IP Case Law library

Sony Corporation v Sony Holdings Limited [2018]

 Facts 

The case revolves around an appeal initiated by Sony Corporation against the decision made by the Registrar of Trademarks concerning the trademark opposition proceedings. The central issue arose when the respondent, Sony Holdings Limited, attempted to register its business name along with two specific trademarks: "Sony Holdings" (word and device) and "Sony Holdings" (word mark) on May 8, 2009. These trademarks were duly advertised in the Industrial Property Journal on May 31, 2011, as mandated by the relevant trademark laws. Subsequently, on February 28, 2012, Sony Corporation lodged a formal notice of opposition against the registration of these marks. The opposition was based primarily on its rights as the registered proprietor of existing trademarks, arguing a likelihood of confusion due to the similarity in names and branding. Despite these objections, the Assistant Registrar of Trademarks, after a comprehensive review and hearing from both parties, issued a decision on June 5, 2015. This decision dismissed the opposition filed by Sony Corporation and permitted the respondent’s trademarks to proceed to registration. Sony Corporation, discontented with the outcome, propelled this appeal, challenging the Assistant Registrar's decision. 

Issues 

1. Whether the appellants’ trademark is a well known mark in Kenya and therefore deserving protection under Section 15A of the Act?
2. Whether the respondents’ marks are so similar to the appellants’ trademark as to cause confusion 
3. Whether the respondent had a valid and legal claim to the trademark before applying to register the marks.

Rule

Issue One

Section 15A (1) of the TradeMark Act- a trademark which is entitled to protection under the Paris Convention or the WTO Agreement as a well known trademark are to a mark which is well known in Kenya as being the mark of a person who;
 

1. Is a national of a convention country; or
2. Is domiciled in, or has a real and effective industrial or commercial establishment in, a convention country, whether or not that person carries on business or has any goodwill in Kenya. 

Article 2 (a) of the Joint Recommendation Concerning Provisions on the Protection of well-known Marks ( WIPO)- in determining whether a mark is a well known mark, the competent authority shall take into account any circumstances from which it may be inferred that the mark is well known.

iii) when they are contrary to morality or public order and of such nature as to deceive the public
 
Mcdonald’s Corporation and Joburgers Drive-inn Restaurant (PTY) Ltd- the protection offered by the law of passing off is limited because of the requirement that the owner has to establish goodwill  in the country.

Issue Two

Section 15 A (1) (4) of the Trade Marks Act- A trade mark shall not be registered if that trade mark, or an essential part thereof, is likely to impair, interfere with or take unfair of the distinctive character of the well-known trade mark.

Section 15 (1) of the Trade Marks Act- no trade mark shall be registered in respect of any goods or description of goods that is identical with or nearly resembles a mark belonging to a different proprietor and already on the register in respect of the same goods or description of goods, or in respect of services, is identical with or nearly resembles a mark belonging to a different proprietor and already on the register in respect of the same services or description of services.

Issue Three

Section 20(1) of the Trademarks Act- A person claiming to be the proprietor of a trade mark used or proposed to be used by him who is desirous of registering it shall apply in writing to the Registrar in the prescribed manner for registration either in Part A or in Part B of the register.

Section 7(i) of the Trademarks Act- The registration of a person as the proprietor of a trademark grants them the exclusive right to use the trademark in relation to specified goods or services. This exclusive right is infringed if someone who is not the proprietor or a registered user uses a mark that is identical or very similar to the registered trademark in a way that is likely to deceive or cause confusion..

Section 15(2) of the Trademarks Act- In case of honest concurrent use, or of other special circumstances which in the opinion of the court or the Registrar make it proper so to do, the court or the Registrar may permit the registration of trademarks that are identical or nearly resemble each other in respect of the same goods or description of goods by more than one proprietor subject to such conditions and limitations, if any, as the court or the Registrar may think it right to impose”.

Analysis

The Appellant argued that its existing Trade Marks are well-known in Kenya and therefore warrant protection under Section 15A(1) of The Trade Mark Act. The Appellant's complaint was threefold: firstly, that the Registrar did not consider the evidence it presented regarding certain factors; secondly, that the Registrar considered irrelevant facts; and thirdly, that the Registrar overlooked the value associated with the Mark.

Without Section 15(A), a foreign owner of a well-known “Trade Mark” would have to depend on the common law of passing off for protection, which is limited due to the requirement for the owner to establish goodwill in the country. Goodwill typically has a local characteristic, which poses a challenge for owners of well-known trademarks who do not conduct business or possess goodwill in Kenya, making it difficult to succeed in an action for protection. Section 15(A) aims to provide effective protection for owners of well-known trademarks who lack business presence or goodwill in Kenya.

Upon reviewing the facts, the court found the appellant had not sufficiently proven that 'SONY' was a well-known trademark in Kenya. The Appellants did not argue for the principle of territoriality to be overlooked, and the Respondent emphasized the importance of the trademark being well-known specifically within the Kenyan market, irrespective of its recognition in other jurisdictions. The court cited the Victoria’s Secret Inc and Edgars Stores Limited case, which reaffirmed that a trademark is a territorial concept, legally operative only within the territory where it is used and registered.

The court also considered the Registrar's findings, which demonstrated that 'Sony' has been a globally recognized brand in the electronics sector since 1958, endorsed by reputable entities like Inter-brand and Harris Interactive. However, the court held that international recognition of the 'Sony' brand did not automatically extend to Kenya, and evidence specific to the Kenyan market was necessary.

Regarding the similarity of the marks, the court agreed with the Assistant Registrar's finding that the marks were similar, with "Sony" being the dominant element in both. The court found it crucial to determine whether the goods or services associated with the Respondent’s mark corresponded to those of the Appellant's mark within the same registration classes. The Appellant highlighted that trademark registration is class-specific and aimed to enforce exclusivity only within the registered classes. The Respondent countered by differentiating its operations in construction and real estate from the Appellant’s electronics, arguing that their goods were not sold alongside each other, thus reducing the likelihood of confusion. The Assistant Registrar concluded that since the goods and services were unrelated, there was no risk of confusion in different trade channels, and the court concurred.

On the third issue, the court discussed trademark proprietorship under Section 20(1) of The Act, which mandates that an application for registration must be made by the legitimate proprietor of the trademark. The court noted that proprietary rights in a trademark could be established by originating or acquiring the mark. The Respondent claimed to have been trading under "Sony Holdings Limited" since 2003, while the Appellant contested that the Assistant Registrar should have required proof of goodwill or reputation to establish proprietorship. However, the court held that Section 20(1) does not necessitate proving reputation and goodwill for the purpose of registration, particularly as marks not yet in use would lack such attributes. Yet, if an opponent demonstrates an existing reputation in the mark for relevant goods and services, a new applicant cannot claim proprietorship under Section 20(1).

The court's reasoning underscores the delicate equilibrium between protecting well-known trademarks and respecting the territorial nature of trademark rights. By demanding specific evidence of a trademark's recognition within Kenya, the court emphasises the importance of localised goodwill and reputation, rather than relying solely on global brand recognition. This approach aligns with the principle that trademark rights are inherently territorial and underscores the necessity for trademark holders to establish a direct connection to the local market. This decision serves as a cautionary tale for global brands, illustrating that international prominence does not automatically confer protection in every jurisdiction without corresponding local recognition and proof of market penetration.

Conclusion

The court contrasted its findings with the Assistant Registrar's. While the Assistant Registrar found that the Respondent had honest concurrent use of the trademark, the court found the evidence provided by the Respondent insufficient to prove such use. The court concluded that without demonstrated use, there could be no acquiescence. Therefore, the court set aside the Assistant Registrar’s decision regarding marks in classes 35, 36, 37, and 39, ruling that these marks should not proceed to registration. Each party was ordered to bear its own costs in the appeal.

Judgement to be found here