Nanoomal Isaardas Motiwalla (U) Ltd v Sophy Nantongo & Ors (HCT-00-CC-CS 430 of 2006) [2007] UGCommC 64 (21 June 2007)

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)}}{\*\pnseclvl7\pnlcrm\pnstart1\pnindent720\pnhang {\pntxtb (}{\pntxta )}}{\*\pnseclvl8 \pnlcltr\pnstart1\pnindent720\pnhang {\pntxtb (}{\pntxta )}}{\*\pnseclvl9\pnlcrm\pnstart1\pnindent720\pnhang {\pntxtb (}{\pntxta )}}\pard\plain \ql \li0\ri0\sl360\slmult1\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid10837397 \fs24\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\b\ul\insrsid6046788\charrsid10837397 \par }\pard \qc \li0\ri0\sl360\slmult1\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid10837397 {\b\insrsid8916664\charrsid10837397 THE REPUBLIC OF UGANDA \par \par IN THE HIGH COURT OF UGANDA AT KAMPALA \par (COMMERCIAL COURT DIVISION) \par \par HCT-00-CC-CS-0430-2006 \par }\pard \qj \li0\ri0\sl360\slmult1\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid10837397 {\b\insrsid8916664\charrsid10837397 \par NANOOMAL ISSARDAS MOTIWALLA \par (U) LTD ::::::::::::::::::::::::::::::::::: PLAINTIFF \par \par }\pard \qc \li0\ri0\sl360\slmult1\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid10837397 {\b\insrsid8916664\charrsid10837397 VERSUS \par }\pard \qj \li0\ri0\sl360\slmult1\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid10837397 {\b\insrsid8916664\charrsid10837397 \par 1. SOPHY NANTONGO \par 2. AFRICAN QUEEN LTD \par 3. UGANDA REVENUE AUTHORITY \par 4. UGANDA NATIONAL BUREAU OF STANDANDS \par :::::::::::::::::::::::::: DEFENDANTS \par \par BEFORE: }{\b\ul\insrsid8916664\charrsid10837397 THE HONOURABLE MR. JUSTICE YOROKAMU BAMWINE \par \par J U D G M E N T: \par }{\b\insrsid8916664\charrsid10837397 \par }{\insrsid1468812\charrsid10837397 The plaintiff is a limited liability company incorporated and carrying on business in Uganda. The 1}{\super\insrsid1468812\charrsid10837397 st}{\insrsid1468812\charrsid10837397 defendant is an adult Ugandan business woman running the 2}{\super\insrsid1468812\charrsid10837397 nd}{\insrsid1468812\charrsid10837397 defendant. The 3}{\super\insrsid1468812\charrsid10837397 rd}{\insrsid1468812\charrsid10837397 and 4}{ \super\insrsid1468812\charrsid10837397 th}{\insrsid1468812\charrsid10837397 defendants are nominal defendants in this suit.}{\insrsid8916664\charrsid10837397 \par }{\insrsid1468812\charrsid10837397 \par The plaintiff\rquote s claim against the 1}{\super\insrsid1468812\charrsid10837397 st}{\insrsid1468812\charrsid10837397 and 2}{\super\insrsid1468812\charrsid10837397 nd}{\insrsid1468812\charrsid10837397 defendants arises out of actions said to amount to infringement of the plaintiff\rquote s trade mark and passing off of the said two defendants\rquote goods as goods of the plaintiff. The thrust of the plaintiff\rquote s case is that the defendants (1} {\super\insrsid1468812\charrsid10837397 st}{\insrsid1468812\charrsid10837397 and 2}{\super\insrsid1468812\charrsid10837397 nd}{\insrsid1468812\charrsid10837397 ) are importing, selling and disposing of in Uganda hair dye bearing its registered trade mark \lquote KANTA\rquote . The defendants deny it. \par In matters of intellectual property, a trademark is a word, phrase, symbol, product feature or any combination of these that distinguishes in commerce the goods or services of its owner from those of others. A trademark, therefore, is an indicator of source. It does not tell what the goods or services are, but where they come from. Trade mark protection is granted to trade dress \endash the packaging or overall look and feel of what constitutes a person\rquote s product or services. \par \par At the scheduling conference, it was agreed that the two defendants hav}{\insrsid15279943\charrsid10837397 e}{\insrsid1468812\charrsid10837397 been importing a product called Kanta Hair dye into Uganda since 2000. It is also}{ \insrsid7285680\charrsid10837397 an agreed fact that the plaintiff is the registered owner of a product called Kanta.}{\insrsid1468812\charrsid10837397 \par }{\insrsid7285680\charrsid10837397 \par The issues are: \par }\pard \qj \fi-720\li720\ri0\sl360\slmult1\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin720\itap0\pararsid10837397 {\insrsid7285680\charrsid10837397 1.\tab Whether or not the get-up of the plaintiff\rquote s product and that of the defendants is the same. \par 2.\tab Whether the plaintiff\rquote s product has been on the market prior to that of the defendants. \par 3.\tab Whether the plaintiff has acquired substantial good will and reputation in its product. \par 4.\tab Whether or not the defendants are passing off the product as that of the plaintiff. \par 5.\tab Whether the plaintiff is entitled to the remedies sought. \par }{\insrsid15882322\charrsid10837397 \par \par }{\i\insrsid7285680\charrsid10837397 Representations: \par }{\insrsid7285680\charrsid10837397 Mr. Andrew Bagayi for the plaintiff. \par Mr. Siraje Ali for the 1}{\super\insrsid7285680\charrsid10837397 st}{\insrsid7285680\charrsid10837397 and 2}{\super\insrsid7285680\charrsid10837397 nd}{\insrsid7285680\charrsid10837397 defendants. \par \par }\pard \qj \li0\ri0\sl360\slmult1\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid10837397 {\insrsid7285680\charrsid10837397 As to whether the get-ups of the two products are the same, I have had opportunity to see the packaging o f the plaintiff\rquote s product (hereinafter conveniently referred to as \lquote Kanta 1\rquote ) and the impugned product (Kanta }{\insrsid15279943\charrsid10837397 2}{\insrsid7285680\charrsid10837397 ).}{\insrsid12653399\charrsid10837397 \lquote Get-up\rquote can simply be defined as the visual features which distinguish a trader\rquote s goods, most notably, the packaging of the goods. In cases where trade mark infringement is alleged, infringement occurs when a suspected infringer uses a mark for goods or services identical or closely related to those of the plaintiff.}{\insrsid2379532\charrsid10837397 The test of infringement is likelihood of confusion. Likelihood of confusion is the probability that a reasonable consumer in the relevant market will be confused or deceived, and will believe the infringer\rquote s }{\insrsid2377440\charrsid10837397 goods or services come from, or are sponsored or endorsed by, the complainant or that the two are affiliated. Infringement thus is analogous to the tort of fraud.}{\insrsid7362100\charrsid10837397 The duty of the Judge in a case such as this is to decide, upon seeing the goods, whether the plaintiff\rquote s goods so nearly resemble the ones complained of as to be likely to deceive or cause confusion in the minds of the public.}{ \insrsid7285680\charrsid10837397 \par }{\insrsid7362100\charrsid10837397 \par The products in the instant case are identical in every possible way. The only difference, quite insignificant to a casual observe}{\insrsid12671025\charrsid10837397 r}{\insrsid7362100\charrsid10837397 , in my judgment, is that Kanta 2 box pack has no address of the manufacturer, expiry date or the batch number. }{\insrsid12671025\charrsid10837397 The rest is the same. }{\insrsid7362100\charrsid10837397 My conclusion is that the get-up of the defendant\rquote s product is }{\insrsid4027213\charrsid10837397 substantially}{\insrsid7362100\charrsid10837397 the same as that of the plaintiff\rquote s product. Very few customers would tell the difference between the two. \par \par The first issue is answered in the affirmative. \par \par As to whether the plaintiff\rquote s product has been on the Uganda market prior to that of the defendants, the evidence of PW1 Rahul }{\insrsid12671025\charrsid10837397 Jham}{\insrsid7362100\charrsid10837397 is that production of their Kanta hair dye dates back to 1947 and that exports to Uganda date back to the sixties. From the evidence of PW4 Kamlesh Shah, he has been in the country since 1986. He started importing Kanta from the plaintiffs in 1987.

\par \par This evidence has not been challenged by the defendants. It is in my view immaterial that Rahul is a young man in his e arly thirties. He produced documents to back up his claim. His evidence is amply corroborated by that of PW4 Shah of Oswald Holdings Ltd. I have seen no reason to doubt it. I accordingly harbour no doubt in my mind that the plaintiff\rquote s product, Kanta 1, was on the market before the defendants started bringing in the impugned brand. I so find. \par \par The second issue is also answered in the affirmative. \par \par As to whether the plaintiff\rquote s product has acquired substantial}{\insrsid11559578\charrsid10837397 good will and reputation in Uganda, I have considered the results of the market survey conduct}{\insrsid12671025\charrsid10837397 ed}{ \insrsid11559578\charrsid10837397 by the plaintiff, P. Exh. 1X}{\insrsid10837397\charrsid10837397 . The}{\insrsid11559578\charrsid10837397 study was conducted in Kampala, Arua, Mbale and Mbarara. Targeted respondents were wholesalers and retailers. The study established a high awareness of Kanta brand. Over 86% of the dealers interviewed were aware of the plaintiff\rquote s brand. 64% of all the saloons and individuals interviewed were aware of it. This translated to an awareness of over 77%.}{\insrsid7362100\charrsid10837397 \par }{\insrsid11559578\charrsid10837397 \par The defendants have not come up with a comparable report. The findings contained in the plaintiff\rquote s report have therefore not been challenged. Court is satisfied that the plaintiff\rquote s Kanta hair dye has acquired a substantial good will and reputation on the Ugandan market. \par \par I so find. \par \par The third issue is also answered in the affirmative. \par \par As to whether or not the defendant\rquote s (1}{\super\insrsid11559578\charrsid10837397 st}{\insrsid11559578\charrsid10837397 and 2}{\super\insrsid11559578\charrsid10837397 nd}{\insrsid11559578\charrsid10837397 ) are passing off their product as that of the plaintiff, passing off in cases of trademark infringement means the pretence by one person that his goods are those of another. In intellectual property law, where}{\insrsid13921064\charrsid10837397 a person sells goods or carries on business under such name, mark, description or otherwise in such a manner as to mislead the public into believing that the goods or business is that of another person, that other person is said to be passing off his goods as those of the registered owner of the trade mark.}{\insrsid4740875\charrsid10837397 A cause of action for passing off is therefore a form of intellectual property enforcement against the unauthorized use of a mark which is considered to be similar to another person\rquote s registered or unregistered trademark, particularly where the action for trade mark infringement based on a registered trade mark is unlikely to be successful (due to the differences between the registered mark and the unregistered mark). It is a c ommon law tort which}{\insrsid9053250\charrsid10837397 can be used to enforce unregistered trade mark. This in my view adequately takes care of learned defence counsel\rquote s argument that the plaintiff company was only registered in 2005 whereas the Kanta 2 brand }{\insrsid12671025\charrsid10837397 was}{\insrsid9053250\charrsid10837397 on the market long }{\insrsid12671025\charrsid10837397 before 2000}{ \insrsid9053250\charrsid10837397 . The evidence on record sufficiently links the plaintiff company with the originator of the brand in India. It matters not in my view that the originator of the brand was a partnership whereas the plaintiff is a limited liability company.}{ \insrsid11099557\charrsid10837397 The instant case is for enforcement of a registered trade mark. Going by authorities, five characteristics which must be present in order to create a valid cause of action for passing off are:}{ \insrsid11559578\charrsid10837397 \par }{\insrsid11099557\charrsid10837397 (i)\tab a misrepresentation; \par (ii)\tab made by a trader in the course of trade; \par }\pard \qj \fi-720\li720\ri0\sl360\slmult1\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin720\itap0\pararsid10837397 {\insrsid11099557\charrsid10837397 (iii)\tab to prospective customers of his or ultimate consumers of goods or services supplied by him; \par (iv)\tab which is calculated to injure the business or good will of the trader (in the sense that it is a reasonably foreseeable consequence); \par and \par (v)\tab which causes actual damage to a business or good will of the trader by whom the action is brought or will probably do so. \par \tab See: }{\b\insrsid11099557\charrsid10837397 Reckitt & Coleman Ltd \endash Vs- Borden Inc. [1990] 1 WLR 491. \par \par }\pard \qj \li0\ri0\sl360\slmult1\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid10837397 {\insrsid11099557\charrsid10837397 In the instant case, the plaintiff has adduced sufficient evidence to show that Kanta 2 is a concocted replica of Kanta 1. The plaintiff has adduced evidence establishing a good will or reputation on the market of its product. It (the plaintiff) has demonstrated a misr}{\insrsid6254054\charrsid10837397 epresentation by the defendants, to the public, in the sense that the defendants\rquote product has also been on the market selling along side that of the plaintiff. It has also demonstrated actual damage to its business occasioned by the defendants \rquote product.}{\insrsid11099557\charrsid10837397 \par }{\insrsid6254054\charrsid10837397 \par I have already noted that the name, colour and get-up of the imp ugned product must have been intended to confuse unsuspecting consumers of the genuine Kanta. Inside the small bottle packs containing the bottle with the hair dye, there is a pamphlet with directions on how to use the product. The pamphlet in Kanta 1 p acks bear}{\insrsid12671025\charrsid10837397 s}{\insrsid6254054\charrsid10837397 the plaintiff\rquote s name and address in English and other language}{\insrsid12671025\charrsid10837397 s}{\insrsid6254054\charrsid10837397 . Without shame, the defendants copied everything! I do not hesitate to declare it a clear case of intellectual piracy and dishonesty. It is unfortunate that the export}{\insrsid12671025\charrsid10837397 ers}{\insrsid15469144\charrsid10837397 \rquote } {\insrsid6254054\charrsid10837397 identity has not been ascertained. \par \par When all is said and done, Court is satisfied that the defendants are passing off their product as that of the plaintiff. \par \par I so find. \par \par As to whether the plaintiff is entitled to the reliefs sought, it is submitted that it has suffered losses on account of a decline in its sales attributable to the mischief of the defendants, and has }{\insrsid4027213\charrsid10837397 had to}{ \insrsid6254054\charrsid10837397 even shut down its factory for extended periods. PW4 Shah said his company stopped importing the product when the counterfeit over shadowed the genuine product. I accept that evidence. The plaintiff\rquote s head prayer is for a permanent injunction restraining the two defendants from use, further and continued use of the words/mark \lquote KANTA\rquote along with shape and design of its black hair dye. It also seeks }{\insrsid12671025\charrsid10837397 a} {\insrsid6254054\charrsid10837397 n order restraining them from the continued infringement of the trade mark; an order that they deliver up to the plaintiff all the infringing hair dyes and other materials relating to their trade mark and its product get-up}{ \insrsid12671025\charrsid10837397 ,}{\insrsid6254054\charrsid10837397 presumably for destru ction. Form the evidence, after the suit was filed and while it was pending hearing, the defendants also registered a similar trademark. I agree with the plaintiff that this registration was in bad faith given that the defendants knew that the plaintiff was already the registered owner thereof and the mark was subject of Court proceedings. It is in my view further evidence of dishonesty on their part. \par \par Court is satisfied that the defendants\rquote product does not show the date of manufacture or expiry. It is an obvious danger to the unsuspecting consumer. A trade mark owner who successfully shows likelihood of confusion, has in my opinion}{ \insrsid1862553\charrsid10837397 , a}{\insrsid6254054\charrsid10837397 right of action in damages or }{\insrsid4027213\charrsid10837397 for an}{\insrsid9976489\charrsid10837397 account, and for an injunction to restrain the defendant for the future. In view of my findings above, the plaintiff is entitled to the reliefs stated above, the subject matter of prayers (a), (b) and (c) in the plaint. I grant them.}{ \insrsid6254054\charrsid10837397 \par }{\insrsid4027213\charrsid10837397 \par The infringing Kanta hair dye (Kanta 2) and product get-up in which the defendants\rquote Kanta is packed shall be delivered up to the plaintiff for destruction under the supervision of the officials of URA and UNBS, 3}{ \super\insrsid4027213\charrsid10837397 rd}{\insrsid4027213\charrsid10837397 and 4}{\super\insrsid4027213\charrsid10837397 th}{\insrsid4027213\charrsid10837397 defendants herein. \par The plaintiff also prays for general damages for the defendants\rquote infringement of its trade mark and passing off, and the costs of the suit. I would agree with the submission of counsel for the defendants that the dilatory conduct of the plaintiff disentitles it to an order for an account. \par \par As regards general damages for passing off and infringement, counsel for the plaintiff has not suggested to me any figure he would consider to be appropriate for the defendants\rquote infringement of its trade mark. This Court is of course cutely aware that damages are intended as compensation for the plaintiff\rquote s loss and not as punishment to the defendant. In }{\b\insrsid4027213\charrsid10837397 Nice House of Plastics Ltd \endash Vs- Hamidu Lubega HCCS No. 0695 of 2006}{\insrsid4027213\charrsid10837397 (unreported), Court found no evidence of passing off. The plaintiff was awarded a sum of Shs.5}{\insrsid1862553\charrsid10837397 , 000,000}{ \insrsid4027213\charrsid10837397 = in damages for the trade mark infringement. }{\insrsid12671025\charrsid10837397 In the instant case, b}{\insrsid4027213\charrsid10837397 earing in mind the plaintiff\rquote s disallowed prayer for an order of account; the fact that the defendants are importers and perhaps not manufactures of the impugned product; the }{\insrsid12671025\charrsid10837397 proved }{\insrsid4027213\charrsid10837397 loss suffered by the plaintiff; and doing the best I can in the circumstances of this case, I consider a sum of Shs.}{\insrsid12671025\charrsid10837397 6}{\insrsid1862553\charrsid10837397 , 000,000}{\insrsid4027213\charrsid10837397 = (}{ \insrsid12671025\charrsid10837397 six}{\insrsid4027213\charrsid10837397 million only) adequate compensation to the plaintiff for the wrongful acts of the 2 defendants. The amount is awarded to the plaintiff. \par \par As regards the trade mark obtained by the 2}{\super\insrsid4027213\charrsid10837397 nd}{\insrsid4027213\charrsid10837397 de fendants during the pendancy of the suit, Section 14 (1) of the Trade Marks Act (Cap. 217), prohibits registration of identical or resembling trademarks. In view of that prohibition, Court takes liberty to invoke its inherent powers under S. 98 of the Ci vil Procedure Act, to cancel it.}{\insrsid12671025\charrsid10837397 It is therefore cancelled.}{\insrsid4027213\charrsid10837397 \par The monetary award to the plaintiff shall attract interest at a commercial rate of 25% per annum from the date of judgment till payment in full. \par \par In }{\insrsid3362768\charrsid10837397 k}{\insrsid4027213\charrsid10837397 e}{\insrsid3362768\charrsid10837397 eping}{\insrsid4027213\charrsid10837397 with the principle that costs follow the event, the plaintiff shall have the costs of the suit. \par }{\insrsid3362768\charrsid10837397 \par The 2}{\super\insrsid3362768\charrsid10837397 nd}{\insrsid3362768\charrsid10837397 and 3}{\super\insrsid3362768\charrsid10837397 rd}{\insrsid3362768\charrsid10837397 defendants shall be discharged on account of no wrong doing on their part. I do so with no order as to costs for or against them. \par }{\insrsid4027213\charrsid10837397 \par I so order. \par \par Yorokamu Bamwine \par }{\b\insrsid4027213\charrsid10837397 J U D G E \par }{\insrsid4027213\charrsid10837397 22/06/2007 \par \par }{\b\insrsid4027213\charrsid10837397 Order:}{\insrsid4027213\charrsid10837397 In my absence on the due date this judgment shall be delivered by the Registrar of this Court. \par \par Yorokamu Bamwine \par }{\b\insrsid4027213\charrsid10837397 J U D G E \par }{\insrsid4027213\charrsid10837397 22/06/2007 \par }{\insrsid6254054\charrsid10837397 \par }\pard \qj \fi-720\li720\ri0\sl360\slmult1\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin720\itap0\pararsid10837397 {\insrsid7285680\charrsid10837397 \par }}