NBC vs Rite Foods Limited: Trademark Infringement and Intellectual Property Debate

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Raheem Akingbolu writes on the debate trailing the clash between the Nigerian Bottling Company (NBC) and Rite Foods Limited over ‘a lion insignia’, on the logo of Predator and Fearless from the stable of the NBC and Rite Foods Limited respectively, pointing out its possible effect on consumption and marketing in Nigeria.

Businesses, the world over, assign much importance to trademarks for easy identification of their products and its usage dates back to prehistoric times.

It is a type of intellectual property consisting of a word, phrase, symbol, or design (or a combination of any of these) that identifies the source of a product or service and distinguishes it from those of competitors.

For example, the trademark “Coca-Cola” distinguishes the brown-coloured soda water from that of Pepsi.

Indeed, about two thousand years ago, Roman craftspeople left their distinctive marks on almost everything made, from tableware, brickwork and roof tiles, to decorative vases, gravestones, lead slingshot ammunition, and even plumbing. Though, without any real legal clout, they were ways of claiming bragging rights over their work.

Also, ancient trademarks can be found on Egyptian and Chinese objects, and the Lascaux cave paintings, which predate the Roman Empire about 15,000 years ago, shows that people used personal marks to claim ownership of livestock, to prevent theft before it became standard practice for craftspeople.

Over the years, these marks evolved into today’s system of trademark registration and protection, with the earliest trademark legislation known as the Bakers’ Marking Law, enacted by the British Parliament in 1266 by King Henry 111.

Other nations of the globe followed suit and in America, the first brand to register a trademark under the United States (US) Federal Trademark Act of 1870 was the Averill Chemical Paint Company, with an eagle and a ribbon, but the company eventually collapsed later.

It was followed by the oldest active US trademark of the J.P. Tolman Company in 1884, (now called Samson Rope), which registered an image of the Biblical Samson wrestling a lion.

As imperative as the issue of trademarks, its rights can be lost through abandonment, improper licensing or when it is generic. It can also be infringed and this was pronounced in the 13th century, with great intervention then, by many European courts.

In the US, trademark law went through a few incarnations before arriving in what now exist in modern times. It started with an old law in 1870, to a new act in 1881, revised in 1905 and in 1946; the Lanham Act spelt out federal trademark protection and registration rules.

Coming down to Africa

In Africa, businesses also make use of trademarks for products recognition, as and the continent represents an untapped, dynamic, fast-moving and competitive market that foreign investors can scarcely ignore.

The situation, where trademarks are used on products by indigenous and multinational organisations, is also the same in Nigeria.

In Nigeria, trademarks are provided for by the Trademarks, Patents and Designs Registry, Commercial Law Department of the Federal Ministry of Industry, Trade and Investment. And this is under the Trade Marks Act, Cap T 13, Laws of the Federation of Nigeria 2004 and the Trademark Regulations 1990.

The importance of trademark and product style protection against passing-off by others trying to deceive the consumers to believe their product share same quality with the original cannot be over-emphasised.

Disputes arising from infringements of trademarks copyrights, identity theft and product style copying abound in the western world, as well as in Nigeria.

Some of the cases recorded in the country’s business locale include that of Nabisco Inc., and Allied Biscuits Company Limited, in 1998, where both companies were entangled in a lawsuit on the trademark RITZ.

Allied Biscuits first registered the mark eight months before Nabisco, and the court held against the appellant, Nabisco, on the premise that it has not used the mark sufficiently to acquire a reputation for it in the country, that its intention is to destabilise the Nigerian market and her economy.

Also on October, 18, 1993, Pfizer, a global pharmaceutical company, dragged Iyke Merchandise to Court for infringing on its trademark, Combantrin Plus, with the mark, Combatinrein, which was likely to confuse consumers.

The plaintiff’s (Pfizer) action for injunction, order of delivery up for destruction of the infringing product (Combatinrein) and general damages were granted in its favour.

Issues around catching-up and passing-off

Interestingly, one of the major global marketing disputes regarding trademark is usually associated with established brands and a catching-up or weaker brand passing-off the established brand.

This appears to be the bone of contention in an unfolding case regarding trademark alleged infringement by the Nigerian Bottling Company (NBC) on its Predator energy drink with a lion insignia, which is a reflection of the mark of the current market leader, named Fearless, a product of Rite Foods Limited.

As a result of the alleged violation, the NBC has been dragged to a Federal High Court, in Ikoyi, Lagos, on January 20, 2021, as published in THISDAY and other news platforms.

In the suit No: PHC/L/CS/92/2021, the plaintiff, Rite Foods Limited, filed a motion ex parte for interim injunction against the defendant, NBC, restraining it from further promoting or using any sales promotion material for its Predator energy drink in a manner that infringes or passes off or that is capable of infringing or passing off the plaintiff’s Fearless energy drink, until the interlocutory application for injunction is determined.

The alleged infringement, it has been averred, negates the provisions of the Trade Marks Act, Cap T 13, Laws of the Federation of Nigeria 2004 and the Trademark Regulations 1990, which offers exclusive rights to trademark holders or users known with the trademark for business before a new entrant into the same trade or business.

Investigation revealed that the Plaintiff, Rite Foods’ Fearless energy drinks, which consist of the Red Berry and Classic brands, were launched into the Nigerian market on June 15 and 16, 2017, respectively, before the NBC’s Predator brand which made entrant in June, 2020.

This implied that the trademark has been in use by the Rite Foods’ brands before NBC’s Predator energy drink was launched three year after, into the Nigerian market.

Although there are claims, according to an investigation that the trademark may have been in use by NBC trade partners in other countries before the product launch in Nigeria in 2020.

However, some experts have argued that trademark concerning businesses and products is territorial. What this means is that a product or trademark registered or used in Brazil or America for example, will not be recognised in Ghana, if it has not been registered or being in use and identified with a product in the country.

According to the Plaintiff, it owns the exclusive right to the trademark which has been a mark of identifying its market leading product, Fearless energy drinks since 2017.

It posits that with the infringement by NBC, consumers are likely to assume (mistakenly) that the Fearless and Predator brands are from the same source and may also share the same quality.

The company claimed the degree of similarity between the lion symbols on its brands and that of the NBC’s Predator energy drink, was high and that since both compete in the same market spectrum, the mark was likely to cause confusion in the minds of consumers, about the source or sponsorship of the brands offered under the defendant’s mark.

The energy drinks market in Nigeria

A critical question posed on this dispute by some observers is that why NBC waited for three years after Rite Foods’ Fearless energy drink was introduced before coming out with a look alike of the trademark of Fearless, if indeed its partner has used the trademark or style in another country?

A marketing analyst, Mr. Adekanmi Fadare wondered why a big multinational company will be playing a catch-up marketing strategy to the point of using a trademark similar to an indigenous company who had gained market acceptability with the trademark unique packaging.

Meanwhile, the management of the NBC has vowed to slug it out with Rite Foods Limited over the issue.

In a statement titled; ‘NBC to vigorously contest case against Rite Foods’ the bottling company argued that it’s well within the NBC rights to continue to sell the Predator

“However, in the interest of clarity and accuracy, both NBC and Predator Energy would like to make two things 100 per cent clear: firstly, we are well within our rights to continue to sell the Predator products and secondly, neither NBC nor its Managing Director, is in breach of any court order,” NBC stated.

As the matter is now before the court with both parties insisting on right to fly the controversial ‘insignia’ , it is hoped that consumers’ interest will be protected while the dispute is being settled.

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