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[2021] ZAWCHC 151
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Wetsuits South Africa (Pty) Ltd t/a Reef Wetsuits v South Cone Inc and Others (4806/19) [2021] ZAWCHC 151; 2021 BIP 10 (WCC); [2021] HIPR 177 (WCC) (22 June 2021)
THE
REPUBLIC OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
(WESTERN
CAPE DIVISION, CAPE TOWN)
Before:
The Hon. Ms Acting Justice Mangcu-Lockwood
Date
of hearing: 23 March 2021
Date
of judgment: 22 June 2021
Case
No: 4806
/19
In
the matter between:
WETSUITS
SOUTH AFRICA (PTY) LTD
Applicant
t/a
REEF WETSUITS
and
SOUTH
CONE INC
First
Respondent
BECAUSE
I CAN CLOTHING CC
Second
Respondent
.ZA
CENTRAL REGISTRY
Third
Respondent
JUDGMENT
MANGCU-LOCKWOOD
AJ,
I.
INTRODUCTION
1.
This is an application
for an interdict restraining the first and second respondents from
infringing certain of the applicant’s
trade mark registrations
in terms of section 34(1)(a) and/or section 34(1)(b) of the Trade
Marks Act 194 of 1993 (“
Trade Marks Act&rdquo
;). The applicant
also seeks ancillary relief in terms of
s 34(3)
of the
Trade Marks
Act for
the removal of the alleged infringing marks in the possession
of the respondents, alternatively for the delivery up of such
materials
for destruction. In addition, the applicant seeks a
direction that an enquiry be held for purposes of determining any
amount of
damages or a reasonable royalty to be awarded to the
applicant as a result of the alleged infringement. Lastly, the
applicant seeks
the transfer of the domain name ‘reefsa.co.za’
from the third respondent to it.
2.
The interdict application
is opposed by the first and second respondents only. The first
respondent has raised some points
in
limine
, as well as a
conditional counter-application. In the counter-application the first
respondent seeks rectification of the register
of trade marks by
effecting certain deletions to some specification of goods for which
the applicant’s trade marks are currently
registered.
II.
THE FACTS
3.
The applicant is a
manufacturer, wholesaler and retailer of wetsuits and related water
sports and surfing accessories, equipment
and apparel. It was
initially named Aquarius Wetsuits (Pty) Ltd and underwent a
name-change to its current name on 28 June 2002.
The first respondent
is a Californian corporation, whose address is in the United States
of America. The second respondent is a
manufacturer of textiles,
clothing and leather goods, and was, at all relevant times, a local
distributor of the first respondent’s
goods in South Africa. It
is also the registrant of the domain name ‘reefsa.co.za’.
The third respondent is a non-profit
organisation managing various
.za second level domains, including .co.za.
4.
The applicant is the
proprietor of the following registered trade marks:
REGISTRATION
NUMBER
TRADEMARK
SPECIFICATION
OF GOODS
1.
1985/06414
Class
25:
"Wetsuits;
articles of protective and/or waterproof clothing included in this
class"
2.
1987/01730
LADY
REEF
Class
25:
"Wetsuits,
articles of protective and/or waterproof clothing included in this
class"
3.
1994/04741
REEF
Class
28:
"Games
and playthings; gymnastic and sporting articles not included in
other classes";
4.
2012/30493
REEF
FLEX
Class
25:
"Clothing
and headgear, including wetsuits"
5.
2012/30828
REEF
Class
9:
"Scientific,
nautical, surveying, photographic, cinematographic, optical,
weighing, measuring, signalling, checking (supervision),
life-saving and teaching apparatus and instruments; apparatus and
instruments for conducting. switching, transforming, accumulating,
regulating or controlling electricity; apparatus for recording,
transmission or production of sound or images; magnetic data
carriers, recording discs; compact discs. DVD's and other digital
recording media; mechanisms for coin-operated apparatus;
data
processing equipment; computer hardware and software, protective
clothing for water sports and sport activities of all
kinds,
including protective wet suits and sports equipment included in
this class; protective eyewear, including sunglasses
and goggles;
protective helmets for use in sports including body boarding,
surfing, skateboarding, snowboarding and skiing"
6.
2012/30829
REEF
Class
18
:
"leather and imitations of leather, and goods made of these
materials and not included in other classes; animal skins,
hides;
trunks and travelling bags, waterproof bags. diving bags,
surfboard bags and sport bags included in this class; umbrellas
and parasols; walking sticks, whips, harness and saddles";
7.
2012/30830
REEF
FLEX
Class
9:
"Scientific,
nautical, surveying, photographic, cinematographic, optical,
weighing, measuring, signaling, checking (supervision),
life-saving and teaching apparatus and instruments; apparatus and
instruments for conducting, switching, transforming, accumulating,
regulating or controlling electricity; apparatus for recording,
transmission or production of sound or images; magnetic data
carriers, recording discs; compact discs, DVD's and other digital
recording media; mechanisms for coin-operated apparatus;
data
processing equipment; computer hardware and software, protective
clothing for water sports and sport activities of all
kinds,
including protective wet suits and sports equipment included in
this class; protective eyewear, including sunglasses
and goggles;
protective helmets for use in sports including body boarding,
surfing, skateboarding, snowboarding and skiing.
5.
By the time that this
application was launched, the first respondent was the proprietor of
only the following trade mark registrations
in South Africa:
REGISTRATION
NUMBER
TRADEMARK
SPECIFICATION
OF GOODS
1.
1998/14485
REEF
ONE
Class
25
:
“Clothing and footwear”
2.
2000/20433
Class
25
:
“Clothing, footwear, headgear”
6.
Previously, the first
respondent was also the proprietor of the following trade mark
registrations, which were assigned and transferred
to Trestles IP
Holdings LLC (“Trestles”) on 26 October 2018 before these
proceedings were launched, although the actual
registration was only
reflected in the register of trade marks from 9 April 2019:
REGISTRATION
NUMBER
TRADEMARK
SPECIFICATION
OF GOODS
1.
1993/02068
Class
25
:
"Articles of clothing; footwear; headwear; parts and
accessories for the aforegoing but excluding wetsuits and articles
of protective and/or waterproof clothing"
2
1998/14485
REEF
ONE
Class
25
:
“Clothing and footwear”
3
2000/19733
Class
25
:
“Clothing, footwear, headgear
4
2000/19734
Class
28:
"Games
and playthings; gymnastic and sporting articles not included in
other
classes";
decorations for Christmas trees
5
2000/20776
Class
25
:
“Clothing, footwear, headgear”
6
2000/20777
Class
28
:
Toys, recreational and sporting goods.
7
2008/10067
Class
25
:"Bathing
suits, bikinis, swim trunks; swimwear; jumpers; dresses; blouses;
walkshorts; boardshorts; fleece shorts; footwear;
headwear;
jackets; jeans; fleece tops; tank tops; muscle tops; pants;
sandals; sarongs; shirts; shoes; shorts; skirts; I-shirts;
walking
shorts"
7.
In 1998 the applicant
brought passing off proceedings against,
inter
alia
, the first
respondent as a result of the latter’s use of the REEF BRAZIL
trade mark on its footwear. On 24 August 2001
the parties
settled the proceedings by entering into a settlement agreement. The
preamble to the settlement agreement took note
of the applicant’s
trade mark registrations 85/614 for REEF (special form) in class 25
in respect of “
wetsuits,
articles of protective and/or waterproof clothing included in this
class
”; 87/1730
LADY REEF in class 25 in respect of “
wetsuits,
articles of protective and/or waterproof clothing included in this
class
”; and its
application at that point under number 94/4741 in class 28 in respect
of “
games and
playthings, gymnastic and sporting articles not included in other
classes
”;
as well as the first respondent’s trade mark registrations
93/2068 for REEF BRAZIL and Device in class 25 in
respect of
“
articles of
clothing, footwear, headwear, parts and accessories for the
aforegoing but excluding wetsuits and articles of protective
and/or
waterproof clothing”
.
The relevant parts of the settlement agreement then stated as
follows:
“
WHEREAS
[the applicant] has used the trade mark REEF or REEF WETSUITS in
relation to wetsuits, as well as various items of clothing,
such as
web gloves, anti-chafe vests, surfing socks, diving socks, split toe
booties, diving booties, Bermuda shorts, warm water
diving gloves,
cold water diving gloves, ladies swimming costumes, caps, straw hats,
knitted woollen caps, T-shirts, sweat shirts
and winter jackets;
AND
WHEREAS footwear products bearing [the first respondent’s]
trade mark REEF BRAZIL have been sold in South Africa through
its
local distributor African Surf, which resulted in passing-off
proceedings being instituted by [the applicant]
…
WHEREAS
the parties have now agreed to settle this matter and wish to define
their respective rights in the REEF, REEF WETSUITS
and REEF BRAZIL
trade marks in South Africa…the parties agree that…
‘
3.
[The first respondent] and any
of its distributors/ licensees will be entitled to use REEF
BRAZIL
(as a word mark or in device form) in South Africa in relation to all
goods in class 25, as covered by its aforementioned
registration in
South Africa;
4.
[The applicant] will be
entitled to use the trade mark REEF or REEF WETSUITS (as word
marks
or in device form) in relation to:
4.1
all the goods covered by its trademark registration numbers 85/6414
REEF (special form)
and 87/1730 LADY REEF in class 25, referred to
above;
4.2
all the goods covered by the specification of goods of its
application number 94/4741 in
class 28 referred to above; and
4.3
items of clothing such as web gloves, anti-chafe vests, surfing
socks, diving socks, split-toe
booties, diving booties, Bermuda
shorts, warm water diving gloves, cold water diving gloves, ladies
swimming costumes, caps, straw
hats, knitted woollen caps, T-shirts,
sweat shirts and winter jackets.
…
6.
The agreement will be effective in South Africa.”
8.
It is common cause that,
over time the first respondent has, through the adoption of various
iterations of its marks, dropped the
word ‘Brazil’ from
its REEF BRAZIL registered trade marks. According to the first
respondent, this has been the case
since the early 2000’s. The
applicant says this only
came
to its attention
in
May 2018, and it immediately made attempts to resolve the matter
through attorneys’ correspondence which was not successful,
and
it thereafter instituted these proceedings.
III.
ISSUES
IN
LIMINE
9.
As I have stated, the
first respondent has raised some points
in
limine
, namely lack
of jurisdiction by this Court to determine the applicant’s
application, and waiver, which I deal with below.
Initially, the
first respondent also relied on additional preliminary issues, namely
that there were irreconcilable disputes of
fact between the parties,
and estoppel, but those points were no longer persisted with by
the time the matter appeared before
me.
IV.
LACK OF
JURISDICTION
10.
The
first respondent states that this Court lacks jurisdiction to
determine the cause of action against it on the basis that it
(first
respondent) is a foreign
peregrinus
,
and the applicant did not attach its property in order to confirm the
Court’s jurisdiction, despite the fact that such confirmation
was possible, since at the time that these proceedings were
instituted, the first respondent was the registered proprietor of
several trade marks in South Africa. For this argument, the first
respondent relies on the cases of
Bid
Industrial Holdings (Pty) Ltd v Strang and others
[1]
(“Strang”) and
Multi-Links
Telecommunications Ltd v Africa Prepaid Services Nigeria Ltd; Telkom
SA SOC Limited and another v Blue Label Telecoms
Limited and others
(“Multi-Links”)
[2]
11.
In
response to this attack, the applicant raises two arguments. Firstly,
the applicant states that the issue of jurisdiction on
account of the
first respondent being a
peregrinus
would only arise if this was a claim sounding in money. Given that
these are motion proceedings in which interdictory relief is
sought,
it does not. In this regard, I was referred to the Supreme Court of
Appeal case of
Foize
Africa (Pty) Ltd v Foize Beheer BV and Others
[3]
,
where
the SCA referred to various authorities
[4]
in which the courts of
this
country have,
as
a matter of course granted interdictory relief against
peregrini.
The
SCA in
Foize
was further persuaded by the fact that,
similar
to this case,
the
act sought to be interdicted would take place within the area of the
Court’s jurisdiction. The first respondent does not
challenge
this authority. Instead, it argues that, although interdictory relief
is sought in the first prayer, the applicant also
seeks an enquiry
into damages in terms of
section 34(4)
of the
Trade Marks Act, which
,
according to the first respondent, can only be granted if the Court
is satisfied that the first respondent is liable for damages.
This is
because enquiries in terms of section 34(4) of the Act are concerned
with quantification, not liability, similar to a finding
on a
separated question relating to merits in an action.
Furthermore,
a
final finding that the first respondent has infringed the
applicant’s registered trade marks would render the question
of
liability for damages
res
judicata
in the same way that a finding on a separated question (relating to
the merits of an action) would do so.
Accordingly,
the first respondent states that what is sought in the third prayer
by the applicant is in effect a determination of
liability for
damages, which means that part of the claim is one sounding in money.
That determination is said to be inextricably
linked to the
interdictory relief sought.
12.
I
am not satisfied that section 34(4), read with section 34(3)(c) of
the Act, amounts to a claim sounding in money. It is worth
setting
out the relevant parts of section 34:
‘
(3)
Where a trade mark registered in terms
of this Act has been infringed, any High Court having
jurisdiction
may grant the proprietor the following relief, namely-
(a)
an interdict;
(b)
an order for removal of
the infringing mark from all material and, where the infringing mark
is inseparable or incapable of being
removed from the material, an
order that all such material be delivered up to the proprietor;
(c)
damages, including those
arising from acts performed after advertisement of the acceptance of
an application for registration which,
if performed after
registration, would amount to infringement of the rights acquired by
registration;
(d)
in lieu of damages, at
the option of the proprietor, a reasonable royalty which would have
been payable by a licensee for the use
of the trade mark concerned,
including any use which took place after advertisement of the
acceptance of an application for registration
and which, if taking
place after registration, would amount to infringement of the rights
acquired by registration
(4)
For the purposes of determining the
amount of any damages or reasonable royalty to be awarded
under this
section, the court may direct an enquiry to be held and may prescribe
such procedures for conducting such enquiry as
it may deem fit.’
13.
In
terms of subsection
(3)
,
if the Court finds that a registered trade mark has been infringed,
it has a discretion regarding which relief to grant. This
is
indicated by the use of the word ‘may’ in the
introductory part of that subsection.
[5]
Damages are therefore not an automatic consequence of a finding of
infringement. A court must still apply its mind as to the appropriate
relief, taking into account what is just in the circumstances, and
may conclude that damages are inappropriate.
[6]
This belies the argument that a finding that an interdict and an
award for damages, in terms of the provision, are interlinked.
Even
if the damages relief were to be construed as a claim sounding on
money, this Court could still grant the interdictory relief
sought by
the applicant. In that event, it would still be open to the applicant
to issue summons in respect of the damages. I was
informed from the
bar that the applicant would, in any event, be willing to abandon
that part of its claim (the award for damages
in terms of subsection
34(3)).
14.
The
second argument raised by the applicant in response to the
jurisdiction challenge is that the first respondent has consented
to
the jurisdiction of this Court through the filing
of
an application by the first respondent to this Court for an extension
of time in terms of Uniform Rule 27 to file its answering
papers,
followed by its extensive opposing affidavit on the merits, as well
as its conditional counter-application. On this basis,
the applicant
argues, relying on
Herbstein
and Van Winsen
[7]
,
that the first respondent has tacitly submitted to this Court’s
jurisdiction, which submission, once made, cannot be revoked.
The
fact, however, is that the first respondent did expressly object to
the jurisdiction of this Court in its answering affidavit,
which, to
my mind does not evince a clear and unequivocal submission to this
Court’s jurisdiction.
[8]
However, in light of the application of
Foize
Africa (Pty) Ltd v Foize Beheer BV and Others
,
and the finding above that this is not a claim sounding in money, I
am of the view that the first respondent’s consent to
jurisdiction is not indispensable in the circumstances of this case.
15.
In
reaching the view that this Court has jurisdiction to determine this
matter, I also take into account the fact that the
applicant’s rights in
relation to its registered trade marks are territorial in nature and
are effective and enforceable throughout
South Africa. Furthermore,
in terms of the express terms of clause 6 of the settlement agreement
whose terms the parties rely upon
for
purposes of both the applicant’s claim and the first
respondent’s counter-claim
,
its terms are effective in South Africa. In addition, the unlawful
conduct complained of, namely the infringement of the applicant’s
registered trade marks and the breach of the settlement agreement
occur,
inter alia,
within the
jurisdiction of this Court. It is this conduct that the applicant
seeks to interdict, and in respect of which it seeks
ancillary relief
for the removal of the infringing marks or delivery up of all
material bearing the infringing marks for destruction.
For all these
reasons, I consider that it is appropriate and convenient for this
Court to exercise jurisdiction over this matter.
V.
WAIVER
16.
The second point
in
limine
raised by the first respondent is that the applicant has waived its
right to object to the respondents’ use of the mark REEF
on
footwear.
Before dealing with the factual basis for this point in
limine
,
it is well to set out the relevant legal principles.
17.
In
order to rely on the defence of waiver, an alleged infringer must
show that the right’s holder, with full knowledge of
its right
and
of
the facts under which, or from which, the right arose
,
has
abandoned that right, whether expressly or by conduct plainly
inconsistent with an intention to enforce it.
[9]
The
conduct, whether express or implied, must be unequivocal and
consistent with no other hypothesis.
[10]
18.
Waiver
is a matter of the intention of the party said to have waived the
right in question. The intention is determined objectively,
that is,
it is adjudged by its outward manifestation in the form of words,
spoken or written, or in the form of conduct or a combination
of
words and conduct.
[11]
19.
The
burden of proof is on the party who alleges that a right has been
waived. By reason of the fact that no one is presumed to waive
his or
her rights, clear proof is required of an intention to do so.
[12]
20.
If
a party does not expressly waive a right, and waiver is to be
inferred, the conduct relied upon must be such as is more consistent,
on a reasonable view thereof, with an intention to waive the right in
question. The outward manifestations of intention must accordingly
be
adjudged from the perspective of a reasonable person in the position
of the other party.
[13]
This does not mean that other factors such as the subjective
motivation of a party for acting in the way in which (s)he did,
are
irrelevant.
[14]
Positive
representations, whether express or implied through conduct, can give
rise to a defence of waiver; as can silence, in circumstances
where
there is a legal duty to speak.
[15]
The existence of a legal duty is a conclusion of law drawn after
consideration of all the circumstances of the case.
[16]
21.
It
is a question of whether the right’s holder, in light of its
knowledge of the facts of the case, the industry concerned
and the
relationship between it and the alleged infringer, should have
foreseen that the alleged infringer would draw an incorrect
conclusion from its silence and, therefore, should have spoken to
avoid the alleged infringer suffering harm.
[17]
22.
The
mere fact that a party has decided not to institute legal proceedings
to enforce a particular right does not necessarily mean
that (s)he
has abandoned, renounced or surrendered the right nor does it
necessarily mean that (s)he consents to its continued
infringement.
[18]
23.
The
respondents state that they have been using the mark REEF (including
as part of the REEF + LEAF logos and the REEF + WAVE logo)
on
footwear in South Africa since 2003; and the applicant has been aware
of this use from the outset. The respondents further
state that
the applicant, with this full knowledge, failed to take action
against them in 2003 and 2005 when it filed complaints
with the
Advertising Standards Authority of South Africa (“ASA”)
against the second respondent’s predecessor
in title, Toxic Ink
CC ( “Toxic Ink”), but contented itself with complaining
in terms of
section 62
of the
Trade Marks Act that
the symbol ®
appeared next to REEF in circumstances where the first respondent did
not have a trade mark registration for the
mark REEF. The first
complaint was settled on the basis of an undertaking given by Toxic
Inc. not to make use of the word REEF
together with the symbol ®.
The
respondents further refer to a letter produced by the applicant dated
11 July 2003 from the applicant’s erstwhile attorneys
to Toxic
Inc.’s attorneys, which, according to the respondents, shows
that the applicant
considered
enforcing its rights in REEF (when applied to footwear) against the
respondents and advised the respondents that it was
giving
consideration to doing so, and elected not to do so until 2018. The
relevant parts of the letter
stated
as follows:
“
I
must also tell you however that the use of the name Reef by itself in
relation to shoes emanating from South Cone Inc. is a cause
for
serious concern. As you are well aware South Cone’s trade
mark in South Africa is REEF BRAZIL and the use of the
name Reef by
South Cone Inc. is currently being considered from the point of view
of trade mark infringement and passing off.
Our client has no
difficulty with the use of the name REEF BRAZIL on South Cone shoes
but the abbreviation of the name to “REEF”
is a different
matter altogether.”
24.
In
addition to the above facts, the respondents state that, for a total
period of 15 years before the launch of these proceedings,
they
made
extensive sales of their REEF footwear, and the applicant took no
steps to prevent the alleged infringement of its rights.
This
despite the fact the first respondent’s REEF shoes (not REEF
BRAZIL) were widely available in mainstream and very popular
stores
such as Sportsmans Warehouse, Trappers, Outdoor Warehouse, Men’s
Shoe Centre; online stores such as Frugo, UBuy and
Surf; and in many
beach and surf wear stores across South Africa.
25.
On the basis of
these facts, the respondents argue that any reasonable person
standing in the shoes of the respondents would have
understood the
applicant to have no objection to the use of the mark REEF (on its
own or with a distinctive device) on footwear,
provided that it was
without the ® symbol.
26.
In
response to the respondents’ allegations, the applicant points
out that, whenever it has previously discovered that the
first
respondent was using the REEF mark without the word BRAZIL, it has
acted. The first two occasions led to the ASA complaints
in 2003 and
2005, and the third arose in 2018 and led to these court proceedings.
Thus, the applicant argues, it
has
always objected to the use of the REEF trade mark without “Brazil”
by the first and second respondents and has never
agreed to such use.
Furthermore, the applicant has set out what it knew over the years
regarding the respondents’ use of
the first respondent’s
trade marks, and states that it was only in 2018 that it discovered
that the respondents had ceased
using the REEF BRAZIL trademark
altogether. It states that, to its knowledge, the first respondent’s
footwear was for many
years sold primarily in Rip Curl stores, which
are operated by the second respondent and in which the applicant’s
goods are
not sold; and until around 2018, the second respondent used
only the REEF BRAZIL trade mark in its advertising and promotional
material relating to the first respondent’s goods, which is the
use that more readily came to the applicant’s attention.
As a
result, the applicant states that it cannot be criticised for not
taking action before 2018, and the absence of formal complaints
or
legal proceedings by the applicant in the circumstances does not
warrant the conclusion that it tacitly agreed to the respondent’s
use of the REEF mark without the word “Brazil”.
27.
As regards the ASA
complaints, the applicant has set out the relevant text of the 2003
complaint, which included the following:
“
whilst
the complainant has no objection to REEF BRAZIL shoes being sold in
South Africa it is felt that the manner in which these
shoes are
being sold and advertised in South Africa is unlawful for the
following reasons:…as previously stated, [the first
respondent] does not have any South African trade mark in respect of
the name Reef by itself”; “nevertheless, the REEF
BRAZIL
shoes have been and are being advertised in conjunction with the word
REEF by itself accompanied by the internationally
recognised symbol ®
for a registered trade mark”.
The applicant states that this is an example of it raising
difficulties regarding the respondents’ use of the REEF mark
without the word BRAZIL. The applicant also states that its decision
to file the 2003 ASA complaint was an attempt to prevent the
respondents from overstepping the bounds of their trade mark in a
more cost-effective and speedy manner than High Court litigation.
It
also points out that the ASA does not have jurisdiction to hear trade
mark infringement disputes or contractual disputes and
therefore the
complaint was brought within the ASA’s mandate and directed at
matters upon which it could adjudicate, namely
Toxic Ink’s use
of the ® symbol.
As
for the letter of 11 July 2003, the applicant has referred to its
contents, stating that they are incompatible with a tacit or
implied
agreement contended for by the respondents, because the letter makes
clear that the applicant took issue with the use of
the mark REEF
alone without BRAZIL.
Regarding
the 2005 ASA complaint, the applicant points out that it is evident
from the 2005 ASA complaint and the ASA ruling that
it related to the
breach of the undertaking in terms of which the 2003 ASA complaint
was settled, and was thus limited to the discrete
point as to whether
the undertaking had been breached.
28.
Taking into
account the evidence before this Court, I am not persuaded that the
applicant at any stage evinced waiver of its right
to enforce its
trade marks, as argued by the respondents. It cannot be
over-emphasised that the respondents have
not
produced any proof whatsoever of the allegations of the extensive
sales for the past 18 years of footwear bearing only the word
mark
REEF, without BRAZIL. There is also no
evidence
relating to the nature and extent of the use of the infringing marks
by the respondents in South Africa after 2006 and
prior to 2018 which
would allow this Court to consider the significance of the alleged
co-existence of the trademarks during that
time. Instead, the
respondents
rely on the ASA complaints lodged by the applicant in this regard as
proof that they were indeed making such use. However, the
text of the
2003 ASA complaint makes clear that the applicant did take issue with
the respondents’ use of the mark REEF without
BRAZIL in
circumstances where they were not so authorised. At the very least, I
am not persuaded that the complaints evince acquiescence
on the part
of the applicant for the respondents to make use of the mark REEF
without BRAZIL on footwear. There is no
evidence
before me of conduct on the applicant’s part that constitutes
an unequivocal representation or consent or tacit agreement
that it
did not object to such use.
Furthermore,
in the circumstances of this case, where the evidence shows that the
applicant has repeatedly complained about the
respondents’ use
of the mark REEF without BRAZIL on its footwear, I am not satisfied
that its delay in bringing these legal
proceedings constituted an
unequivocal waiver. The applicant has explained that it opted to
rather follow the less costly ASA route,
and has also explained what
knowledge it had, and at what point.
Accordingly,
I cannot find that the applicant waived its trade mark rights or its
rights to proceed against the respondents in respect
of its
registered trade marks.
VI.
THE
TRADE MARK INFRINGEMENTS
29.
For the infringement
claim, the applicant relies on
section 34(1)(a)
, and in the
alternative 34(1)(b) of the
Trade Marks Act, which
state as follows:
‘
(1)
The rights acquired by registration of a trade mark shall be
infringed by-
(a)
the
unauthorized use in the course of trade in relation to goods or
services in respect of which the trade mark is registered, of
an
identical mark or of a mark so nearly resembling it as to be likely
to deceive or cause confusion;
(b)
the
unauthorized use of a mark which is identical or similar to the trade
mark registered, in the course of trade in relation to
goods or
services which are so similar to the goods or services in respect of
which the trade mark is registered, that in such
use there exists the
likelihood of deception or confusion…’
30.
In
order to establish infringement in terms of
section 34(1)(a)
, it is
necessary for the applicant to show: use of the registered trade mark
or of a mark so nearly resembling it as to be likely
to deceive or
cause confusion; that the use is in relation to the goods or services
in respect of which the trade mark is registered;
that the use is in
the course of trade; and that the use is unauthorised.
[19]
31.
In
order to establish infringement in terms of
section 34(1)(b)
the
applicant must show: the use of the registered trade mark or of a
mark similar to it; use of the offending mark in relation
to goods or
services which are so similar to the goods or services in respect of
which the trade mark is registered that in such
use there exist the
likelihood of deception or confusion; that the use is in the course
of trade; and that the use is unauthorised.
[20]
32.
Section 34(1)(b)
is
therefore similar to
section 34(1)(a)
except that it is not limited
to the goods or services in respect of which the trade mark is
registered, but covers use in relation
to similar goods.
33.
As to the requirements,
it is common cause that the respondents’ use of the alleged
infringing marks is use in the course
of trade. The respondents
dispute that their use of the trade mark is unauthorised and contend
that it is authorised in terms of
a tacit co-existence agreement,
part of which I have already discussed in relation to the waiver
argument. Further, the first respondent’s
case is that it is
not infringing the applicant’s REEF trade marks because it is
neither using the marks in relation to the
same goods as contemplated
by
section 34(1)(a)
, nor in relation to similar goods as is likely to
deceive or cause confusion, within the contemplation of
section
34(1)(b).
15
0%">
34.
The notice of motion
seeks interdictory relief in relation to six trade marks. However,
the applicant’s heads of argument
state that the relevant trade
marks for determination of the infringement claim are the first four
of the trade marks listed below.
Further still, the fifth trade mark
listed below is also discussed in relation to
section 34(1)(a)
in the
applicant’s heads of argument:
34.1
2012/30829 REEF in
class
18
,
which
is registered for
"leather
and imitations of leather, and goods made of these materials and not
included in other classes; animal skins, hides;
trunks and travelling
bags, waterproof bags. diving bags, surfboard
b
ags
and sport bags included in this class; umbrellas and parasols;
walking sticks, whips, harness and saddles";
34.2
1985/06414
in
class 25, which is registered for “
wetsuits;
articles of protective and/or waterproof clothing included in this
class”
;
34.3
2012/30828 REEF in class
9, which is registered for “
protective
clothing for water sports and sport activities of all kinds,
including protective wetsuits and sports equipment included
in this
class
”; and
34.4
1994/04741 REEF in class
28, which is registered for “
games
and playthings; gymnastic and sporting articles not included in other
classes”.
34.5
2012/30493 REEF FLEX in
class 25, which is registered for “
clothing
and headgear, including wetsuits
”.
35.
According to the
applicant, the respondents are infringing trade mark 2012/30829
through the sale of bags bearing a REEF trade mark.
The applicant has
registered trade mark 2012/30829 REEF in class 18 for
inter
alia
“
travelling
bags, waterproof bags, diving bags, surfboard bags and sport bags
included in this class
”.
It is common cause that the applicant uses its REEF trademark in
relation to bags, including duffel bags and backpacks.
It is also
common cause that the first respondent sells a bag bearing the REEF
and wave design logo, which is marketed as an ‘adventure
duffel
bag’.
36.
The
first respondent states that the applicant’s case based on
section 34(1)(a)
must fail because t
he
applicant has provided no evidence that it has used a REEF trade mark
on a
waterproof bag,
diving bag, surfboard bag or a sport bag,
which
are the goods for which the applicant is registered
.
The only bag in the
record sold by the second respondent is a duffel bag bearing the
first respondent’s REEF & WAVE design
logo. The duffel bag
in question, according to the first respondent is clearly not (i)
waterproof; (ii) a diving bag; (iii) capable
of accommodating a
surfboard; or (iv) a sports bag of any description. Indeed, there was
some debate during the proceedings regarding
the precise category of
the duffel bag sold by the respondents, which points the lack of
evidence in this regard. At the very least,
it does not fall within
any of the categories of bags for which the applicant is registered,
thus placing it outside the ambit
of
section 34(1)(a)
, because the
use cannot be said to be in relation to the goods or services in
respect of which the applicant’s trade mark
is registered.
37.
As regards the remaining
trade marks, it is said that the first respondent has infringed them
through sale of clothing. In the first
instance, it appears that any
reliance on 1994/04741 REEF in class 28, which is registered for
“
games
and playthings; gymnastic and sporting articles not included in other
classes”
can
be dispensed with because it does not appear to be relevant to the
case made by the applicant. Next, the applicant does not
appear to be
making a case that any of the REEF marks used by the first respondent
are similar, in a trade mark sense, to the composite
mark REEF FLEX.
After all, the basis for the applicant’s case in these
proceedings is the use of REEF without BRAZIL. I have,
in any event,
found no similarities between the use of REEF by the respondents on
its goods to the applicant’s registered
REEF FLEX trade mark.
Regarding the alleged breach of the remaining trade marks, namely
1985/06414 and 2012/30828, the
applicant has provided no
evidence that the first respondent has sold wetsuits, articles of
protective and/or waterproof clothing
included in class 25,
protective clothing for water sports and sport activities, or
protective wetsuits or sports equipment included
in class 9. For
all the above reasons, I am of the view that the applicant has failed
to make out a case based on
section 34(1)(a).
1.
25cm; line-height: 150%">
38.
As
I have already stated, the provisions of
s 34(1)
(b)
do
not require that the offending mark be used in relation to goods in
the class for which the trade mark has been registered.
It
contemplates two elements, namely: (a) a mark identical or
similar to the trade mark used; (b) in relation to goods
which
are so similar to those for which it has been registered, that it
gives rise to a likelihood of deception or confusion.
[21]
As
to the relationship between these two elements, the following has
been stated in
New
Media Publishing (Pty) Ltd v Eating Out Web Services CC
[22]
:
'There
is…an interdependence between the two legs of the inquiry: the
less the similarity between the respective goods or
services of the
parties, the greater will be the degree of resemblance required
between their respective marks before it can be
said that there is a
likelihood of deception or confusion in the use of the allegedly
offending mark, and vice versa. Of course,
if the respective
goods or services of the parties are so dissimilar to each other that
there is no likelihood of deception or
confusion, the use by the
respondent even of a mark which is identical to the applicant's
registered mark will not constitute an
infringement; also, if the two
marks are sufficiently dissimilar to each other no amount of
similarity between the respective goods
or services of the
parties will suffice to bring about an infringement. . . .'
39.
The
SCA in
Mettenheimer
and Another v Zonquasdrif Vineyards CC and Others
further
set out considerations that could assist in determining the
likelihood of deception or confusion
[23]
referred to in
New
Media
above, including the following:
(a)
the
uses of the respective goods;
(b)
the
users of the respective goods;
(c)
the
physical nature of the goods; and
(d)
the
respective trade channels through which the goods reach the market.
In
Mettenheimer
the SCA found that the use of “
Zonquasdrif
Vineyards
”
in respect of wine grapes did not infringe the registered trade mark
“
Zonquasdrift
”,
which was registered,
inter
alia
for wine. The SCA held that the two marks were “virtually
identical” but considered that the differences between
wine, on
the one hand, and wine grapes, on the other, were such as to negate
the likelihood of confusion or deception.
[24]
Both parties in this case rely on the cases of
Mettenheimer
and
New
Media Publishing
mentioned above.
40.
The applicant states that
the respondents use the infringing marks on clothing, footwear and
bags, which are goods so similar to
the goods in relation to which
the applicant’s REEF trade marks are registered, namely
wetsuits, protective and water proof
clothing, protective clothing
for water sports and sports of all kind, clothing, bags and sports
equipment. The respondents’
response is that the applicant’s
trade mark rights relied upon are limited to the use of the mark on
the specific items mentioned
in in previous sentence, whereas the
goods sold by the respondent may be correctly classified as (i)
casual shirts, T-shirts and
shorts; (ii) flip flops, sandals and
casual shoes; and (iii) one duffel bag. The respondents state that
these items are distinct
from ‘clothing, footwear and bags’,
and that the applicant’s trade mark protection does not extend
to clothing
and footwear of all types.
41.
It is already evident
that trade mark 1994/04741 does not fit within the ambit of this
discussion because it is a registration for
“
games
and playthings; gymnastic and sporting articles not included in other
classes”
,
none of which can be described as ‘clothing, footwear or bags’
or items similar thereto. The applicant has, in any
event, not made
out a case in this regard. Thus, the remainder of the discussion in
this section concerns the remaining trade marks
mentioned above.
42.
The question is whether
casual shirts, T-shirts and shorts; flip flops, sandals and casual
shoes; and duffel bag are similar to
the items for which the
applicant is registered, namely wetsuits, articles of protective
clothing for water sports and other sports
activities or waterproof
clothing, and bags. The applicant states that the uses, users,
physical nature and trade channels of their
goods overlap to a
significant degree that the question must be answered in the
affirmative.
43.
A
“
wetsuit”
is defined by the Oxford English Dictionary as “
a
close-fitting rubber garment typically covering the entire body, worn
for warmth in water sports or diving”;
and
a “
garment”
is a “
piece
of clothing”
.
Thus, although it may be argued that wetsuits, prote
ctive
and waterproof clothing are specialised items used for specific
activities compared to casual clothing, they are nevertheless
clothing. As regards the respondents’ sale of bags, the uses
and physical nature of the goods are, in my view, similar to,
if not
the same as the goods for which the applicant is registered.
Regarding the respondents’ sale of footwear, including
flipflops, my view is that, taking into account the significant
overlap in the parties’ trade channels, target markets, users
and similarity of marks, which are discussed below, the similarity
envisaged by the case law set out above is established by the
applicant. In all the instances, the evidence shows that the users
and trade channels of the parties’ goods, do overlap.
The
evidence shows that both parties target the same markets, namely surf
wear, water sports and sports fashion. The users of the
parties’
goods and their target markets both include surfers. Indeed,
according to the first respondent, the REEF BRAZIL
brand of sandals
was created by two Argentine brothers who were both avid surfers and
who wanted to share their love for surf,
travel and beach culture
with the world. Furthermore, the parties’ products are sold in
many of the same stores - surf wear
and beach wear shops - such as
Big Bay Surf Shop and Sportsman’s Warehouse. In some instances
- such as the Sportsman’s
Warehouse online store – the
parties’ goods are sold in close proximity to each other.
44.
The first respondent
sought to distinguish its clientele by contending that the
competitors of its footwear are well-known brands
such RIP CURL,
ROXY, BILLABONG, IPANAMA and HAVAIANA’S; and that very few of
the respondents’ customers would purchase
wetsuits. However,
the applicant has demonstrated that a number of those competitors
sell wetsuits as well as footwear in South
Africa, namely RIP CURL,
BILLABONG AND ROXY. The applicant also demonstrated that many surfing
brands such as O’NEIL, QUICKSILVER
AND HURLEY sell wetsuits,
clothing and footwear. There is therefore significant overlap
in the trade channels and the users
of the goods. Furthermore, I am
satisfied that the intended users of the goods are the same, namely
customers in the surfer/water
sports/sports fashion market, who will
be able to purchase the goods at the same stores.
45.
Regarding
similarity of the marks used by the parties, the applicable test in
this regard was summarised in
Plascon-Evans
Paint Ltd v Van Riebeeck Paint (Pty) Ltd
[25]
as
follows:
“
In
an infringement action the onus is on the plaintiff to show the
probability or likelihood of deception or confusion. It
is not
incumbent upon the plaintiff to show that every person interested or
concerned (usually as customer) in the class of goods
for which his
trade mark has been registered would be probably be deceived or
confused. It is sufficient that the probabilities
established
at a substantial number of such person will be deceived or confused.
The concept of deception or confusion is
not limited to inducing in
the minds of interested persons the erroneous belief or impression
that the goods in relation to which
the defendant’s mark is
used are the goods of the proprietor of the registered mark, by
either plaintiff, or that there is
a material connection between the
defendant’s goods and the proprietor of the registered mark; it
is enough for the plaintiff
to show that a substantial number of
persons will probably be confused as to the origin of the goods or
the existence or non-existence
of such a connection.
The
determination of these questions involves essentially a comparison
between the mark used by the defendant and the registered
mark and,
having regard to the similarities and differences in the two marks,
an assessment of the impact which the defendant’s
mark would
make upon the average type of customer who would be likely to
purchase the kind of goods to which the marks are applied.
This
notional customer must be conceived of as a person of average
intelligence, having proper eyesight and buying with ordinary
caution. The comparison must be made with reference to the sense,
sound and appearance of the marks. The marks must be viewed
as
they would be encountered in the market place and against the
background of relevance surrounding circumstances. The marks
must not only be considered side by side, but also separately.
It must be borne in mind that the ordinary purchaser may encounter
goods, bearing the defendant’s mark, with an imperfect
recollection of the registered mark and due allowance must be made
for this. If each of the marks contains a main or dominant
feature or idea the likely impact made by this on the mind of
the
customer must be taken into account. As it has been put, marks
are remembered rather by general impressions or by some
significant
or striking feature then by a photographic recollection of the
whole. And finally consideration must be given
to the manner in
which the marks are likely to be employed as, for example, the use of
name marks in conjunction with the generic
description of the goods.”
46.
I have already stated
that the respondents
admit
to using the word mark REEF on their goods without the word BRAZIL.
They state, however, that
the
applicant’s registered stylised mark
is
sufficiently different to the REEF marks used by them (respondents)
to distinguish them apart. In this regard, the first respondent
refers to
logos
and designs, labels, tags and other get-up that is sometimes used in
conjunction with its REEF mark to negate the likelihood
of confusion
and deception.
47.
It is evident from the
evidence that the
respondents
use the word mark REEF either on its own, or together with different
logo trade marks in the vicinity of the word REEF,
or together
therewith. They use the word REEF in physical and other forms in
relation to footwear, clothing and bags, and advertising
material in
connection therewith. There are also many instances where the word
REEF is used as a word mark in ordinary block letters
without any
stylisation or font, and in some instances the word is used in one of
a few different stylised formats, none of which
are distinctive. On
the other hand, the applicant’s registered mark is REEF, a word
mark, without any logo or other device.
48.
Viewed
side-by-side, the parties’ marks exhibit similarities. The
dominant feature and first impression gained from both parties’
marks is the use of the word REEF – it is not the logos or wave
signs, as argued by the respondents. The likely impact made
by the
use of REEF on the goods in question is to create an impression on
the mind of the customer that the goods are of the same
origin,
bearing in mind that marks are remembered by general impressions or
by some significant or striking feature rather than
by a photographic
recollection of the whole. When considering the manner in which the
marks are likely to be employed, for example,
the generic description
of footwear or bags in the same industry, confusion is the likely
outcome. The broader context in which
the mark REEF is used is also
relevant because, as I have observed, the industries in which the
parties conduct business do overlap.
When comparing the applicant’s
registered trade mark and the first respondent’s REEF mark
through the eyes of the ordinary
consumer of the goods to which the
mark is applied, both side-by-side and apart, a substantial number of
persons will probably
be confused as to the origin of the
respondent’s goods or the existence or non-existence of a
connection between the trade
mark proprietor and the goods or
services of the respondent. The small differences between the
parties’ trade marks –
through the use of logos and the
like - do not, in my view, negate the likelihood of confusion. The
first respondent places reliance
on the fact that the mark REEF is
commonly used by traders. However, there is no evidence that the
goods covered by those trade
marks have the same similarities as
those arising in this case.
49.
The
applicant has attached to its papers various emails and social media
enquiries from customers who contacted it (the applicant)
believing
it to be, or to be connected to, the respondents’ business. The
applicant states that this is proof of actual confusion
by the
customers, as contemplated by the authorities discussed above.
In many instances, the customers
were making enquiries or complaining about the respondents’
footwear bearing the REEF brand.
There is, however, no confirmation
of these enquiries by way of affidavit, and as such, they constitute
hearsay evidence. At the
hearing of the matter, the applicant’s
counsel applied for the enquiries to be admitted as evidence, and the
first respondent
raised an objection. I consider the enquiries to be
very relevant to these proceedings because, according to the
applicant, it
was because of the intensifying enquiries regarding the
REEF goods sold by the respondents, particularly the footwear, that
led
it to conduct investigations and launch these proceedings. The
enquiries are furthermore very relevant given the nature of the
infringement dispute between the parties, having a bearing as it does
on the legal requirement of confusion and deception. It must
also be
borne in mind that the nature of the enquiries is correspondence from
the public, who cannot be expected to readily provide
affidavits for
legal proceedings. At the very least, the enquiries show that,
in contacting the applicant, the members of
the public believed that
the applicant was connected to the first respondent’s REEF
trade mark goods. That is the only basis
on which I consider the
enquiries to be admissible and relevant. The reasons for such belief
are not matters that can be determined
from the enquiries, and are
not matters for which I consider the enquiries to be admissible.
50.
For its part, the first
respondent has undertaken its own speculative analysis of the
public’s enquiries, pointing out that
the customers in question
were clearly trying to contact the respondents and not the applicant.
Further, according to the first
respondent, internet searches for
REEF BRAZIL, REEF SHOES SOUTH AFRICA, and REEF BRAZIL SHOES SOUTH
AFRICA yield results placing
the applicant ahead of the first
respondent, and this would explain why the applicant was contacted
instead of the respondent regarding
the respondent’s footwear
products. According to the first respondent this ‘internet
search evidence’, also shows
that, even if the first respondent
were using REEF BRAZIL, as opposed to REEF, members of the public
would still have been directed
to the applicant’s website ahead
of that of the first respondent. This speculative analysis does not
assist in resolving
this matter, and, as I have stated in any event,
the admission of the enquiries is on a narrow basis.
51.
Even without reliance on
the customers’ enquiries however, I am of the view that the
applicant has established that the respondents
are using an identical
word mark in relation to similar goods used by the applicant in
relation to items that are covered by its
REEF trade marks. I am also
of the view that the likelihood of confusion is manifest. As a
result, I find that the respondents
have indeed infringed the
applicant’s registered trade marks.
VII.
THE
COUNTER-APPLICATION
52.
The first respondent has
brought a counter-application in terms of
section 27(1)(b)
, read with
section 24(1)
of the
Trade Marks Act for
partial expungement of
certain specified goods (“the contested goods”) from the
applicant’s REEF trade mark registrations,
as follows:
52.1
From trade mark
2012/30493 REEF FLEX (class 25): Clothing (except for wetsuits) and
headgear;
52.2
From trade mark
2012/30830 REEF FLEX (class 9): Scientific, nautical, surveying,
photographic, cinematographic, optical, weighing,
measuring,
signalling, checking (supervision), life-saving and teaching
apparatus and instruments; apparatus and instruments for
conducting,
switching, transforming, accumulating, regulating or controlling
electricity; apparatus for recording, transmission
or production of
sound or images; magnetic data carriers, recording discs; compact
discs, DVD’s and other digital recording
media; mechanisms for
coin-operated apparatus; data processing equipment; computer hardware
and software;
52.3
From trade mark
2012/30828 REEF (class 9): Scientific, nautical, surveying,
photographic, cinematographic, optical, weighing, measuring,
signalling, checking (supervision), life-saving and teaching
apparatus and instruments; apparatus and instruments for conducting,
switching, transforming, accumulating, regulating or controlling
electricity; apparatus for recording, transmission or production
of
sound or images; magnetic data carriers, recording discs; compact
discs, DVD’s and other digital recording media; mechanisms
for
coin-operated apparatus; data processing equipment; computer hardware
and software;
52.4
From trade mark
2012/30829 REEF (class 18): Leather and imitations of leather, and
goods made of these materials and not included
in other classes;
animal skins, hides; umbrellas and parasols; walking sticks, whips,
harness and saddles;
52.5
From trade mark
1994/04741 REEF (class 28): Games and playthings; gymnastic articles.
53.
Section 24(1)
of the
Trade Marks Act provides
as follows:-
“
(1)
In the event of a non-insertion in or omission from the register of
any entry, or of an entry wrongly made
in or wrongly remaining on the
register, or of any error or defect in any entry in the register, any
interested person may apply
to the court … for the desired
relief, and thereupon the court … may make such order for
making, removing or varying
the entry as it … may deem fit”.
54.
Section 27(1)(b)
provides
as follows:
“
Subject
to the provisions of
section 70(2)
, a registered trade mark may, on
application to the court, …by any interested person, be
removed from the register in respect
of any of the goods or services
in respect of which it is registered, on the ground either-
(a)
…
(b)
that up to the
date three months before the date of the application, a continuous
period of five years or longer has elapsed from
the date of issue of
the certificate of registration during which the trade mark was
registered and during which there was no bona
fide use thereof in
relation to those goods or services by any proprietor thereof or any
person permitted to use the trade mark
as contemplated in
section 38
during the period concerned;
55.
The first respondent
states that, for the five years and three months preceding the
delivery of its counter-application, the applicant
had not used the
above REEF FLEX and REEF trademarks in respect of the contested
goods. The applicant’s response to the counter-application
is
firstly that the first respondent lacks the necessary
locus
standi
to bring the
counter-application as it is not an “interested person”
within the contemplation of
section 27
of the
Trade Marks Act.
Secondly
, the applicant contends that the contested goods have no
bearing to the main application or the dispute between the parties,
and
therefore the counter-application amounts to
mala
fide
abuse the
proceedings. Thirdly, the applicant has pointed out that, during the
relevant period, it has made use of the REEF FLEX
trade mark in
respect of clothing, namely wetsuits; as well as the REEF mark in
relation to umbrellas.
56.
Both
parties rely on the case of
South
African Football Association v Stanton Woodrush (Pty) Ltd
[26]
in
which it was held that the meaning of an “interested person”
in terms of
sections 24
and
27
may be determined by borrowing
from the principles developed for determining an “aggrieved
person” applying for expungement
or rectification in terms of
the previous
Trade Marks Act (the
Trade Marks Act, 1963. In
South
African Football Association v Stanton Woodrush (Pty) Ltd,
Spoelstra
J stated as follows:
“
I
do not consider the change of wording of “person aggrieved”
in s33(1) of the old Act to “interested person”
in s24(1)
of the new Act to have any real significance in this matter. It is
clear from the cases which considered the term “person
aggrieved” that it refers to persons “who are in some way
or other substantially interested in having the mark removed
from the
register” (Ritz Hotel Ltd v Charles of the Ritz & Another
1988 (3) SA 290 (A) at 308A-B) and
“a genuine
and legitimate competitive interest in the trade to which the
offending mark relates (Danco Clothing (Pty) Ltd
v Nu-Care Marketing
Sales and Promotions (Pty) Ltd & Another 1991 (4) SA 850
(A) at 855C-D). In Valentino Globe
BV v Phillips & Another
1998 (3) SA 775 (SCA) at 781B – D Harms JA
states:
‘
The
onus rests upon the applicant for removal to establish, as a
reasonable possibility, that he is a person aggrieved. For this
purpose it is assumed that the trade mark is wrongly on the register.
A wide and liberal interpretation is given to the term “person
aggrieved”. The applicant must have a substantial interest in
the mark or must substantially be damaged by its remaining
on the
register. The fact that the registered mark constitutes an obstacle
to the registration of a mark applied for by the applicant
is prima
facie evidence of an interest, but if that application for
registration was in bad faith, vexatious or without any substance,
the prima facie inference is negated.’”
57.
In
essence, the principles used in considering whether a person was a
person “aggrieved” related to whether the person
applying
for the rectification of the trade marks register or cancellation of
the trade mark had a trading interest in the mark
sought to be
expunged. If so, the
locus
standi
of that applicant was recognised.
[27]
58.
The difficulty on this
aspect is that the first respondent has not shown to have a
substantial interest in having the contested
goods it seeks to have
expunged from the applicant’s specifications. It has not shown
that it has any interest in trading
in the contested goods or
registering a trade mark for them. There is also no evidence that the
first respondent has ever traded
in the contested goods, or is
reasonably expected to enter trade in the contested goods in the
future. Thus, the continued registration
of the applicant’s
trade marks in respect of the contested goods does not appear to
hamper the first respondent in the legitimate
exercise of its
affairs. Rather, the first respondent has shown that it has a
substantial, commercial interest in the goods forming
the basis for
the infringement proceedings. However, it is not seeking expungement
in relation to those goods. It is seeking the
rectification of the
specification in relation to goods, which do not form the basis of
the infringement proceedings instituted
against the respondents. Were
the contested goods to be removed from the register, it would not
affect the basis upon which the
infringement proceedings have been
brought at all.
59.
I therefore find that the
first respondent has failed to establish the requisite
locus
standi
for the
counter-application. Accordingly, the counter-application is
dismissed.
VIII.
THE DOMAIN NAME
60.
As mentioned at the
start, the applicant seeks transfer of the domain name “reefsa.co.za”
from the third respondent
to it. However, no case is made in the
papers in this regard. During argument, the applicant’s counsel
stated that, if it
obtains the relief sought in the notice of motion,
it will need the relief sought against the third respondent. In light
of the
paucity of facts and law supplied by the applicant in this
regard, I am not able to come to its assistance. The relief sought in
this regard is accordingly dismissed.
IX.
COSTS
61.
There is no reason why
costs should not follow the result. The applicant has been
substantially successful in its application. The
second respondent
joined cause with the first respondent’s case, did not raise
any new averments, and relied wholly on the
defences raised by the
first respondent. The third respondent did not oppose the main
application. I consider that it is appropriate
that the first and
second respondents should bear the costs of these proceedings,
including the counter-application, jointly and
severally, including
the costs of two counsel.
X.
ORDER
62.
In the result, the
following order is made:
a.
It
is declared that, in terms of s 34(1)
(b)
of
the Trade Marks Act 194 of 1993 (the Act), the first and second
respondent (“the respondents”) have infringed
the trade
mark registration numbers 1985/06414, 2012/30828 and 2012/30829.
b.
The
respondents are interdicted and restrained from infringing trade mark
registration numbers 1985/06414, 2012/30828 and 2012/30829
by using,
in the course of trade or otherwise, the word mark REEF, either
simpliciter, stylised or in conjunction with a device,
without the
accompanying word “Brazil” (“the infringing
marks”), or any other marks so similar thereto,
in relation to
clothing, footwear, including flip flops and bags;
c.
The
respondents are directed:
i.
to
remove the infringing marks from all material in their possession
within 20 days of service of this order on them; and
ii.
where
the infringing mark is inseparable or incapable of being removed from
any such goods, to deliver up for destruction all such
goods and
material to the applicants’ attorneys within 20 days of service
of this order on them.
d.
It
is directed that an enquiry be held for the purposes of determining
the amount of damages (in terms of s 34(3)
(c)
of
the Act) or reasonable royalty in
lieu
of damages (in terms of s 34(3)
(d)
of
the Act) to be awarded to the applicant and, for purposes of such
enquiry, the applicant shall deliver a declaration within
20 days of
the grant of this order, after which the Uniform Rules of Court shall
apply.
e.
The
first and second respondents are ordered to pay the costs of these
proceedings, including the counter-application, jointly and
severally, the one paying the other to be absolved, including the
costs of two counsel.
MANGCU-LOCKWOOD
AJ
Appearances:
·
For applicant:
Adv
AR Sholto-Douglas SC (Instructed by Von Seidels Attorneys)
Adv
BJ Vaughan
·
For first respondent:
Adv
G Marriott (Instructed by Adams & Adams Attorneys)
·
For second respondent:
Adv
I Veerasamy (Pather & Pather Attorneys)
[1]
Bid Industrial
Holdings (Pty) Ltd v Strang and others
2008 (3) SA 355 (SCA).
[2]
Multi-Links
Telecommunications Ltd v Africa Prepaid Services Nigeria Ltd; Telkom
SA SOC Limited and another v Blue Label Telecoms
Limited and others
[2013] 4 All SA 346
(GNP) para [15].
[3]
Foize Africa (Pty) Ltd
v Foize Beheer BV and Others
2013
(3) SA 91 (SCA).
[4]
See
fn
[3].
[5]
See
also
Terespolsky
and Another v Morituri Restaurant (Lakeside) and Others
(107/13) [2014] ZAWCHC 62 (30 April 2014) at [65].
[6]
See,
for example
LA
Group Limited and Another v B & J Meltz (Pty) Limited and Others
(2672/04)
[2005] ZAGPHC 23
(23 February 2005) para [59];
Smith
and Nephew Ltd v Mediplast Pharmaceutical Sales CC
1999 (2) SA 646
(D) at 656 C – D, where the Court referred the
matter to an enquiry to determine
the
reasonable royalty,
if
any
,
was payable by the respondent.
[7]
Herbstein and Van Winsen, p66.
[8]
Blanchard, Krasner & French v
Evans
2001 (4) SA 86
(W) at 92B - C.
[9]
Ex
parte Sussens
1941
TPD 15
at 20;
Road
Accident Fund v Mothupi
supra
[24] para 17;
Borstlap
v Spagenberg en Andere
1974
(3) SA 695
(A)
at
704;
Hepner
v Roodepoort-Maraisburg Town Council
1962
(4) SA 772 (A)
at
778H – 779A;
Netlon
Limited and Van Leer South Africa (Pty) Ltd v Pacnet (Pty) Ltd
1977
BP 87 (A)
at
p 133. Also reported at 1977 (3) SA 840 (A).
[10]
Road A
c
cident
Fund v Mothupi
2000
(4) SA 39
(A) 50;
New
Media Publishing (Pty) Ltd v Eating Out Web Services CC
[2005] ZAWCHC 20
;
2005
(5) SA 388
(C)
at 406C – E.
[11]
Road
Accident Fund v Mothupi
2000
(4) SA 38
(SCA)
para
15; and
Absa
Bank Ltd v The Master and Others NNO
1998
(4) SA 15
(N)
at
28G – J.
[12]
Ellis
and Others v Laubscher
1956
(4) SA 692
(A)
at 702E;
Laws
v Rutherfurd
1924
AD 261
at 263.
[13]
Palmer
v Poulter
1983
(4) SA 11
(T)
at 21A; and
Multilateral
Motor Vehicle Accidents Fund v Meyerowitz
1995
(1) SA 23
(C)
at 27D – E.
[14]
Thomas
v Henry and Another
1985
(3) SA 889
(A)
at 897D;
Road
Accident Fund v Mothupi
supra
[24].
[15]
Road Accident Fund v
Mothupi
p 50.
[16]
Union Government v
National Bank
of SA
Ltd
1921 AD 121
at 128.
[17]
Martin v de Kock
1948 (2) SA 719 (A) 291.
[18]
New Media Publishing
(supra) at 406E
to G.
[19]
Webster and Page, South African Law of Trade Marks, para 12.7, page
12-13.
Lucky
Star Ltd v Lucky Brands (Pty) Ltd and Others
2017
(2) SA 588
(SCA) at para [4] ;
Commercial
Auto Glass (Pty) Ltd v Bayerische Motoren Werke
Aktiengesellschaft
2007
(6) SA 637
(SCA)
([2007]
4 All SA 1331)
para 3.
[20]
Webster and Page, South African Law of Trademarks, para 12.21, page
12-38.
[21]
Mettenheimer
and Another v Zonquasdrif Vineyards CC and Others
2014 (2) SA 204
(SCA) para [11].
[22]
New Media Publishing
(Pty) Ltd v Eating Out Web Services CC
[2005] ZAWCHC 20
;
2005
(5) SA 388
(C)
at 394C – F; See also
Mettneheimer
.
[23]
At para [13], applying
British
Sugar plc v James Robertson & Sons Ltd
[1996]
RPC 281
(Ch) at 296 – 297 and
Danco
Clothing (Pty) Ltd v Nu-Care Marketing Sales and Promotions (Pty)
Ltd and Another
1991
(4) SA 850 (A)
at 860F – 861E.
[24]
See paras [12] and [14] of the judgment.
[25]
[1984] ZASCA 51
;
1984 (3) SA 623
(A) at 640G to 641E.
[26]
South African Football
Association v Stanton Woodrush (Pty) Ltd
2003 (3) SA 313
(SCA).
[27]
Mars Incorporated v
Candy World (Pty) Ltd
1991 1 SA 567
(A) 575;
Ritz Hotel
Ltd v Charles of the Ritz Ltd
1988 3 SA 290
(A) 307;
Danco
Clothing (Pty) Ltd v Nu-Care Marketing Sales and Promotions (Pty)
Ltd
1991 4 SA 850
(A) 858.