First '.co.za' domain name dispute decided

The adjudicator in the first '.co.za' domain name dispute lodged with the South Africa Institute of Intellectual Property Law (SAIIPL) has refused to order the transfer of the domain name 'mrplastic.co.za' to the complainant, Mr Plastic CC (Mr Plastic) (Case ZA2007-0001, June 7 2007).

Mr Plastic has been trading under that name since 1976. Mr Plastic & Mining Promotional Goods CC (Mr P&M), which has also been trading under the name Mr Plastic since 1989 in relation to the sale of plastic products, registered the domain name 'mrplastic.co.za' in October 2000. Mr P&M soon afterwards commenced operating a website under the domain name. Subsequently, Mr Plastic sought to register the same domain name and was unable to do so. More than six years after the registration of the domain name in dispute, Mr Plastic demanded that Mr P&M cease all use of the domain name. Mr P&M declined to do so.

Mr Plastic filed a complaint with the SAIIPL, claiming that:

• it had rights in the mark MR PLASTIC, which is identical or similar to the domain name in dispute; and
  
  
• the registration of the domain name by Mr P&M was abusive under Rule 3(1) of the Alternative Dispute Resolution Regulations (ADRR).

The adjudicator held that in order to succeed in this claim, Mr Plastic must prove that it had rights in the name or mark MR PLASTIC. The adjudicator found that the mere registration of a company or close corporation name does not per se confer the right to restrict third parties from using that name. Mr Plastic must show that it had used MR PLASTIC as a trademark so extensively that it had acquired substantial rights in it. In essence, Mr Plastic was relying on the common law cause of action passing off as the grounds of its objection.

The adjudicator held that in order to prove passing off, Mr Plastic must show that the trademark MR PLASTIC enjoyed a substantial repute and that, as a result, the trademark was distinctive of Mr Plastic specifically. The trade or public must automatically associate the trademark MR PLASTIC with Mr Plastic and no other trader.

The adjudicator found that Mr Plastic had indeed established that its business under its name Mr Plastic enjoyed a reputation. However, so too had Mr P&M. Moreover, the Mr Plastic name had been used by several other entities for several years. The adjudicator consequently found it highly questionable that the name Mr Plastic was distinctive of the complainant specifically.

The dubious distinctive nature of the mark MR PLASTIC was compounded by its inherent descriptive qualities. A mark that is inherently lacking in distinctiveness such as MR PLASTIC can acquire distinctiveness through extensive use, but distinctiveness must be clearly established. Mere use and a reputation does not equate with distinctiveness. It must be shown that the use and reputation have in fact brought about a situation where the mark denotes one trader and no other.

The adjudicator found that although there had been instances of confusion as a result of the use of the disputed domain name, confusion per se does not give rise to an action for passing off. It does so only where it is the result of a misrepresentation that the goods offered are in some way connected with the complainant. Confusion may arise from the mere fact that the parties are conducting the same trade and using descriptive titles of which neither can claim any legitimate monopoly. Where a trader adopts a descriptive designation as a mark, it must reconcile itself to the fact that a measure of confusion may follow if other traders use the same descriptive name. The adjudicator found that the confusion in the case in question was due to the fact that Mr Plastic and Mr P&M were conducting essentially the same trade and using largely descriptive names in respect of which neither can claim exclusive rights.

The adjudicator held that Mr Plastic had failed on the evidence to show that:

• the mark MR PLASTIC was distinctive of its business; and
  
  
• it had a valid claim of passing off against Mr P&M under the common law.

Mr Plastic had consequently not discharged the onus of showing on a balance of probabilities that it had rights in respect of the mark MR PLASTIC which are enforceable against any third party and in particular against Mr P&M.

Furthermore, the adjudicator found that the evidence shows that Mr P&M has been legitimately connected with the trademark MR PLASTIC for a period of 18 years. Mr P&M has consequently acquired concurrent rights in the name and mark MR PLASTIC. This is explicitly a circumstance which in terms of Rule 5(a) indicates that the domain name in dispute is not an abusive registration.

Finally, Mr P&M pointed out that Mr Plastic was in any event prevented on grounds of estoppel or acquiescence from restraining Mr P&M from using the Mr Plastic name after having stood by while Mr P&M used it for 18 years.

In the circumstances, the adjudicator rejected the complaint.

This is the first decision handed down under the South African ADRR. The threshold of proof in the case of unregistered trademarks has been set - a complainant must show not only that it has a reputation in the mark, but also (particularly in the case of a descriptive mark) that its trademark is distinctive and that the registrant does not have a concurrent claim to the mark.

Megan Reimers, Spoor & Fisher, Pretoria