South Africa: Trade Mark Law Is Confusing

Last Updated: 28 November 2012
Article by Lauren Frizelle

Most Read Contributor in South Africa, September 2018

Confusion lies at the heart of trade mark law. By that I mean that the enquiry in most trade mark cases is this:  is there likely to be consumer confusion, given the similarities between the two marks in dispute, and the similarities between the goods or services (for ease I'll simply refer to 'goods' in this article)?  This may come up in an infringement case, where one company has a trade mark registration and another company uses a mark that may potentially cause confusion.  Or, it may come up in a registration case, where one company has a trade mark registration and another company wants to register a mark that may potentially cause confusion.

The courts in Europe and South Africa have given us guidelines on how to determine these matters.  They have told us that the likelihood of confusion must be appreciated globally, in other words, that all factors need to be taken into account.  And, although the law says that it's necessary to consider both similarity of marks and similarity of goods, in most cases the goods are the same, so the only issue is the closeness of the marks.  We've been told that, when assessing marks, the court will consider the visual, phonetic and conceptual similarities.  We've also been told that the court will view the matter through the eyes of the ordinary customer, bearing in mind that the average person probably won't see the two marks side by side,  doesn't have a perfect recollection,  and may have just a general impression of a mark, or may just remember one striking or dominant feature of it.  

In some cases, however, the goods are not quite the same, and it then becomes necessary to decide if they qualify as similar.  When it comes to comparing goods, we've been told to consider stuff like this:  what the goods are used for; who they are used by; what they are made of; where and how they are sold; to whom they are sold (discerning experts or the public at large); are they regarded as competitive products; and do they complement one another?

Two recent cases have focussed on the similarity of goods.  The first was a South African decision that we have discussed before.  The case dealt with infringement, and the issue was whether a registration for Zonquasdrift covering wine was infringed by the use of the mark Zonquasdrif Vineyards for grapes.  Clearly the marks were similar, but were the goods so similar that there would be confusion? No, said Judge Davis of the Western Cape High Court, highlighting the fact that goods are completely different in nature and sold in different outlets.  This despite the fact that the grapes and wine are obviously very closely linked, and despite the fact that there was evidence in this case to the effect that the Zonquasdrif Vineyards grapes were actually sold to wine cellars.

Eyebrows were raised when this decision came out.  After all, some European decisions have said that one of the factors that must be considered is whether the goods complement one another – for example, in one case it was held that clothing and clothing retail services are similar because they complement one another.  In the Waterford case, which involved the famous Irish glass company and a South African wine estate, the court held that glasses and wine are complementary, but were not sufficiently so to render them similar goods.  The courts have also stressed that, as part of the global assessment, the marks and the goods cannot be seen in isolation.  In other words, if the mark is particularly strong (distinctive), a lesser degree of similarity of goods will be required in order for there to be a likelihood of confusion, and vice versa.

A European court has now also handed down a decision in a registration case in which it seems to have followed the same formulaic approach that was adopted in the Zonquasdrit case.  The mark in issue was Matador, and the question was whether a registration covering beer blocked an application to register it for tequila-based drinks.  No, said the court - the goods may be in the same general category, and they may even be consumed in the same places, but they're very different.  For example, they look different, they taste different, they're made differently, the ingredients are different, they come from different places, they don't complement one another, they don't act as substitutes for one another, and they aren't sold on the same shelves in supermarkets.   On top of that, said the court, beer quenches thirst whereas tequila doesn't.  The court wasn't even moved by evidence that there are in fact alcoholic cocktails which mix beer with tequila.

What do these decisions mean for trade mark owners?  The decisions can, I think, be seen as part of a general desire by courts and trade mark authorities to rein in trade mark rights, and make sure they're kept in check.  The right of companies with well-known trade marks to sue for infringement based on dilution has already been watered down terribly by the Laugh-It-Off (Black Label/Black Labour) decision, and it now seems that it may become increasingly difficult to sue for infringement based on confusion in cases where the goods are not the same.  This may well result in trade mark owners seeking to register their marks for goods that they aren't necessarily interested in.  In short, they will seek registrations that are defensive in nature, and that are intended simply to create a sort of 'no-go' zone.  This may, of course, lead to a great deal of clutter – trade mark registrations that aren't really needed, and that are open to attack.  Oh well, thirst come, thirst served.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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