Court of Appeal Settles 20 Year Copyright Dispute: Case of Mount Kenya Sundries v Macmillan Publishers

Macmillan Memorial Library Kenya

A recent judgment by the Court of Appeal in the case of Mount Kenya Sundries Ltd v Macmillan Kenya (Publishers) Ltd [2016] eKLR involved a copyright infringement claim with respect to two maps of Kenya produced between 1985 and 1990 by the Respondent, Macmillan (now known as Moran Publishers). At the High Court, Macmillan had successfully proved that Mount Kenya had reproduced and sold its maps without its authorisation contrary to the Copyright Act. This High Court decision has been discussed previously here.

In the present appeal, the court reconsidered the evidence, evaluated the submissions of both parties in order to determine several key issues including locus standi (standing to sue), copyright ownership of the maps and copyright infringement of the maps.

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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.

L’Oréal Acquires Nice & Lovely Trademark in Multi-Billion Shilling Deal

Media reports (here, here and here) indicate that the world’s largest multinational cosmetics company L’Oréal has acquired Kenya’s Interconsumer Products Ltd’s flagship Nice & Lovely brands, in a multi-million dollar acquisition reported this past week.

L’Oréal opened shop in Nairobi in late 2011 and has for the past 18 months been in talks with Interconsumer Products Ltd for a buyout deal. To facilitate the conclusion of the deal, Interconsumer Products Ltd transferred the beauty division to a new company dubbed Interworld Cosmetics, which has now been acquired by L’Oreal. The French based cosmetics giant has now renamed the new business Interbeauty Products.

This blogger salutes Interconsumer Products Managing Director Mr. Paul Kinuthia. We have all read the story of how Mr. Kinuthia grew his business from a modest sole proprietorship in the late 1990s to a major cosmetics manufacturer in East Africa. This success story of Interconsumer Products Ltd is even more significant and instructive when viewed from an intellectual property (IP) perspective.

The mark NICE and LOVELY was registered in favour of Interconsumer Products Ltd at the Kenya Industrial Property Institute (KIPI) in 2002 but had been in use by Interconsumer since 1999. From this date onwards, Interconsumer has been actively policing its intellectual property rights in the NICE AND LOVELY mark particularly as its products begun to gain prominence not just in Kenya but in neighbouring countries, particularly Uganda.

In 2004, Interconsumer moved to the Commercial Division of Uganda’s Commercial Court to seeking restrain Nice & Soft Investments Ltd., its servants and/or agents and/or distributors from manufacturing, selling or exposing for sale or in any way dealing in cosmetics using the names “Nice & Soft”. This case was reported as Interconsumer Products Ltd V Nice & Soft Investments Ltd (2003) Miscellaneous Application No. 256 Of 2004 (available here and here). In this case Interconsumer alleged, inter alia that the respondents without any form of authority were selling cosmetics goods in Uganda under the mark “Nice & Soft” and had attempted to register a trademark under the said names to the detriment of Interconsumer. Therefore, Interconsumer argued that it’s trademark was in danger of being wasted and irreparably damaged by virtue of such use by the respondent who is selling inferior goods similar to those of Interconsumer. On the question of whether there was trademark infringement, the court noted that the respondent’s application for registration was before the Registrar of Trademarks prior to the filing by Interconsumer of the suit which suit does not aver that it is a challenge to registration. On the question of whether there was passing off, the court found that the Interconsumer pleaded the ingredients of passing off, namely the acquired reputation. The actions taken by Interconsumer to protect its NICE AND LOVELY trademark in Uganda are instructive and must be borne in mind when considering the amount L’Oréal has just paid to acquire this well-known mark.

However before this acquisition deal, many will remember that in Interconsumer had previously locked horns with L’Oréal in both the Ugandan and Kenyan courts over the NICE AND LOVELY trademark. In the Ugandan case reported as L’Oreal and Another vs Interconsumer Products Ltd Application no. 13 of 2006 (available here), L’Oreal moved to the Commercial Division of the High Court to review the decision of the Registrar of Trademarks setting aside opposition proceedings and granting registration of two trademarks, SMOOTH & LOVELY and NICE and LOVELY applied for by Interconsumer.

In the Kenyan case, L’Oréal once more moved to the High Court to challenge the decision of the Registrar of Trademarks in rejecting its opposition of the registration of the mark NICE & LOVELY HERBAL OIL MOISTURIZER by Interconsumer. In a ruling delivered last year on 21st February, the High Court dismissed L’Oréal’s appeal against the decision of the Registrar rejecting L’Oreal’s opposition to the registration of the mark by Interconsumer. The court agreed with the Registrar on several important grounds including that the mark NICE & LOVELY was not similar to DARK AND LOVELY (owned by L’Oréal) and that there could be no confusion as defined under section 14 and 15 of the Trade Marks Act. The Court also agreed with the Registrar’s conclusion that L’Oreal had failed to show that its trademark was well known in Kenya. Furthermore, the Court agreed with the Registrar’s finding that the respondent had used the mark NICE and LOVELY since 1st March 1999 and the appellant had not tendered any evidence to show that it had objected to the use of the mark in the last five years. Therefore, the common law doctrine of honest concurrent use was applicable therefore both NICE & LOVELY and DARK AND LOVELY marks could co-exist in the Trademarks Register. A detailed synopsis of this unreported case is available over at the afroip blog here.

Viewed against the above backdrop, L’Oréal’s acquisition of NICE & LOVELY is an important lesson for trademark owners not only in Kenya but throughout the East African region. Interconsumer’s investment in registration and enforcement of its (IP) rights was a crucial factor in sealing this major buy-out deal.