South Africa: Constitutional court judgment goes against SABMiller

Johannesburg: SABMiller said on May 27 that it was surprised that the constitutional court had overturned a supreme court decision that a promotional company had illegally mocked its Carling Black Label beer brand, according to Business Report news.

In handing down the landmark judgment, Judge Dikgang Moseneke found that SAB, the local subsidiary of SABMiller, had not proved that Laugh It Off Promotions, owned by entrepreneur Justin Nurse, had infringed on the brewery's trademark by printing what appeared to be racial accusations on T-shirts.

Laugh It Off substituted the slogan "Carling Black Label Beer, America's lusty lively beer, enjoyed by men around the world" with the words "Black Labour White Guilt, Africa's lusty lively exploitation since 1652, no regard given worldwide" on T-shirts it sold to the public. SAB said that, while it supported the concept of freedom of expression, it felt this matter did not involve genuine freedom of expression.

"Trademarks are important commercial assets of a company and ... we have an obligation to protect our trademark rights and brand equity and reputation. The decision suggests that the dignity or reputation of a trademark will not be afforded protection in itself," said Michael Farr, a spokesperson for SAB. He added: "In other words, you can disparage a brand as long as the sales of that brand are not likely to be reduced. This, we believe, could be of concern to trademark holders."

In a case that boiled down to balancing the right to freedom of expression against the right to protect a trademark, Sabmark International successfully sought an interdict in 2001 after it discovered that Laugh It Off was producing and selling T-shirts that lampooned the Carling Black Label trademark.

Sabmark, which owns beer and cider trademarks licensed to SAB, argued that Carling Black Label was a reputable brand, worth billions internationally, and it had a right to protect itself, its brand names and property from unauthorised use, or abuse. Laugh It Off appealed, arguing that Sabmark had been and still was guilty of exploiting black labour and of racial discrimination, and that its T-shirts simply criticised the way SAB marketed its beer.

Moseneke held that Sabmark failed to prove Laugh It Off had infringed its trademarks and "the likelihood of taking advantage of, or being detrimental to, the distinctive character or repute of the marks" had not been established.

He ruled that Laugh It Off was not selling beer in competition with SAB, but was rather involved in the sale of "an abstract brand criticism". Such expressive conduct was acceptable in terms of the constitution and, in light of Sabmark's failure to establish the likelihood of economic harm, was not an infringement of the act. In the court's view, the expression of humour was not only permissible, but necessary for the health of democracy, Moseneke said.

In a concurring judgment, Judge Albie Sachs said that Laugh It Off had merely engaged in parody and that parody was inherently paradoxical.

"Good parody is both original and parasitic, simultaneously creative and derivative. The relationship between trademark and parody is that if the parody does not take enough from the original trademark, the audience will not be able to recognise the trademark and therefore not able to understand the humour.

"The evidence indicates that everybody concerned with the T-shirts, whether producer or consumer, knew that they were intended to poke fun at the dominance exercised by brand names in our social and cultural life."

He said the overzealous application of the trademark law could have a detrimental effect on the free circulation of ideas.

Sachs also warned that big companies attempting to block free speech could do themselves more damage than good.

"Simply bringing proceedings against Laugh It Off risked tarnishing Carling Black Label ... more than the sale of 200 T-shirts could ever have done," Sachs said.

Speaking after the judgment, Jane Duncan, the executive director of the Freedom of Expression Institute, said: "It sends a very clear message that freedom of expression takes precedence over intellectual property rights, more specifically the intellectual property of a company that has massive financial backing and the ability to splash its message over the public domain."

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