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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Trade Mark Squatting, Blackmail and Prior Use Defence: High Court Ruling in Clips Kenya v Brands Imports Africa

hoshan clips kenya trademark case brands imports limited 2016

Recently, Kenya Law reported the case of Clips Limited v Brands Imports (Africa) Limited formerly named Brand Imports Limited [2015] eKLR which involved three disputed trade marks: ATLAS, FANTASTIC and ALPHA registered in class 16 in Bahrain, Saudi Arabia, Yemen and Kuwait by Clips Kenya’s parent company, Hoshan. From 2010 to-date, Clips Kenya has been trading in goods bearing Hoshan’s marks under a Royalty Agreement in existence from 2009. However, in 2013, Brands Imports registered all three disputed marks in Kenya which led to Hoshan commencing expungement proceedings before the Registrar of Trade Marks.

In the intervening period, Brands Imports, the registered proprietor of the disputed marks in Kenya, wrote a letter to Clips Kenya demanding a 5% payment of royalty. In the letter, Brands Imports threatened to lodge complaints with government authorities to prevent Clips Kenya from continuing to import and sell in Kenya the goods bearing the disputed marks. According to Clips Kenya, Brands Imports’ actions amount to unlawful interference of it’s business and that it could rely on the ‘prior use defence’ provided in section 10 of the Kenya Trade Marks Act.

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Kenya Copyright Board Suggests Guernsey Approach to Image Rights Protection

Kenya Copyright Board Publication Copyright News Issue 18 2015 Cover

The most recent edition of Kenya Copyright Board (KECOBO) newsletter (cover pictured above) focuses on photography and image rights. A copy of the full Issue 18 is available here.

In the lead article starting on page 4 by KECOBO Executive Director, a compelling case is made in favour of specific legal protection of image rights, particularly in the case of celebrities. The article uses the oft-cited case of Dennis Oliech v. EABL (previously discussed here) to illustrate the limitations of existing intellectual property (IP) regimes in cases of commercial appropriation of one’s personality and/or image.

The article reads in part as follows:

“The use of images and personality rights is gaining currency and there is need to ensure that the same is well regulated and third parties do not take undue advantage of the commercialisation of the same. Guernsey provides a good example and maybe we should follow suit.”

This view from the Copyright Office begs the question: will Kenya be better off with a specific law on image rights like Guernsey? This blogger argues that the answer must be “No”.

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Litigation Imminent in “Equitel” Trade Mark Dispute: Equitel Insurance Agency v. Equity Group Holdings Ltd

Equitel SIM

According to media reports here, Finserve Africa Limited, a subsidiary of the multi-billion shilling Equity Group Holdings Ltd has been threatened with court action by Equitel Insurance Agency Ltd over the use of the name “Equitel” in connection with its telecommunication network operated using the now controversial ‘thin SIM’ technology. It is reported that Equitel has issued Equity with a cease and desist notice in which the former terms as unlawful the use of its trade mark which includes the name “Equitel” by Equity. Therefore Equitel has reportedly demanded that Equity desist from using the trade mark, including withdrawal of all publicity and advertising materials that contain this word.

In reply to Equitel’s claims, it is reported that Equity’s counsel stated in a letter as follows:-

“Our client is the proprietor of Equity Insurance Agency registered as such in 2007, to provide insurance services to its customers. Therefore, registration of Equitel Insurance Agency was targeted to misrepresent to the public that it was offering our client’s insurance services (….) The mere fact that your client may have been the first to register the trade name does not override the common law protection of the name, goodwill and reputation amassed by our client over the years”

In this connection, it is reported that Equity accused Equitel of using insider knowledge to set up its operations, given that it was an account holder at the bank and had first-hand experience of the services Equity Insurance was offering and, therefore, sought association in the registration of its own business name.

This blogger will be keenly following this dispute in the event the matter is not settled amicably and ends up before the courts for determination.

Intellectual Property and Public Events: Rights of Organisers, Participants and Third Parties

amateur photographer

I am hesitant to believe the Defendants’ argument on the issue of intellectual property rights to the event since the traditional common law view that has prevailed is that it is difficult to attach ‘any precise meaning to the phrase “property in a spectacle”. A spectacle in this case refers to an event. A “spectacle” cannot, therefore, be “owned” in any ordinary sense of that word. – Mabeya J. in AMCIL v Joseph Mathenge Mugo & ABMCIL HCCC 242 of 2013 at paragraph 29.

In the recent case of Africa Management Communication International Limited v. Joseph Mathenge Mugo & Access Business Management Conferencing International Ltd. HCCC 242 of 2013 (hereafter the HR Symposium case), Justice Mabeya held that there are no intellectual property (IP) rights in a spectacle or event dubbed “Human Resource Symposium”. In holding that there is no IP in a spectacle, Justice Mabeya cited the Australian case of Victoria Park Racing and Recreation Grounds Co. Ltd v. Taylor (1937) (hereafter the Taylor case) where Latham CJ stated that: “The law of copyright does not operate to give any person an exclusive right to state or to describe particular facts. A person cannot by first announcing that a man fell off a bus or that a particular horse won a race prevent other people from stating those facts.”

Read the rest of this article here.