo”) – respondents), upheld the appeal in all substantive respects. Although one would have welcomed a more precise and accurate decision (which in places is just wrong) from such a powerful bench, the case illustrates that the South African test for distinctiveness remains somewhat different to the European test and also, that a registration certificate is simply a first glance proof of right, even after substantial use of the mark.

The contested mark is LOTTO. The respondent had successfully shown infringement and passing off through use of the name LOTTOFUN in connection with the sale of sale of tickets for the national lottery by the appellant. The appellant had unsuccessfully claimed for the cancellation of the Board’s mark on the basis that it wrongly remains and was an entry wrongly made on the register because it is not used as a trade mark and has not been used as one. [The decision is somewhat ambiguous on the actual reasoning of the grounds of the cancellation claim (see paras 10 v 12 v 35 of the decision, and the comments below).]

The expungement/cancellation claim

The court stressed the general principles that “use” on its own does not mean that a mark is distinctive and furthermore that a single user of a generic name as a trade mark does not mean that a name is a trade mark. In addition, it held that expert opinion on the meaning of dictionary definitions is not necessary, as dictionaries generally speak for themselves.

The court held at para 32 that the word LOTTO “was alive in South African language usage at the time of the registration in 1991 and had been for many years” and “the concept of lotto as a genus of games of chance which embraces a variety of species was clear”. Consequently, “the registering party simply appropriated to itself a word already in general circulation which possessed an ascertainable generic and descriptive meaning over which it could have no monopoly and which should have been open to use by all competitive undertakings in the gaming industry.” (See comment on this finding below).

At para 35 the judges made a finding that there had been no use of the mark in relation the part of the specification which covered "services for or in connection with financial services" which consequently left the registration liable to be cancelled on the basis of non use.

Passing off

Establishing passing off when a mark has been ruled to be generic is understandably difficult, and so it proved to be in this case. Paras 54 sets out the findings of fact and para 55 the finding that no passing off could be shown. The judge made the curious comment in para 55 that “the learned judge should have concluded the deception or confusion which is an essential element of the delict of passing off had not been shown”. The comment is plainly wrong because actual deception or confusion is not an essential element of passing off – it is only necessary to show a likelihood of deception or confusion.

The judge went on to consider whether applicant had contravened the Lotteries Act which is not relevant to this blog.

Comment: (Right - a full bench decision)

It would have been helpful for SCA to have been more precise and there are a number of ambiquities. Under S70(1) of the 1993 Act the validity of an original entry of a trade mark needs to be determined under the laws in force at the date of such entry. In this case the contested registration(s) was/were applied for under the 1963 Act (which was replaced by the 1993 Act) yet there is no argument under the 1963 Act despite the Judge finding at para 36 that the marks “were wrongly placed on the register” and “[the meaning of lotto] was alive in South African language usage at the time of the registration in 1991 and had been for many years” The order only directs the Registry to rectify the register on the ground that the entries wrongly remain on the register indicating that arguments relating to “wrongly made” were not necessary, and so too the finding in para 36. Odd but perhaps I am missing something.

There is a difference between generic (the only practicable name or description of a good or service) and descriptive words (words which can become trade marks). It would have been preferable for the Court simply to have used “generic” in the sentence “possessed an ascertainable generic and descriptive meaning” because “and descriptive” is then redundant. By using “and descriptive” the judgement could be expressing the notion that the word is also a descriptive term over which “it could have no monopoly”, ie contemplating a separate category of words that cannot be registered. If that is correct (and there are provisions in the Act which allow for a separate category) then how do the findings interface with how the case was pleaded under Section 10 and Section 9 – for example, para 13 only refers to S10(2)(a) and not Section 10(2)(b) or does the judge mean that all descriptive words are not capable of distinguishing under Section 10(2)(a)? Surely not.

The phrase “should have been open to use” used in the judgement, and the concept of “availability” has been ruled to be irrelevant under the equivalent European test (see ECJ decision here). It does not appear that Counsel for the respondent sought to argue this point. A case that would also have helpful to the appellant is the ECJ decision known as the DOUBLEMINT decision which establishes the principle that “a sign must…be refused registration…if at least one of its possible meanings designates a characteristic of the goods or services concerned”. ECJ decisions are persuasive because of the close correlation between the European Harmonisation Directive on Trade Marks, and the RSA Trade Marks Act 1993.

Monday, 7 September 2009

online patent searches in SA

Finally some more cheerful news about CIPRO! The South African Companies and Intellectual Property Registration Office has announced that a patents database is available online, which provides access to the full original documents of South Africa-granted patents for the period 1984 to 2005. See patentsearch.cipro.gov.za for more details.

Thursday, 3 September 2009

TANCon 2009

TANCon 2009, to be held on 3 October 2009 at the Stanford Campus, Palo Alto, California, is the world’s sole event of its kind for entrepreneurs of African descent. Explains Isaac Rutenberg:
"The target audience includes entrepreneurs, Fortune 500 business leaders, venture capitalists, investment bankers, government policy makers and other entrepreneurial ecosystem organizations. Our theme this year is “Africa: Uncovering Entrepreneurial Opportunities", to provide future and current entrepreneurs the tools needed to establish and develop successful companies.

One panel discussion will be devoted to IP and development. For the entrepreneur, strategic management of IP is vitally important to the success of a business. IP rights, whether domestic or foreign, can be valuable assets capable of attracting investment, generating revenue, and supporting further innovation. Failure to take IP rights seriously, however, can result in loss of property rights or, worse, infringement lawsuits. African entrepreneurs face a range of challenges relating to IP, including structural and financial challenges. This panel will discuss general issues of IP management as well as the issues that apply specifically to African entrepreneurs.

TAN is a global non-profit organization with the sole mandate of fostering entrepreneurship and technology in Africa and among people of African descent worldwide".
If you want to know more about this year's programme, click here.

Wednesday, 2 September 2009

Own goal or opening goal?

A recent article in the September newsletter of FIFA’s attorneys, Spoor & Fisher, is replete with soccer imagery. In the article, it was stated that FIFA had had ‘the honour of scoring the first goal in the 2010 Soccer World Cup’. It does seem as though they chose a less than worthy opponent, a small Pretoria tavern that had the words ‘World Cup 2010’ below its name. Eastwoods Tavern did not put up much of a fight – a consent order, including a large costs order in FIFA’s favour, is not much of a famous victory.

The next victory is similarly less than impressive. A newspaper report states that FIFA has won another victory, against a Cape Town businessman who has a registered design for a keyring holder. The article, available here, implies that FIFA is relying on passing off in this instance. It does not appear that the businessman concerned opposed the legal proceedings but he allegedly faces paying FIFA’s legal costs, amounting to ‘hundreds of thousands of rands’, according to another business report: another famous victory for Goliath-- again against a rather timid David.

Tellingly, the only defended action, against a large company that has the funds to litigate, is not proceeding according to plan. This time it is Adams & Adams, another of the largest IP firms in South Africa, who acts for FIFA to prevent the sale of lollipops with the numerals 2010. A report on today’s Legalbrief (available here) states that judgment has been outstanding for over nine months, and that any judgment is likely to be of academic value only, especially if the losing party lodges an appeal. Very reminiscent of the Ferrero judgment in Germany- also a confectionery manufacturer.

Conspiracy theorists might wonder if the reason for this delay is that the constitutionality of the ambush marketing provisions, on which provisions FIFA relies, has been questioned. Possibly a ruling on this issue is not part of the ‘game plan’?

Tuesday, 1 September 2009

S26 baby food scare - Tanzania

Health authorities are to carry out food safety tests on a popular baby formula, S26, after the product was banned in Tanzania this week according to The Times. The Tanzanian Food and Drug Authority banned the product — manufactured in Sandton, Johannesburg, by Aspen Pharmacare — after receiving complaints that it was making babies ill. No problems with the product have been reported in South Africa. Aspen said the product sold in Tanzania may be counterfeit. For more click here. Think you could spot a counterfeit product click here for a counterfeit drug quiz.

Beer dispute in East Africa fermented in UK High Court

A dispute concerning production and distribution of beer in Tanzania, between Tanzania Breweries Ltd ("TBL") and Kenya’s East African Breweries Ltd ("EABL") has been decided in favour of TBL by the High Court in UK. The ruling (available here on BAILII) by Justice Christopher Clarke, and dated 18th August 2009 effectively restrains EABL from terminating a brewing and distributorship agreement with TBL. The injunction also prohibits EABL from distributing or engaging any other company to distribute its range of products in Tanzania. TBL is a subsidiary of South Africa’s Sabmiller Africa BV while EABL is a Kenyan listed company with majority shareholding by Diageo Plc.

The dispute, linking various companies under the control of the two multinational brewing giants arises from a number of brewing and distribution agreement entered into between the two companies in 2002 in which EABL ceased operating in Tanzania and likewise TBL ceased operating in Kenya. Under the agreement, the products of each company would be brewed and distributed under licence by the market leader in each country.

In Tanzania TBL is the leader in the beer market holding 80% market share with popular brands Kilimanjaro and Safari. In Kenya EABL owned Kenya Breweries Ltd is the market leader with brands such as Pilsner, Tusker, Guinness and Malta Guinness with Tusker being the most dominant brand.

The battle between South Africa brewery and EABL, often termed as a proxy war between the multinational Companies SABmiller Plc and Diageo Plc started in Kenya when the South African brewer entered the Kenyan Market as Castle Breweries with a huge investment in a brewing facility in Thika. The ensuing rivalry between their respective brands -Tusker and castle witnessed both companies throwing thinly veiled allegations at each other over destruction of advertising billboards. The battle subsided in 2002 when the contract now under dispute was agreed upon- in what later emerged as a deal struck in UK by the parent companies.

The court ruling means that the status quo remains until 17th January 2011 when the contract is set to expire or earlier if ordered by the Court or of an arbitration tribunal appointed by the parties to resolve the dispute.