BACKGROUND
The
legal battle regarding product names in the fencing industry might at last be
over. This is the impression one gets from the latest episode in the CLEARVU trade
mark war, being the ruling of the Supreme Court of Appeal (SCA) in an
opposition matter involving the parties, reported here.
The
order of the lower court was:
“1.1.
The registration of this mark shall give no right to the exclusive use of the
word (sic) “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”.”
Readers
will recall that Cochrane Steel had sued M-Systems for unlawful competition for
bidding on the mark CLEARVU as an adword. Cochrane Steele lost, setting a
precedent that the mere bidding on a competitor's mark as a keyword without
more (eg it appearing in the ad text) is not unlawful competition. The High
Court case is well covered by this blog and you can view
those summaries here,
here, here and
on CNBC Africa, here. In the Supreme Court of Appeal, decision here,
M-Systems successfully defended the appeal by Cochrane Steel creating clarity
that keyword bidding on a competitor's trade mark (on its own) is not passing
off or unlawful competition in South Africa.
Cochrane
Steel also lodged a complaint before the Advertising Standards Authority, which
was rejected on the basis that the adwords do not constitute ”advertisements”,
a finding set out here.
The
scene then moved back to the High Court, dealing with the registry's acceptance
of Cochrane Steel's CLEARVU trade mark without any disclaimers or endorsements
in respect of CLEAR, VU and/or CLEAR VIEW. M-Systems also claimed that the mark
should not have been accepted because it described the intended purpose of a
fence, namely one that provides a clear view, and that the evidence on file did
not support a finding that the mark had acquired a secondary meaning. In the judgment, discussed here, the court
ruled in favour of both parties on some aspects, but significantly exclusive
rights to “clear” and “vu” had to be disclaimed. This discussion deals with the appeal on this
ruling.
THE SCA OPPOSITION JUDGMENT
Cochrane
Steel applied for the registration of the mark CLEARVU in:
1.
Class 6 (in respect of non-electric cables and wires of common metal; metal
fences; metal mesh; pipes and tubes of metal)
2.
Class 37 (in relation to building, construction, repair and installation
services.
The
opponent was of course M-Systems.
The
ground of opposition was that the mark was not registerable in that:
1. It consists exclusively of an indication
which may serve in trade to designate the kind, quality, intended purpose or
other characteristics of the goods or services (s 10(2)(b) of the Trade Marks
Act 194 of 1993;
2. It is not capable of distinguishing the goods
and services for which it is to be used (ss 9(1) and 10(2)(a) of the Act).
One
question raised is how far the misspelling contained in the CLEARVU mark can
go. The following “view” on the
situation in the market is instructive:
“[8] M-Systems, in its objection to the
mark, supplied material from websites operated by a number of other companies
within the security barrier industry in which they use the words ‘clear’ and
‘view’ in describing their fencing products. One company is called C-Thru
Fencing which equates to fencing through which one has a view. Another
competitor, Betafence, offers products called ‘Betaview’. Trellidor, also
referred to as a competing company produced a product called ‘Trellidor Clear
Guard’. Trellidor describes its products as ‘security screens that provide a
clear view’. They go on to say that their products enable users to ‘enjoy the
view without feeling vulnerable’, ‘allow unobstructed views of the outdoors’,
‘appear to be invisible while helping to protect against unwanted intruders’
and ‘provide security without detracting from the views or aesthetics of the
premises’. Clear View Security Solutions, yet another competitor that sells a
range of products which they describe as ‘clear security solutions’, including
‘clear bars’, ‘clear armed bars’ and ‘clear gates’. It explains on its website
that all of its products ‘ensure that no light or view is lost’.”
To
use the word, clearly, the concept of a see-through product is in wide use in
the industry.
The
court referred to section 15 of the Act, and various decisions dealing with the
issues of disclaimers and admissions. It
was mentioned that the use of disclaimed matter cannot amount to infringement
(paragraph 13). Mention was also made of
the unique practice of entering admissions, specifically where misspellings of
words were concerned (paragraph 14).
The
court found particular guidance in the Distillers case:
“[19] In determining whether a
discretion should be exercised in favour of the entry of a disclaimer and admission, it is necessary
to have regard to Distillers Corporation (SA) Ltd v S.A. Breweries Ltd &
another; Oude Meester Groep Bpk. & another v S.A. Breweries Ltd 1976 (3) SA
514 (A). There this court was considering, in relation to an application for an
entry for disclaimers, the composite trade mark ‘Oude Meester’, which had
undoubtedly become distinctive…
The court, whilst acknowledging that the
mark ‘Oude Meester’, by its use as a whole had become distinctive, held that
such use does not ‘ordinarily or necessarily mean that Meester per se has
thereby become distinctive’. It found that the court below had accordingly
correctly entered disclaimers.
[20] In Distillers, Trollip JA also had
to consider an order similar in form to para 1.2 in the present case. Trollip
JA stated that what was there under consideration was not a disclaimer in the
usual form. He had regard to the contention on behalf of one of the parties
that it was not a disclaimer, but rather an ‘admission’. Noting that the entry of
admissions was a peculiarly South African practice, particularly where the
trade mark contains words that are regarded as being reasonably required for
use in the trade, he stated that the purport or effect of admissions ‘does not
appear to be entirely clear; and it is difficult to understand on what basis
the distinction between disclaimers and admissions is drawn’. He proceeded to
construe the ‘admission’ as a disclaimer and in that regard said the following:
‘That construction does not, in my view,
do any violence to the wording or effect of the entry. For by not debarring
others from using Meester, the entry in effect disclaims Distillers’ right to
the exclusive use thereof.”
Applying
these dicta (paragraph 21), the SCA stated that “the “VU” in the composite mark
“CLEARVU”, is a deliberate misspelling of the ordinary word “view” and is
understandable in light of the nature of the product and what it intends to
convey.” The argument of Cochrane that it does not constitute a misspelling of
the ordinary English word “view”, but that it is a “coined word which just
happens to be the phonetic equivalent of the ordinary English word ‘view’ is to
strain to avoid the implication that commonly, admissions are entered when
there is a misspelling of a word and to seek a monopoly that extends beyond
that which is acceptable.” Also, as per Webster and Page South African Law of
Trade Marks para 9.20 at 9-17, service issue 19, “the phonetic equivalent of a
non-distinctive word is itself non-distinctive and it would seem to follow that
if the word itself is one that ought to be disclaimed then its phonetic
equivalent should also be disclaimed.”
In
paragraph 22 the court stated that neither Cochrane, nor any other trader, is
entitled to appropriate exclusively the ordinary English words “clear” and “view”,
which, in effect, constitute the composite mark. In addition, those words are
commonly used descriptively in relation to fencing products.
The
conclusion of the SCA was to accept the order of the court a quo, but it was
stated though that the words “the trade mark registrant admits” must be
deleted.
In
my next post, I interview fellow blogger Darren who represented M-Systems to
find out his thoughts on what this all means, on a practical level.
Prof Wim Alberts
