Polo: the end game

Previously

In 2020, we wrote about LA Group (Pty) Ltd v Stable Brands (Pty) Ltd and The Registrar of Trade Marks. This was the attention-grabbing case where a South African company, Stable Brands, successfully applied for the cancellation of over 40 trade mark registrations in the name of another South African company, LA Group (Pty) Ltd – the cancellation action had been launched in response to a trade mark infringement claim by LA Group.

The trade marks in question all contained the word Polo and/or a device of a polo player. The registrations covered a range of classes: 6, 9, 14, 16, 18, 20, 24, 25, 26, 27, 28, 35, 41, 42 and 43.

The grounds for cancellation included:

Lack of distinctiveness.
Registration without a genuine intention to use/continuous non-use for five years or more.
Likelihood of confusion or deception arising from the manner in which the trade marks had been used.

Now

Inevitably, the case was taken on appeal. The Supreme Court of Appeal has handed down its judgment and this runs to 111 pages. There are two judgments, but we’ll limit the discussion to the majority judgment handed down by Judge Schippers. We will deal with the various grounds separately.

Lack of distinctiveness: section 24 read with section 10(2)(a)

As mentioned, the registrations were all for the word mark Polo or the word Polo with a polo player device.

The trade mark proprietor, LA Group, had submitted evidence of very significant use of its marks since 1976. The judge was impressed by the fact that there had been “custom-designed and manufactured Polo shirts for former President Nelson Mandela”, as well as a shirt that was used to host a bid for the Olympic Games in 2004. The judge described the publicity as “immeasurable…marketing gold.” There was also evidence of a sponsorship of the South African rugby team during the 1999 Rugby World Cup. The judge said that “virtually the entire country followed the Rugby World Cup in 1999 and the majority of people would have identified the Polo trade marks with the appellant’s goods.”

The judge concluded that “there has been intensive, widespread, long-standing and continuous of the appellant’s Polo and Polo Pony & Player device trade marks since 1976. … (they) have become firmly established as indicators of origin for more than 40 years.”

The judge went on to say that LA Group “has established that the Polo (word) trade mark has become distinctive as a trade mark source of its goods, irrespective of the dictionary meaning of the word ‘polo’.”

Registration without a genuine intention to use/non-use for five years – section 27(1)(a) and (b)

The judge held that certain registrations had been registered without a “bona fide intention to trade commercially in the goods for which the mark is registered.” These had been correctly cancelled by the first court, but the bulk of the registrations were secure.

The judge further held that there were a few registrations where there had been no genuine use for at least five years, in other words where there had been no proof of “use for commercial purposes… (use) for the purpose of establishing, creating or promoting trade in the goods to which the mark is attached.” These registrations had been correctly cancelled by the first court, but the bulk of the registrations were secure.

The judge made the point that the appellant had tried to avoid proving use of each mark by contending that “all its different trade marks formed a “unitary brand” and that each individual trade mark registration was protected as part of the brand.” This approach, he said, was “impermissible.”

Marks likely to deceive as a result of manner of use: section 24 read with 10(13)

This deals with the issue of a mark being likely to cause deception or confusion as a result of the manner in which it has been used. This claim related to the fact that LA Group had entered into a co-existence agreement with a third party, Ralph Lauren, in terms of which Ralph Lauren was allowed to use and register in South Africa the Polo mark in respect of cosmetics in class 3.

But, said the judge, this did not fall within the prohibition, which is aimed at the use of the trade mark in question in a deceptive or confusing manner, and it is this use that must lead to the likelihood of deception or confusion. “10(3) operates only when the deception or confusion has been caused by the use which has been made of the mark by the proprietor.”

This long quote is interesting:

“Trade mark co-existence, a situation in which two different enterprises use a similar trade mark to market a product without interfering with each other’s businesses, is neither novel nor unique… the effect of their agreement is to give the appellant free rein in the field of clothing and similar items, whilst leaving Ralph Lauren to import and sell its brand of cosmetics and skincare products… consumers who buy items of clothing in South Africa bearing the Polo mark… are buying goods of the appellant… it matters not that they think that they are buying from a well-known US fashion house… the badge of origin function of a trade mark is fulfilled provided that all items bearing that badge come from the same source…. The same applies to consumers buying cosmetics or perfume bearing the Ralph Lauren trade marks.”

Conclusion

The judge found that Stable Brands had failed to “establish that 46 of the appellant’s trade marks – the lifeblood of its business – were liable to be removed from the register.” A long saga has come to an end!

Gaelyn Scott

IP | Trade Mark Attorney | Executive | Head of Department

gscott@ENSafrica.com