Most Read Contributor in South Africa, September 2016
The divergent views of the same issue that courts can take was
recently well illustrated in a South African court case where
Adidas launched trade mark infringement proceedings in the Western
Cape High Court based on its well-known three-stripe trade mark.
However, despite international recognition of this mark, the court
found in favour of the other party, Pepkor, who used a four-stripe
design on shoes sold by them.
The dominant features of the Adidas mark are three lateral
stripes, parallel to and equi-distance from each other. The
stripes are also of the same width. The Pepkor shoe shared
these characteristics, with the exception of having either two or
four stripes. Adidas argued that the public would be confused
between these two products and submitted survey evidence showing
that many respondents interviewed had identified the Pepkor shoes
as being that of Adidas. Pepkor, on the other hand, argued
that it used the two/four-stripe designs as mere
The court referred to the substantial amount of exposure enjoyed
by Adidas's products and held that consumers are sufficiently
discerning to distinguish Adidas's stripes from the two or
four-stripe designs used by Pepkor. The essential part of the
ruling is that Adidas does not have a monopoly in parallel stripes
of an equal width and distance on the surface of shoes,
irrespective of the number of stripes used or their established
recognisable usage of them. In addition, Adidas had notably
never registered two or four-stripes as trade marks.
This ruling is in stark contrast to decisions in other parts of
the word, notably in Oregon in the United States, in the
Payless case, where Adidas was successful in a matter
where two and four-stripe marks were held to be infringing.
It is interesting to compare the American court's view with
that of the Pepkor decision. In the former, it based
its view on the likelihood of confusion, that:
"Although three stripes
obviously do not equal four stripes, the issue is not simply the
number of stripes. Instead, the issue is whether the total effect
of the allegedly infringing design is likely to cause confusion in
the minds of an ordinary purchaser. While there can be no debate
that defendants' four stripe mark has one stripe more than
Adidas' Three Stripe Mark, so too there can be no debate that
many of the other features of the stripes displayed on
defendants' [shoes] are strikingly similar-if not identical-to
the features of the Three Stripe Mark displayed on [Adidas']
Superstar IIK and Campus II models.... The stripes are equal in
size, are placed equidistant at a similar or identical angle, are
in substantially the same location between the sole and the
reinforced area which supports the shoelace holes (with the
necessary adjustment to accommodate four rather than three
stripes), are displayed in colors which contrast with the
background color of the shoes, and have serrated edges. Thus, this
court cannot simply count the number of stripes and determine as a
matter of law that four stripes are not confusingly similar to
Interestingly, a total amount of $305 million in damages was
awarded in this case, one of the highest amounts awarded this
far. However, Adidas was less successful in Europe, where the
stripes used were seen to be merely decorative (with a few
exceptions in specific countries).
Decisions of the Court of Justice of the European Union (CJEU)
have a significant influence in South Africa. The CJEU's
approach is to establish whether the defendant's use could harm
the mark's ability to indicate the origin of the
plaintiff's products, which would be the case where a material
link is seen to exist between the parties' respective products.
On this basis it could perhaps be argued that a two-striped shoe
cannot indicate origin. However, the American decision indicates
that perceptions as of origin and confusion may differ in various
parts of the world.
The Pepkor case highlights the seemingly paradoxical
situation where a mark is found to be famous, yet qualifies for
only limited protection. The three-stripe pattern is exposed
to consumers on a massive scale. Despite this, two or four
stripe-patterns will fall outside of the monopoly given to Adidas,
as matters stand. In other words, unless the exact mark is
used, there will be no infringement, with the ironic result being
that Adidas seems to be victim of its own successand. It will
be interesting to see whether they appeal the matter.
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It has always been the practice of the Industrial Property Institute of Mozambique to prohibit the refiling of trade marks that have been finally refused, which has posed a serious obstacle to trade mark applicants...
A recent Australian decision on keyword usage of a registered trade mark is in line with decisions in many other countries, including South Africa.
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