Thursday 6 June 2013

Caroline B Ncube

RSA: another passing off decision: Distell Ltd v KZN Wines and Spirits CC

The Durban High Court handed down its decision in  Distell Ltd v KZN Wines and 

Spirits CC  (10006/2011) [2013] ZAKZDHC 25 on 23 May 2013.

Distell is the holder of the KNIGHT’S GOLD and KNIGHTS marks registered in class 33 which covers alcoholic beverages, including whiskey. The first trademark consists only of words and the second is a label device which incorporates the word 'knight' and some decorative features.  Distell uses these trademarks in relation to whiskey which it manufactures and distributes in South Africa. This whiskey is sold in a rectangular 750 ml clear bottle with a rectangular front label front label with white and gold text designs against a black background (at para 6 and depicted here).

KZN Wines and Spirits imports and sells BLACK KNIGHT Blended Scotch Whisky. This product was described by the court as being sold in a round 1 litre green  bottle with a wrap-around front label with black and red text and a black image on a white background (at para 6). 

 Distell sued KZN Wines and Spirits claiming that
1) the BLACK KNIGHT mark is so similar to its KNIGHT’S GOLD and KNIGHTS Label trademarks that it constitutes trademark infringement and 
2) the use of the BLACK KNIGHT mark is so confusingly similar to its KNIGHTS trade mark  in respect of which Distell averred it has  substantive reputation and goodwill . 
In relation to the trademark infringement claim the court dealt with visual, aural and conceptual similarity in turn. It held  "As far as the visual similarity is concerned, I am satisfied that the comparison of the marks as a whole reveal that these marks are visually so different that confusion or deception is impossible" (at para 14). With regard to possible aural and conceptual similarity the court held that  "it is unlikely that the notional purchaser of the applicant’s whisky, even with an imperfect recollection or perception, when confronted with BLACK KNIGHT, would focus attention only on the word KNIGHT and ignore the word BLACK. To my mind, the whole mark BLACK KNIGHT serves to distinguish the respondent’s whisky from that of the applicant" (at para 21). The court noted that whiskey drinkers are discerning and due to its costs are likely to "exercise circumspection and a greater degree of care in making a purchase" (at para 20).  

With regard to the passing off claim the court reiterated the onus upon Distell in the following terms: "Passing off occurs when one trader represents to the public that his goods or merchandise are of another trader...The applicant must allege and prove the requisite reputation, misrepresentation and damage. The reputation must be in existence at the time the offending party entered the market and it must exist when the misrepresentation is committed." (at para 23). The court noted that  establishing "reasonable likelihood of confusion or deception is a question of fact to be determined in the light of the particular circumstances of the case" (para 24). Assessing these circumstances, the court found that a comparison of Distell and KZN Wines and Spirits' get-ups made it "perfectly clear" that Black Knights Blended Scotch Whiskey was different from Knights whiskey and that there was no association in the course of trade between the two parties to the litigation (at para 33). The court laid great store on the fact that the two products had been on the market alongside each other for 11 years and there had been no instances of actual confusion (at para 33).

The court did not refer to the recent Supreme Court of Appeal (SCA) decision in the Swartkops and Cerebos matter but took a similar approach to the SCA which focuses on a first and general impression created in a consumer's mind rather than a detailed comparison of the get ups in issue. 

Caroline B Ncube

Caroline B Ncube

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