Al Baik Fast Food Distribution Co SAE v El Baik Food Systems Co SA

• Jurisdiction: South Africa
• Judge: AN Tuwe (Mr)
• Court: Registrar of Trade Marks
• Citation: 2015 JDR 2322 (TRM)

Tuwe:

The Applicant is AI Baik Fast Food Distribution Co. S.A.E., an Egyptian company of 5 Abdul Azeem AI Ghulami Street, Nasr City, Cairo, Egypt (hereinafter referred to as "the Applicant").The Applicant had applied for the trade mark ALBAIK & DEVICE in class 43 under application no. 2006/18331 in respect of:

"Services for providing food and drink"

The Opponent is El Baik Food Systems CO. S.A, a Grand-Dutchy company, of 69 Boulevard de Ia Petrusse, L-2320 Luxenburg (hereinafter referred to as "the Opponent"). The Opponent is the applicant for trade mark application nos. 2007/21486-7 ALBAIK & DEVICE and 2007/21488-9 ALBAIK & Logo in classes 29 and 43 in respect of:

"Meat, fish, poultry and game, meat extracts, preserved, frozen, dried and cooked fruits and vegetables, jellies, jams, compotes, egg, milk and milk products, edible oils and fats", and

"Services for providing food and drink, temporary accommodation"

The Opponent based its opposition on the provisions of Sections 10(3), 10(6), 10(7), 10(12) and 10(16) of the Trade Marks Act, Act 194 of 1993 ("the Act").

Section 10 provides that:

"Unregistrable trade marks. - The following marks shall not be registered as trade marks, or if registered, shall, subject to the provisions of section 3 and 70, be liable to be removed from the register:

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(3) a mark in relation to which the applicant for registration has no bona fide claim to proprietorship,

(6) subject to the provisions of section 36(2), a mark which, on the date of application for registration thereof, or, where appropriate, of the priority claimed in respect of the application for registration thereof, constitutes, or the essential part of which constitutes, a reproduction, imitation or translation of a trade mark which is entitled to protection under the Paris Convention as a well-known trade mark within the meaning of section 35(1) of this Act and which is used for goods or services identical or similar to the goods or services in respect of which the trade mark is well-known and where such use is likely to cause deception or confusion,

(7) a mark the application for registration of which was made mala fide,

(12) a mark which is inherently deceptive or the use of which would be likely to deceive or cause confusion, be contrary to law, be contra bones mores, or be likely to give offence to any class of persons,

(16) a mark which is the subject of an earlier application as contemplated in paragraph (15), if the registration of that mark is contrary to existing rights of the person making a later application for registration as contemplated in that paragraph."

The Opponent operates a chain of quick service restaurants under the name and trade mark ALBAIK, together with certain logo marks. The Opponent's representative submitted that it had made use of the ALBAIK trade mark and logo since 1987. The ALBAIK trade mark and logos were initially registered in Saudi Arabia in 1986. The use

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of the mark expanded over the years and the brand became so popular in Saudi Arabia, that it was found to have been the fifth most popular brand in Saudi Arabia.

The Opponent's representative submitted in his heads of argument that the Opponent had branched out to other countries and had forty restaurants in the Kingdom of Saudi Arabia, one in Egypt and another in Jordan. It had employed over 1,900 full time team members and served over 30 million customers every year. In the last 35 years, it had served over 400 million customers. In addition, the Opponent's trade mark had received considerable coverage in the press.

Regarding the Opponent's reputation in South Africa, its representative stated that a substantial number of members of the Muslim community in South Africa had been exposed to the Opponent's AI Baik Restaurants. During the pilgrimage to Mecca the Opponent operated three seasonal restaurants designed to serve two hundred and fifty thousand meals per day. During the period of Haji the Opponent served hundreds of pilgrims, including many pilgrims from South Africa. The pilgrims from South Africa would have seen the Opponent's ALBAIK trade mark and signage, including the ALBAIK device.

The Opponent's representative contended that the fact that the Opponent's ALBAIK trade mark had become known to a substantial number of persons in the relevant sector of the market, was evidenced by the fact that the Opponent had received numerous enquiries from South Africans regarding the possibility of opening an ALBAIK franchise

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in South Africa. Examples of these enquiries were on page 9 of the Opponent's heads of argument, in paragraphs 7.4.1 up to 7.4.4. It was further submitted that the Opponent's website on the internet was accessible to South Africans.

The Opponent's representative therefore contended that, as at the relevant date, its ALBAIK trade mark and the ALBAIK device were well-known within the meaning of Section 35 of the Act. Reference was also made to Section 10(6) providing protection to the owner of a well-known mark, where it sought to prevent registration of a trade mark contrary to its rights in the well-known mark.

It was argued on behalf of the Opponent that it was noteworthy that Sections 10(6) and 35 of the Act did not require the proprietor of a well-known trade mark to have used the mark in South Africa in order to qualify for protection in terms of those sections. In fact, the sections explicitly stated that the protection was available whether or not that person carried on business, or had any goodwill in South Africa. A mark would be considered to be well-known in the Republic if it was well-known to persons interested in the goods or services to which the market related (McDonald's Corporation v Joburgers Drive-Inn Restaurant (Pty) Ltd, McDonald's Corporation v Dax Prop.CC, McDonald's Corporation v Joburgers Drive-Inn Restaurant (Pty) Ltd 1997 (1) SA 1 (A).

The Opponent's representative submitted that the Court in the above case accepted that there were two categories of persons who were interested in the goods and services, namely:

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(a)

Potential customers, and

(b)

Potential franchisees

A distinction was drawn in that potential customers would cover a wide field. It would include all persons who liked fast-food of this type and had the money to buy it. Since the cost was not high there would be many such people. Potential franchisees would be a smaller group, namely persons who could finance and run a franchise, or considered that they could. A further group of potential franchisees to consider was a group that would more likely be exposed to international travel or to spill-over advertising of the product. This group would have heard of the brand and would know of its marks.

It was submitted on behalf of the Opponent that the relevant class of consumer in this case were those of potential franchisees, but particularly in the Muslim community. The evidence suggested that thousands of Muslims who travelled to Mecca on a yearly basis would have been exposed to the Opponent's ALBAIK trade mark and chain of restaurants. The same, it was said, applied to those potential customers who were also from the Muslim community and who, although not interested in obtaining a franchise, would have been exposed to the Opponent's ALBAIK chain of restaurant in the course of their visit to Mecca.

It was contended that in the context of the Muslim community, the extent of use outside South Africa was sufficient to show that the ALBAIK trade mark of the Opponent would be known to a substantial number of South Africans who had travelled abroad. In this

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regard the Tribunal was referred to what was said by the Supreme Court of Appeal in McDonald's (supra) at 22J-23A that:

"Although there was no evidence on the context to which the advertising outside South Africa spilled over into this country through printed publications and television, it must, in all probability, be quite extensive. In addition the McDonalds trade marks would be known to many South Africans who have travelled abroad. This again would not be an insignificant number."

The Opponent's representative argued that the Supreme Court of Appeal also specifically had regard to the fact that requests from South Africans to conclude franchise agreements in the McDonald's (supra) case confirmed that there was a general level of knowledge in South Africa about the operations of McDonalds. It was stated that the same should apply to the public's knowledge of the ALBAIK trade marks of the Opponent.

It was in view of the above that it was submitted that the Opponent's ALBAIK trade marks qualified for protection in terms of Sections 35 and 10(6) of the Act.

In its opposition based on Section 10(6), it was submitted that when one had regard to the well-known trade marks ALBAIK and ALBAIK DEVICE used by the Opponent and compared that with the Applicant's mark, it was immediately apparent that the Applicant's mark constituted an imitation or reproduction of the Opponent's original mark. It was telling that the Applicant did nothing to explain its choice of its mark,

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particularly the use of a device which was virtually identical to that of the Opponent. In this regard reference was made to Webster & Page paragraph 6.4, page 6-7 which states that:

"Once the foreign proprietor has proved that his trade mark was well-known in South Africa at the relevant time the local Applicant will, however, have considerable difficulty in persuading the Tribunal that his trade mark was conceived independently."

It was submitted that in the present case the Applicant had not even made a bold allegation that it conceived its trade mark independently, hence it had failed to prove that its mark qualified for registration.

Regarding the Section 10(12) opposition, the Opponent relied on the reputation it...