Trade mark registrations are often attacked on the basis that they haven’t been used for a continuous period of five years or longer. In many cases the trade mark owner can show use, and the focus is on other issues. Was the use ‘permitted use’ and use ‘with the licence of the proprietor’? Was it ‘bona fide use’?
Both of these issues came up in the recent case of Philip Morris v Westminster Tobacco. In this case Westminster Tobacco (part of BAT) had cigarette registrations for the mark Parliament. When these registrations were attacked by rival Philip Morris, the company showed that a small number of cigarettes marked Parliament had been sold over the relevant period. These cigarettes had, however, not been manufactured by Westminster, but by its holding company, British American Tobacco SA.
Was this permitted and licensed use? Certainly said the court, because even though there was no formal licence in place, the companies were part of the same group – the one being a trade mark-holding company and the other an operating company – and they shared directors. There was a tacit licence.
But was the use bona fide? What made this case unusual was that the brand had been introduced in an attempt to deal with certain low-cost and illicit cigarette brands that were hurting sales of BAT’s major cigarette brand, Peter Stuyvesant. The usage was somewhat experimental, in that it took place in some obscure parts of SA like Upington, and it was undertaken as a stop- gap pending a more permanent solution. The group had decided to use a registered but unused mark, Parliament, knowing that Philip Morris had rights to the same mark in other parts of the world.
This wasn’t bona fide use said the judge. Bona fide use means use aimed at ‘protecting, facilitating and furthering trade’ in the goods. This usage had been made with ulterior motives – disrupting the competition, and protecting one of the group’s other brands. So the registrations had to be revoked.