Bergkelder Bpk. v Vredendal Koöp Wynmakery and Others (105/05) [2006] ZASCA 5; 2006 (4) SA 275 (SCA); [2006] SCA 8 (RSA) ; [2006] 4 All SA 215 (SCA) (9 March 2006)

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Bergkelder Bpk. v Vredendal Koöp Wynmakery and Others (105/05) [2006] ZASCA 5; 2006 (4) SA 275 (SCA); [2006] 4 All SA 215 (SCA); 2006 BIP 128 (SCA) (9 March 2006)

Links to summary

THE SUPREME COURT OF
APPEAL OF SOUTH AFRICA
Case No 105/05
REPORTABLE
In the matter between
DIE BERGKELDER BEPERK
APPELLANT
and
VREDENDAL KOöP WYNMAKERY FIRST
RESPONDENT
JOHANNES
JACOBUS ROSSOUW SECOND RESPONDENT
WILLIE
PETRI BRAND THIRD RESPONDENT
Coram: Harms, Streicher, Cameron, Lewis JJA et Cachalia
AJA
Heard: 21
February 2006
Delivered: 9 March 2006
Summary: Trade marks; container
marks; capability of distinguishing.
Neutral citation: This case may be cited as
Bergkelder Bpk v Vredendal Koöp Wynmakery
[2006] SCA 8
(RSA).
_____________________________________________________
JUDGMENT
_____________________________________________________
HARMS JA:
[1] This appeal concerns a trade mark dispute relating
to a wine bottle. The appellant sought to interdict the respondent
from infringing
its registered trade mark for a container for
alcoholic beverages (TM 1977/00647) and the respondent, in turn,
sought to have the
mark expunged. Wagley AJ, in the Cape High Court,
ordered the mark to be expunged and, consequently, found it
unnecessary to decide
the infringement issue. The appeal is with his
leave.
[2] Wine drinking is steeped in tradition and wine is
usually marketed in conventional bottles. These include the thick
glass Champagne
bottle used for sparkling wines, the Burgundy bottle
with low shoulders, the Bordeaux bottle with its broad shoulders, the
mace-shaped
bottle used for Rhein and Moselle wines, the Alsace
slender flute, the Chianti bulbous fiasco and, relevant for present
purposes,
the so-called
Bocksbeutel
. By the name hangs a tail.
Translated literally from the German (though not entirely accurately)
Bocksbeutel
means a ‘goat’s pouch’, which, it is said,
is a humorous (according to others, vulgar) allusion to its shape. It
is a short,
flat, broad-bellied glass flagon or, to give another
description, a bottle with a flattened globular shape.
The
oldest surviving example of a
Bocksbeutel
is supposed to date
back to 1400 BC. Originally they were made from leather or wood. As
many a shepherd or soldier could have testified,
it is easier to
carry a flat hipflask against the body than a round one. These
bottles have been in constant use by Franconian vintners
for at least
500 years for their better wines and in consequence Germany has tried
to obtain protection for the bottle as a geographical
indication. The
problem for Germany is, however, that the bottle shape had been used
in Bolzano province, Italy, for more than a
century, and that it had
been used classically by Portuguese wine growers for their famed
vino
verde
.
1
[3] The appellant (‘Bergkelder’ –
I do not intend drawing a distinction between the appellant and its
predecessor in title)
adopted the
Bocksbeutel
bottle in the
early 1950s for marketing its Grünberger line of wines. It is a
successful line and the only locally produced
wine that was being
sold in a
Bocksbeutel
. Bergkelder sold about 2m litres of
Grünberger wines to the value of about R25m during 2002. When it
began marketing this wine,
Portuguese wines were being sold on the
local market in
Bocksbeutels
and they are still so being sold.
Bergkelder, who imported standard bottles off the shelf, was
audacious in applying for the registration
of the container as a
design in 1962 (absolute novelty was required) and the registrar
surprisingly (if that is the appropriate adverb
to use in the
circumstances) granted the application. When the design registration
was about to lapse, Bergkelder applied on 16 February
1977 for a
trade mark registration for the container. Importers of Portuguese
wines opposed the application and eventually after
more than eight
years the matter was settled. Bergkelder undertook to limit the
registration to alcoholic beverages ‘produced in
South Africa’.
The registrar happily endorsed the settlement and registered a
container mark in the form of a
Bocksbeutel
in part A of the
register in class 33 with the agreed limitation.
2
[4] The respondents also use a
Bocksbeutel
bottle
for their locally produced wines. There is, however, this difference:
a large and prominent crayfish is embossed on the one
flat side. The
use of this bottle, Bergkelder alleged, is an infringement of its
registered trade mark. The respondents countered
by denying that
their container so nearly resembles the registered mark ‘as to be
likely to deceive or cause confusion’, the
test laid down by
s 34(1)(a)
of the
Trade Marks Act 194 of 1993
. In addition, they
have asked for an expungement of the mark on various grounds, the
main being that the container mark lacked at
the time of registration
and still lacks the necessary capability to distinguish Bergkelder’s
wines from those of other wine producers.
[5] The registration was granted under the repealed
Trade Marks Act 62 of 1963. This Act, for the first time, made
provision for the
registration of containers as trade marks. The
definition of ‘mark’ in the Act as originally promulgated
included a ‘distinctive
container’ alongside the more
conventional types of marks such as devices, names, words and the
like. The Act was amended during
1971 when the adjective
‘distinctive’ was deleted from the definition. It did not change
much because, in order to have been
registrable in Part A of the
register, which was the case here, a trade mark had to contain or
consist of ‘a distinctive mark’.
[6] That containers could perform a
trade mark function, ie, could be a badge of origin, was not at the
time generally accepted or
recognised. As late as 1986, the House of
Lords
3
regarded as startling the idea that a bottle – in that case the
classic Coca-Cola bottle – could be a trade mark. One of the
consequences of such recognition, the Lords felt, would be to create
perpetual monopolies in containers, something unacceptable even
if
‘the manufacturer has in the eyes of the public established a
connection between the shape of the container and the manufacturer.’
4
[7] In due course it was generally
recognised that not only containers but also shapes of goods may
perform a trade mark function.
5
For example, English law, implementing a European Community
Directive, now provides that a trade mark may consist of ‘the shape
of goods or their packaging’ and our 1993 Act, similarly, states
that shapes and containers for goods may be trade marks. Importantly,
from a legal perspective these trade marks do not differ from any
other kind of trade mark:
‘
the
criteria for assessing the distinctive character of three-dimensional
shape-of-products marks are no different from those applicable
to
other categories of trade mark
.’
6
However, from a practical point of view they stand on a
different footing.
[8] The problem they pose for their
promoters is that according to the public perception containers and
shapes generally do not, in
American parlance, serve as source
identifiers.
7
Containers are usually perceived to be functional and, if not run of
the mill, to be decorative and not badges of origin. Laddie
J pointed
out that
merely because a bottle shape is both new and
visually distinctive, meaning that it would be recognised as
different to other bottles
on the market, does not mean that it would
convey to someone who was not a trade mark specialist that it was
intended to be an indication
of origin or that it performed that
function.
8
This dictum was quoted with approval by the English Court of Appeal
in
Bograin
9
where Jacob LJ rejected the proposition that even a very fancy shape
is necessarily enough to confer on it an inherently distinctive
character. He said:
10
‘
As
a matter of principle I do not accept that just because a shape is
unusual for the kind of goods concerned, the public will
automatically
take it as denoting trade origin, as being the
badge of the maker. At the heart of trade mark law is the function of
a trade mark
– expressed in Recital 10 of the Directive [of
the European Community] as an indication of origin. The perception of
the public
– of the average consumer is what matters. Mr Daniel
Alexander QC, for the Registrar, helpfully pointed out that the kinds
of sign
which may be registered fall into a kind of spectrum as
regards public perception. This starts with the most distinctive
forms such
as invented words and fancy devices. In the middle are
things such as semi-descriptive words and devices. Towards the end
are shapes
of containers. The end would be the very shape of the
goods. Signs at the beginning of the spectrum are of their very
nature likely
to be taken as put on the goods to tell you who made
them. Even containers, such as the fancy Henkel container may be
perceived as
chosen especially by the maker of the contents (e.g.
shampoo) to say “look – here is the product of me, the maker of
the contents”.
But, at the very end of the spectrum, the shape of
goods as such is unlikely to convey such a message. The public is not
used to
mere shapes conveying trade mark significance . . .. The same
point was made about slogans in
Das Prinzip der Bequemlichkeit,
para 35:
“the authorities may take account of the fact that average
consumers are not in the habit of making assumptions about the origin
of products on the basis of such slogans.”’
[9] Since containers are not usually perceived to be
source indicators, a container mark must, in order to be able to
fulfil a trade
mark function, at least differ ‘significantly from
the norm or custom of the sector’. This appears from one of the
Henkel
judgments of the European Court of Justice where this
was said:
11
‘In those circumstances, the more closely the shape for which
registration is sought resembles the shape most likely to be taken
by
the product in question, the greater the likelihood of the shape
being devoid of any distinctive character . . .. Only a trade
mark
which departs significantly from the norm or customs of the sector
and thereby fulfils its essential function of indicating
origin, is
not devoid of any distinctive character . . ..’
But, as mentioned, the mere fact that it does so differ
does not necessarily mean that it is capable of distinguishing
because the
question remains whether the public would perceive the
container to be a badge of origin and not merely another vessel.
12
[10] Jeremy
Phillips points to yet another aspect and that is the dependency of
shape marks (the same applies to container marks)
on other marks such
as word marks.
13
The dependency may be such that, as we know is the case in the
present instance, the trade mark owner did not trust the bottle ‘to
do this job [of identification of trade source] on its own’.
14
[11] A
registered word mark does not give copyright protection and,
likewise, it is wrong to assume that container marks give a
patent-like
or industrial design-like monopoly in the container
itself.
15
As Andrew Phang Boon Leong J said in
National Fittings
:
‘whilst the court should recognise and give effect to the rights of
registered trade mark holders wherever appropriate, it should
also
bear in mind the fact that such rights should not be permitted to
either blatantly or subtly develop into disguised monopolies
which
stifle or stymie the general public interest and welfare.’
[12] Section 20(4) of the 1963 Act permitted the
registrar to accept an application for registration subject to
conditions and limitations.
The term ‘limitations’ was defined to
include a limitation as to the mode of use of the exclusive right to
the use of a trade
mark (s 2 sv ‘limitations’) and a geographical
limitation would probably be covered thereby. A limitation such as
the present,
ie, for ‘alcoholic beverages produced in South Africa’
appears to be a permissible limitation.
[13] The
original registration of a trade mark registered under the 1963 Act
in part A of the register (the 1993 Act no longer provides
for
separate parts of the register) is, after seven years from the date
of registration, taken to be valid in all respects unless,
ia, ‘the
trade mark offends against’ the provisions of s 16 (s 42). The date
of registration is considered to be the date of
application for
registration (16 February 1977).
16
Section 16(1) of the 1963 Act stated that it was not lawful to
register ‘any matter the use of which would be likely to deceive
or
cause confusion’ as a trade mark.
[14] In
terms of the transitional provisions contained in s 70(1) of the
1993 Act, these provisions survived since the validity
of the
original entry of existing trade marks has to be determined in
accordance with the laws in force at the date of the entry.
But not
much turns on this because under the 1993 Act a mark that ‘is not
capable of distinguishing’ in the trade mark sense
is liable to be
expunged unless it has in fact become capable of distinguishing as a
result of the use of the mark (s 10(2) read
with the proviso to s
10).
[15] That
then brings me to the factual question whether, during 1977, a
Bocksbeutel
could have performed a ‘badge of origin’
function enabling it, without more, to distinguish the wine of one
producer from that
of another. In the light of the common cause
facts, the answer must clearly be in the negative. If one were to put
a so-called Grünberger
bottle, stripped of its labels, next to a
nude
vino verde
or
Frankenwein
bottle, one would not be
able to distinguish the one from the other. On the contrary, the use
of the Grünberger bottle as a trade
mark would, in these
circumstances, be palpably misleading. But, Bergkelder ripostes, the
use of the
Bocksbeutel
as some or other kind of geographical
indication by Franconians, Portuguese and some Italians is proof of
the fact that a
Bocksbeutel
has the inherent capability to act
as a badge of origin. The answer is this: a
Bocksbeutel
may
have some informal and limited function as a certification or
collective mark but that fact in itself establishes conclusively
that
it cannot be a badge of origin in the ordinary trade mark sense, ie,
it cannot distinguish the goods or services of one person
from those
of another.
17
[16] Secondly,
Bergkelder argues that its
Bocksbeutel
could distinguish its
locally produced wine from any other locally produced wine bearing in
mind that there were no other local producers
at the registration
date. That, it said, should be the inquiry because of the limitation.
The High Court dismissed this argument.
It held that Bergkelder’s
reliance on the limitations of use in order to create a monopoly is
misconceived because when Bergkelder’s
mark is stripped of its
labelling, the bottle serves no distinguishable feature and the wine
bottled in that mark could have been
produced anywhere.
[17] I
respectfully agree. During argument the following example was put to
counsel. Would it be possible to register as a container
mark the
well-known Dimple bottle (used for marketing Scottish whisky) in
respect of ‘spirits produced in South Africa’ without
causing
confusion?
18
The only answer counsel could offer was that there is apparently some
regulation somewhere that requires wines and spirits to contain
an
indication of the country of origin and that the ordinary purchaser
would look for that indication and would then know that the
product
has a different source. I cannot accept the proposition. To
paraphrase a statement in
Viking
,
19
this response
acknowledges that Grünberger’s
commercial origin is ultimately identified on the basis of other
distinguishing features and
that the consumer will therefore not see
the bottle as a sign indicating that the goods come from a particular
undertaking but will
rather see it merely as an aspect of the
marketing of the particular wine. Were it otherwise, there could not
be any confusion in
the trade mark sense between Grünberger
wines (supposing that they are South African) and an imported wine
bearing the same
name mark.
[18] Bergkelder
placed some reliance on the fact that since the date of registration
Grünberger was the only local wine marketed
in a
Bocksbeutel
and that, if it comes to wine sales in
Bocksbeutels
,
Grünberger was dominant in the market. Therefore, according to
the submission
the
container in question has (in terms of the proviso to s 10 of the
1993 Act) in fact become capable of distinguishing as a result
of the
use of the mark. This court has rejected a similar argument
20
because it is based on the ‘unspoken and illogical assumption that
“use equals distinctiveness”’
21
and loses sight of the fact that ‘to be really distinctive of a
person’s goods [a trade mark] must generally speaking be incapable
of application to the goods of anyone else.’
22
Put differently, although the shape of the container may assist in
distinguishing Bergkelder’s wine, a
Bocksbeutel
cannot
per
se
perform the ‘badge of origin’ function with other wines in
Bocksbeutels
on the market.
[19] For these reasons it is unnecessary to deal with
the other issues raised in the appeal and the following order issues:
The appeal is dismissed with costs.
______________
L
T C HARMS JA
CONCUR:
STREICHER JA
CAMERON
JA
LEWIS
JA
CACHALIA
AJA
1
Cf
Criminal Proceedings against Karl Prantl
ECJ case 16/83 of 13
March 1984. This information may be outdated since reclaiming lost
geographical indications has become somewhat
of an industry of its
own.
2
This
Court in the past has bemoaned the lackadaisical approach to trade
mark applications, giving parties inordinate periods of
time to get
their house in order. The following dictum by Jacob LJ in
Bograin
SA’s Trade Mark Application
[2004] EWCA Civ 1690
;
[2005] RPC 14
para 30
is
apposite: ‘
The Registry is entitled to
be firmer with this sort of thing; it should have regard to the
public interest in disposing of applications
one way or another. One
must never forget that a pending application for an intellectual
property right hangs over the public at
large. A pending
application, even if ultimately refused, may act as a real
commercial deterrent while it “pends”. It is not
fair on the
public to allow the applicant to string things out.’
3
Coca-Cola
Trade Marks
[1986] RPC 421
(HL).
4
At
457. See DR Shanahan
Australian Law of Trade marks and Passing
Off
(1990) 11-15.
5
Beecham
Group plc v Triomed (Pty) Ltd
2003
(3) SA 639
(SCA) dealt with shape marks.
6
The
European Court of Justice in
Henkel v
OHIM,
joined cases C-456/01 P and C-457-01 P, 29
th
April 2004. These judgments can be found at www.curia.eu.int.
7
In
re Pacer Technology
338
F.3d 1348
,
67 USPQ2d 1629
(Fed. Cir. 2003)
referring
to
Wal-Mart Stores Inc v Samara Bros
Inc
[2000] USSC 26
;
529 US 205
, 210 (2000);
Two Pesos Inc v Taco Cabana Inc
[1992] USSC 108
;
505 US 763
, 768 (1992
)
;
Tone Bros Inc v Sysco Corp
28 F.3d 1192
, 1206 (Fed Cir 1994);
and
Seabrook Foods Inc . Bar-Well Foods Ltd
568 F.2d 1342
,
1344 (CCPA 1977).
8
Yakult's
Application
[2001] RPC 39
para
10-11. See also
Interlego AG’s Trade Mark Applications
[1998] RPC 69
;
Dualit Ltd’s (Toaster Shapes) Trade Mark
Applications
[1999] RPC 890
;
Procter & Gamble Ltd’s
Trade Mark Applications
[1999] RPC 673
(CA);
SM Jaleel &
Co Ltd’s Trade Mark Application
[2000] RPC 471.
9
Bograin
SA’s Trade Mark Application
[2004] EWCA Civ 1690
;
[2005]
RPC 14.
10
At
para 25. This passage was quoted with approval in Singapore in
National Fittings v Oystertec
[2005] SGHC 225.
11
Henkel
KGaA v Office for Harmonisation in the Internal Market (Trade Marks
and Designs) (OHIM)
joined
cases C-456/01P and C-457/01P. Cf the facts in
Eurocermex v OHIM (shape of a beer bottle)
[2004] ECR II-0000.
To be found at
www.curia.eu.int.
12
Bograin
SA’s Trade Mark Application
[2004] EWCA Civ 1690
;
[2005]
RPC 14
;
Nestlé Waters France v OHIM
case T-305/02 para
39.
13
Trade
Mark Law: A Practical Anatomy
p
153-154.
14
Philips
Electronics NV v Remington Consumer Products
[1998]
RPC 283.
15
This raises the question whether a trade mark can be infringed by
non-trade mark use of a trade mark, especially in the light of
R
v Johnstone
[2003] UKHL 28
at para 13-17. See David Kitchen et
al
Kerly’s Law of Trade marks and Trade Names
14 ed (2005)
p 364-368. The matter was not argued and need it not be decided
whether
Abbott Laboratories v UAP Crop Care (Pty) Ltd
1999
(3) SA 624
(C) 632B-C and
Abdulhay M Mayet Group(Pty) Ltd v
Renasa Insurance Co Ltd
1999 (4) SA 1039
(T) 1045I-J were
correctly decided. The authority relied on in the latter judgment,
British Sugar plc v James Robertson & Sons
Ltd
[1996] RPC 281
(Ch),
does not any longer appear to be
good law in this regard in its country of origin. Cf for Canada:
Compagnie Generale Michelin v National Automobile, etc Workers
Union
[1997] 2 FC 306.
16
Mars
Inc v Cadbury (Swaziland) (Pty) Ltd
2000 (4) SA 1010
(SCA) para 10.
17
See
s
42 of the 1993 Act for certification
trade marks and s 43 for collective trade marks.
18
The
Dimple bottle was the subject of a passing off claim in
John Haig
& Co Ltd v Forth Blending Co Ltd
[1953] ScotCS CSOH_3
;
(1953) 70 RPC 259.
With
passing off, too, the test is whether the bottle is associated in
the mind of the purchasing public with the goods of the
particular
trader
and of no other.
[My emphasis.]
Adcock-Ingram
Products Ltd v Beecham SA (Pty) Ltd
1977 (4) SA 434
(W) 437 A-F:
the shape of the container must indicate a
single
source.
19
Viking-Umwelttechnik
GmbH v Office for Harmonisation in the Internal Market (trade marks
and designs) (OHIM)
Case T-316/00 para 36-37. To
be found at
www.curia.eu.int.
20
Beecham
Group plc v Triomed (Pty) Ltd
2003
(3) SA 639
(SCA) at para 15 and 21. The case dealt with shape marks.
21
A
quote from
British Sugar plc v James Robertson & Sons Ltd
[1996] RPC 281
(Ch) at 302.
22
A
quote from
The Canadian Shredded Wheat Co Ltd v Kellogg Co of
Canada Ltd
(1938) 55 RPC 125
(PC) at 145.