Tuesday, 28 June 2011

Nigerian court slaps huge damages on GSK in Panadol dispute

Afro Leo lets out a roar of thanks to his friend Bolanle Olowu (partner, IPI Watch Services, Lagos), for drawing his attention to an article, "Patent Right Infringement: Court Awards Nl.2bn against Claxosmithkline" (sic), which was reported at page 3 of today's THISDAY newspaper, published in Nigeria.  The article reads as follows:
"A Federal High Court in Lagos yesterday awarded N12 billion as damages against a multinational pharmaceutical firm, Glaxosmithkline Consumer Nigeria PIc (GSK). and its parent company, Smithkline Beecham Pic, based in tbe United Kingdom for infringing on the trademark and patent right of a Lagos-based indigenous pharmaceutical company, Continental Pharmaceutical Limited (CPL). 
The court also placed a perpetual order restraining the companies and their agents from adopting the features of the plaintiff's registered trademark comprising the eclipse logo with blue and white package design for the manufacture and sale of the Panadol and Panadol Extra products. 

Delivering judgment in the 16-year-old legal battle that witnessed about 50 appearances by counsel to the suit, Justice James Tsoho not only dismissed GSK's counterclaims dated January 22, 2009 but also awarded another N 150,(XX) against the defendants as exemplary cost following the application by the plaintiff's. 

In the verdict, which lasted for two hours, the judge held that the defendants illegally adopted the plaintiff's trademark to deceive the buying public in an attempt to pass out their Panadal as the plaintiff's product. The judge barred the defendants from importing, manufacturing, selling or supplying any analgesic preparation containing the active ingredient known as ''Paracetamol'' bearing the name PanadaI or Panadol Extra in a container or any packaging with the logo closely resembling the plaintiff's registered trademark for Conphamol to mislead the public. 
He also ordered the defendants to swear to an affidavit that it would remove all goods in their custody, control and possession bearing the marks complained about by the plaintiff and which would be a breach of the orders of the court. 

While describing the defendants' submission regarding the copyright's idea and ownership as inconsistent, Justice Tsoho submitted that it was wrong for them to assume that the ownership of copyright between an employee and employer could be the same. 

It faulted the defendants' submission that it had been marketing Panadol products prior to 1981, saying that this did not mean that it did not infringe on the plaintiff's trademark and copyright.
He further held that the plaintiff's Registered Trade Mark (RfM) 40551 and device was valid and subsisting and consequently dismissed the defendants' counter-claims that they did not infringe on the plaintiff's trademark. 

The judge however refused to award the plaintiff's relief seeking aNl,(XX) per package cost on the proceeds of the infringed trademark prescribed under section 20(1) of the Copyright Act, Cap C of the Law of the Federation of Nigeria 2004, saying that it related to crirninal matters liable upon conviction and not applicable to civil proceeding such as the suit. 

While the judge awarded N5OO million against the defendants as damages for passing-off and for infringing on the plaintiff's registered trademark for Conphamol and Device in Class 5, he awarded N700 million as special damages for infringing on the copyright in the artistic work of the trademark. 

Trouble started for the defendants when the plaintiff, in its statement of claim, stated that after due diligence it registered. a product known as Conprunnol on November 10, 1981. It contended through its counsel, Mr. Ekpe Asuquo, that upon a test that was conducted by the Trademarks Registry on the said "Conphamol and Device" applied for, it revealed that there were no conflicting marks on the Register which made "Conphamol and Device" to be accepted and numbered 50551 for publication on June 14,1982. 
The plaintiff also contended on March 20,1992, that the registration was renewed for a period of 14 years with effect from November 10, 1988, adding that since then, it had exclusively, extensively and continuously used its registered trademark in relation to its phannaceutical preparation, Conphamol, for the treatment of rheumatic pains, toothache, period pains, cold and influenza, chest and throat infections, mild immunisation and vaccination reaction in Nigeria and abroad particuIarly the ECOWAS sub-region without objection to any individual or Corporate body and sold multi-millions of naira. 

However, it stated that in 1995, it started noticing various phannaceutical purporting to be analgesic preparation containing the active ingredient ''Paracetamol'' not to its manufacture but sold in packages and get-ups sirniIar and identical to its registered trademark for Conphamol".
This decision, also reported in the Nigerian Observer here, has surprised some readers, as has the magnitude of the damages award, and sources inside Nigeria expect the defendants to appeal. The report is somewhat muddled at times; it does not appear that there were any patents in dispute.

Afro Leo hopes that readers -- particularly those from Nigeria -- will give their appraisal of this ruling.

2 comments:

Anonymous said...

N1.2bn? Crazy! That is about £4,877,942.75 and that would get you a decent road, a few schools and hospitals in Nigeria.

Funny thing is that IP is not even respected (at best, it is vaguely recognised) in Nigeria; moreover, the existing regime is obsolete and does not make IP law & practice any easy.

As corruption is widespread, the judiciary is not exempt including the fact that they're often found wanting in some of their decisions.

That word "indigenous" is a bit odd but strangely, it is widely used in commercial literature (including media, lawsuits) in Nigeria.

In this context, one may even cry foul or bias that GSK is picked as the "foreign" company to be milked by the Judge for the benefit of the poor Lagos-based "indigenous" pharmaceutical company.

Over the past 5 years we've had Lancor v OLPC, Beddings v INEC, now this one. One thing for sure is that this should be a wake up call for the Nigeria government to sit up to the fact that IP is becoming ever relevant to everyone and it is not just that so-called "western tool" accused of keeping developing nations down.

As you reported here, Nigeria just launched its first IPO website though (not a surprise) currently useless.

It's beggars belief that decisions are coming out of this jurisdiction where the legal landscape & enforcement of IP is somewhat in disarray.

If this was against the "indigenous" company, my guess is that enforcing this judgement will almost turn out futile. Easy meat - not good signal for FDI.

I hope the indigenous company makes good use of the lottery - perhaps to get a website to begin with.

Kingsley said...

For a start, I'd like to know Bolanle's opinion on this.