African Court Blocks Paint Start-Up Brand Name

WEDNESDAY, DECEMBER 13, 2023


The Free State Division of the High Court in South Africa has recently barred paint company Dumax Paints from continuing to use its brand name, citing that the trademark infringes on AkzoNobel’s Dulux brand.

Dumax reportedly began trade in 2021; however, it was found by the court that it had copied an identical image from Dulux’s website onto its own to promote products.

In terms of branding, Dulux has what’s described as a “flourish device” over the word Dulux, whereas Dumax uses a “rainbow-like device” with its name. The colors also feature an “extraordinary similarity,” including red, orange, yellow, green and blue.

Additionally, the court said another move was meant to confuse consumers—Dulux’s slogan is “The future of paint today,” while Dumax used “Painting the future.”

“The respondents are new entrants in a competitive market. There is no doubt that the Dulux trademark is dominant to such an extent that the Competition Commission recently refused to consent to the merger of Dulux and Plascon, the biggest and second-biggest paint brands in SA, the reason being that it would limit competition,” the judge found, according to a report from Business Live.

“No one can claim an absolute right to exercise [his or her] trade or profession without interference and in so doing contravene the rights of their rivals. This is trite. Though the importance of a free market and robust competition cannot be underestimated, no one shall be allowed to interfere with the clear rights of others.”

During the defense, Dumax said that Dulux’s application to interdict it using its trade name was the “antithesis of transformation and has a massive potential to halt economic transformation,” adding that “during the years in which the applicants were formed, black people were not allowed to participate in the mainstream economy.”

The judge found this argument to amount to no more than a “political argument.”

“They [Dumax] obviously selected the name Dumax in order to sail as close as possible to the wind,” said the judge.

“Although this is a borderline case, I am not satisfied that the Dumax mark so nearly resembles the registered trademark Dulux as to likely deceive or cause confusion.”

However, there was reportedly no trademark infringement under either Section 34(1)(a) or 34(1)(b).

“I am satisfied that this case falls squarely within the parameters of s 34(1)( c)’, and that the owner of the company decided to ‘sponge’ on the well-known Dulux and Maxicover trade marks by ‘pirating the product of years of invention’ and ‘reaping the fruits’ sown by the applicants,” the judge concluded.

The judge granted AkzoNobel an interdict under Sections 34(1)(c)  of the Trade Marks Act, one that prohibits Dumax from infringing the well-known trade mark registration no. 1931/00131 Dulux in class 2, by using in relation to any goods of services an identical or confusing similar name to Dulux, including the name Dumax.

Recent Acquisition Cancellation

Last month, after reviewing a request for consideration, the Competition Tribunal in South Africa issued an order prohibiting the merger between global coatings company AkzoNobel and shares from African coatings company Kansai Paint.

According to the Commission, the merger would combine the largest and second-largest manufacturers of decorative coatings, the Dulux and Plascon brands manufactured by AkzoNobel and KPAL, respectively.  

In June 2022, AkzoNobel announced that it had reached an agreement with Kansai Paint to acquire its paints and coatings activities in the region. Then, in November of last year, the Competition denied the proposed merger to acquire Kansai’s paint and coatings activities in the region. 

Most recently, on Nov. 21, the commission once again prohibited the proposed merger. While no reasoning has yet been provided, initially it was found that that the transaction would likely result in a substantial prevention or lessening of competition in the market for the manufacture and supply of decorative coatings.

As a result, AkzoNobel and Kansai announced they have mutually agreed not to proceed with the intended acquisition of Kansai's paints and coatings activities in Africa. According to the emailed press release, the two companies have also agreed that no break-up fee will be involved.

   

Tagged categories: AF; AkzoNobel; Business matters; Dulux; EMEA (Europe, Middle East and Africa); Good Technical Practice; Government; Laws and litigation; Lawsuits; Marketing; Paint; Program/Project Management

Join the Conversation:

Sign in to our community to add your comments.