Karen Harverson
The trademark dispute between Chicken Licken owner=20 George Sombonos and US hamburger chain McDonald’s will=20 be heard in the Pretoria Supreme Court this month.
The case consists of two applications; one of which will=20 be tried under South Africa’s old Trademark Act and the=20 other under the new Act passed in May 1995.
The first application — to expunge McDonald’s trademark=20 from the registrar for non-use — is being brought by=20 Joburgers Drive-In Restaurant, owned by Sombonos, and=20 Dax Prop, a franchisee of Sombonos.
It will be tried under the old Trademark Act as legal=20 action was taken before the new Trademark Act was passed=20 in May 1995.
According to South African law, a third party can apply=20 to the registrar to remove a trademark if non-use of the=20 trademark for a period of five years can be proven. A=20 trademark can only be registered if there is intent to=20 make use of it.
“McDonald’s first registered its trademark in 1968, re- registered in 1974, again in 1980, once again in 1985=20 and finally in 1993 shortly after we applied for its=20 expungement from the register,” says Sombonos attorney=20 Sean Ryan of Ryans Attorneys and Trade Mark Agents.
“Twenty-seven years have passed and McDonald’s still has=20 not made use of it — therefore, we are entitled by law=20 to apply for its expungement.”=20
McDonald’s will contest the expungement applications=20 brought under Section 36 of the old Act which justifies=20 non-use if there are “special circumstances in the=20 trade”. In papers before the court, it contends that=20 sanctions and sanctions legislation constituted such=20 “special circumstances”.
“McDonald’s was seriously considering investing in South=20 Africa as far back as 1979 in the normal course of its=20 international expansion. However, the threat of=20 sanctions and later, sanctions legislation, precluded=20 such an arrangement. The critical five-year period of=20 non-use fell right in the middle of the sanctions=20 period,” says Spoor & Fisher partner Gavin Morley.
However, Ryan argues that the Anti-Apartheid Act had two=20 provisions which enabled US companies to operate in=20 South Africa during the sanctions period — at arm’s=20 length, through licensing agreements, or through handing=20 over the reins to a black-owned or -controlled company=20 or person.
The second application, brought by McDonald’s, will be=20 tried under the new Act which has a provision under=20 section 35 which affords protection to foreign=20 trademarks which are “well known” in South Africa.
“Although the trademark is not yet in use, the evidence=20 in the case, including surveys, prove that a substantial=20 portion of the South African population recognises the=20 name,” says Morley.
Not so, says Ryan. He claims that the McDonald’s survey=20 only represents the opinions of a mere 200 whites from=20 households with incomes in excess of R6 000, while a=20 survey conducted on behalf of his client indicates most=20 South Africans have no recognition of the trademark.
He further slates the passing of the new Trademark Act=20 which he views as “an appalling piece of legislation”=20 which gives more rights to foreigners than South=20 Africans would be afforded in those countries.
US legislation states if a trademark isn’t used in two=20 years of registration, it is presumed abandoned and=20 struck from the register unless the owner can prove he=20 didn’t abandon the mark.
In South Africa, a trademark, if renewed every 10 years,=20 remains registered indefinitely unless a third party=20 applies for expungement after non-use of five years.