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[2016] ZAGPPHC 677
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M-Systems Group (Pty) Ltd v Cochrane Steel Products (Pty) Ltd (61028/2015) [2016] ZAGPPHC 677; 2016 BIP 228 (GP) (10 August 2016)
REPUBLIC OF SOUTH
AFRICA
IN THE HIGH COURT OF
SOUTH AFRICA
GAUTENG DIVISION,
PRETORIA
DATE:
10/8/2016
CASE
NO:
61028/2015
Reportable:
No
Of
interest to other judges: No
Revised.
M-SYSTEMS
GROUP (PTY)
LTD
Applicant/Opponent
and
COCHRANE
STEEL PRODUCTS (PTY)
LTD
Respondent/Trademark
Applicant
JUDGMENT
AC
BASSON, J
[1]
“
In
a globally competitive business world a trademark can be the single
most valuable asset for a company…… A trademark
with a
good image and reputation enhances the goodwill of a company and
provides it with a competent edge:
“
Trademark
law aims to aid consumers in identifying the source of goods by
allowing producers the exclusive right to particular identifying
words . . . which they may attach to their products as a designator
of source.”
(
Thomas
& Betts Corp v Panduit Corp
[1995] USCA7 1185
;
65
F 3d 654
(7th Cir 1995).
[1]
In
this regard it was also stated in
Mars
GB Ltd v Cadbury Ltd
[2]
with reference to the
function of a trademark:
“
A trademark is a
flag planted to identify the fact that you are in a
particular trader’s territory.”
[2]
Cochrane Steel Products
(Pty) Ltd (the trademark applicant - hereinafter referred to as “the
applicant”) has applied
to register the mark “CLEARVU”
in the name of the trademark applicant in respect of classes 6 and
37. The marks are
sought to be registered in class 6 in respect of
“non-electric cables and wires of common metal; metal fences;
metal mesh;
pipes and tubes of metal” under trademark
application number 2010/13544. The applicant also sought to register
the mark in
class 37 in respect of “building construction;
repair; installation services “under trademark number
2010/13545 (“the
opposed applications”).
[3]
The deponent to the
applicant’s founding affidavit - Mr Cochrane (“Cochrane”)
- is the Group Marketing Director
of the applicant. He has been
actively involved with the development of the CLEARVU products since
the inception of the business.
[4]
M-Systems Group (Pty) Ltd
(hereinafter referred to as “the opponent”) operates a
business which manufactures and installs
steel and other fences. The
opponent brands its competing products as “M-Secure”.
[5]
Both parties therefore
operate in the security fencing industry and are rival traders.
[6]
The opponent has filed an
opposition to the registration of the trademark CLEARVU and seeks an
order refusing the registration of
the trademark application in
respect of both applications (“the opposed applications”).
In the alternative, the
opponent seeks an order entering
appropriate endorsements against both these trademarks to the effect
that the applicant would
not, by virtue of the registration of the
marks, obtain the exclusive rights to use the words “CLEAR”,
“VIEW
“or “VU” separately and apart
from the trademark “CLEARVU”.
[7]
From the papers it does
not appear that the opponent is opposing the registration of the
CLEARVU trademark because it has rights
in a confusingly similar
mark. The opponent, as already pointed out, brands its competing
products under the name “M Secure”.
The opponent is
opposing the registration on the basis that the mark is not capable
of distinguishing within the contemplation
of section 10(2) of the
Act. The opponent brings the opposition on the grounds set out in
section 10(2) of the Trademarks Act
[3]
(“the Act”). In addition, the opponent submits that the
applicant is not able to overcome an opposition brought under
section
10(2) of the Act by proving that the mark has, through extensive
prior use, acquired the necessary distinctiveness as contemplated
in
section 9(1) of the Act.
[8]
As will be pointed out
herein below, it is the applicant’s case that it does not need
to rely on section 10(2) of the Act
(which states that a mark shall
not be registered if it is not capable of distinguishing within the
meaning of section 9 of the
Act) because the trademark CLEARVU “has
in fact become capable of distinguishing within the meaning of
section 9 as a result
of use made of the mark.”
[4]
[9]
The applicant criticises
the opposition to the trademark registration and submits that the
opponent is merely opposing the registration
of the trademark because
it has been making unauthorized use of the mark CLEARVU and that
registration of the trademark would mean
that the opponent
potentially becomes exposed to a statutory infringement which may
result in a claim for damages. One of the alleged
unauthorized uses -
according to the applicant – is the alleged unauthorised use of
the CLEARVU mark in its advertising campaign
and the use of the
CLEARVU mark as a keyword in an advertising campaign that the
opponent has conducted. The applicant has formally
notified the
opponent that it will sue for the statutory trade infringement once
the trademark CLEARVU has been registered. This,
according to the
applicant, is the reason for opposing the registration of the
trademark CLEARVU, which it labels as being “spurious”.
[10]
It should be pointed out
that, at the time this application was heard an appeal between the
same parties was pending before the
Supreme Court of Appeal
(“SCA”).
[5]
The SCA has since
delivered judgment in the matter. In
May
2016 the SCA dismissed an appeal against an order of the High Court
refusing to interdict and restrain
the
respondent, M-Systems, from using the mark CLEARVU in relation to
Google “AdWords” advertising. Briefly in that
matter
advertisements of M-Systems would be displayed upon the entry into
the Google search internet search terms consisting of
or comprising
of the word “CLEARVU”. The appellant (Cochrane Steel
Products (Pty) Ltd) contended that this was a formal
unlawful
competition, alternatively passing off.
[11]
The SCA concluded that,
whilst accepting that the appellant has acquired a reputation in
respect of its business to the extent that
it became distinctive
therefore, it was not persuaded that the conduct of the respondent
caused, or was calculated to cause the
public to be confused:
“
[6] Not having any
registered right in the name CLEARVU, it was for the appellant to
show that the name has acquired such a reputation
in relation to its
business that it may be said to have become distinctive thereof
(
Capital
Estate
(above)
at 925H). Whilst I am willing to accept in the appellant’s
favour that it succeeded in establishing a reputation in
the name
CLEARVU, I entertain some doubt as to whether it established the
second leg of its cause of action, namely that the respondents’
conduct caused, or was calculated to cause, the public to be confused
or deceived. Whether there is a reasonable likelihood of
such
confusion arising is, of course, a question of fact which will have
to be determined in the light of the circumstances of
each case.”
[12]
I have already pointed
out that the opponent is a rival trader in the security fencing
industry. One of the opponent’s prominent
products is the
“M-Secure Fencing System”. According to the opponent this
product has the characteristic of providing
an aesthetically pleasing
yet secure fencing system which allows a “clear view”
through the fence which is the main
selling point of high-density
welding steel mesh panel fences. According to the opponent this
product enables a clear view without
compromising on the fence’s
safety and strength.
[13]
The two parties are
currently engaged in litigation before the Commissioner of Patents in
respect of patented infringements at the
suit of the applicant
against the opponent.
History
of the CLEARVU product
[14]
The applicant was
established in 1984 as a partnership between Anglo American
Corporation of South Africa and Cochrane. The company
was set up to
service the expanding need for perimeter security. Initially razor
wire was used but gradually the product was expanded
to include other
forms of fencing such as steel bar fencing and mobile barriers.
[15]
In 2004 the applicant
adopted the mark CLEARVU for a particular fencing product and has
since marketed various kinds of security
barriers under this brand.
[16]
CLEARVU products are not
only marketed in South Africa but are also marketed in 142 countries
which include the United States, Israel
and the United Kingdom.
The CLEARVU trademark has also been registered in the United States
of America. Cochrane points out
that this could only have been done
on the basis of the use that has been made of the trademark and
points out that the registration
of the trademark in America likewise
requires stringent “distinctiveness” requirements.
[17]
Cochrane further contends
that the applicant’s fencing is virtually a national
institution and that it is to be found in literally
thousands of
strategically placed and highly visible installations around the
country. The installation of the fencing of the applicant
can be
found at residential estates, industrial estates, golf estates,
corporate offices, shopping centres, sport facilities, to
mention but
a few. At all of these installations significant exposure for the
CLEARVU brand is given: Signage of the product displaying
the CLEARVU
mark is erected at the commencement of the contract for installation
of the fencing and would remain there permanently.
This, according to
Cochrane, serves to enhance the reputation of the applicant’s
products and particularly serves to indicate
and establish a
connection between the applicants’ (fencing) products and the
use of the mark CLEARVU.
[18]
According to Cochrane the
revenue generated from products under the CLEARVU brand in South
Africa alone has exceeded R 500 million.
[19]
Cochrane further points
out that the respective products of the applicant are often specified
by architects, customers, builders
and engineers with reference to
the trademark CLEARVU and not with reference to the product itself.
In this regard it was submitted
that the inference to be drawn from
these facts is that the mark CLEARVU has obtained a reputation
amongst a significant percentage
of the population to the extent that
the mark has become associated and connected in the minds of the
public and professionals
with the product and consequently with the
applicant.
[20]
The applicant accordingly
submits that the evidence shows that the mark CLEARVU does indeed
represent and is a “badge of origin”
for the products of
the applicant to the exclusion of all other products of its
competitors in the market.
Legal
framework
[21]
Section 2(1) defines a
trademark as “any sign capable of being represented
graphically, including a device, name, signature,
word, letter,
numeral, shape, configuration, pattern, ornamentation, colour or
container for goods or any combination of the aforementioned”.
[22]
The courts have
interpreted this definition to mean that the primary function of a
trademark is to denote origin which in turn performs
its function of
distinguishing the goods from the same kind of goods:
“
The
subsection must be construed so that its ambit coincides with its
purpose. That purpose is to exclude from registration shapes
which
are merely functional in the sense that they are motivated by and are
the result of technical considerations. Those are the
types of shapes
which came from manufacture of patentable inventions. It is those
types of shapes which should not be monopolised
for an unlimited
period by reason of trademark registration, thereby stifling
competition. Registrable trademarks are those which
have some
characteristic which is capable of and does denote origin.”
[6]
[23]
It is accepted that it is
not in the interest of the public to register a trademark that cannot
portray the basic function contemplated
by section 9(1) of the Act
which is to distinguish.
[7]
[24]
Section 9(1) of the Act
requires as follows –
“
9 Registrable
trademarks
(1) In order to be
registrable, a trademark shall be capable of distinguishing the goods
or services of a person in respect of which
it is registered or
proposed to be registered from the goods or services of another
person either generally or, where the trademark
is registered or
proposed to be registered subject to limitations, in relation to use
within those limitations.
(2) A mark shall be
considered to be capable of distinguishing within the meaning of
subsection (1) if, at the date of application
for registration, it is
inherently capable of so distinguishing or it is capable of
distinguishing by reason of prior use thereof.”
[25]
Section 10(2) of the Act
reads as follows:
“
10 Unregistrable
trademarks
The following marks shall
not be registered as trademarks or, if registered, shall, subject to
the provisions of sections 3 and
70, be liable to be removed from the
register:
(1) A mark which does not
constitute a trademark;
(2) a mark which-
(a)
is
not capable of distinguishing within the meaning of section 9; or
(b)
consists
exclusively of a sign or an indication which may serve, in trade, to
designate the kind, quality, quantity, intended purpose,
value,
geographical origin or other characteristics of the goods or
services, or the mode or time of production of the goods or
of
rendering of the services;”
[26]
Section 10(2) of the Act
is subject to the following provision:
“
Provided that a
mark shall not be refused registration by virtue of the provisions of
paragraph (2) or, if registered, shall not
be liable to be removed
from the register by virtue of the said provisions if at the date of
the application for registration or
at the date of an application for
removal from the register, as the case may be, it has in fact become
capable of distinguishing
within the meaning of section 9 as a result
of use made of the mark.”
[27]
The effect of the
provision is that the applicant for a trademark may be able to
overcome an opposition brought in terms of section
10(2)(a) of the
Act by proving that the mark has, through extensive use prior to the
date of the application for the mark, acquired
the distinctiveness
contemplated in section 9(1) of the Act.
[28]
As already pointed out,
the opponent is opposing the registration on the grounds set out in
section 10(2) of the Act. Moreover,
as already pointed out, it is
also submitted on behalf of the opponent that the applicant has not
discharged the onus of proving
that the trademark applied for has,
through extensive use acquired the distinctiveness as contemplated in
section 9(1) of the Act.
First
enquiry: Is the mark “CLEARVU” inherently distinctive as
at the date of application?
[29]
In essence the opponent
submits that the mark “CLEARVU” is not capable of
distinguishing the applicant’s products
and services from the
same kind of goods connected in the course of trade with other
traders or competitors.
[30]
Whether a mark is
“capable of distinguishing” has been considered by the
courts on numerous occasions. If a mark is
capable of distinguishing
it would follow that it can perform the function of a trademark. In
simple terms that would imply that
the mark is capable of
distinguishing or differentiating the goods in respect of which the
mark is used from the same or similar
kind of goods.
[31]
The
opponent referred to the decision in
First
National Bank of Southern Africa Ltd v Barclays Bank plc and
another
[8]
in support of its submission that the mark CLEARVU is not capable of
distinguishing. In that matter the appellant (First National
Bank)
had applied for the registration of the trademarks “Premier”
and “Premier Package” in relation to
cheques and banking
and credit card services.
[9]
The
court concluded that the mark was purely descriptive in that it
referred to the superior nature of the banking product in question.
In this matter the court, although not ruling out the
possibility of such a mark being registered, cautioned against
registering
such a mark unless it is incapable of application to the
goods of anyone else:
“
[15]
The next bit of evidence gives us the number of Premier cheque
account and credit card accounts held by customers and the debit or
credit amounts reflected in them and also some advertising material.
This evidence appears to deal with the current position and
does not
purport to deal with the position at the relevant date. The evidence,
likewise, is of little moment. The mark, as far
as I can see, was
used mostly, if not invariably, in connection with FNB's obvious
trademarks and as an adjective. It was also
used to distinguish FNB's
services one from the other: prime clients get the premier product;
others do not. It is worth quoting
Jacob J in
British
Sugar plc v James Robertson & Sons Ltd
(the
Treat
case):
'I
have already described the evidence used to support the original
registration. It was really no more than evidence of use. Now
it is
all too easy to be beguiled by such evidence. There is an unspoken
and illogical assumption that ''use equals distinctiveness''.
The
illogicality can be seen from an example: no matter how much use a
manufacturer made of the word ''Soap'' as a purported trademark
for
soap the word would not be distinctive of his goods. He could use
fancy lettering as much as he liked, whatever he did would
not turn
the word into a trademark. Again, a manufacturer may coin a new
word for a new product and be able to show massive
use by him and him
alone of that word for the product. Nonetheless the word is apt to be
the name of the product, not a trademark.
Examples from old
well-known cases of this sort of thing abound. The
Shredded Wheat
saga is a good example: the Canadian case is
The Canadian Shredded
Wheat Co Ltd v Kellogg Co of Canada Ltd
in the Privy Council and
the United Kingdom case
The Shredded Wheat Co
Ltd
v
Kellogg Co of Great Britain Ltd
in the House of Lords. In the
former case Lord Russell said:
''A
word or words to be really distinctive of a person's goods must
generally speaking be incapable of application to the goods
of anyone
else.''
It
is precisely because a common laudatory word is naturally capable of
application to the goods of any trader that one must be
careful
before concluding that merely its use, however substantial,
has displaced its common meaning and has come to denote
the mark
of a particular trader. This is all the more so when the mark has
been used in conjunction with what is obviously taken
as a
trademark.'”
[32]
See also:
Online
Lottery Services (Pty) Ltd and others v National Lotteries Board and
Others Online Lottery Services (Pty) Ltd
:
[10]
“
[32]
But, just as the term 'motorcar' generally embraces many
different manifestations both in design and name, none of which
entitles anyone to the sole trading use of the generic name, so was
it with 'lotto' at the relevant time. By adopting the word
simpliciter
(without
adaptation or qualification) as a trademark for lottery services, the
registering party simply appropriated to itself a
word already in
general circulation which possessed an ascertainable generic and
descriptive meaning over which it could have
no monopoly and which
should have been open to use by all competitive undertakings in the
gaming industry. The word 'lotto' could,
as counsel for On-Line have
submitted, contribute nothing to identifying the source of the
service which it promoted. Moreover,
as stressed earlier, the Board
and its operator could not enhance the inherent absence of power
to distinguish by creating
a game to which they chose to apply the
generic description 'lotto'.
[33]
Despite the fact that the
SCA in
First
National Bank
[11]
was of the view that the appellant was not entitled to registration
of the trademarks “premier” and “premier
package”
the court did not exclude the possibility of the registration of
“laudatory epithets”:
“
[9]
Nothing in the Act prohibits the registration of 'laudatory epithets'
but since Cozens-Hardy MR (
Joseph
Crosfield & Sons
Ltd's
Application
)
famously derided
'
(w)
ealthy
traders [who] are habitually eager to enclose part of the great
common English language and to exclude the general public
of the
present day and of the future from access to the enclosure'
and
held that
'an
ordinary laudatory epithet ought to be open to the world, and is not,
in my opinion, capable of being registered',
what
at best may be a rule of thumb, is regarded by some as a rule of law.
One can rightly question whether this is not a
'further
instance in this context of wrongly elevating into a general
proposition of law observations made by Judges in their application
of the law to the facts of the cases before them'.
The
suggestion that the registration of a trademark excludes the public
from using it is in any event hyperbolic.
[10]
Intellectual property laws and principles are not locked in a time
capsule or a straightjacket and judicial expositions should
be read
in context. What was the Master of the Rolls dealing with? It was an
application for the registration of the trademark
'Perfection' for
soap. In England at the time a trademark had to contain or consist of
certain essentials, for instance, it had
to be an invented word or
otherwise a word having no direct reference to the character or
quality of the goods and not, according
to its ordinary
signification, a geographical name or a surname. If it was, for
instance, not invented or had a direct reference
to the character or
quality of the goods, even though it was distinctive, it could not be
registered unless the Board of Trade
or a court, in the exercise of a
discretion, allowed the application to proceed. Counsel in that case
conceded that the mark
had a direct reference to the quality of the
goods. In order to establish that the mark was distinctive, reliance
consequently
had to be placed on extensive use of the mark. The Court
found that the mark had not been used as a trademark but only as an
adjective
in either 'Perfection Soap' or 'Crosfield's Perfection
Soap'. Against that background and finding that the word had not
acquired
distinctiveness through use, the Court, in the exercise of
its discretion, refused to permit the application for registration to
proceed.
[11]
The true scope and effect of the judgment was fully perceived by as
early as 1927. In
Joshua Gibson Ltd v Bacon
, a case decided
under the then existing South African equivalent of the
mentioned English provision, the Court found that
laudatory and for
that matter other descriptive words can, by use, acquire
distinctiveness, albeit that it may be difficult to
prove.
Epithets, laudatory or otherwise, are by definition adjectives
because they are descriptive and a trademark, at least a
word mark,
is as a general rule not an adjective. It is the name given by a
particular concern to its goods or services. That does
not mean that
it cannot be used adjectivally. The point is rather this. Take the
word 'Perfect' for soap: how does one distinguish
between
'perfect soap' and 'Perfect soap'? But 'Perfection' does not cause
the same problem: there is no need to distinguish between
'perfection
soap' and 'Perfection soap' and consequently 'Perfection' can be a
perfectly good trademark.
[12]
It is probably because of an underlying unease about the 'doctrine'
of laudatory epithets that most cases that refer to
the
Cozens-Hardy
dictum
were eventually decided under s 10(1)
(a)
or a similar provision, namely that it was a 'mark which is
reasonably required for use in the trade'. There is an absolute
prohibition
against registering such a mark. The fact that under the
1993 Act use of a mark for certain descriptive purposes may provide a
defence against infringement does not affect the prohibition.
[34]
On behalf of the opponent
it was submitted that “clear view” has a very specific
meaning in the English language which
is to refer to the fact that
one has the ability to see something clearly. The fact that the word
“view” has deliberately
been misspelled (“vu”)
does not, according to the opponent, change the meaning of the word.
Furthermore, the
word is used in relation to fencing products. A
fence, to different degrees, ordinarily provides a see-through or
transparent barrier.
If regard is had to the fencing manufactured by
the applicant, it is clear that these fences provide substantially
more see–through
than an ordinary fence despite the fact that
these fences are relatively densely meshed. According to the opponent
there are other
fences on the market which are technically similar.
These fences also provide relative transparency and consequently
provide the
same characteristics in respect of which the applicant is
seeking registration: All these fences have in common the provision
of
an effective barrier to entry whilst not obstructing the view of
the person looking into the property. Put differently, all these
fences provide a “clear view” to the person looking into
the property.
[35]
It was therefore
submitted that registration of the trademark should be refused as the
intended trademark exclusively consists of
a mark which serves to
indicate the intended purpose or characteristic of the product in
respect of which registration is sought.
The mark is consequently not
capable of distinguishing or differentiating the goods or services of
the applicant from the fencing
products manufactured by other traders
in the fencing particularly if regard is had to the fact that all
fences provide a “clear
view”. The use of the word
“CLEARVU” in relation to a fence is therefore not,
according to the opponent, capable
of disguising the fences from the
applicant from the fences manufactured by other traders.
[12]
The use of the mark is therefore merely used, according to the
opponent, to refer to a characteristic of transparency, which
characteristic
renders this kind of fence more advantages over an
ordinary wall and to a lesser extent, palisade fences.
[36]
The
applicant, however, points out that the word CLEARVU is clearly an
invented word which makes it capable of registration as a
trademark.
More in particular, the word “CLEARVU” does not appear in
a dictionary and it can therefore safely be accepted
that the word
has been invented. See in this regard
Adcock-Ingram
Laboratories Ltd v Lennon Ltd
[13]
where the court held as
follows:
“
The
respondent on the other hand contends that the mark is incapable
of becoming distinctive within the meaning of s 12 of
the Act
and that it accordingly offends against the provisions of s 33
thereof and constitutes an entry made in the register without
sufficient cause. In support of this argument it is pointed out that
the words 'stop' and 'pain' are, as conceded by the applicant,
words
which are associated with the effect of analgesics and are words
which are commonly and reasonably required for use
by persons engaged
in the manufacture and sale of analgesics. It is argued that the word
'Stopayne' is not an invented word and
that there is no
distinctiveness therein. Reliance is placed on the following remarks
of Lord HERSHELL in the
Solio
case -
Eastman
photographic Materials Co Ltd's Application
1898
AC 571
(15 RPC 476
at 485):
'I
do not think the combination of two English words is an invented
word, even although the combination may not have been in use
before,
nor do I think that a mere variation of the orthography or
termination of a word would be sufficient to constitute an invented
word, if to the eye or ear the same idea would be conveyed as by the
word in its ordinary form.'
However,
as the learned authors of
South African Law of Trademarks
point out in the first edition of their work at 16, in dealing with
the provisions of s 11 prior to the 1971 amendment, if a word
is
invented it
prima facie
qualifies for registration and the
fact that it may convey some meaning is not necessarily material. The
learned authors refer
to the remarks of Lord MACNAGHTEN in the
Solio
case
supra
at 486:
'If
it is an invented word - if it is 'new and freshly coined' (to adapt
an old and familiar quotation) it seems to me that it is
no objection
that it may be traced to a foreign source, or that it may contain a
covert or skilful allusion to the character or
quality of the goods -
I do not think it is necessary that it should be wholly meaningless.'
The
word Stopayne is, in my view, an invented word. It is, no doubt, a
contraction of the words 'stop' and 'pain', but the omission
of one
of the letters 'P' renders its pronunciation, according to the
ordinary rules thereof, different from a simple combination
of the
two words. The first syllable of the word would, in my opinion,
ordinarily be pronounced 'stow'. That, combined with
the fact of the
different spelling, is sufficient in my view to make the reference to
the character of the produce a covert one.
The mark is thus
prima
facie
registrable and I do not consider that the respondent has
established a case for expungement on the first ground advanced. Nor
do I think that it is necessary that the registration of the mark
should be rendered subject to a disclaimer or admission. Adequate
protection is afforded by the provisions of s 46
(b)
of the
Trademarks Act to enable the respondent to make use of the words
'stop' and 'pain', insofar as it requires to do so, to
describe the
character of quality of its own products.”
[37]
On behalf of the
applicant it was submitted that what the applicant is manufacturing
and marketing is steel fencing and not, to
put it plainly, a “clear
view”. The fact that the fencing allows for a clear view does
not, according to the applicant,
mean that it is a clear view –
it remains steel fencing.
[38]
Although there is some
validity in the submission that the word CLEARVU is descriptive of
the characteristics of the steel fencing,
the trademark is not sought
exclusively in respect of fencing but also in respect of non-electric
cables and wires of common metal;
metal mesh; pipes and tubes of
metal (class 6) as well as services such as building construction;
repair and installation services
(class 37). Significantly the
opponent does not in its papers deal with these goods which
constitute the great majority of goods
and services in respect of
which registration of the trademark CLEARVU is sought. Moreover, the
mark CLEARVU - in the sense that
it characterises a fence where a
person has an unobstructed or clear view through the fence - is not
the only characteristic of
the fence particularly as it does not
describe other characteristics or qualities of the fence such as the
fact that it also consists
of cables, tubes and metals such as steel.
[39]
I am, in light of the
aforegoing, of the view that the mark CLEARVU is in fact capable of
distinguishing.
[40]
Even if I am wrong in
concluding that the trademark CLEARVU is capable of distinguishing
within the meaning of section 9 of the
Act, I am nonetheless of the
view that, in the alternative, the applicant has established that the
trademark CLEARVU has in fact
become capable of distinguishing within
the meaning of section 9 of the Act as a result of use made of the
mark. I should also
reiterate that it is in any event the applicant’s
case that it does not have to rely on the provisions of section 10(2)
of
the Act. I will now turn to the second leg of the enquiry.
Second
enquiry: Has the mark become distinctive because of prior use?
[41]
If it is concluded that a
trademark is not capable of distinguishing, having regard to the
proviso, the onus will then rest on the
applicant to prove that it
has become registrable through its use as a trademark.
[42]
The opponent disputes
that the descriptive mark (CLEARVU) has acquired distinctiveness
through use. More in particular, it is disputed
that the use of the
mark has translated in the minds of consumers to distinctiveness in
that consumers see the mark CLEARVU as
indicating that the goods sold
by the applicant emanate from the applicant and not from another
trader. Put differently, the opponent
submits that the applicant has
fallen into the trap of assuming that “use” equals
“distinctiveness”. The
opponent further contends that the
term “Cochrane” is used in conjunction with the mark
“CLEARVU”. Consequently,
the use of the word “Cochrane”
indicates the “source” or “origin” of the
product whereas the
word “CLEARVU” merely described the
type of product or characteristic of the product (namely a fence
through which
a person can see).
[43]
It is accepted that the
mere use of a product does not necessarily equal distinctiveness.
This much was also recognised in the
Lotto
-case
where the court pointed out that the question whether a mark has
become distinctive by use should be approached with caution:
“
[14] Of course, as
pointed out in
Cadbury
(Pty) Ltd v Beacon Sweets & Chocolates (Pty) Ltd and Another
2000
(2) SA 771 (SCA)
at
779C - D, evidence that a mark has become distinctive by use must be
approached with circumspection, since the sole producer
or
distributor of a product cannot by means of advertising and selling
the product under its generic name render that name capable
of
distinguishing in terms of s 9. That caution applies equally to the
provision of a service said to be protected by a trademark.
[15] In
First
National Bank of Southern Africa Ltd v Barclays Bank plc and
Another
2003
(4) SA 337 (SCA)
([2003]
2 All SA 1)
this court was required to decide whether the mark
PREMIER was registrable in relation to cheques, banking and credit
card services,
and certain related marketing and merchandising
services. In upholding the decision of the Registrar of Trademarks
that the word
PREMIER was not registrable for such goods and
services, it approved the dictum of Jacob J in
British
Sugar plc v James Robertson & Sons Ltd
[1996]
RPC 281
(Ch) at 302, that there is 'an unspoken and illogical
assumption that use equals distinctiveness'. This assumption is based
on
the fact that common words are naturally capable of use in
relation to the goods or services of any trader, no matter how
extensively
such common words have been used by any individual
trader of goods or services of that class.”
[44]
It is also accepted that
the more descriptive the term is (as in the case of
Cadbury
v Beacon Sweets
)
the more difficult it may be to establish that the mark has acquired
distinctiveness through use.
[45]
However, despite the
circumspect approach of the courts in approaching the question
whether a mark as a matter of fact has become
“capable of
distinguishing” as a result of use, a mark can become
distinctive of origin where the mark has been used
extensively as a
trademark. In this regard Harms JA stated as follows in
First
National Bank of Southern Africa Ltd v Barclays Bank plc and Another
in
respect of the correct approach that must be followed in deciding
this question
“
[17]
The correct approach is that of the Court of Appeal in
Premier
Luggage and Bags Ltd v Premier Co (UK) Ltd
.
It concerned the trademark 'Premier' used in relation to luggage. The
mark had been used extensively as a trademark.
'I
reject the submission, made on behalf of Premier UK in this Court,
that the word ''Premier'' is incapable of being or becoming
distinctive of origin. In particular, I do not accept that the word
''Premier'', although plainly capable of being used in a descriptive
or adjectival sense (denoting primacy or superiority over other
members of the class) and so (absent use) devoid of any inherent
distinctive character, cannot become distinctive of origin as a
result of use in relation to particular goods or services.
''Premier''
is not a word like ''soap'' which can only describe
the article to which it is applied - see the observations of Mr
Justice
Jacob in the
British
Sugar
case
(
British
Sugar plc v James Robertson & Sons Ltd
[1996]
RPC 281)
at 302 and 305 to which the Judge referred. Nor is it a word
which, although once capable of being distinctive, has become solely
descriptive through use - see the examples given in the
Bach
case
(
Bach
and Bach Flower Remedies Trademarks
[2000]
RPC 513)
para 34 (at p 526).'”
[14]
[46]
Can it be concluded on
the facts placed before the court that the mark “CLEARVU”
– which serves as a badge of
origin – has acquired a
reputation to the extent that it designates in the mind of the public
a particular source?
[47]
Although it is accepted
that the mere use of a trademark does not necessarily equals
“distinctiveness”, each case must
be decided on its own
facts. Following this approach the scale of use may very well point
to a conclusion that such extensive use
resulted in the public
becoming familiar with the product or goods to such an extent that it
associates the product or goods with
the applicant’s goods. See
in this regard:
Cambridge
Plan AG and another v Moore and others:
[15]
“
Counsel
for the respondents has contended that the mere evidence as to the
matter and scale of use of the mark relied upon
by the
applicants is insufficient to establish the necessary reputation. In
support of this contention, he has referred to
S
C Johnson & Son and Another v Klensan Ltd t/a Markrite
1982
(4) SA 579 (T)
at
584E, where the Court held that
'the
mere proof of large-scale advertising, or even of substantial
sales... does not of itself lead to the conclusion that
a
reputation has thereby been established'
and
appeared to consider that evidence from the purchasing public that
the symbol in question was recognised as distinctive of the
plaintiff's goods, services or business, was essential to the proof
of reputation.
In
my respectful opinion there is no justification for requiring such
evidence in every case: whilst each case must be decided
on its
own facts, there are undoubtedly cases where the manner and scale of
use of the symbol in question can in itself be sufficient
to warrant
the conclusion that it must have become recognised by a substantial
section of the relevant public as distinctive of
the plaintiff's
goods, services or business. That conclusion has been drawn from such
evidence in a number of cases. See eg
Haggar
Co v SA Tailorscraft (Pty) Ltd and Another
1985
(4) SA 569
(T)
;
John
Craig (Pty) Ltd v Dupa Clothing Industries (Pty) Ltd
1977
(3) SA 144 (T)
;
United
SA Brush Manufacturing Co Ltd v Kleenem Brush Works (Pty) Ltd
(CPD
16/7/78 SAPJ January 1981);
Easyfind
International (SA) (Pty) Ltd v Instaplan Holdings and Another
1983
(3) SA 917
(W)
.
In
my view the manner of use proved in the present case is unequivocally
use of the term 'The Cambridge Diet' as an indication of
the origin
of the goods to which it has been applied and would have been
understood by members of the public exposed to such use
in that way.
This conclusion is fortified by the fact that there is no other
indication of origin on the goods. Anybody wishing
to refer to the
goods of the first applicant would necessarily have had to refer to
them as 'The Cambridge Diet.' I do not
think that it is
essential for the Court to have testimony by members of the public
before it can, on the balance of probabilities,
draw the conclusion
that this is the impact which such use would have had upon them. The
scale of the use is in my view sufficient
to justify the conclusion
that a substantial number of members of the public must, as a
result thereof, have come to recognise
the term 'The Cambridge Diet'
as indicative of the goods of the first applicant and its predecessor
in title, and not merely as
a generic description of the dietary
regimen developed by Dr Howard. The fact that the term contains an
allusion to that dietary
regimen and the place where it was
originated does not, in my view, detract from the probability that
its primary signification
to members of the public is as
indicative of the goods of the first applicant. The evidence of the
first respondent herself, to
which I have already referred, confirms
to me the correctness of this conclusion.
I
accordingly find that the applicants have
prima facie
established the requisite reputation in the term 'The Cambridge Diet’
as indicating to a substantial number of persons
in South Africa that
the goods to which it is applied are the goods of the first
applicant.”
[48]
I am in agreement with
the submission that, if the applicant can show that it had made use
of its trademark through sales, advertising,
attaching signage of the
trademark to installed fences to the extent that it can be concluded
that that the public has become familiar
with the mark CLEARVU to
such an extent that the mark has obtained a reputation, it may be
concluded that the mark performs a distinguishing
function.
[49]
What are the facts upon
which the applicant relies in support of its contention that the mark
has obtained a reputation through
use to such an extent that it can
be concluded that the mark performs the function of being
distinguishable? I have already referred
to some of the salient
facts. To recap: The mark is extensively used throughout South Africa
which is evidenced by the fact that
the revenue generated from the
products and services supplied under the CLEARVU brand exceeds R500
million. Fencing installed by
the applicant displaying strategically
the CLEARVU signage has resulted in the brand being highly visible in
locations such as
sport stadiums, residential estates, embassies,
shopping centres and game farms to name but a few. Fences displaying
the CLEARVU
signage are passed by thousands of vehicles every day. It
can therefore, in my view, be safely concluded that the public have
been
and continues to be exposed to the CLEARVU brand. There is also
evidence before this court that the trademark is recognised by
professionals and clients in the field who often specify their
requirements in respect of fencing with reference to the CLEARVU
brand and not to the product itself.
[50]
I am persuaded, if regard
is had to what was placed before this Court, that it can be concluded
that the explicit and extensive
use of the brand CEARVU serves as an
indication of the origin of the goods and that it is so understood by
the public as a result
of the reputation established over many years.
[51]
I am accordingly
satisfied that the applicant has established a significant reputation
in the minds of the public through extensive
prior use prior to the
filing of the applications for registration, to the extent that this
brand indicates that the goods to which
it (the CLEARVU mark)
applies, are the goods of the applicant: The applicant has
accordingly established a significant reputation
in the minds of the
public to such an extent that it has attained a significant level of
distinctiveness as a result.
Endorsement
[52]
In conclusion it is
necessary to briefly deal with the opponent’s submission,
although in the alternative, for the entry of
one or more
endorsements. More in particular it is submitted that the Court
should not allow the applicant to become entitled to
any exclusive
right to the word “clear” or “view” (or “VU”)
when used in relation to fences
(separately from “CLEARVU”).
[53]
I am in agreement with
this submission and has made it part of my order in so far as the
words “clear” and “view”(not
“vu”)
is concerned.
[54]
In the event the
opposition falls to be dismissed with costs. Although the applicant
prayed for a cost order on a punitive scale,
I am exercising my
discretion that such an order is not warranted.
Order
[55]
It is ordered that:
1. Trademark Applications
2010/13544 and 2010/13545 are registered in the name of the Trademark
Applicant (Cochrane Steel Products
(Pty) Ltd) subject, in each case,
to the following conditions:
1.1.
The registration of this mark shall give no right to the exclusive
use of the word “clear” and “view “separately
and apart from the mark;
1.2.
The trademark registrant admits that the registration of this mark
shall not debar others from the
bona
fide
descriptive
use in the course of trade of the words “clear view” and
“view”.
2. M-Systems Group (Pty)
Ltd is ordered to pay the costs of the opposition of these
proceedings.
_______________________
AC
BASSON
JUDGE
OF THE HIGH COURT
Appearances:
For
the applicant :
Adv. Owen Salmon (SC)
Instructed
by :
Rademeyer Attorneys
For
the Opponent :
GD Marriott
Instructed
by :
Adams & Adams
[1]
Discovery Holdings
Ltd v Sanlam Ltd and others
2015
(1) SA 365
(WCC) ad paragraph [2].
[2]
[1987] RPC 387
ad 402.
[3]
Act 193 of 1994.
[4]
Section 10 of the Act (the proviso).
[5]
Cochrane
Steel Products (Pty) Ltd v M-Systems Group (Pty) Ltd
(227/2015)
[2016] ZASCA 74
(27 May 2016).Because the application for the
registration were still pending and the trademark “CLEARVU”
was still
to be registered as a trademark in terms of the Act, the
appellant relied on what is described as a “common law
trademark”.
[6]
Philips
Electronics
NV
v Remington Consumer Products Philips Electronics NV v Remington
Consumer Products Ltd
[1999]
RPC 809
(CA) at page 821 line 25.
[7]
Cadbury (Pty) Ltd v Beacon Sweets &
Chocolates (Pty) Ltd and Another
[2000] ZASCA 2
;
2000 (2) SA 771
(SCA) at 778H.
[8]
2003 (4) SA 337 (SCA).
[9]
This matter was decided under the
provisions of the repealed Trademarks Act 62 of 1963.
[10]
2010 (5) SA 349 (SCA).
[11]
Supra.
[12]
The term “liquorice allsorts”
have been found to only describe a product and could therefore not
be used to distinguish
one packet of liquorice allsorts from another
packet of liquorice allsorts. See
Cadbury
(Pty) Ltd v Beacon Sweets & Chocolates (Pty) Ltd and
Another
[2000] ZASCA 2
;
2000
(2) SA 771
(SCA) at paragraph
[19]
.
[13]
1982 (1) SA 862 (T).
[14]
Supra
.
[15]
1987 (4) SA 821
(D) at 837B –
E.