Zuma SA operates a restaurant in South Africa under the name Zuma. They advertise the restaurant, using the name Zuma, on theirwebsite, and on their Facebook and Instagram pages, as well as other places, such as display material.
SOME BACK STORY
When Zuma UK first became aware of Zuma SA the parties did the right thing – they spoke. During these talks, Zuma SA assured Zuma UK that it would trade as Zhuma. Yet, Zuma SA seemingly went ahead and opened a restaurant called Zuma, using the website www.zumarestaurant.co.za.
OFF TO THE ARB
Zuma UK lodged a complaint with the ARB, claiming:
Dishonest and misleading advertising
Zuma UK alleged that Zuma SA had made dishonest and misleading statements and that it was in breach of two clauses of Section II of the Code of Advertising Practice: Clauses 2 (honesty) and 4.2.1 (misleading advertising). More particularly:
- On its website, Zuma SA said that “Zuma is an internationally established brand, trademarked in South Africa.”
- At the opening of the restaurant, Zuma SA said that it “is the name of an international restaurant brand of which Manal (the owner of Zuma SA) said he had the sole trademark in South Africa.”
- Zuma SA’s advertising was framed in a way that it implied that it was part of an international chain.
Exploitation of advertising goodwill and imitation
Zuma UK claimed that Zuma SA had exploited Zuma UK’s advertising goodwill and imitated its advertisements (Articles 8 and 9 of Section II). Zuma SA’s actions would therefore cause confusion…in fact, there had been actual confusion already on social media.
A lack of jurisdiction
In response, Zuma SA claimed that the ARB had no jurisdiction over it because it (Zuma SA) was not a member of the ARB.
THE ARB’S DECISION
The ARB first tackled the jurisdiction issue.
Jurisdiction
Zuma SA’s attorney cited a recent SCA judgment. In that case, the SCA held that the ARB “has no jurisdiction over a non-member and it may not, in absence of a submission to jurisdiction…issue any instruction, order or ruling against the non-member.”
Yet, as the ARB pointed out, the judgment also says that “the ARB is entitled to consider, on behalf of its members, complaints in respect of advertisements published by non-members of the ARB, so that its members may make an election whether or not they wish to publish that advertisement. This is an incident of their constitutional rights to freedom of expression and association.”
As it so happens, the Constitutional Court judgment has in fact now come out with a final judgment on the matter.
The ARB moved on to the substantive issues.
Dishonest and misleading claims
Clause 3, Section II of the Code says that “advertisements should not be so framed as to abuse the trust of the consumer or exploit their lack of experience, knowledge or credulity” - It further says that "advertisements should not contain any statement or visual presentation which…is likely to mislead the consumer"- Clause 4.2.1, Section II.
On its website, Zuma SA says that “ZUMA is an independent and trademarked entity in South Africa.” The ARB, however, noted that Zuma SA’s trade mark application for Zuma Contemporary Asian Cuisine is still pending. So, the use of the word “trademarked” was misleading and in breach of the two clauses.
Exploitation of goodwill
The ARB said that it was quite clear that “a deliberate attempt was made by the Advertiser to create an association with the Complainant’s brand.”
Imitation
The ARB held that Clause 9 of Section II had been breached because Zuma SA “consciously and deliberately chose to use the trade name Zuma – and not their registered trade mark Zhuma – with the intention of imitating the Complainant’s brand and benefitting therefrom. This becomes especially clear if one considers that in South Africa… the word ‘Zuma’ is more likely to be associated with former President Jacob Zuma, who is not Asian…naming a restaurant Zuma therefore is not a logical move for an Asian restaurant.”
INSTRUCTIONS TO MEMBERS
The ARB instructed its members not to accept “any advertising from the Advertiser that makes use of the name Zuma or claims that it owns the registered trade mark.”
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Read the original publication at ENSafrica.