Goodwill as Constitutionally Protected Property: High Court Case of Bia Tosha Distributors v Kenya Breweries, EABL, Diageo

warm-beer by gobackpackingdotcom Kenya tusker crate eabl

“I am acutely aware of the far reaching consequences of my conclusive finding that purely constitutional issues and questions have been borne out of a hitherto commercial relationship and hence the court’s jurisdiction rather than agreed mode of dispute resolution. I however do not for a moment view it that the framers of our Constitution intended the rights and obligations defined in our common law, in this regard, the right to freedom of contract, to be the only ones to continue to govern  interpersonal relationships.” – Onguto, J at paragraph 101 of the ruling.

A recent well-reasoned ruling by the High Court in the case of Bia Tosha Distributors Limited v Kenya Breweries Limited & 3 others [2016] eKLR  tackled the complex question of horizontal application of the Constitution to private commercial disputes governed by contracts with private dispute resolution mechanisms. More interestingly, the court had to consider whether the amount of Kshs. 33,930,000/= paid by the Petitioner to acquire a ‘goodwill’ over certain distribution routes or areas of the Respondents’ products can be defined as ‘property’ held by the Petitioner and as such protected under Article 40 of the Constitution.

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High Court Rules New Tobacco Law on Packaging, Labelling and Disclosure Does Not Violate Intellectual Property Rights

British American Tobacco Kenya

Previously, this blogger reported here that the High Court had suspended the coming into force of the Tobacco Control Regulations 2014 made by the Cabinet Secretary for Health scheduled to take effect on 1st June 2015. Recently in the case of British American Tobacco Kenya Ltd v Cabinet Secretary for the Ministry of Health & 4 others [2016] eKLR, Lady Justice Mumbi Ngugi (known to many readers for her landmark decision on anti-counterfeit law and access to medicines here) delivered a judgment at the High Court dismissing claims by ‘Big Tobacco’ that their constitutional rights including intellectual property (IP) rights are being violated by the new Tobacco Regulations.

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Kenafric ‘Fuma’ Footwear Denies Counterfeiting Claims by Puma

Kenafric Fuma Footwear

This blogger has previously blogged here and here about Kenafric’s fatal attraction to well-known trade marks, to put it mildly. The latest victim of Kenafric’s attraction is none other than Puma AG Rudolf Dassler Sport (Puma for short). In this connection, this blogger came across a recent ruling in the case of Kenafric Industries Limited & another v Anti-Counterfeit Agency & 3 others [2015] eKLR.

In this case, Puma through its representative Paul Ramara lodged complaints at Anti-Counterfeit Agency (ACA) against Kenafric for trade mark infringement. ACA and Ramara went to Kenafric’s premises and demanded to check the same for goods in the name of Puma a demand Mikul Shah a director at Kenafric declined to comply with due to the fact that his company had not been served with any Court order directing the said search and entry. Consequently, Shah was arrested, taken to Ruaraka Police Station and charged with the offence of obstruction and released on bond.

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Recap of WIPO African Sub-Regional Workshop on New Perspectives on Copyright

WIPO African Sub regional Workshop New perspectives on copyright organized by the World Intellectual Property Organization in cooperation with the African Regional Intellectual Property Organization Harare Zimbabwe July 2015

This week, African Regional Intellectual Property Organization (ARIPO) hosted the WIPO African Sub-regional Workshop on New Perspectives on Copyright organized by the World Intellectual Property Organization (WIPO) from 20 – 21 July 2015.

The Workshop drew Heads of Copyright Offices in the ARIPO Member States and some Observer States who took part in this crucial Workshop aimed at discussing the management of Copyright and Related Rights in the face of new challenges emanating from new digital technologies. Also in attendance were copyright officials from Jamaica and Trinidad and Tobago who shared their experiences with their African colleagues.

What follows is a summary of the presentations made by the various participants at the Workshop.

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International Women’s Day: Celebrating African Women Leaders in Intellectual Property

Angélique Kidjo won her 2nd Grammy Award in 2015. The world renowned Beninoise singer-songwriter is Vice President of the International Confederation of Societies of Authors and Composers (CISAC). CISAC is the umbrella body for copyright societies worldwide.

Angélique Kidjo won her 2nd Grammy Award in 2015. The world renowned Beninoise singer-songwriter is Vice President of the International Confederation of Societies of Authors and Composers (CISAC). CISAC is the umbrella body for copyright societies worldwide.

Celebrated globally on 8th March, this year’s International Women’s Day highlights the Beijing Declaration and Platform for Action, a historic roadmap signed by 189 governments 20 years ago that sets the agenda for realizing women’s rights. The official United Nations theme for International Women’s Day 2015 is “Empowering Women – Empowering Humanity: Picture It!”

“When we unleash the power of women, we can secure the future for all” – United Nations Secretary-General Ban Ki-moon in his message for International Women’s Day 2015.

To mark this year’s International Women’s Day (#IWD2015), this blogger has compiled a list of some of the (influential) women (leaders) in intellectual property (IP) from Kenya and throughout English-speaking Africa. The women listed below (in no particular order) are primarily drawn from IP offices, academia, non-governmental organisations and the IP legal fraternity.

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Regulation of Online Video Content, Territoriality and Copyright

Trevor-3

This month South Africa’s top comedian Trevor Noah announced that he will be joining the award-winning late-night satirical news show, “The Daily Show With Jon Stewart” aired on US cable network, Comedy Central (CC). For those who would want to enjoy this Emmy and Peabody Award-winning television show on demand, there is always “Hulu”, a leading online video service. However for those accessing Hulu outside the US, you are likely to receive the following notice: “We’re sorry, currently our video library can only be streamed within the United States. For more information on Hulu’s international availability, click here.”

A similar service to Hulu called Netflix has been the subject of conversation in South Africa in a recent article here by TechCentral South Africa titled: “DStv wont sue Netflix users” then later changed to “DStv to launch Catch Up Plus”. The relevant portion of the article reads: “[DStv Digital Media CEO John] Kotsaftis says it’s not clear if it’s legal or not for South Africans to watch Netflix and similar services. What is clear, he says, is that these companies are breaking the law when they allow access to services to consumers in markets for which they haven’t purchased content distribution rights.” In this regard, many Kenyans may ask: “when you purchase a US virtual private network (VPN) to by-pass Netflix or Hulu region locks to watch shows and movies that are supposed to only be available to Americans, is that copyright infringement?” This blogpost explains why this question must be answered in the affirmative.

Read the rest of this article here.

Intellectual Property in Crafts and Visual Arts in Kenya

Craft Afrika Jumpstart Thursday June 2014

This month, CraftAfrika organized a forum for creators and entrepreneurs in the crafts and visual arts sectors to discuss the impact and importance of the intellectual property (IP) system. This blogpost is a review of some of the key IP issues that arose during this important forum.

In today’s digital era, the real challenge for artisans and visual artists is not just to produce and market winning new products that cater to changing consumer tastes, but also to prevent – or if unable to prevent then to effectively deal with – unfair competition or theft of their creative ideas. The intellectual property (IP) system is the best available tool for creating and maintaining exclusivity over creative and innovative output in the marketplace, albeit for a specified maximum period of time. The effective use of IP can also help artisans and visual artists to develop networks and relationships not only with end consumers, but also with all the links in the supply and demand networks.

Overview of IP

Intellectual property (IP) refers to creations of the mind: inventions, literary and artistic works, and symbols, names, images, and designs used in commerce. Intellectual property is divided into two categories: 1) industrial property, which includes patents, trademarks, industrial designs and utility models; and 2) copyright, which includes musical works, literary works such as novels, poems and plays, films, musical compositions; artistic works, such as drawings, paintings, photographs and sculptures, and architectural designs. Rights related to copyright include those of performing artists in their performances, producers of phonograms in their recordings, and those of broadcasters in their radio and television programmes.

Different Types of IP Protection for Crafts and Visual Arts

kecobo and kipi fees 2013

Before a person or enterprise can take advantage of its intellectual output it has to acquire IP rights (IPRs). IPRs in the fields of industrial property need to be registered in order to be protected. In the case of copyright, registration is voluntary since IPRs under copyright subsist automatically once the work is fixed in material form. Here are the different types of IP protection for Crafts and Visual Arts, in order of priority:

1.Trademark: A brand or trademark is a sign or any combination of signs, capable of distinguishing a product or service from other products or services on the market. The main task of a trademark is to individuate a product or a service – consumers are able to distinguish between different goods with different marks precisely on the basis of the marks. Unlike other types of IP, the term of protection for trademarks is not limited; they can be renewed indefinitely by the owner.
Example: SANDSTORM is a registered trademark used for hand-crafted leather items such as bags. It is registered together with a lizard symbol.

2.Copyright: Basically, copyright gives the owner the exclusive right to use the work. It protects items such as paintings, drawings, sculptures, photographs, architecture, instruction manuals, software, databases, technical documentation, advertisements, maps, literary works, music, films or songs. In most countries, a copyrighted work is protected for the length of the author’s life plus a minimum of another 50 years.

3.Industrial Design: An industrial design (or simply a design) is the appearance of the whole or part of a product resulting from features of, in particular, the lines, contours, colours, shape, texture and/or materials of the product itself and/or its ornamentation. Industrial designs, as objects of IP, can usually be protected for up to a maximum of 15 years. The fees indicated in the table above for design registration are the total fees payable to KIPI and not merely the filing fees.

Example: A new textile pattern or the unique shape of a piece of jewellery can be protected as designs.

4.Patent: A patent is an exclusive right granted for an invention, which is a product or a process that provides a new and non-obvious way of doing something, or offers a new and non-obvious technical solution to a problem. A patent provides protection for the invention to the owner of the patent for a limited period, generally 20 years.

Example: A new method of tatting, using a shuttle, that enables the tatter to use more than two colours or textures of thread has been patented.

5. Utility Model (‘Petty Patent’): A utility model is similar to a patent, but the requirements for acquiring protection are less stringent and the protection is much cheaper to obtain and to maintain. On the other hand, the term of protection offered by a utility model is shorter than a patent i.e. 10 years without the possibility of renewal. The fees indicated in the table above for utility models are the total fees payable to KIPI and not merely the filing fees.

6.Trade secrets: this is confidential business information of any nature that can be used in the operation of a business and that is sufficiently valuable and secret to afford economic advantage over others. To be protected, the owner of a trade secret must have taken reasonable steps to keep the information secret. Therefore it is advised that artisans and visual artists use Non-Disclosure, Non-Compete and Confidentiality agreements and/or clauses in all their dealings with third parties.

Examples: Glass-blowing techniques, oven processing methods for baking pottery, clay mixture preparations for ceramics, consumer profiles, advertising strategies, lists of suppliers and clients, and manufacturing processes can all be trade secrets.

Commercialising Intellectual Property Rights

IPRs represent property rights. They can be used by the IPR owner or they can be transferred to others. Artisans and visual artists who own any IPRs can sell their rights to another person. More importantly, IPRs have the particular advantage that they may be exploited simultaneously by several people. This can be done through licensing.

The word licence simply means permission – a person grants permission to another to do something. A licence agreement is a contractual agreement under which a licensor (the person who owns the IP) permits another (licensee) to use the right. It does not transfer the ownership of the IP.

Enforcing Intellectual Property Rights

The main reason for acquiring IP protection is to be able to reap the benefits of the creations. IP assets can only lead to benefits when the acquired IPRs can be enforced; otherwise, infringers and counterfeiters will always take advantage of the absence of effective enforcement mechanisms to benefit from the artisan’s or visual artist’s hard work. It is often the threat of enforcement or the actual enforcement action which allows an IPR to be effectively exploited as a commercial asset.

In the recent dispute between Penny Galore and Amani Women’s Group, Amani was accused of infringing Penny Galore’s rights under both copyright and trade mark law with respect to the latter’s handmade necklace branded and marketed widely as the Kura Necklace. Penny Galore alleged that Amani had substantially copied and/or reproduced the Kura Necklace Grey and that Amani were selling this infringing work at its shops to individuals and/or independent traders. Therefore Penny demanded that Amani immediately stop all dealings with its alleged infringing necklace and that all pieces of the disputed Amani neckace must be destroyed.

In the case of Alternative Media Ltd vs Safaricom Ltd (2005) 2 KLR 253, the court found that Safaricom had infringed Alternative Media’s rights under copyright with respect to artistic works created by the latter. It was found that Safaricom had used artwork belonging to Alternative Media on its 250 Shillings Scratch Cards without Alternative Media’s authority. Therefore the court found that infringement of copyright arose not because the Safaricom’s work resembled Alternative Media’s, but because the Safaricom had copied all or a substantial part of Alternative Media’s work.

The Intellectual Property End-Game

For artisans, craft entrepreneurs and visual artists in Kenya, the IP system should be viewed as a protection and promotion tool that, if used effectively, can enhance business success.

Some important IP considerations include: identification of creative output that may be protected with IP rights, understanding the types of IP rights and protective measures best suited for particular needs and business, consideration of the costs and benefits of IP registrations, maintenance and management of IP assets, detection of IP infringements and enforcement of IP rights.