Online Lottery Services (Pty) Ltd v National Lotteries Board and others
[2007] 1 All SA 618 (T)
Division:
Transvaal Provincial Division
Date:
4 October 2006
Case No:
21917/2004
Before:
J Motata J
Sourced by:
M Snyman and D Cloete
Summarised by:
D Harris
. Editor's Summary . Cases Referred to . Judgment .
[1] Delict Unlawful competition Passing off Test Whether the resemblance between the competing products is such
that there is a reasonable likelihood that ordinary members of the public, or a substantial number thereof, may be
confused or deceived into believing that the merchandise of the alleged wrongdoer is that of the aggrieved party or is
connected therewith.
[2] Intellectual property Trade marks Application for expungement Whether trade mark is distinctive.
[3] Intellectual property Trade marks Infringement of Application for interdict Trade Marks Act 194 of 1993 Section
34(1) Applicant must establish unauthorised use in the course of trade, in relation to goods or services in respect of
which the trade mark is registered, of an identical mark or of a mark so nearly resembling it as to be likely to deceive or
cause confusion.
Editor's Summary
Two applications were before the Court. The first, referred to as the "interdict application", was brought by the
National Lotteries Board ("the Board") and the holder of the sole licence to conduct the national lottery ("Uthingo").
The latter two parties sought an interdict against the respondent in that application ("Online"). The second
application was brought by Online, for the expungement from the trade marks register of a trade mark registered
by the Board and Uthingo.
The Board was the registered proprietor of the trade mark "LOTTO", and Uthingo was a registered user of the
mark.
Held (i) The interdict application
Uthingo had at all times used the registered trade marks strictly under the directions and control of the Board.
Without the Board's authority, Online began selling tickets for the lottery via internet and via the small message
service provided by mobile telephone networks. It used the trade name "LottoFun". In doing so, it was, according
to the Board, infringing the latter's trade mark and unlawfully competing with the Board and Uthingo.
The Court set out the established requirements for a final interdict, viz a clear right; an injury actually committed
or reasonably apprehended; and the absence of similar protection by any other remedy.
To succeed in an application based on section 34(1)(a) of the Trade Marks Act 194 of 1993 the applicant must
establish unauthorised use in the course of trade, in relation to goods or services in respect of which the trade
mark is registered, of an identical mark or of a mark so nearly resembling it as to be likely to deceive or cause
confusion.
Page 619 of [2007] 1 All SA 618 (T)
The respondent was unable to satisfy the court that its use of the LottoFun mark was not in relation to services in
respect of which the trade marks were registered or that the services which it rendered were not services which
were similar to the services in respect of which the trade marks were registered. Thus, the issue in dispute was
limited to whether there was a likelihood of deception or confusion.
The evidence established that there was no business relationship between Uthingo and Online. However, the
latter went on to conduct business as if authorised by the Board and Uthingo. The Court pointed out that passing
off is a species of the broader delict of "unlawful competition", characterised mainly by misrepresentation of a
particular kind. A passingoff is unlawful because it is calculated to result in the improper filching of another's trade
and an improper infringement of his goodwill and/or because it may cause injury to that other's trade or reputation.
The test remains whether the resemblance between the competing products is such that there is a reasonable
likelihood that ordinary members of the public, or a substantial number thereof, may be confused or deceived into
believing that the merchandise of the alleged wrongdoer is that of the aggrieved party or is connected therewith.
The rights infringed by passingoff are the applicant's rights in an existing goodwill. Before the likelihood or
otherwise of deception or confusion between the two competing products is considered it is necessary for the
applicant to establish as a prerequisite a reputation in the getup on which it relies. The Board and Uthingo in this
case had satisfied the above test, showing as they had, that the Lotto trade mark had become distinctive. The
Court accordingly granted the interdict sought.
(ii) The expungement application