Under the previous South African advertising regulatory regime, the Advertising Standards Authority (ASA), it became increasingly common for brand owners to take trade mark-style disputes to the ASA rather than to the courts, given that the ASA was both cheaper and quicker. The ASA has been replaced by the new Advertising Regulatory Board (ARB), with a similar code of conduct. A recent ARB ruling suggests that trade mark-style disputes can still go the advertising law route, provided that they aren’t too legalistic.
The case of Colgate-Palmolive Company and Colgate-Palmolive (Pty) Ltd v Bliss Brands (Pty) Ltd (30 August 2019), dealt with competing fabric softeners. Colgate Palmolive, makers of the market-leading Sta-Soft product, complained about a competitor, Bliss Brands, that sells a product under the name Maq. Although the products have co-existed for many years, it was the decision of Bliss to change the sub-brand or descriptor that appeared under the name Maq from Boost to Soft that prompted Colgate Palmolive to take action.
The ARB certainly made its feelings known about the legalistic nature of this matter:
“There are aspects of both the complaint and the response in this matter which are problematic. Far too much reference is made to trade mark law, matters of passing off, as well as other issues decided on by South African courts. All of these fall within the broader field of intellectual property and, while not irrelevant, the Directorate would like to remind both parties that the purpose and mandate of the Advertising Regulatory Board is to decide matters related to advertising in terms of the Code of Advertising Practice.”
The ARB nevertheless dealt with the matter, involving complaints under two separate clauses of the Code.
Exploitation of advertising goodwill
Clause 8 of Section II states that “advertisements may not take advantage of the advertising goodwill relating to the trade name or symbol of a product or service of another, or advertising goodwill relating to another party’s advertising campaign or advertising property...”
It also says that “consideration will be given to, inter alia, the likelihood of confusion, deception and the diminution of advertising goodwill. Furthermore whether the device or concept constitutes the ‘signature’ of the product, is consistently used, expended throughout the media and is prominent in the mind of the consumer.”
Although Colgate-Palmolive submitted consumer survey evidence to support its claim of possible confusion, this evidence was rejected as being flawed. The ARB did, however, make it clear that evidence of confusion will not be necessary in every case:
“It is not impossible for a matter of this nature to come before the Directorate where the similarities in the packaging are so patently obvious that the Directorate can make an assumption of confusion without any proof thereof. This was not such a matter. The very different brand names outweigh any other similarities and in the absence of proof the Directorate cannot assume likely confusion.”
Clause 9 of Section II provides that an advertiser must not copy an advertisement in a way that is “recognisable or clearly evokes the existing concept and which may result in the likely loss of potential advertising value.” It also provides that this will apply despite the fact that there is “no likelihood of confusion or deception, or that the existing concept has not been generally exposed.”
The ARB will consider various factors such as the extent of exposure, the period of usage and advertising spend, the issue of whether the concept is central to the theme, and the issue of whether it is distinctive or crafted. The competitive sphere will also be considered.
The central issue in this matter was that, although the two companies had co-existed for many years (with packaging that was very similar to the packaging that existed at the time of the proceedings), it was the change of the sub-brand or descriptor that appeared under the name Maq from Boost to Soft that prompted Colgate-Palmolive to take action. As the ARB said: “It is therefore down to the question of whether the use of the word ‘soft’ alone amounts to imitation.”
The ARB held that the adoption of the word “soft” did amount to imitation, despite the fact that it is a common word that is descriptive of the product. First, there was the fact that “it would be disingenuous to expect the Directorate to accept that the Advertiser arrived at its current packaging design ignorant of Sta-Soft.”
There was also the issue that the word Soft had been added to packaging that already included a number of design elements that were similar to those used with Sta-Soft.
But the most important reason, seemingly, was “there appears to be no reason given for the change from Boost to Soft, two very different words... the change is both out of line with the labelling of other products in the category and with its own in-house style. The only conclusion... is that the move was made in imitation of the market leader’s packaging.”
The ARB ruled that there was a breach of the Imitation Clause.
It will be interesting to see if brand owners make more use of the ARB for their trade mark disputes.