South Africa: BMW: Still Shaping Trade Mark Law

Last Updated: 4 August 2017
Article by Tanith Robertson

Most Read Contributor in South Africa, July 2017

It is safe to say that BMW protects its trade marks fiercely. As a result, the company has done more than its fair share to shape South African trade mark law. A recent UK trade mark decision involving BMW will therefore be of considerable interest to businesses in South Africa.

In a number of cases involving BMW, South African courts have made it very clear that a trade mark registration is only infringed if a third party makes unauthorised "trade mark use" of that trade mark. This may sound a little odd, but what it means is that the third party must use the registered trade mark in a way that suggests that there is a commercial connection between the third party and the owner of the registered trade mark. In other words, the third party must use the registered trade mark as a badge of origin.

In the famous case of BMW v Verimark, the issue was whether the direct marketing firm Verimark had, by using a BMW vehicle in a TV ad for car polish, infringed BMW's trade mark registration for its famous roundel logo, a logo that was clearly visible in the TV ad. The Supreme Court of Appeal ("SCA") held that there was no trade mark infringement because the usage of the BMW logo was "non-trade mark use", what the court also described as "descriptive use" or "incidental use". In other words, Verimark had not used the BMW logo in a way that suggested a commercial connection between the car polish that it was selling and BMW.

In the more recent case of BMW v Grandmark, the motor company tried to use its trade mark registrations to stop a company that supplies BMW replacement parts (parts that fit BMW vehicles but are not manufactured by BMW) from using the BMW trade marks in ways like this: "GORDON AUTO BODY PARTS CO. LTD; MFG LOT: 1004A; GD471: BM3 SRS 92-05 HOOD." The company failed because the SCA felt that this was descriptive use and not trade mark use. The court explained its thinking as follows: "It can hardly be said that the trade mark is used as a badge of origin when the label states it to have a different origin. Moreover, the numbering surrounding and immediately following the mark clearly reflects its use to identify the component concerned."

The recent decision of the UK Court of Appeal in the case of BMW v Technosport is not dissimilar. What happened here was that BMW sued a firm that carries out business as a repairer of BMWs and Minis and used the trade mark BMW and the roundel logo in various ways. The BMW trade marks appeared on the exterior of the firm's premises, inside the premises, on the side of vans, on business cards, on the firm's website, as a Twitter handle @TechnosportBMW, and on T-shirts.

The issue was whether this usage by the repair firm was descriptive use in the sense that it told the public what the firm did, or whether it falsely suggested a trade connection between the firm and BMW. The court described the two types of usage as "informative use" and "misleading use", expressions that would equate with South African expressions of non-trade mark use and trade mark use. To add to the confusion, the European courts express these concepts in different terms still, in that they talk of the fact that a trade mark registration is only infringed if the function of the trade mark (generally origin-indicating) has been negatively affected or compromised.

The Court of Appeal went on to say that BMW had been quite right not to complain about Technosport's use of the term "the BMW specialists" as this was perfectly legitimate informative use (non-trade mark use). But the company had been within its rights to complain about the other uses made by Technosport, all of which went well beyond simply explaining that the firm specialises in the repair of BMW vehicles. The court made it very clear that using another company's trade mark in your trading style is misleading, as is the use of the company's logo.

This UK judgment is useful because, although it dealt with issues that have to a certain extent already been dealt with in South Africa, it examined different types of use in considerable detail. The judgment is also likely to be persuasive in South Africa, as UK judgments generally are. South African businesses should therefore bear in mind that, although they might be justified in using another company's trade mark to describe what it is that they do, they need to think very carefully about how they use that trade mark. As always, it's best to get professional advice.

Reviewed by Gaelyn Scott, director and head of ENSafrica's IP department.

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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