PYREX dispute: turning up the heat on trademark rights

Kenya

Does the withdrawal of a threat of opposition amount to a surrender of one's rights to institute cancellation proceedings in respect of the same trademark? In Kenya, pursuant to a recent decision handed down by the assistant registrar, the answer is no.

Corning Incorporated applied in 2009 to cancel a trademark registration for PYREX in the name of Casebella Associates Limited on the basis of its own prior rights, among other things.

Casebella had applied to register the PYREX mark in 2005. When the trademark application was advertised for formal opposition purposes, Corning sought an extension of the opposition term up until March 29 2007. However, on April 12 2007 Corning’s local representative advised the registrar that Corning did not wish to proceed with the opposition and that the registrar could proceed to issue the registration certificate.

It is worthwhile to mention that one should avoid advising any registrar to issue a registration certificate, when one has indicated its interest in opposing the registration of a trademark. It is better to simply advise that one does not wish to proceed with the opposition, and to reserve one's rights to take action.

On May 11 2007 the trademark PYREX therefore proceeded to registration in the name of Casebella.

Interestingly, Corning submitted that Casebella had previously been its local distributor for the Kenyan market, and that it had applied for registration of Corning’s trademark without its consent. This was clearly done in bad faith, as Casebella was well aware that Corning was the genuine proprietor of the PYREX mark.

Casebella denied that there was an agency relationship between itself and Corning, but admitted that it had been selling Corning’s goods for the past 40 years. It claimed that it was not going to “give up on the brand easily”, and that it routinely registered the trademarks of third parties in situations where it was concerned that its “principals would forsake them”.

Casebella argued in the cancellation application that Corning’s letter to the registrar stating that he could issue the registration certificate amounted to a surrender of Corning’s rights in and to the PYREX mark. Therefore, Casebella argued that Corning’s application for cancellation of Casebella’s registered trademark amounted to an abuse of due process.

After having considered all of the facts pertaining to this matter, the assistant registrar concluded that he needed to determine the following key issues:

  1. Who is the rightful owner of the PYREX trademark in Kenya, given that trademark rights are territorial;
  2. Whether the letter by Corning’s local representative withdrawing Corning’s threat of opposition amounted to a complete surrender of Corning’s rights in respect of the trademark, and a subsequent bar to the removal of Casebella’s trademark;  and
  3. Whether two identical trademarks in the name of two different proprietors can co-exist.

With regard to the first issue, it was clear to the assistant registrar that both parties were claiming to be the genuine owner of the trademark, to the exclusion of the other. The assistant registrar held that, based on Corning’s earlier and valid trademark registration for PYREX, Corning’s prior sales and the evidence of Corning’s agency relationship with Casebella, Corning was the bona fide proprietor of the PYREX mark in Kenya.

With regard to the second issue, Corning’s local representative’s letter stated the following:

We have our client’s instructions that it does not wish to proceed with the opposition. In the circumstances, please proceed to register the above trademark 57546 PYREX (word) in Class 21 and issue the registration certificate to Corning.”

The assistant registrar stated that Section 36A of the Kenyan Trademarks Act allows a proprietor to surrender a registered trademark voluntarily. In addition, Section 36B of the act also states that the proprietor of an earlier or other right, who acquiesces to use of a trademark for a continuous period of five years, being aware of such use, will not be entitled to, among other things, apply for invalidation of the later trademark.

Although the assistant registrar agreed that Corning’s conduct (withdrawing its opposition and then applying to expunge the trademark) might amount to an abuse of process, he believed that Corning had not lost its right to take action, as a five-year period had not yet lapsed since Casebella applied to register the PYREX mark.

Therefore, the assistant registrar held that Corning had not acquiesced to Casebella’s registration of the PYREX mark, and was not disentitled (on the basis of the letter submitted to registrar) to bring an application for cancellation of Casebella’s trademark registration.

With regard to the third issue, the assistant registrar noted that Casebella is the registered proprietor of the trademark PYREX in Class 21 (for various household goods, including glassware), and Corning is the registered proprietor of the trademark PYREX in Class 15 (for various household goods, including glassware). The goods covered by Corning’s registration were the same as those covered by Casebella's registration, and only appeared in a different class due to an update in the classification system.

Section 15 of the Trademarks Act prohibits the registration of identical or similar trademarks in respect of similar or identical goods. However, it does allow for the co-existence of trademarks if there has been honest concurrent use of the respective trademarks by both parties.

The assistant registrar found that Casebella's conduct was not honest. At the time it applied to register the PYREX trademark, it was well aware of Corning and of Corning's use of - and rights in and to - the PYREX trademark, and routinely registered trademarks belonging to third parties to effectively prevent its principals from terminating agreements.

The assistant registrar implored the registrar to guard against such blatant, devious and malicious practices by agents, distributor, licensees or other parties authorised to sell goods on behalf of proprietors of trademarks in order to protect the public.

The assistant registrar held that the respective trademarks could not co-exist, as they are identical and cover identical goods. Use by both parties of the same trademark would inevitably cause confusion in the marketplace as to the true source of the goods sold under the trademark.

In conclusion, Corning’s cancellation application was successful - although Casebella is entitled to take the decision on appeal.

Alicia Louw, Adams & Adams, Pretoria (verified by Debbie Marriott)

A slightly different version of this article was originally published in Without Prejudice, August 2013 issue.

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