Premier Trading Co (Pty) Ltd and Another v Sporttopia (Pty) Ltd

• Jurisdiction: South Africa
• Citation: 2000 (3) SA 259 (SCA)

Premier Trading Co (Pty) Ltd and Another v Sporttopia (Pty) Ltd
2000 (3) SA 259 (SCA)

2000 (3) SA p259

Citation	2000 (3) SA 259 (SCA)
Case No	218/97
Court	Supreme Court of Appeal
Judge	Hefer JA, Nienaber JA, Schultz JA, Plewman JA, Farlam AJA
Heard	May 20, 1999
Judgment	June 1, 1999
Counsel	M J D Wallis SC (with him J N Cullabine) for the appellants.; D A Gordon SC (with him G E Morley) for the respondent.

Flynote : Sleutelwoorde B

Trade and competition — Trade — Passing-off — 'Product confusion' — Basic principles stated.

Trade and competition — Trade — Passing-off — 'Product confusion' — Where C plaintiff's reputation associated with symbol under which product marketed — Minimum requirements for success in interdict proceedings for passing-off involving use of symbol where plaintiff alleging false representation by defendant about symbol used by plaintiff — Plaintiff required to prove (1) own reputation in relation to symbol epitomising product and (2) deception or confusion on part of not insignificant segment of buying public caused by defendant's conduct as to origin of D product or trade connection with defendant and which would be likely to have influence on public's decision to procure product.

Headnote : Kopnota

Passing-off is a wrong consisting of a false representation made by one trader (the defendant) to members of the purchasing public that the E enterprise, goods or services of a rival trader (the plaintiff) either belongs to him (the defendant) or are connected in the course of trade with his own enterprise, goods or services. In the case of 'product confusion' (as opposed to 'business confusion') the defendant's representation is a misrepresentation if it is likely to deceive or confuse a substantial number of members of the public as to the source F or origin of his goods. Actionable passing-off erodes the plaintiff's goodwill, goodwill being the product of a cumulation of factors, the most important of which, in the context of passing-off, is the plaintiff's reputation. Reputation is the opinion which the relevant section of the community holds of the plaintiff or his product. If favourable, it would dispose potential customers to patronise the plaintiff or his product and, if unfavourable, it would tend to G discourage them from doing so. The plaintiff's reputation may be associated with the symbol under which his product is marketed. That symbol renders the product distinctive of the plaintiff or his product. A false representation by the defendant about the symbol used by the plaintiff may encourage or induce potential customers of the plaintiff, believing that they were patronising him (the plaintiff), into H patronising the defendant. (At 266H - 267B/C.)

Two minimum requirements which a plaintiff would normally have to prove in proceedings for an interdict based on passing-off involving the use of a symbol are (1) his own reputation in relation to the symbol which epitomises his product and (2) deception, or at the very least confusion, on the part of a not insignificant segment of the buying public caused by the defendant's conduct as to the origin of the I product or the trade connection with the defendant and which would be likely to have had an influence on their decision to procure it. (At 267D/E - F.)

The first appellant (the appellant) had unsuccessfully applied in the Durban and Coast Local Division for an interdict restraining the respondent from, inter alia, 'dealing in any way with roller skates bearing the trade mark Bladeline J

2000 (3) SA p260

or using the brand name Bladeline in connection with the sale of roller skates'. The skates in A question were 'in-line' roller skates. An Australian firm, Skateworks, had developed in-line skates and registered a trade mark, Bladeline, in respect thereof. The firm which had taken over Skateworks concluded an agreement with the respondent, a South African company, on 23 September 1993 in terms of which the respondent was licensed to market, distribute and sell Skateworks products, and especially Bladeline skates, in South Africa. The respondent was B also granted the exclusive right to use the Bladeline trade mark in South Africa and to register it as a trade mark in South Africa in its own name. On 22 November 1993 the respondent applied to register the mark in two classes of the trade marks register.

The appellant, an importer and distributor of consumer goods, had acquired the assets and goodwill of Jokari (South Africa) (Pty) Ltd on C 8 July 1993. Prior to that Jokari had been a prominent supplier of sports goods to the South African retail market under the mark 'Jokari'. Jokari had introduced to the South African market in-line skates imported from Taiwan which resembled, but were not identical to, Skateworks' Bladeline skates. Whereas the Skateworks skates had the name 'Bladeline' prominently displayed on the side of the heel of the boot and continuously along the rims of the wheels, the Taiwanese D skates displayed the name 'Jokari' on the side of the boot and the name 'Bladeline' on the wheels. The box in which the Taiwanese skates were packed was an exact replica of the box designed for Skateworks' Bladeline skates, even repeating the technical specifications displayed on the box relating to Skateworks' skates but not to the Taiwanese skates. The only difference was that a picture of the Taiwanese skates E appeared on the box. When the respondent complained about this the first appellant reacted at first by placing a sticker over the false specifications and, later, by redesigning the packaging as well as the manner in which the word 'Bladeline' appeared on the wheels. It was the respondent's launch of the Skateworks skates in South Africa during December 1994 with the name Bladeline prominently featured on the outside heel of the boot and on the wheels which precipitated the F application for an interdict.

The appellant's complaint was that the marketing by the respondent of in-line skates by means of a get-up in which the word-mark Bladeline was a prominent feature without distinguishing it from the appellant's product was a misrepresentation. It tendered in proof of its reputation evidence relating to sales of its product; national advertising on TV; promotional material; and certain trade evidence. No direct G customer evidence was tendered. The appellant stated that its skates were promoted and marketed with the 'general' mark 'Jokari' endorsed on the outside of the heel used in conjunction with the 'specific' mark 'Bladeline' on the wheels and sought to argue that the conjunctive use of the two marks identified the actual Bladeline skates as a Jokari product and as emanating from and being connected in H the course of trade with the proprietor of the Jokari trade mark.

Held, that the issue was whether, in December 1994 and within the jurisdiction of the Durban and Coast Local Division, the appellant had enjoyed a reputation in the word-mark 'Bladeline' in respect of in-line skates. (At 267H/I - 268A.)

Held, further, since the Taiwanese manufacturer undoubtedly had copied the Skateworks artwork in designing the package for the I appellant's product, that it could safely be assumed in the absence of any contrary explanation that the name 'Bladeline' had also been copied from its Australian source. If that were so then Bladeline was in effect a manufacturer's mark. (At 268F - H.) And if Bladeline had been a feature devised by the Taiwanese manufacturer by which the product was distinguished as that of the J

2000 (3) SA p261

manufacturer, then the word 'Jokari' had to have been affixed at the instance of Jokari in its A capacity as importer and distributor of the product in South Africa. (At 268H/I - I/J.)

Held, further, that the inference could therefore safely be drawn that the word 'Bladeline', at least initially, had functioned as a manufacturer's mark and that the word 'Jokari' on the boot and on the box functioned as the mark of an importer and distributor. (At 269B - C.) B

Held, further, that, while an importer or distributor of the goods of a manufacturer who acted as a mere conduit between the manufacturer and end user would as a rule find it hard to maintain proceedings for passing-off in her or his own name, the appellant was not simply an inactive link in the chain of distribution: it had had its own stamp of identity, selection and approval imprinted on the product. (At 270C - D/E.) C

Held, further, that on that approach the appellant's distinguishing symbol was 'Jokari' and not 'Bladeline' and any reputation which it acquired as importer and distributor would thus adhere, not to the word 'Bladeline', but to the word 'Jokari'. The addition of the word 'Jokari' accordingly had not assisted the appellant in establishing a reputation in the word-mark 'Bladeline'. (At 270E/F - F.) D

Held, further, that the conclusion that, at best, the appellant had acquired a reputation in the word 'Jokari' rather than 'Bladeline' was fortified by its own trade evidence, the tenor of which strongly suggested that in South Africa Jokari was regarded as the name of the make and 'Bladeline' and 'Pro-Line' (another in-line skate sold under the Jokari label) as the names of particular Jokari models. (At 270F/G and 271E - E/F.) E

Held, further, as to the appellant's argument that Jokari and Bladeline were used conjunctively, that, although the notion of a conjoined or composite mark might be perfectly feasible as a proposition of law, in this case it failed as a proposition of fact. (At 271J.) Furthermore, the trade evidence tendered by the appellant did not support it, while evidence of reputation by customers or F potential customers of in-line skates had been conspicuously lacking. (At 272B/C - G, summarised.)

Held, accordingly, that the...