Jenni Button restrained from using her own name

The Cape High Court granted an order on 19 September 2008 against the well-known South African clothing designer, Jenni Button, interdicting her from making use in any way of the trade name JENNI BUTTON for purposes of conducting business within the retail clothing trade in South Africa.  She was also directed to pay the costs of the application.

The High Court actually dealt with two applications heard simultaneously : 

• the first, by Jenni Button against Jenni Button (Pty) Limited (“the company”) and other entities, to transfer to her 30 % of the shares of the company; and

• the second, a counter-application by the company to restrain Jenni Button from using the trade name JENNI BUTTON for purposes of conducting business within the retail trade including as part of the domain name jennibutton.com.

In 1997, a written sale of business agreement was entered into between a company then known as Jenni Button (Pty) Limited and, inter alia, a nominee of an unnamed company (known as Newco, which subsequently changed its name to Jenni Button (Pty) Limited). The business sold included

“the names of JENNI BUTTON and JB Inc and all goodwill relating thereto, and all trade marks and copyright in or relating to the names JENNI BUTTON and JB Inc which, together, comprises a going concern”.

The purchasers undertook in the agreement to offer Jenni Button an interest of at least 30 % in Newco and it provided that the terms of conditions of her interest would be the subject of a further agreement.

For reasons of vagueness and unenforceability, the court held that the provisions of the sale of business agreement relating to the sale of 30 % of the interest in Newco was void and refused Jenni Button’s claim for the transfer of the shares to her, with costs.

In the counter-application by the company (the second Jenni Button (Pty) Limited) to restrain Jenni Button from using the trade name JENNI BUTTON, the following facts emerged :

• Jenni Button had never disputed the fact that the company had acquired all the goodwill relating to her name, trade marks and copyright;

• despite that, she had used the name JENNI BUTTON in trade in several instances relating to her new clothing business.  When challenged, she had given an undertaking to desist from doing so;

• in her answering affidavit in the counter-application, she sought to qualify her undertaking, taking the attitude that she could not be prevented from referring to her own name provided she did not use JENNI BUTTON as a trade mark or trading style in South Africa.  Jenni Button contended that the Respondents were not entitled to prevent the use of her own name in the context of the clothing designs that she creates and that the undertaking she had given previously was done “in the spirit of co-operation and reconciliation”;

• she also sought to rely on the provisions of Section 34(2) of the Trade Marks Act which entitle a person to use his or her own name in trade in a bona fide manner.

The court held that :

• in view of the fact that no registered trade mark was in issue, the provisions of Section 34(2)(a) were not relevant but the court did recognise that, under South African common law, a person has a prima facie right honestly to use his or her

own name in business and to sell goods under his or her own name. However, there are limitations upon the right of a person to do so and the earlier decisions in Policansky Brothers Ltd v L&H Policansky, 1935 AD and Brian Boswell Circus v Boswell-Wilkie Circus 1985 (4) SA 466 (A) were pertinent;

• in view of the fact that the company had acquired the name JENNI BUTTON and the goodwill associated with it from the applicant, the court had no doubt as a matter of fact that the continued use by her of her own name in the course of her current business infringed the right to goodwill attaching to the JENNI BUTTON trade mark.  She was not entitled to make use of her own name in the course of business, at least not for as long as that business operated in the same field as the company in South Africa;

• as there was undisputed evidence of Jenni Button’s use of her name in trade in South Africa (including the use as part of the domain name for her website at http://www.jennibutton.com), the company had established its entitlement to the interdictory relief claimed and granted it the order requested (restricted to South Africa), with costs.

Chris Job
Adams & Adams
chris@adamsadams.co.za
25 September 2008