Insuring against disparagement? - Santam v Dial Direct

Cluver Markotter's Jeremy Speres has very kindly sent through this thought provoking guest post, with interesting questions over the recent Santam V Dial Direct TV ad dispute:

"It’s not very often that we South Africans get treated to a spat of robust comparative advertising, let alone one that ends up in court, which is why local IP practitioners will be licking their lips at the recent dispute between insurers Santam and Dial Direct.


Beginning May 2011, Santam began airing their “Real McCoy” TV ad (available here and here) featuring the Oscar winning Sir Ben Kinglsey strolling down Noordhoek beach in a grey suit, lamenting the inequities of some insurance policies (because, naturally, this is what Sir Ben Kingsley concerns himself with when strolling along the beach). The advert then ends with Santam’s “Insurance good and proper” tagline.

In response, Dial Direct, as part of its “Yada Yada” talking hands campaign (that may be responsible for a recent surge in self-immolation), aired a brilliant parody (available here) featuring a man dressed in a similar suit strolling along a similar looking stretch of beach. Only this time, the man’s head is replaced with a talking hand that repeatedly blurts out “yada yada”.

Dial Direct, no doubt anticipating Santam’s displeasure, rather cunningly began airing the parody over the weekend of 2 July 2011. Santam, clearly not amused, fired off the usual salvos alleging copyright infringement and unlawful competition. Dial Direct refused to relent and Santam proceeded to obtain an urgent interim interdict in the Western Cape High Court requiring Dial Direct to remove the ad from circulation pending the return date for the final hearing (the founding papers can be downloaded here).

Now what’s particularly interesting here is that there was no reproduction (whether mechanical, digital or otherwise) of the actual footage of the Santam ad – Dial Direct filmed an entirely new ad. So it seems that Santam may be claiming copyright over an idea, and not the material expression of the idea (being the footage itself). Apart from claiming that the parody ad reproduces the Santam ad, Santam also claims that it is an adaptation which, in respect of cinematographic films, is not defined in the Copyright Act.


In terms of copyright law then, this case raises all sorts of rather tricky points surrounding the idea/expression divide; the definition of “adaptation”; whether Dial Direct could squeeze its ad into one of the rather limited exceptions provided in the Copyright Act and whether the right to freedom of expression should temper copyright law in the face of parody (think Laugh It Off). I can do no better than to refer readers to Andrew Rens’s (previously of the Shuttleworth Foundation and Creative Commons, currently pursuing an SJD at Duke University) excellent blog on these issues and more, available here. For a great analysis of the applicability of the ASA code to this matter, see Delene Bertasso’s piece here .


Regarding the unlawful competition angle, Santam appears to be relying on disparagement as the cause of action. This is a recognised form of unlawful competition in South Africa (see ch 11 of Van Heerden-Neethling’s Unlawful Competition) requiring, amongst others, proof that damage in the form of lost custom is probable. What isn’t clear is the extent to which our courts will be prepared to assume that damage is probable where all that is clear from the papers is that the material in question is disparaging and that many people will be exposed to it. Our courts have been willing to assume that damage will follow in passing off cases where the two elements of reputation and deception have been proved – perhaps our courts will follow the same route in relation to disparagement?

One can’t help but get the feeling that there may have been a third way for Santam that may or may not have yielded more productive results. Perhaps, with all the creative talent we have in this country, all those billable hours could have been spent on devising a tasteful retort? The South African public tends to respond well to that sort of thing – remember BMW’s brilliant “Beat the Bends” come back? (see here). No doubt the Streisand effect is about to kick in, hopefully thanks (or not) to this post!"



One wonders too what the basis of a claim by Sir Ben Kingsley might be either contractually against Santam or against Dial Direct. Is this the same as Zapiro's parodies of another bald gent we all know? Does Sir Ben also have a claim under unlawful competition for disparagement to his own brand or perhaps one based on defamation? Is it his reputation or that of Santam's that is at stake or both? Sir Ben is clearly recognisable and the concept of the advert revolves around him and look-a-likes. His involvement also endorses the Santam policies. Indeed the difficulty in getting Ben to sign up for the add is (rather prophetically) explained here:
 
“You also have to keep in mind that these people are brands in their own right and won’t do anything they don’t like or that’s puts them in bad light. We were very lucky with Sir Ben...".
 
This may explain the action taken by Santam but one cannot help feel too, that Jeremy has a point: what would you do if you were Santam or Ben for that matter?