godrej consumer products ltd vs target international t ltd 2020 tzhccomd 2002 2 july 2020

IN THE HIGH COURT OF TANZANIA (COM M ERCIAL DIVISION)

AT DAR ES SALAAM M ISCELLANEOUS COM M ERCIAL APPLICATION NO. 54 OF 2019 (Arising out o f Commercial Case No. 60 o f 2019) GODREJ CONSUM ER PRODUCTS L T D ......................................... APPLICANT Versus TARGET INTERNATIONAL (T) L T D ...........................................RESPONDENT L a st O rder: 0 1 s' J u n e, 2 0 2 0 D a te o f R ulin g: 0 2 nd J u ly , 2020

RULING FIKIRINI, J. This application filed under certificate o f urgency, has been made under Rule 2 (2) o f the High Court (Commercial Division) Procedure Rules, 2012 (the Rules); section 68 (c ) and Order XXXVII Rule 2 (1) o f the Civil Procedure Code, Cap. 33R.E. 2002 (the CPC). The applicant, Godrej Consumer Products Ltd is in essence seeking for the following orders: 1. That, the Honourable Court may, pending determination o f the Commercial Case No. 60 o f 2019, be pleased to grant tem porary injunction restraining the respondent or its agent or servants from manufacturing, selling, 1 |P a g e importing or exporting or commercially dealing in any other manner with counterfeit mosquito and insect repelling spray bearing the HIT Trade Mark in the Tanzanian market; 2. Any other or further relief that this Honourable Court may deem it fit to grant; and 3. Costs o f this application be awarded to the applicant. The application is supported, by an affidavit o f Mr. Gradus Oluoch Adis, Head o f Legal Service East A frica in Godrej Consumer Products Ltd, and by the reply to the counter affidavit o f Mr. Krishan Kishore, Senior Project M anager o f the applicant based in Dar es Salaam. The respondent opposing the application filed counter-affidavit through Mr. Mohamed Ramzanali Virani, Principal Officer o f the applicant (I want to believe it was slip o f a pen), he must have

meant respondent. Mr. Adis, in his affidavit has deponed that; the applicant since 2011 has been registered proprietor o f a Trade Mark HIT under registration No. TZ/T/2011/147 in the Tanzania M ainland as exhibited in the annexture-5. And that it has been assuring the availability o f the HIT products by supplying and distributing the products all over the Tanzanian Market. That it has also made the HIT products known in the Tanzania Market, and to the customers by undertaking various 2 |P a g e promotions, and advertisements o f the products through various media platforms such as the internet, and the Faceboolc, as exhibited in annexture-3. The deponent has stated under paragraph 8 o f his affidavit, stated that the applicant’s HIT products and its Trade Mark “HIT” have acquired goodwill in the Tanzania market, and consumers in the market associate the products with the applicant. He has averred that sometime in April 2019, the applicant’s officers came across counterfeit HIT products bearing an identical get-up with the genuine HIT products o f the applicant and exhibited the claim through annexture -7 which carried photos o f genuine and counterfeits HIT products flooding the market. The deponent under paragraph 12 o f the affidavit outlined the im pending threats if a temporary injunction is not issued and prayed the Court to do so pending determination o f the main

suit. The respondent countered, all the averments made by Mr. Adis in his affidavit on behalf o f the applicant, through a counter-affidavit o f Mr. Viran, sworn by him, on their behalf. The counter-affidavit contested the averment under paragraph 3 o f the affidavit, and stated that the registered owner o f HIT Trade M ark as per the Business Registration and Licensing Agency (BRELA) is HB W orldwide Ltd a sister company to the respondent who is authorized by owner o f Trade M ark to use it. He 3 |P a g e also stated that the applicant’s Trade M ark was expunged from the records of BRELA and since then the Trade Mark has never been re-registered, the fact admitted by the applicant in the pleadings as exhibited by annexture TIL-2. It was the conclusion o f Mr. Viran in his counter affidavit that the averment that the applicant has been supplying and distributing the products for many years in the Tanzania market was thus unfounded. Disputing the statement on goodwill as averred under paragraph 8 o f the affidavit, the deponent o f the counter-affidavit, deponed that applicant had not acquired any goodwill in Tanzania because it has never brought in Tanzania mainland any HIT products. In the reply to counter-affidavit taken out by Mr. Kishore, Senior Project Manager, he deponed that the Trade Mark registration number T Z/T /2010/1091 in the name o f HB W orldwide Ltd which was

issued on 5th April, 2019 was objected and dismissed by the Registrar o f Trade and Service Marks as exhibited in annexture-8, the objection which prompted Commercial Appeal No. 2 o f 2019. And that after being expunged from the Register o f Trade Marks, the expungement was being contested by way o f an appeal before the High Court o f Tanzania at D ar Es Salaam, Civil Appeal No. 147 of 2019, as per annexture-9. The affidavit as well indicated that the respondent was distributing counterfeit products as has 4 |P a g e reproduced 100% all the features of the applicant’s products, while the Trade Mark registration which the respondent relies on for its rights did not entitle the respondent to copy the packaging and the entire get-up o f the applicant’s products. This application was disposed of by filing written submissions. Mr. Francis Kamuzora learned counsel filed written submission and rejoinder on behalf o f the applicant while Mr. Edwin Webiro learned counsel did that on behalf o f the respondent. It was Mr. K am uzora’s submission that in the pending suit before this Court the applicant was suing the respondent for passing-off, a tort under common law. In support he referred this Court to the book by K erly’s Law of Trade Marks and Trade Names, 12th Ed, p.344 and the book by Harry Street, The Law of Torts, 2 nd Ed, p. 370, which a quotation was made from the case

of Leather Cloth v American Leather Co. (1865) 11, HL Cas. 523, at p. 538, that: “The fundam ental rule is, that one man has no right to p u t o ff his goods fo r sale as the goods o f a rival trader.......... ” It was equally his submission that the respondent/defendant has not denied neither in the written statement o f defence not its counter-affidavit that it was in fact importing identical mosquito aerosol “HIT” which was identical with that o f the applicant’s/plaintiffs manufacturer. Alluding to the principles established in the cases o f Attilio v M bowe (1969) H.C. D. No. 284 and Giella v Cassam Brown & flsf- 5 |P a g e Co. Ltd [1973] EA 352, he submitted that this Court in exercising its discretion, the applicant must show three things, which were: i) That there was a prima-facie case with probability that the applicant/plaintiff will be entitled to the relief claimed; ii) That the C ourt’s interference was necessary to protect the applicant/plaintiff from kind o f injury which may be irreparable before his legal right was established; and iii) That on the balance o f convenience, there would be greater hardship and m ischief suffered by the plaintiff from withholding o f the injunction that would be suffered by the respondent/defendant from the grant o f it. Expounding on the established principles in the context o f passing o ff action, it was his submission that

the cases o f CPC International Inc. v Zainab Grain Millers Ltd, CAT, Civil Appeal No. 49 of 1995, (unreported), Colgate Palmolive v Zakaria Provision Store & Others, Civil Case No. 1 of 1997 (unreported) the decision quoted in the case o f Kibo Match Group Ltd v H.S. Impex Ltd [2001] T.L.R 158, where the Court articulated on how a prim a fa cie case can be shown, but also warned that the Court should not be tem pted to go into the merits o f the case by requiring specific proof or evidence. All it was required 6 |P a g e was for the Court to satisfy itself that the plaintiffs case needs consideration and there was a likelihood o f the suit succeeding. Matters such as loss o f goodwill, confusion and/or deception resulting from apparent similarity o f the goods involved, be considered as may have far reaching consequences to business o f both parties even after conclusion o f their cases in Court. Pegging the established principles from the decisions pointed out above, it was Mr. K amuzora’s submission that through the affidavit o f Mr. Adis in support of the application a prima facie case has been established to warrant grant o f a temporary injunction. The evidence included annexture 2 bill of lading proving importation of applicant’s HIT products; annextures 4- attesting to knowledge o f the applicant’s product for many years in Tanzanian market; annexture-5 expunged

registration certificate which would prove existence o f the product for many years prior to the respondent’s coming into play; and annexture-7 showing comparison o f the genuine and counterfeit products. Also the existence o f the products in the market was a testimony that the applicant potentially held goodwill which needs to be protected, submitted Mr. Kamuzora. Contrasting the counter-affidavit filed by Mr. Virani, it was his submission that annexture TIL-1 a registration certificate number T Z/T /2010/1091 in the name of HB Worldwide Ltd which did not confer the right to imitate the entire applicant’s 7 |P a g e product and the certificate which was subject to challenge in the Commercial Appeal No. 2 o f 2019 as well as lack o f evidence that showing that HB Worldwide Ltd has allowed use o f the Trade Mark in importing goods in question, all put together weaken the respondent’s objection to the application. It was further Mr. Kam uzora’s submission that the Court interference was necessary to protect the applicant from kind o f injury which may be irreparable before its legal rights were established. In support he cited the Kibo case (supra). He went on stating that the damage may be irreparable as once goodwill o f a business or products has been tarnished it was unlikely to measure in monetary terms the true value o f what has been damaged or lost that could be patched

up. Submitting on the third test, Mr. Kamuzora contended that on the balance o f convenience the applicant will suffer greater hardship compared to the respondent. He argued that it was due to the fact that the applicant has established prim a fa cie case that it has Trade Mark rights over HIT products and that the goodwill developed over a period of many years need to be protected compared to those o f the respondent who started importing the identical goods in April, 2019. On the strength o f his submission he prayed for the grant o f temporary injunction. 8 |P a g e Reacting to the submission Mr. Webiro discounting the applicant’s claim as unfounded, submitted that the respondent has been doing business with the mark for a long time even before it was registered with BRELA. The product has therefore acquired reputation and goodwill among customers in the local market. Challenging the applicant’s claim on the passing-off allegation, Mr. Webiro referred this Court to the case o f Erven W arnink B.V. v J. Townsend & Sons (Hull) Ltd., [1979] AC, p. 755-6, 731, [1980]R.P.C.31, where the Court illustrated five characteristics for establishing a valid cause o f action o f passing off, to include: (i) misrepresentation; (ii) trader who made the misrepresentation in course o f the trade; (iii) misrepresentation to prospective customers o f his or ultimate consumers o f goods or

service supplied by him; (iv) misrepresentation which is calculated to injure the business or goodwill o f another trader; and (v) misrepresentation which causes actual damage to a business or goodwill o f the trader by whom the action is brought or will probably do so. According to Mr. Webiro, the applicant had to first substantiate that the Trade Mark acquired goodwill in all senses, the first step being to prove it was a prior user o f the Trade Mark. To support his stance, he cited the case o f Consolidated Foods Corporatio v Brandon & Co. pvt Ltd, AIR 1965 Bom 35, (1964) 66 BO M LR 612. 9 |P a g e Submitting on the three requirements as established in the case o f Attilio (supra) to be considered before granting a temporary injunction, starting with the first one on triable issues, he disputed existence o f any triable issues or the chances that the applicant will be entitled to reliefs. His reasons being the Trade Mark in question was registered under HB Worldwide Ltd the respondent’s sister company and who allowed its use by the sister company. Besides, the applicant’s Trade Mark was not registered and has been expunged from the register long ago. With that in place, it leaves the respondent under section 31 o f the Trade and Mark Services Act, with exclusive rights, since 2013. He went on submitting that all the documents annexed only showed the goods were supplied in

Zanzibar and no evidence that the goods were being sold in Tanzania mainland market. The goodwill in Zanzibar cannot be said to have acquired goodwill in Tanzania mainland. On the second test, Mr. Webiro refuted any irreparable loss could be suffered by the applicant as it was the respondent who has been doing business w ith HIT products for a long time and has acquired goodwill and reputation in the local market. Pressing on his submission, he contended that it was the respondent who first entered the market with HIT products before the applicant’s purported products which created confusion and deception to the customers. The customers 10 | P a g e were unable to distinguish between genuine and counterfeit hence the applicant would suffer no irreparable loss. On the third test, based on the respondent’s long presence in the market establishing goodwill and reputation, between the two the respondent will suffer more than the applicant, as the espondent entered the market in 2013 while the applicant in 2017, submitted Mr. Webiro. Taking up the Kibo Match and CPC International Inc cases (supra) he stated the cases were distinguishable to the present one. In both cases they were registered proprietor o f the Trade Marks and with long time presence in the market such that they had established goodwill while in the instant case the applicant was not. After driving home his points,

Mr. Webiro urged this Court to dismiss the application with costs. In a rejoinder Mr. Kamuzora responding to points raised by Mr. Webiro, had this to say in summary, that since the HB Worldwide Ltd registration has been nullified in Commercial Appeal No. 2 o f 2020. This has changed the whole o f the respondent’s position despite the fact the issue before the Court was essentially on passing-off o f products and not registration. The applicant’s case was on blatant copying o f the applicant’s products by the respondent who was supplying the same product, the evidence which the applicant has been able to provide to establish a l i |p a g e prima facie case. Also the respondent failed to furnish evidence and history o f its products in Tanzania markets. And the Tanzania Pesticides Research Institute certificate heavily relied on by the respondent was o f no effect as far as passing-off cause of action was concerned. Passing-off action is essentially based on close similarity on products present in the same market, which may lead to confusion or deception on the part o f customers. This may as well result into damage or loss o f goodwill. At this juncture, however, the task o f this Court would be only to determine if the applicant has been able to establish a prim a-facie case on similarity o f the products already in the market and subject matter in Commercial Case No. 60 o f

2019. The Court is not at all required to gobeyond that as by doing so it will be prone to embarking on prejudging the case on its merits. The stance taken in Kibo Match case (supra) said it all when it was concluded that: “A ll that the court has to be satisfied of, is that on the fa ce o f it the p la in tiff has a case which needs consideration and that there is likelihood o f the suit succeeding. ” In this application, my task is therefore to evaluate if the applicant has been able establish a prim a-facie proof warranting granting temporary injunction sought by the applicant. 12 I P a g e The affidavit, counter-affidavit, reply to the counter-affidavit and accompanying annextures plus rivalry submissions will thus be measured in the context o f the three tests enunciated in the M bow e’s case (supra). On the first issue whether there is a prim a facie case, which can as well be translated to mean asking whether there are triable issues, with a probability that the applicant/plaintiff will be entitled to reliefs claimed. After thorough evaluation o f the information and documents availed to the Court, it is evident that both parties have their products in the Tanzanian market. And the two products one owned by the applicant and the other by the respondent, both depicting Trade Mark “HIT” have close similarity. The existed close similarity must undoubtedly have caused

confusion and deception to the customers. At this point the Court will, however, not dwell on the Trade Mark issue p er se, but will examine the accounts and history o f the product in the market to be able to determine the issue posed before it. From the availed evidence, the applicant has been able to establish that they have been importing o f HIT products prior to the respondent’s importation o f identical counterfeit products. The certificate o f registration no. TZ/T/2011/147 for HIT in the name o f Godrej Household Products Ltd which though was expunged but all in all shows or proves the existence o f the applicant’s products in the market well before those o f the respondent. Going by the expunged certificate of registration issued in 2011, and 13 | P a g e by the respondent’s nullified certificate issued in April, 2019, there is almost eight or nine (8 or 9) years the applicant’s products have been in the market prior to those of the respondent in the market, but even if the year 2013 claimed is taken into consideration instead o f 2019, still it is after the applicant’s products were already in the market. Guided by the decision in C PC International Inc. (supra), where the Court held: “It is settled principle that in matters o f passing o ff a prim a- facie case could well be shown i f upon consideration o f the close similarity between the Trade M arks com plained o

f was, on balance, such as to cause deception or confusion on the p a rt o f the customers. "[Emphasis mine] Applying the principle to the present application, it is obvious the applicant has been able to establish a p rim a fa cie case and undeniably there are triable issues. The second test on the necessity o f the C ourt’s intervention, under the circumstances intervention is necessary as goodwill established over period of time, confusion and deception which indisputably m ust have been going on due to close similarity in the products though one was genuine while the other was not. O f course, the applicant stands to suffer most as has been in the market longer than the 14 | p a g e respondent. Without Court intervention the applicant will suffer financial loss as the competition in the market is inevitable. In addition, there as well could be a possibility o f damage to its goodwill which has been established and enjoyed over all the years before coming o f the respondent into the market. Once goodwill o f a business has been tainted or products discredited, the damage in most cases is beyond repair. Even the measure in monetary terms can fail to gauge the actual or true value o f the damage caused or lost so as the same could be patched up as argued by the applicant. To avoid all these C ourt’s intervention becomes unescapable. The affirmative answers in the first and

second tests, surely lean more towards the conclusion that on the balance o f convenience, the applicant will suffer more than the respondent who it has been established that it came into the m arket later while the applicant has already established itself well and developed goodwill. Comparing the two, the applicant may suffer financial loss as she m ight be required to invest more to restore its lost goodwill which could have been lost or damaged from competing with counterfeit goods o f the respondent. Examining the application as a whole, the Court is satisfied that the applicant has been able to establish a prim a-facie case which is param ount in granting o f the temporary injunction. 15 | P a g e The application for temporary injunction is thus granted as prayed. It is so ordered. 16 | P a g e