Luster Products Inc v Magic Style Sales CC

• Jurisdiction: South Africa
• Judge: Corbett CJ, Nestadt JA, Harms JA, Schutz JA and Plewman JA
• Judgment Date: 26 November 1996
• Citation: 1997 (3) SA 13 (A)
• Docket Number: 232/95
• Hearing Date: 19 November 1996
• Counsel: C E Puckrin (with him O Salmon) for the appellant (respondent in the cross-appeal) L G Bowman (with him ABS Franklin for the respondent (appellant in the cross-appeal)
• Court: Appellate Division

Plewman JA:

This appeal concerns a trade mark. The appellant, Luster Products Incorporated, a corporation registered according to the laws of the State of Illinois in I the United States of America, is the proprietor of South African trade mark 84/6404 registered in Part A of the register in respect of goods in class 3. The respondent is a South African close corporation, Magic Style Sales CC, which has its registered office in Sandton, Gauteng. The appellant manufactures and distributes hair care products and cosmetics for use mainly by black persons. There is a large J

Plewman JA

market for these products in America. Since 1980, the appellant has distributed its A products in South Africa through representatives in this country, and has used its trade mark (which then was registered in America but not in South Africa) on such goods. In July 1984 the appellant's mark was registered locally. B

The respondent carries on business in the same field as the appellant. It was incorporated in 1988. The dispute arose in December 1990. At that time the appellant became aware of the fact that the respondent was marketing certain of its products using a mark thereon which the appellant considered an infringement of its registered C mark. It accordingly caused a letter of demand to be addressed to the respondent calling upon it to desist from using this mark. Correspondence passed between the parties. The details are not relevant. The upshot was a refusal by the respondent to comply with the appellant's demands (though it did, it seems, slightly modify the mark it used on its goods; the details will be given later). As a result the appellant applied for D an interdict restraining the respondent from infringing its mark. The notice of motion is dated 9 December 1992. The application was opposed. The respondent in addition launched a counter-application, filed on 9 February 1993. An enthusiastic paper chase ensued. Initially relief was also sought on the ground of passing-off. This has not been E pressed on appeal. The papers rapidly became voluminous. The counter-application (insofar as is now relevant) was a double-barrelled attack. The respondent sought the expungement of appellant's mark under the provisions of s 16(1) read with s 33(1) of the Trade Marks Act 62 of 1963. This Act applies to the proceedings by reason of the provisions of s 3(2) of the Trade Marks Act 194 of 1993 (which came into operation F on 1 May 1995). Section 3(2) provides that proceedings commenced under the 1963 Act are to be dealt with in accordance with that Act as if it had not been repealed. The respondent's second barrel was an application (made in the alternative) for an order directing the entry of a disclaimer, of 'any right to the exclusive use of the G term "S-Curl" apart from the special representation as depicted in the mark'. The counter-application necessitated the joinder of the Registrar of Trade Marks. The Registrar has, however, taken no part in the litigation and abides a result. The matter was argued on the papers and without either party seeking a reference to evidence. H

The Court a quo dealt first with the counter-application (and I propose to do likewise). It held against the respondent on expungement but ordered the entry of the disclaimer sought. It dismissed the main application. What is before this Court is an appeal by the appellant against the dismissal of the main application and against the I grant of the alternative counter-application - that is the order directing the entry of the disclaimer. The respondent, for its part, cross-appeals against the refusal of the (main) counter-application. Leave to appeal was granted by the Court a quo in both cases.

It is necessary, in order that the contentions and counter-contentions can be understood, that I describe the mark and its effect and explain the manner in which the respondent has marketed its goods. J

Plewman JA

First the mark. This was (as already stated) granted on 18 July 1984. It is depicted in A the certificate of registration in the following representation:

The registration is subject to the following disclaimer: B

'Registration of this trade mark shall give no right to the exclusive use of the "CURL" and the alphabetical letter "S" separately from each other and apart from the special representation as depicted in the mark.'

Class 3 (in which the registration falls) covers goods in the following categories: D

'Soaps, perfumery and essential oils; cosmetics; hair lotions, hair care products, shampoos, conditioners, creams, creme perm and styling lotions, hair pressing preparations, hair setting preparations, all the aforegoing including those for professional use only.'

Neither in counsels' written heads of argument nor in the judgment is there any discussion of the effect of the grant. In my view, a clear understanding of this is of fundamental importance. E

In terms of the 1963 Act ('the Act' for the purposes of this judgment) a 'trade mark'

' . . . means a mark used or proposed to be used in relation to goods or services for the purposes of -

(a)

indicating a connection in the course of trade between the goods or F services and some person having the right, either as proprietor or as a registered user, to use the mark, whether with or without any indication of the identity of that person; and

(b)

distinguishing the goods or services in relation to which the mark is used or proposed to be used, from the same kind of goods or services connected in the course of trade with any other person'. G

A registered mark must also satisfy the requirements of s 10 and s 12 of the Act and it is accordingly also necessary to quote the relevant portions of s 10 and s 12. In terms of s 10, in order to be registrable in part A of the register, a trade mark -

'. . . shall contain or consist of a distinctive mark'. H

In terms of s 12(1) 'distinctive' means

'adapted, in relation to the goods . . . in respect of which a trade mark is registered . . ., to distinguish goods . . . with which the proprietor of the trade mark is or may be connected in the course of trade from goods . . . in the case of which no such connection subsists, either generally or, where the trade mark is registered . . . subject to limitations, in relation to use within those limitations. I

(2) In determining whether a trade mark is distinctive as aforesaid, regard may be had to the extent to which -

(a)

the trade mark is inherently adapted to distinguish; and

(b)

by reason of the use of the trade mark or of any other circumstance the trade mark is or has become adapted to distinguish.'

The mark then is the mark as depicted - that is the large or bold stylised J

Plewman JA

alphabetical letter S in combination with the word 'curl' in capital letters. It is a 'goods A mark'. The mark must also be accepted as meeting the requirements of s 10 and s 12 - in particular as distinguishing the goods upon which it is used from the goods of other persons and as indicating a connection in the course of trade with appellant. It B conferred on the appellant the right to restrain infringement of the mark under the provisions of s 44(1)(a) and (b) of the Act (to which I will presently refer more fully).

The manner in which the respondent marketed its goods - that is the use complained of - is illustrated in the document I annex hereto. What is of course significant is the bold S, in each case, combined with the word 'curl'. C

It is convenient here to discuss also the use of the term 's curl' by other persons - which is what respondent largely relied upon for its attack on the mark. The respondent's contention was that the term 's-curl' had come to denote a particular hair style and that various manufacturers of hair products intended for use by black persons D had used the term descriptively on containers of their products and in advertisements. These are the propositions from which the learned Judge's reasoning proceeded. The evidentiary foundation for both, as I shall presently show, is questionable but for reasons which I later give this is not of great importance. Du E Plessis J in his judgment cites exh RW 17 to RW 20 as the evidential basis for his finding. In these exhibits what is significant is the depictions on the reverse face of the containers consisting, for the most part, on directions for the use of the contents.

Annexure RW 17 may be taken as an example. The directions for use commence with the words: F

'DO NOT WASH THE HAIR - USE ON DRY UNWASHED HAIR. Apply SOF 'N EASY HAIR BALM to the hair line covering ears and neck. Apply "S" CURL RELAXER CREAM starting at the back of the head. . . . '

The directions continue in like vein referring also to

'"S" CURL RELAXER CREAM, "S" CURL NEUTRALIZING SHAMPOO, G "S" CURL DEEP CONDITIONER, "S" CURL GEL AND "S" CURL MOISTURISING'.

Du Plessis J did not refer in the judgment to the appellant's answering affidavit in which it is said of annexure RW 17 that it was a product of American Hair Products (Pty) Ltd and American Hair Care CC. Letters of demand had been sent in 1991 to both with the result that the product was removed from the market. Broadly similar answers H were given in respect of the other exhibits referred to by Du Plessis J. His acceptance of the respondent's evidence in this respect no doubt flowed from his incorrect appreciation of the operation of the Plascon-Evans rule, a matter to which I presently refer. However, little of this matters because there is other evidence of I various concerns having used the term 'S curl' in advertisements. A good deal of this evidence consists of photographs of bill-boards used by 'informal hairdressers' on which various cuts or styling for hair are advertised. An...