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IN THE SUPERIOR COURT OF JUDICATURE

IN THE HIGH COURT

ACCRA

CORAM; JUSTICE BARBARA ACKAH-YENSU (J)

 

SUIT NO. IPR/2/09

24 June 2010

 

MENKISH IMPEX LIMITED

 

PLAINTIFF

VRS

 

 

PAM VENTURES LIMITED

 

DEFENDANT

 

Plaintiff has instituted an action for the following reliefs: "a. An Injunction to restrain Defendant, whether by themselves, their agents, servants, assigns etc, from infringing with Plaintiff's registered Trade Mark No. 32529 dated 5th May 2002 and also from passing off Defendant's goods as those of Plaintiff b. Damages for the passing off the Plaintiff's goods by the Defendant and the injury to Plaintiff's goodwill. C Delivery up to Court for destruction of Defendant's unsold stock of the said offensive items. d. Any other order as to the Court may seem fit." Plaintiff's case is that it is the registered proprietor of the "HEAVEN" mosquito coil and that its mark "HEAVEN" is set against a yellow background with a white bird flying across a rainbow. According to Plaintiff since the registration of its mark, it had imported and widely marketed its HEAVEN BLACK mosquito coil such that mosquito coils packaged with the said name, mark, style and colour have become very popular with consumers and the general public as their favourite brand of mosquito coil. It is Plaintiffs further case that the Defendant has packaged its DHOOM BLACK mosquito coil in very similar colour, shape and style (get up) as if same are products of Plaintiff and released same for sale in the local market. It is Plaintiff's contention that the use by Defendant of Plaintiff's packaging style (get up) is calculated to deceive and confuse the general public into thinking/believing same to be Plaintiff's product. In effect, Defendant was perpetrating unfair trade practices by its conduct. Defendant denied Plaintiff's claims that the name, mark, colour and packaging style (get up) were similar and insisted that the decoration on their package was completely different from that of Plaintiff. The Defendant further stated that there were numerous brands of mosquito coil on the market which had been packaged in square boxes with yellow background and that their packing style was not capable of confusing or deceiving the general public. The Trade Marks Act, 2004 (Act 664) defines Trade Mark as follows: "Meaning of trademark 1. Trade mark means any sign or combination of signs capable of distinguishing the goods or services of one undertaking from the goods or services of the other undertakings including words such as personal names, letters, numerals and figurative elements" Haisbury's Laws of England, 4th Edition, Vol.48, paragraphs 78 and 79 provide as follows: 78. "Identical mark for identical goods or services" A person infringes a registered trade mark if he uses in the course of trade a sign which is identical with the trademark in relation to goods or services which are identical with those for which it is registered" 79. "Identical mark for similar goods or services; similar mark for identical goods or services. A person infringes a registered mark if he uses in the course of a trade a sign where because: 1. The sign is identical with the trade mark and is used in relation to goods and services similar to those for which the trade mark is registered; or 2. The sign is similar to the trade mark and is used in relation to goods or services identical with or similar to those for which the trade mark is registered, There exists a likelihood of confusion on the part of the public, which includes the likelihood of association with the trade mark" Section 3 of the Trade Marks Act states that the registration of a trade mark by any person confers an exclusive right to the use of the trade mark. Section 9 also provides for the Rights conferred by registration. Some of the provisions under section 9 are as follows: 9(1) A person other than a registered owner of a trade mark shall not use the mark in relation to any goods or services for which the trade mark was registered without the agreement of the owner. (2) The registered owner may institute court action against any person who infringes a registered trade mark by a. using a registered mark without permission; or b. performing acts which make it likely that infringement may occur. (3) No person shall knowingly infringe the rights of the owner of a registered trade mark by using a trade mark in relation to goods or services for which the trade mark was registered without the consent of the owner. (4) The right of the registered owner under is section shall, in addition to any other remedies, extend to the use of a sign similar to the registered trade mark and use in relation to goods and services similar to those for which the mark has been registered where confusion may arise in the public. (5) Where there is use of an identical sign for identical goods or services, a likelihood of confusion shall be presumed. The position of the law is that the claimant in an action for infringement of a registered mark must generalIy establish his title to sue either as proprietor or as an exclusive licencee. He must then prove that the defendant has acted or threatens to act in such way as to infringe the right conferred by registration. Per Exhibit "B", Plaintiff proved that it is the registered proprietor of the trademark "HEAVEN". The claimant's title as proprietor depends on the existence of a valid registration. The fact that a person is registered as proprietor of a mark is prima facie evidence of the validity of the original registration and of any subsequent assignment or transmission thereof. The Plaintiff's mark is "HEAVEN" written in black with white neon lines on the outside and set against a yellow background with a white bird flying across a rainbow. The Defendant's mark is "DHOOM" written in a similar black with white neon lines on the outside and set against a similar yellow background, but with an eagle and thunder on the right side. So, looking at the two (2) marks are they so similar as to exist the likelihood of confusion? I must state here that the fact that both marks are used in relation to goods and services identical with or similar is an undisputed fact. Both marks are used for mosquito coil. It is Plaintiff's contention that the two marks are identical to a very large extent. That, it is the total effect of the marks together, with the shape, size, style (get up) that brings the similarity thereby creating the likelihood of confusion and deception. Defendant contends that it too has registered its trade mark with the Registrar General's Department and is therefore protected under the Trade Marks Act. From the evidence of Prince David, Financial Controller/Accountant of Defendant Company (D.W.1) however, Defendant's mark has not as yet been registered the process has been set in motion but not completed Defendant's mark therefore cannot be said to have been registered. So, we are now back to the question as to whether the two marks (Plaintiff's and Defendant's) are "so nearly resembling' each other that there is the likelihood of confusion and deception. In my opinion, the two marks “HEAVEN" and “DHOOM" are not so similar as to qualify for an infringement of a trade mark under the Trade Marks Act, and I will so find. However, Plaintiff herein has come to Court seeking reliefs for passing off. Generally speaking, there is nothing in the Trade Marks Act that affects a trader's right against another in an action for passing off. It is not even a bar to an action for passing off that the trade name, get up or any other of the badges identified with the claimant's business, which are alleged to have been copied or imitated by the defendant, might have been, but not registered as trade marks, even though the evidence is wholly addressed to what may be a mark capable of registration. Again, it is no defence to passing off that the defendant's mark is registered. The law offers advantages to those who register their trade marks, but imposes no penalty upon those who do not. Passing off is increasingly being seen as unfair competition by misrepresentation. The consensus is that traders should be protected in their relationship with one another. There is nothing wrong with competition but it has to be fair. Thus any misrepresentation calculated to give one trader the benefit of another's goodwill is actionable; or even more generally that any " misrepresentation ..... calculated to injure another in his trade or business" is to be regardedas passing off as per Lord Morris in Parker-Knoll v Knoll International [1962] RPC 265 at 278. The applicable law in Ghana relating to the tort of 'passing off" is the Protection Against unfair Competition Act, 2000 (Act 589). Sections 1, 2 and 3 of the said Act state as follows: Causing confusion with respect to another's enterprise or its activities 1. (1) Any act or practice, in the course of industrial or commercial activities that causes, or is likely to cause, confusion with respect to another person's enterprise or its activities, in particular, the products or services offered by that enterprise, constitute an act of unfair competition. (2) Confusion may, in particular, be cause with respect of a. A trademark, whether registered or not; b. A trade name; c. A business identifier other than a trademark or trade name d. The presentation of a product or service; or e. A celebrity or well-known fictional character. Damaging another person’s goodwill or reputation 2. (1) Any act or practice in the course of industrial or commercial activities, that damages or is likely to damage the goodwill or reputation of another person's enterprise or its activities constitutes an act of unfair competition, whether or not the act or practice causes confusion (2) Damaging another person's goodwill or reputation may, in particular, result from the dilution of the goodwill or reputation attached to a. A trademark whether registered or not, b. A trade name c. A business identifier other than a trademark or a trade name; d. The appearance of a product; e. The presentation of a product or service; or f A celebrity or a well-known fictional character Misleading the public 3. (1) any act or practice in the course of industrial or commercial activities, that misleads or is likely to mislead the public, with respect to an enterprise or its activities, in particular, the products or services offered by the enterprise, constitutes an act of unfair competition. (2) Misleading may arise out of advertising or promotion and may, in particular,occur with respect to a. The manufacturing process of a product; b. The suitability of a product or service for a particular purpose; c. The quality or quantity or other characteristics of a product or service; d. The geographical origin of a product or service; e. The conditions on which a product or service is offered or provided f. The price of a product or service or the manner in which the price is calculated. In Haisbury's Law of England,4th Edition volume 48, paragraph 189 (page 117), passing off is explained as follows: 189. "Passing off any similarity of get up or shape of goods. Passing off may occur, not by reason of any similarity of trade marks or names but because of the similarity of the general appearance or get-up of the goods; the similarity of get-up may be such that passing off is likely to occur even though the trademarks or names are wholly different especially where the goods are likely to be bought by illiterate or uneducated persons..:' It states further at page 118 that: "In assessing whether or not the get-up of the Defendant's goods is deceptively similar to the Plaintiff's, characteristics which are common to the trade should be disregarded, but the use in combination of a number of features which are individually used by others in the trade can amount to passing off Thus, where the Defendant adopts a feature used by the Plaintiff which is also used by others in the trade, so that its use as such is unobjectionable, the Defendant may nevertheless have to take greater care not to copy other features of the get- tip of the Plaintiff's goods. Further. where the general appearance of the goods is necessary similar, Defendant needs to take greater care to avoid adopting those features which are distinctive to the get-up of the Plaintiff's goods" it is trite learning that passing off, is concerned with misrepresentation made by one trader which damage the goodwill of another trader. Misrepresentations, damage and goodwill are therefore the three (3) essential elements of the tort, and are sometimes referred to as the “Classical Trinity". In the case of Reckitt & Colman Products Ltd v. Borden [1990] All ER 873 HL the learned judges referred to the "Classical Trinity" in their description of the elements of the action. Lord Oliver put the matters a successful claimant must prove as follows: "First he must establish a goodwill or reputation attached to the goods or services which he supplies in the mind of the purchasing public by association with the identifying 'get-up', (whether it consists simply of a brand name or a trade description, or the individual features of labelling or packaging) under which his get-Lip is recognized by the public such that the get-up is recognized by the public as distinctive specifically of the plaintiff's goods and services. Secondly, he must demonstrate a misrepresentation by the defendant to the public (whether or not intentional) leading or likely to lead the public to the belief that the goods or services offered by him are the goods and services of the plaintiff Thirdly, he must demonstrate that he suffers or, in a quia timet action, that he is likely to suffer damage by reason of the erroneous belief engendered by the defendant's misrepresentation that the source of defendant’s goods or services is the same, as the source of those offered by the plaintiff" It is well settled (unless registered as a trade mark) that no one has a monopoly in his brand name or get-up, however familiar these may be. Passing off is a wrongful invasion of a right of property vested in the claimant; but the property which is protected by an action for passing off is not the claimant's proprietary right in the name or get¬up which the defendants has misappropriated, but the goodwill and reputation of his business which is likely to be harmed by the defendant's misrepresentation. What common law protects through passing off actions is the goodwill between the trader and its customers, which the mark, get-up, in which the goods are packaged, or a combination of the two. The law regards such reputation as an incorporeal piece of property the integrity of which the owner IS entitled to protect. The law will not allow such reputation and goodwill to be taken advantage of by another trader. The nature of goodwill is probably not capable of precise definition; it is more easily understood than defined. In-the context of passing off, it has been stated to represent, in connection with any business or business product, the value of the attraction to customers which name and reputation possesses. See Reuter v Muhlens [1953] R.P.C. 235 at 254. But in the words of Sir Stephen Browne P. in Scandecor Development AB v Scandecor Marketing AB [1999] F.S.R. 26, CA, "no one judge or jurist has yet improved on Lord Macnaghten's description of goodwill". This is how goodwill was defined in the case of Inland Revenue Commissioners v Mukker & Co's Margarine Ltd [1901] AC 217 HL: "What is goodwill? It Is a thing very easy to describe, very difficult to define. It is the benefit and advantage of the good name, reputation and connection of a business. It is the attractive force which brings in custom. It is the one thing which distinguishes an old-established business from a new business at its first start. The goodwill of a business must emanate from a particular centre or source. However widely extended or diffused its influence may be, goodwill is worth nothing unless it has power of attraction sufficient to bring customers home to the source from which it emanates." In the same case, Lord Lindley said that: "Goodwill regarded as property has no meaning except in connection with some trade, business, or calling. In that connection I understand the word to include whatever adds value to a business by reason of situation, name and reputation, connection, introduction to old customers, and agreed absence from competition, or any of these things, and there may be others which do not occur to me. In this wide sense, goodwill is inseparable from the business to which it adds value, and in my opinion, exists where the business is carried on. Such business may be carried on in one place or country or in several, and if in several there may be several businesses, each having a goodwill of its own." In a true case of passing off, all three elements are intertwined. It is the exclusive reputation which provides the necessary foundation for misrepresentation; the misrepresentation must be one which causes or is likely to cause damage to goodwill; and damage to goodwill is the heart of the cause of action. It has always been the law that every case in which passing off is alleged turns on its own facts. The question whether in the uses of particular indicia results in passing off the goods or services is in substance a question of fact. As per Halsbury L.C. in Reddaway v. Banham [1896] AC 199 at 244; "The principle of law may be very plainly stated that nobody has any right to represent his goods as the goods of somebody else. How far the use of particular words, signs, or pictures, does or does not come up to the proposition enunciated in each particular case must always be a question of evidence, and the more simple the phraseology, the more like it is to a mere description of the article sold, the greater becomes the difficulty of proof, but if the proof establishes the fact, the legal consequences appears to follow." The first element in passing off is reputation/goodwill. That is does the Plaintiff have any goodwill in HEAVEN' BLACK mosquito coil to protect in Ghana? The overriding consideration in judging the extent of reputation is whether the claimant has built up goodwill to the point where substantial damage will be caused to it by the acts he complains of. P.W.1'sevidence was as follows: Q. In paragraph 6 of your statement of claim, you are saying that you have imported and widely marketed your product. That your product has become very popular with consumers and that your product is the most favourite. Can you explain this to the court? A. We started as a very small brand years ago with only 2 distributors. All the years, we have built it up with almost 60 distributors nationwide. We have placed bill boards in Accra and in the outskirts of Kumasi, we advertise on the TV 3 news daily. Anybody who puts on his television sees Heaven Black mosquito coils. We have spent our entire youth, me and my brother, developing and advertising this brand, another person just brings an inferior quality product and copies our entire label and everything to mislead the consumer, the people who used the mosquito coils are the poor people. They are even illiterates. In his evidence, P.W.1 stated that Plaintiff's product was the number one selling brand in the market, the most advertised and the best quality. All these pieces of evidence were not challenged by Defendant. In proof of Plaintiff's case, P.W.1 tendered in evidence receipts and documents covering locations of billboards, list of customers, customers shop brandings and TV adverts; Exhibits "E", "F", 'G", and "H" series. In the light of all that I have said about reputation and goodwill, I will find that Plaintiff has adduced sufficient evidence to establish that it has reputation and goodwill. With regard to the second element, i.e. representation, the position of the law is that selling ones goods under the pretence that they are the goods of another; constitutes an invasion of proprietary rights vested in the plaintiff. The misrepresentation should lead to confusion/deception. Proof of actual confusion is often compelling evidence of passing off, but such proof is not a requirement for passing off. Legal authorities recognized that similarity sufficient to result in confusion should be enough to create a misrepresentation that can form the basis of a passing off action, Legal authorities recognized that similarity sufficient to result in confusion should be enough to create a misrepresentation that can form the basis of a passing off action, the important factor being whether purchasers or consumers of the products have been or are likely to be misled. There are a number of dicta that can assist in determining similarity and likelihood of confusion. In Pianotist. Co's Application, Re [1906] 23 R.P.C 774 at 777, Parker J said as follows: "You must take the two words. You must judge them both by their look and their sound. You must consider the goods to which they are to be applied. You must consider the nature and kind of customer who would be likely to buy those goods. In fact you must consider all the surrounding circumstances, and you must further consider what is likely to happen if each of those trade marks is used in a normal way as a trade mark for the goods of the respective Owners of the trade marks." In considering the question of possible deception or confusion, due cognizance must be given to the fact that human recollection is not perfect. Thus the court, in Rysta Ltd's Application [1943] 60 R.P.C. 87 at 108, said: "It is the person who only knows the one word, and has perhaps an imperfect recollection of it, who is likely to be deceived or confused. Little assistance therefore is to be gained from a meticulous comparison of the two words, letter by letter and syllable by syllable pronounced with the clarity to be expected from a teacher of elocution. The court must be careful to make allowance for imperfect recollection and the effect of careless pronunciation and speech on the part not only of the person seeking to buy under the trade description but also of the shop assistant ministering to that person s wants." Vijay Krishnan Moolchandani, a Director of Plaintiff Company; P.W.1'S evidence was that Defendant had copied the entire get up of Plaintiff's product, the colours, wording, and even the mistakes they made in the wording. He said that initially Plaintiff wrote "manufacture" instead of "manufactured", and this mistake was copied by Defendant. Defendant denies that they have copied Defendant's get up etc and to prove this they called Samuel Quaynor, a trader in mosquito coils (D.W.2) to testify. His evidence was that he was a wholesaler and that his customers never got confused between the two products. In my view the fact that he was a wholesaler did not help establish definitely that customers did not get confused because he sold the products in cartons; it did not reveal the similarities between the packaging. in any case, even D.W.2 admitted to some similarities in the packaging. It is my opinion that looking at Exhibits "C" (package of HEAVEN BLACK mosquito coil), and Exhibit "C1" (DHOOM BLACK mosquito coil), the average person might not see much difference between them. It is common knowledge that mosquito coils are usually used by the not so educated and not so sophisticated members of the society. One cannot therefore expect the possible purchaser to be meticulous and pay particular attention to the minor dissimilarities between the two Packages. The Packages boxes, in my view look quite similar. After all a trademark to carry out its function in a market, recognition of it by the relevant public has to be almost instantaneous. The other packages of mosquito coil tendered in evidence, Exhibits "D" series are not as similar to Exhibit "C" (HEAVEN BLACK mosquito coil) as Exhibit "C1" (DHOOM BLACK mosquito coil) is. I will find that Defendant's product has been packaged in such a way that it looks confusingly similar to that of Plaintiff's. The third and last ingredient in a passing off action is damage. The assumption is that the claimant in a passing off action is being prevented from selling as many goods as he otherwise would; while even if there was no direct loss of sales, the confusion between the two suppliers puts the plaintiff's goodwill at risk. The claimant does not have to prove actual damage (still less special damage) in order to succeed in an action of passing off. Likelihood of damage is sufficient. As per Lawrence J in Motor Manufacturers' & Traders' Insurance Society v Motor Manufacturers' & Traders' Insurance Co [1925] All ER 616; "It is well established that a court of equity will protect the business reputation enjoyed by any person or corporation against tangible risk or probability of injury, just as it will protect any other property of such person or corporation against any such risk or probability. One of the ways in which a business reputation may be injured is by the appropriation by a stranger of part of such reputation. Such appropriation may be brought about by the adoption of a name which suggests that the person or corporation enjoyed the reputation. Damage or likelihood of damage is the gist of all such actions, and unless a plaintiff can prove that his credit or business reputation has suffered damage or that there is a tangible risk or probability of his credit or business reputation suffering damage, no action will lie. Buckley J also said in Bulmer (HP) Ltd v Bollinger SA [1978] R.P.C. 79 that: "It is well settled that the plaintiff/n a passing off action does not have to prove that he has actually suffered damage by loss of business or in any other way. A probability of damages is enough, but the actual or probable damage must be damage to him in his trade or business, that is to say, damage to the goodwill in respect of that trade or business." In his evidence P.W.1 stated as follows: Q: You have also said that the practices of the Defendant has made you to suffer damage to your business, you reputation and your goodwill. What do you mean by that? A: 'My Lord, since this product (Dhoom) came to the market, our number one position has fallen because our customers are complaining that they cannot buy our product at a price which is for good quality when there is a cheaper product on the market which looks identical like ours. And even the sellers cannot tell the difference, whether he is buying the original or the fake: because the language, colours and everything are the same. So the sales have dipped on the original product. During cross examination of Plaintiff, the following ensued Q: the Defendant's product has not damaged your reputation in the market. A. I disagree, my Lord. It has created damage because now it is known as the cheap "Heaven" in the market. Everybody refers to it as cheap "Heaven" Q: Why do they refer to it as cheap "Heaven"? A: My customers, my distributors tell me because they are saying it looks the same from all directions and it is available so they call it cheap "Heaven". D.W.2 confirmed in his evidence that indeed Dhoom was selling cheaper than Heaven. He said: Q: How much were you selling the Dhoom? A: We were selling the Dhoom for GH˘30.00 Q: And Heaven? A: My Lord, the Heaven was sold for GH˘35. 00 by then In short, if the court finds that there is a likelihood of confusion in the circumstances of the case, it should necessarily follow that the risk of damage to the plaintiff is inevitable. I have made a linding that there is a likelihood of confusion and therefore it follows that there is the risk of damage being caused to Plaintiff. In conclusion, I will opine that all the three ingredients of a passing off action have been satisfied and the Plaintiff is entitled to the reliefs being claimed. As Lord Parmoor said in Spalding Bros v Gamage [1915] 32 RPC 273, 'The plaintiff who establishes a case of this character is entitled to an injunction and, if necessary, to an inquiry into damages." Lord Parmoor also stated that a tort having been committed, the plaintiff is entitled to such damages as naturally flow from defendant's unlawful act, and there is no artificial limitation in the case of a passing off action. Having established the misrepresentation on which the Plaintiff relies, and being in its nature calculated to produce damage, it is my opinion that the Plaintiff is prima facie entitled to both an injunction and to an award of damages. I accordingly make an order of injunction to restrain Defendant whether by themselves, their agents, servants, assigns etc from infringing with Plaintiff's registered Trade Mark No. 32529 dated 5th .May 2002 and also from passing off Defendant's goods as those of the Plaintiff. I will further order that the Defendant deliver up for destruction upon oath of all its unsold stock of DHOOM BLACK mosquito coils. I will award damages of GH˘10,000.00. Costs assessed at GH˘2,500.00. COUNSEL ADZA KOJO PLAINTIFF AYITEY ARMAH TETTEH DEFENDANT

 

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