South Africa: House Marks: Do They Make A Difference?

Last Updated: 15 October 2014
Article by Waldo Steyn

Most Read Contributor in South Africa, September 2016

Two recent South African High Court decisions reflect a worrying lack of consistency in trade mark judgments. They also show how courts sometimes struggle with the issue of the likelihood of confusion in cases where trade marks are accompanied by house marks.

In the first case a well-known retailer of health products, Wellness Warehouse, applied to register the trade mark livewell (in lower case) with a device that comprised three interlocking ovals above the letter 'e' of 'well' . The application was in class 35 and covered retail services. A company called General Nutrition opposed this application on the basis of its registration for the trade mark GNC Live Well in various goods classes and also retail services in class 35.

The opposition failed, with the judge finding that there was no likelihood of confusion. The judge's reasoning was simple - in the case of the opposing trade mark the distinctive feature was GNC, whereas in the case of the opposed trade mark the distinctive feature was the interlocking ovals device - the judge described the distinctive feature as 'what will attract the members of the public to it'. Nothing too controversial there, especially in the case of an inherently weak trade mark like Live Well! The judge went on to say that, in the case of the opposing trade mark, not only would the emphasis be on GNC, but there would also be definite pause between the words 'live' and 'well', something that would not happen in the case of the opposed trade mark. Finally, it's interesting to note that the judge applied a 'discerning consumer' test, saying that confusion was unlikely because consumers for health products 'generally come from the better educated portions of the public.. these will be discerning customers who are careful about the products... and less likely to be deceived or confused as to the origin.'

This decision probably wouldn't have attracted much attention if it hadn't been for a decision that came out a few months later. The second decision involved another trade mark application that Wellness Warehouse had filed for retail services in class 35, this one being for eatwell (in lower case) and the same interlocking ovals device over the second letter 'e'. In this case the opponent was the well-known retailer Woolworths, which relied on its registration for a logo trade mark comprising the words 'eat well' in lower case, together with the name Woolworths, the Woolworths 'Double W' logo, as well as a flower device. The Woolworths trade mark was registered for various goods in classes 5, 29, 30 and 32, but there was no registration in class 35.

In this case the opposition was upheld, with the judge finding that there was a likelihood of confusion. The judge said that that consumers would not notice features like the name Woolworths or the Double W logo, but would rather concentrate on the feature 'eat well' . The judge also rejected the argument that potential purchasers of the goods and services would be limited to the wealthier or better-educated. Surprisingly, the judge made no mention of the earlier decision involving GNC and Wellness Warehouse, notwithstanding the fact that it was apparently brought to her attention.

Another interesting aspect of the second decision is that the judge - who found that there was a similarity between the goods covered by Woolworths' registrations and the retail services of Wellness Warehouse's application – did not see fit to even mention a controversial decision handed down by the same court (Gauteng) a few years back. In the Due South case the judge, who was strongly influenced by competition law and policy, made a number of eyebrow-lifting findings: goods will seldom be similar to goods that fall into different classes; there will seldom be similarity between goods and services; and retail services cannot be considered similar to goods as this would confer an unjustifiable monopoly on trade marks covering retail services. Many will be pleased that this judgment wasn't followed.

The whole issue of what relevance the addition of a house mark has is a tricky one. In a recent South African decision the judge said that, although the addition of a house mark doesn't necessarily avoid confusion, it is a factor especially where the common feature between the trade marks is 'so weak that any source-indicating value it has is overwhelmed by the addition of an arbitrary, distinctive element.' The judge referred to a great deal of US law, including a decision where the court held that trade mark Essentials was not infringed by the trade mark Norton McNaughton Essentials.

In a recent UK decision the court held that, although Thomas Pink's trade mark registrations for Pink were infringed by Victoria's Secret who used the name Pink (on its own) on stores and on clothing, it was not infringed by the use of Pink in conjunction with Victoria's Secret on swing-tags. The leading EU case on the topic is, of course, Medion v Thompson, which involved the trade marksLife and Thompson Life. In that case the court held that adding a house mark doesn't avoid infringement if the common feature retains its 'independent distinctive role'.

What these cases do, of course, is emphasize the need to adopt distinctive trade marks. But that's a message that sadly doesn't seem to get through!

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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