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[2016] ZAGPPHC 363
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Saic Motor Co Ltd v Deutz (65401/2015) [2016] ZAGPPHC 363; 2016 BIP 161 (GP) (13 May 2016)
REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
(GAUTENG
DIVISION, PRETORIA)
CASE
NO:65401/2015
DATE:
13 MAY 2016
In
the matter between
SAIC
MOTOR CO
LTD
.....................................................................................................
APPLICANT
And
DEUTZ
AG
...........................................................................................................................
OPPONENT
J
U D G M E N T
VAN
OOSTEN J:
Introduction
[1]
This matter comes before this court by way of a
referral by the Registrar of Trademarks in terms of s 59(2) of the
Trade Marks Act
194 of 1993 (the Act). The applicant for registration
of the trademarks which are the subject of this application (SAIC),
is a
Chinese company, trading in the production and sale of motor
vehicles and components and providing services in the automotive
trade.
The opponent to the applicant’s application is Deutz AG
(Deutz), a German corporation, represented in South Africa by its
distributor, Deutz Dieselpower (Pty) Ltd, conducting business in
producing, marketing, and selling of various mobile engines, parts
and components and rendering services related thereto.
[2]
On 7 January 2011 SAIC applied for the registration of a trade mark
in classes 12, 37 and 39 with the Registrar of Trade Marks.
The
applications (no’s
2011/00412; 2011/00413
and 2011/00414)
were accepted and advertised. No disclaimers
or admissions were entered but a notice of opposition was filed by
Deutz, to which
a lengthy affidavit was attached. SAIC in response
thereto filed an answering affidavit to which Deutz has filed a
reply.
The
competing trade marks
[3]
The trade mark referred in the application for registration is
described by Deutz as a ‘Tower Device’ which SAIC,
in my
view not without justification, strongly disagrees with. SAIC
explains that the trade mark is related to their ‘primary
legendary commercial vehicle brand’ known as MAXUS, from which
the MAXUS Device mark is derived, which it maintains reflects
the
correct description of the trade mark. Photographs attached to the
papers depict the trade mark, attached to MAXUS commercial
vehicles,
as .
[4]
Deutz is the proprietor of altogether 11 trademarks, registered in
South Africa, which are referred to and described as a ‘Tower
Device’, which consists of a device mark, registered in classes
7, 12, 37 and 42 and a word mark, DEUTZ & Tower Device,
registered in classes 7, 9, 12, 16, 37, 41 and 42 (and therefore not
in class 39).
These
marks are respectively depicted as and .
The
grounds of opposition
[5] The grounds of
opposition to the application are premised on the provisions of
s
10(12), 10(14) and 10(17) of the Act, which provide as follows:
‘
The
following marks shall not be registered as trade marks or, if
registered, shall, subject to the provisions of sections 3 and
70, be
liable to be removed from the register:
10(12)
a mark which is inherently deceptive or the use of which would be
likely to deceive or cause confusion, be contrary
to law, be contra
bonos mores, or be likely to give offence to any class of persons;
10(14)
subject to the provisions of section 14, a mark which is identical to
a registered trade mark belonging to a different
proprietor or so
similar thereto that the use thereof in relation to goods or services
in respect of which it is sought to be registered
and which are the
same as or similar to the goods or services in respect of which such
trade mark is registered, would be likely
to deceive or cause
confusion, unless the person making the earlier application consents
to the registration of such mark;
10(17)
a mark which is identical or similar to a trade mark which is already
registered and which is well-known in the Republic,
if the use of the
mark sought to be registered would be likely to take unfair advantage
of, or be detrimental to, the distinctive
character or the repute of
the registered trade mark, notwithstanding the absence of deception
or confusion, unless the proprietor
of such trade mark consents to
the registration of such mark.’
[6]
In the opposing affidavit the deponents for Deutz solely rely on an
alleged conceptual and visual similarity between the competing
marks
for the submission that ‘a member of the public confronted with
the Tower Device mark will immediately be confused
by and associate
any services or goods to which this trade mark has been applied with
the Opponent’s Tower Device trade mark’.
No facts in
support of the submission were advanced and, as I will presently deal
with, it is moreover premised on the wrong test.
[7]
The first and indeed decisive issue for determination, as rightly
acknowledged by both counsel in argument, is whether such
similarity
in the trade marks exists as to cause the ‘likelihood of
deception or confusion’ which is the term used
in all the
quoted sub-sections of s 10 of the Act and therefore must be accepted
to bear the same meaning (
Minister of the Interior v Machadodorp
Investments (Pty) Ltd and Another
1957 (2) SA 395
(A) 404D).
The
legal principles: likelihood of deception or confusion
[8]
The meaning of the words ‘as to cause the likelihood of
deception or confusion’ and the general principles governing
their application to the facts of a particular case, has been dealt
with in numerous cases. In the leading case of
Plascon-Evans
Paints Ltd v Van Riebeeck Paints (Pty) Ltd
[1984] ZASCA 51
;
1984
(3) SA 623
(A) 640G-641D, Corbett JA (as he then was) summarised the
main legal principles applicable, 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 probably be deceived or
confused. It is sufficient if the probabilities establish
that a
substantial number of such persons 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, i.e. the 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 relevant 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
than 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 a
generic description of the goods.’
[9]
The approach has been followed in numerous judgments of the Supreme
Court of Appeal, most recently in
Yair
Shimansky v Browns the Diamond Store
(9/2014)
[2014] ZASCA 2014
(1 December 2014), in which extensive reference is
made to the judgment in
Roodezandt
Ko-operatiewe Wynmakery Ltd v Robertson Winery (Pty) Ltd &
Another
(503/13)
[2014] ZASCA 173
(19
November 2014), where Brand JA elaborated on the meaning of the value
judgment to be made (in the context of an application
to remove a
trade mark from the register), as follows (para 5):
‘
[5]
The fundamental enquiry is therefore whether Roodezandt’s
Robertson Hills mark so resembles the Winery’s marks
incorporating the term ‘Robertson’ that, if the competing
marks are all used in relation to wine, such use would be
likely to
cause deception or confusion. That determination involves a value
judgment (see eg
Cowbell AG v ICS
Holdings Ltd 2001(3) SA 941
(SCA) para
10). Considerations that could assist in the exercise of this value
judgment have been proposed in numerous decided cases.
One of these
cases is
Laboratoire Lachartre SA v
Armour-Dial Incorporated
1976 (2) SA 744
(T)
in which Colman J sounded the following note of caution (at 746B-E):
‘
We
have had ample time for full consideration and close comparison of
the two trademarks with which we are concerned. These advantages,
however, carry their own dangers. They have caused us to look at the
trademarks with far greater care than they would be looked
at by the
members of the public whose probable reactions we are required to
assess, and with a far keener awareness of similarities
and
dissimilarities than such people would probably have as they go about
their daily lives.
What we have now to do
is, therefore, to transport ourselves, notionally, from the
court-room or the study, to the market place.
We must try to look at
the marks as they will be seen, if they are both in fair and normal
commercial use, by the hypothetical
consumers of [wine]. Those will
be people of many races and degrees of education, having varied
gifts, interests and talents. We
are not to postulate the consumer of
“phenomenal ignorance or extraordinarily defective
intelligence”. . . We are to
consider a person of average
intelligence and proper eyesight, buying with ordinary caution’.’
The
learned judge of appeal then listed the following principles of
comparison that have developed in order to reach the value judgment
(para 6):
‘
[6]
Most, if not all, of these considerations seem to find application in
the present context. Other principles of comparison which
have become
crystallised in earlier decisions of this court which I find to be
pertinent, include the following:
(a)
A likelihood of confusion does not only arise when every person
interested or concerned in the class of goods for which the
trademark
has been registered could probably be deceived or confused. It also
arises if the probabilities establish that a substantial
number of
such persons will be deceived or confused.
(b)
The concept of deception or confusion is not limited to inducing in
the minds of these interested persons the erroneous belief
or
impression that the two competing products are those of the objector
or that there is a connection between these two products.
A
likelihood of confusion is also established when it is shown that a
substantial number of persons will probably be confused as
to the
origin of the products or the existence or non-existence of such a
connection.
(c)
The determination of the likelihood of confusion involves a
comparison between the two competing marks, having regard to the
similarities and differences in the two and an assessment of the
impact it would have on the average type of customer who is likely
to
purchase the kind of goods to which the marks are applied.
(d)
The marks must not only be considered side by side, but also
separately.
(e)
It must be borne in mind that the ordinary purchaser may encounter
goods bearing one mark with an imperfect recollection of
the other.
(f)
If each of the competing marks contains a main or dominant feature or
idea, the likely impact made by this dominating feature
on the mind
of the customer must be taken into account. This is so because marks
are remembered by some significant or striking
feature rather than by
the photographic recollection of the whole. (See eg
Plascon-Evans
Paints Ltd v Van Riebeeck Paints (Pty) Ltd
[1984] ZASCA 51
;
1984 (3)
SA 623
(A) at 640G-641E;
Puma AG Rudolf Dassler Sport v Global
Warming (Pty) Ltd
2010 (2) SA 600
(SCA) para 8; and
Adidas AG
& another v Pepkor Retail Ltd
2013 BIP 203 (SCA) paras
20-23.)’
(See
also,
Adcock Ingram Intellectual
Property (Pty) Ltd v Cipla Medpro (Pty) Ltd et al
2012
(4) SA 238
(SCA) at 243 para 15;
Orange
Brand Services v Account Works Software
2013
BIP 313 at 315 and 319. Compare the following cases decided by the
Court of Justice of the European Union:
Sabel
BV v Puma AG
(Case C-251/95),
[1998]
RPC 199
,
[1998] ETMR 1
(1997);
Canon
Kabushiki Kaisha v Metro-Goldwyn-Mayer
[1999] RPC 117
para 26-30;
Lloyd
Schuhfabrik Meyer & Co GmbH v Klijsen Handel BV
[1999] EUECJ C-342/97
;
[2000]
FSR 77
para 8-28;
Marca Mode CV v.
Adidas AG & Adidas Benelux BV
[2000] EUECJ C-425/98
;
[2000] ETMR 723
;
Matrazen Concord GmbH v
GmbGv Office for Harmonisation in the Internal Market
[2004] ECR I-3657).
Application
of legal principles
[10] Applying the
above legal principles to the facts of this case, a comparison must
be made between the competing trade marks,
with reference to their
appearance both conjunctively and separately. The DEUTZ word mark is
clearly distinguishable by the use
of the word DEUTZ and the
likelihood of deception or confusion accordingly, does not arise.
That leaves for comparison the DEUTZ
Tower Device mark and
separately, as well as side by side, or opposed to it, the MAXUS
Device mark. Counsel for Deutz relied on
the following alleged
similarities in the competing marks, in support of the submission
that they are ‘strikingly similar’
in visual and
conceptual appearance:
·
both marks resemble a tower device;
·
both marks have two levels, a lower level
and immediately above, an upper level;
·
in both the marks the lower level depicts
two peaks adjacent one another; and
·
in both the marks the upper level depicts
one peak between the two peaks on the lower level.
At
best for Deutz the features referred to, in my view, are inconclusive
in making a proper comparison: the comparison must involve
both
similarities and differences in the competing marks. As for general
conceptual appearance the striking feature of the DEUTZ
mark is that
the sharp distinctive tower point is a continuation of the solid line
from the ‘M’ styled lower level,
in effect constituting
one single design. It should be noted that in terms of the
endorsement on the certificate of registration
of its trade mark,
Deutz does not hold the right to the exclusive use of the letter ‘M’.
The MAXUS Device mark, on
the other hand, consists of a configuration
of three separate triangles, juxtaposed, two of which side by side as
the base of the
mark, with the third triangle symmetrically at the
top. The right line segment of each triangle is shaded thus creating
a two dimensional
impression.
[11] Having
described the conceptual similarities and differences of the
competing marks, assisted by the photographic images thereof
above,
an assessment now needs to be made of the impact they would make upon
the notional average type of customer who would be
likely to purchase
the kind of goods or require the kind of services rendered, in the
ordinary course of business to which the
marks would be applied. In
its widest sense the market place we are here concerned with is the
motor industry where the prospective
customer, in any event, is
bombarded with a large variety of marks, in all forms and shapes.
Both Deutz and SAIC trade in specialised
goods and services,
restricted to the motor industry, through designated distributors and
dealerships, which clearly distinguishes
their customer base from the
ordinary supermarket-off-the-shelf-customers. Furthermore, customers
in the motor industry, and in
particular in regard to commercial
vehicles, specialised equipment and components can be expected to be
cautiously discerning and
fastidious concerning the brand of goods
they select to purchase or their choice of a service provider.
[12] A value
judgment is ultimately called for, dictated by the overall impression
created by the competing marks (
Orange Brand
para 14),
requiring a consideration of the principles enunciated in
Roodezandt.
In addition to the comparison between the conceptual
characteristics of the competing marks I have already made, I should
add that
in my view, the likely impact that would be made by the
dominant features of the competing marks on the mind of the average
customer
(
Shimansky
para 10) or substantial number of
customers in the motor vehicle trade, differs materially. The
dominant impression of the DEUTZ
mark evidently, is derived from its
pertinent, bold sharp pointed tower device, as opposed to the MAXUS
device mark, depicting
a stacked configuration of three triangles.
Nothing of substance has been advanced to show in what respects
deception or confusion
may arise. I am unable to find any: not even a
fleeting observance of any one or both the trade marks, in my view,
would likely
cause deception or confusion.
[13] Deutz has
attached to the opposing affidavit its annual report, as well as
copies of its advertising brochures and newsletters
which are widely
distributed to its distributors, dealers and the public, to
demonstrate that ‘the tower device has achieved
a high level of
recognition including in the South African market place’. On
perusal of the documents, which notably extend
into 225 pages, it is
apparent that the largest segment of Deutz’s trade comprises
the manufacture, sale and supply of engine
units for use in mobile
and stationery equipment, commercial vehicles, agricultural
machinery, implements, boats, ships, aircraft
tugs, construction
equipment, hi-performance generators and trains. It is obviously for
this reason that Deutz proudly advertises
and holds itself out to the
outside world where it trades, as ‘The engine company’.
As for South Africa it is stated,
in one of the Deutz newsletters,
that DEUTZ Dieselpower has been supplying engines for the local
market in Johannesburg for more
than 27 years. SAIC on the other
hand, mainly trades in the production and sales of passenger and
commercial vehicles as well as
components including engines,
transmissions, power trains, chassis, interior and exterior trims and
electronic and electric parts.
Although there is an overlap of goods
and services in the business activities of SAIC and Deutz, the
difference in their main scope
of business, particularly in South
Africa, is quite obvious and cannot be ignored. It has this
significance: it further diminishes
the likelihood of deception or
confusion by the concomitant use of the competing marks.
Conclusion
[14]
For all the aforesaid reasons I conclude that no degree of similarity
exists between the competing marks that is likely to
cause deception
or confusion in the motor vehicle industry. It follows that there is
no merit in the opposition.
Order
[15]
In the result the following order is made:
1.
The opponent’s
opposition to trade mark applications no’s 2011/00412,
2011/00413 and 2011/00414, in the name of SAIC
Motor Co Ltd, is
dismissed.
2.
The opponent
is ordered to pay the costs of this application.
FHD
VAN OOSTEN
JUDGE
OF THE HIGH COURT
COUNSEL
FOR APPLICANT ADV CJ VAN DER WESTHUIZEN SC
ATTORNEYS
FOR APPLICANT DM KISCH INC
COUNSEL
FOR RESPONDENT ADV P CIRONE
RESPONDENT’S
ATTORNEYS DR GERNHOLTZ INC
DATE
OF HEARING 28 APRIL 2016
DATE
OF JUDGMENT 13 MAY 2016