Puma AG Rudolf Dassler Sport v Global Warming (Pty) Ltd (408/08) [2009] ZASCA 89; 2010 (2) SA 600 (SCA) ; [2010] 1 All SA 25 (SCA) (11 September 2009)

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Puma AG Rudolf Dassler Sport v Global Warming (Pty) Ltd (408/08) [2009] ZASCA 89; 2010 (2) SA 600 (SCA); [2010] 1 All SA 25 (SCA); 2009 BIP 192 (SCA) (11 September 2009)

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THE
SUPREME COURT OF APPEAL
REPUBLIC
OF SOUTH AFRICA
JUDGMENT
Case
No: 408/08
PUMA
AG RUDOLF DASSLER SPORT
Appellant
and
GLOBAL
WARMING (PTY) LIMITED
Respondent
Neutral
citation:
Puma v Global Warming
(408/08
)
[2009] ZASCA
89
(11 SEPTEMBER 2009)
Coram:
HARMS DP, HEHER, VAN HEERDEN, MAYA JJA AND WALLIS
AJA
Heard:
01
SEPTEMBER 2009
Delivered:
11
SEPTEMBER
2009
Updated:
Summary:
Trade
mark – infringement –
Trade Marks Act 194 of 1993
s 34(1)(a).
ORDER
On
appeal from:
High Court of South Africa
(CPD):
NTSEBEZA
AJ sitting as court of first instance:
The
appeal is dismissed with costs.
JUDGMENT
HARMS DP (HEHER, VAN
HEERDEN, MAYA JJA AND WALLIS AJA concurring):
[1] The
appellant, Puma AG Rudolf Dassler Sport, instituted a trade mark
infringement action against the respondent, Global Warming
(Pty) Ltd.
Two trade marks were in issue. Puma sought relief by way of an
interdict and damages calculated on a notional royalty
basis. The
high court, after hearing evidence, dismissed the claim with costs.
The appeal is with the leave of this court.
[2] Puma
relied on
s 34(1)(a)
of the
Trade Marks Act 194 of 1993
, which
provides that the rights acquired by registration of a trade mark are
infringed by 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.
[3] The
issues on infringement are limited particularly because the two trade
mark registrations were not impinged. Both are registered
in class 25
for footwear of all types and descriptions, and for clothing. Their
particulars are these:
The first mark, TM
1980/05551, consists of a device described in the admissions section
of the registration certificate as a ‘tapering
stripe on the side
of the shoe or boot as depicted’. It runs from the upper portion
of the heel to meet the sole at the middle
of the shoe. The stripe
contains two dotted lines that follow its curvature. They appear to
consist of or be in the form of stitching.
A disclaimer states that
the registration gives no right to the exclusive use of the stylised
shoes as depicted by means of
dotted lines. The word PUMA appears
above the stripe. PUMA is an associated word mark held under TM
78/05750. A representation
of this mark is attached.
The second, TM
1982/04607, consists of a similar device but differs from the first
mark in the following respects: the device
is not limited to use on
the side of a shoe; it is of one colour and there are no dotted
lines; and there is a blank space in
the tapering stripe close to
its widest end. The registration contains an undertaking by Puma
that, in use, the blank space appearing
in the mark will be occupied
only by matter of descriptive or non-distinctive character, or by a
registered trade mark, or it
will be left blank. Another difference
between the marks is that the name mark PUMA does not form part of
the registered mark.
Because of the poor quality of the photocopies
in the record the attached representation of the mark does not
reflect the blank
space.
[4] Global
is in the business of having shoes made for it on order, and
marketing them. A photograph of the shoe with the alleged
infringing
mark is attached to this judgment. The words ‘DT NEW YORK’ appear
on the tongue and the side of the shoe. A stripe
runs from the heel.
The stripe tapers slightly and then splits in two with a distinct
intruding section, more or less like an inverted
thumb, in a
contrasting colour. One leg has a curve in the direction of the heel.
There are, as in the first registration, dotted
lines but whether
they are, in the light of the disclaimer, to be discounted for
purposes of determining infringement was not argued
and need not be
decided.
[5] The
first question that springs to mind is this: what is Global’s trade
mark as represented on the shoe? I would have thought
that it is DT
NEW YORK. Puma’s counsel argued otherwise because, he said, these
words are meaningless. Trade marks more often
than not are
objectively meaningless (because if they have a meaning they may be
descriptive) but that does not mean that they
cannot be badges of
origin or source identifiers even if they do not disclose the source.
[6] The
second question that springs to mind is whether the stripe on
Global’s shoe, which is not substantially the same as the
marks in
issue, would have been perceived by the purchasing public as a source
identifier or as an adornment.
1
Since counsel did not
address the issue squarely it is not necessary to consider this
question or the effect of the recent judgment
of the European Court
of Justice in the
Adidas
case where the
issue was whether the use of two stripes on sportswear could infringe
Adidas’s three-stripe motif trade mark or
whether it would have
been perceived as a mere adornment.
2
[7] If
Global’s stripe has trade mark significance, as Puma contends,
regard must be had to the whole of its mark, which consists
of the
stripe with the name, to determine whether
it
so nearly resembles any of Puma’s marks as to be likely to deceive
or cause confusion. Once that is recognized, Puma’s reliance
of the
first registration is doomed because of the prominence on the name
PUMA.
[8] That
brings me to a consideration of the second registration. The trial
court relied on
Cowbell
3
for the proposition that the decision about 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. The court also
had regard to the factors set out in
Plascon
Evans
that have to be taken into
account in determining the question whether there is a probability or
likelihood of confusion.
4
It held that the average consumer would have had regard to the fact
that DT NEW YORK was part of the trade mark and would have
noted that
the two stripes are significantly different and, consequently, that
Global’s mark was not confusingly or deceptively
similar.
[9] As
counsel for Puma reminded us, the question of the likelihood of
confusion or deception is a matter of first impression and
that one
should not peer too closely at the registered mark and the alleged
infringement to find similarities and differences.
5
As a matter of first impression I came to the same conclusion as did
the trial court. Argument did not convince me to the contrary,
and in
my view the trial court was correct in its eventual judgment.
[10] The
court did, however, have regard to matters that were not permissible
to consider. These included the fact that the mark
on Global’s
packaging differed from that used on the shoe; that Puma after
instituting action in this case applied for registration
of a trade
mark that approximated Global’s stripe; and that Puma did not
produce in evidence, as it undertook to do, a shoe with
either of
these trade marks. These factors might have been relevant in a
passing-off situation but they are not in a trade mark
infringement
case which requires an objective comparison between the registration
and the defendant’s actual use.
[11] The
fact that the test is objective impinges on another aspect of Puma’s
case. It sought to rely on the subjective intention
of Global in
adopting the stripe to support a finding of infringement. The first
problem with the argument concerns the evidence.
Global sought to
produce a shoe that approximated the Puma Sprint shoe without
infringing its trade marks. The photograph of the
Sprint shoe, as
reproduced in the record, does not appear to bear either of the two
registered marks in issue although it could
be considered to be an
adaptation of the first mark. In any event, there are other aspects
to the argument. The first is that the
intention to compete must not
be confused with the intention to mislead.
6
The second is that the subjective intention of a defendant could
hardly assist in deciding the objective question of the likelihood
of
deception or confusion. The New Zealand Court of Appeal in
Advantage
Group Ltd v ADV E-Commerce Ltd
[2002]
NZCA 282
quoted in this regard
McCarthy
on Trademarks and Unfair Competition
(4
ed), para 13.22 with approval:
‘
Almost all of the
modern decisions have shifted the emphasis away from the defendant's
subjective mental state, and have placed
prime importance upon the
issue of likelihood of confusion and consequent consumer deception.
That is, the objective facts of probable
customer confusion are more
important than trying to determine what was going on in the
defendant's mind.’
One
could test the proposition by asking whether the intention of a
defendant not to confuse or deceive could assist in a defence
of
non-infringement. The answer must be in the negative because as an
Arizona court quoted by McCarthy has said: ‘Both the first
user and
the public may be as readily wounded by the ostrich as the fox.’
7
[12] The
court below, unnecessarily, expressed a view about Puma’s claim for
a notional royalty, stating that the claim could
not have succeeded
in the absence of proof of actual loss. In this regard the court
erred. The object of permitting a claim for
damages in the form of
notional royalties is to obviate proof of actual loss, something
extremely difficult to establish in intellectual
property
infringement cases. As Learned Hand J explained,
8
‘
The
whole notion of a reasonable royalty is a device in aid of justice,
by which that which is really incalculable shall be approximated,

rather than that the patentee, who has suffered an indubitable wrong,
shall be dismissed with empty hands.’
All a
claimant has to prove is the number of infringing articles and the
reasonable royalty rate.
9
[13] It
follows that the appeal stands to be dismissed and the appeal is
accordingly dismissed with costs.
_____________________
L T C HARMS
DEPUTY PRESIDENT
For
Appellant: C Puckrin SC
I Joubert
Instructed by: Adams &
Adams
Pretoria
Honey Attorneys
Bloemfontein
For
Respondent: J Newdigate SC
Instructed
by: Fairbridges
Cape Town
McIntyre
& Van Der Post
Bloemfontein
80/05551
Global
shoe
1
Verimark (Pty) Ltd v
Bayerische Motoren Werke AktienGesellschaft; Bayerische Motoren
Werke AktienGesellschaft v Verimark (Pty)
Ltd
[2007] ZASCA 53
; [2007] SCA 53 (RSA);
2007 (6) SA 263
(SCA) para 5.
See also the discussion in
Bergkelder
Bpk v Vredendal Koöp Wynmakery
(105/05)
[2006] ZASCA 5
;
2006 (4) SA 275
(SCA); [2006] SCA 8 (RSA)
para 8;
Lubbe NO v
Millenium Style (Pty) Ltd
[2007] ZASCA 10
; [2007] SCA 10;
[2007] 4 All SA 692
(SCA);
2007 (6)
SA 241
(SCA) para 9.
2
Adidas AG
(Approximation of laws)
[2008] EUECJ C-102/07
(10 April 2008)
[Adidas AG v Marca Mode CV
].
3
Cowbell AG v ICS Holdings
Ltd
[2001] ZASCA
18
;
2001 (3) SA 941
;
[2001] 4 All SA 242
(SCA) para 10.
4
Plascon-Evans Paints Ltd v Van Riebeeck Paints (Pty) Ltd
1984 (3) SA 623 (A) 640G-641E, 642D-F.
5
Laboratoire Lachartre SA v Armour-Dial Inc
1976 (2) SA 744 (T)
746B-F.
6
Reckitt & Colman SA (Pty) Ltd v SC Johnson & Son SA (Pty)
Ltd
1993 (2) SA 307 (A) 318A-C.
7
V J Doyle Plumbing
Co v Doyle
120
Ariz 130
(Ct App 1978).
8
Cincinatti Car Co v New York Rapid Transport
Corp
66 F2d 592.
9
But see the reservations expressed in
Reed
Executive Plc & Ors v Reed Business Information Ltd
&
Ors
[2004] EWCA Civ 159
para 165-169.