As a result, this has transformed business practices into an intensely networked world whereby manufacturers, distributors, retailers, consumers and end-users alike transact in a highly intergrated global market place.
By virtue thereof, well-known or famous brand names have assumed a supra-national character. In equal measure these technological advances have increased temptations by trademark pirates (satirically termed “enterprising entrepreneurs”) to prey om well-known and famous trademarks and trade on their reputation much to the chargrin of their owners.
Legal implications of piracy
Technological advances have enabled trademark piracy to operate without being in physical contact with the original source or origin, easily and cheaply access, copy, use or register well-known or famous marks ahead of their legitimate owners. This is usually perpetrated before the latter have had the opportunity to expand their businesses or register their titles in the local territorial jurisdictions-so called pre-emptory use or registration of the marks.
Characteristically, the pre-emptory use or registration of well-known or famous marks by pirates is usually motivated by predatory or fraudulent intent. This raises the contentious and vexatious question of whether to afford the “enterprising entreprenuer” protection of the mark on the principle of territoriality, or to preserve protection of the mark to the foreign owner on the principle of equity. Noting, however, that pre-emptory use or registration is a blatantly callous act of obtaining a free ride on the coat-tails of another’s hard earned reputation, reaping where one has not sown, and gathering where one has not planted, the principle of equity was logically preferred.
Objectives of equity considerations
The commercial value of well-known or famous marks resides in their intrinsic magnetic force to invoke memories and the desire to purchase the trade-marked goods or services which previously have yielded the same and consistent satisfication to the familiar customer or end-user. Thus, equity considerations seek to adjust the competing interests of, inter alia: the originator of the mark’s entitlement to protection for investment in time, money, labour and effort in creating repute and goodwill in the mark; the public’s entitlement to protection and preservation of the intergrity of global trade practices from such malicious and deliberate deceit. For these reasons well-known or famous marks have been extended special supra-national protection as here-under highlighted.
Global legislative context
Article 6bis of the Paris Convention for the Protection of Industrial Property (Paris Convention) obliges member states to refuse, cancel or prohibit the use or registration of copycats to well-known marks. However, article 6bis is devoid of any definition or criteria of what constitutes well-known marks. This legislative lacunae is somewhat plugged by Article 16,2 of the Agreement on Trade Related Aspects of Intellectual Property Rights (Trips Agreement) which, apart from extending the application of Article 6bis of the Paris Convention to services stipulates that: “In determining whether a trademark is well-known, members shall take account of the knowledge of the trademark in the relevant sector of the public, including knowledge in the members concerned which has been obtained as a result of the promotion of the trademark.”
However, despite stipulating the source of evidence Article 16,2 of the TRIPS Agreement’s shortcoming lies in its failure to provide the guiding factors in sourcing this evidence. Recognising this shortcoming, some criterion was distilled from national and regional legislation, case law and office procedures around the globe though with some degree of jurisprudential variance in parameters as to what constitutes well-known or famous marks. In response, the World Intellectual Property Organisation (WIPO) in turn crafted a somewhat comprensive guideline in an attempt to attain global harmony.
Determinant guiding factors: The adopted global jurisprudential concensus is to interpret Article 16.2 of the Trips Agreement as meaning that a mark shall be adjudged well-known if it is substantially known to the relevant class of consumers of the goods or services, and not necessarily known to the general public. In this determination the factors to consider include, but are not in any way limited to:
Degree of recognition of the mark: In this regard the extent of unsolicted requests for licenses and assignments presents the best testimony to a mark’s market recognition and reputation as it constitutes direct evidence thereof. In contrast, surveys are indirect evidence that is less reliable.
The extent and duration of use of the mark: Although, admittedly,modern advertisement and technology can make a mark famous overnight, under normal circumstances, however, a mark would became famous over time by dint of concerted expense on resources, time, labour and effort. In which case the volume of sales, depth of market penetration and market share would be valuable indicators.
The extent and duration of advertising and publicity of the mark:This would be vital in instances where the mark is yet to be used in the local market. In which case spillover advertising in the form of internet and television exposure, circulation of relevant international magazines or parties, periodicals, and travel statistics of personalities who are likely to have been exposed to the mark abroad would be of significant importance.
Extent of geographical registration of the mark: This is indicative of the recognition the mark commands in various jurisdictions as revealed by the owner to register and protect the mark extensively.
Degree of inherent or acquired distinctiveness of the mark: These have a bearing on the mark’s degree of exclusivity. In this respect noteworthy is that acquired distinctiveness is of more probative value than inherent distictiveness (For which, the more distinctive the more exclusive is the mark).
The nature and scope of use of the same or similar mark by third parties: The more the lure of predators whether on similar or non-competing products the more indicative is the recognition and repute of the mark on the marketplace.
The nature of goods and services in context of the nature of the related trade channels: With regards to non-competing goods or services the more multiple the trade channels in which the mark circulates the more indicative of the mark’s repute, hence the need for broader protection.
Degree to which the mark symbolises the quality of products: This recognition is most relevant in ‘dilution by tarnishing ‘cases where the quality gurantee function of marks is at stake and in want of protection.
The extent of commercial value attributed to the mark: Financial institutions may ascribe a certain value of the mark for purpose of security against funding- so called hypothecation.
The above list of factors is in no way singularly determinative but merely indicative. It is a factual enquiry criterion decided on a case by case basis encompasing both competing and non-competing goods or services, locally registered and unregistered well-known marks.