All Eyes on Trademark War Between Rite Foods and NBC

Brands & Marketing

Brand and marketing specialists who are by-standers in the legal battle between two leading energy drink brands, Rite Foods Limited and Nigeria Bottling Company over trademark infringement are of the view that the decision of the court would create a pathway towards addressing the issues going forward, writes Wale Igbintade

With the resolution of the interlocutory applications in the legal battle between the manufacturers of Fearless Energy drink, Rite Foods Limited and the owners of Predator brand, Nigeria Bottling Company (NBC), last week by the Federal High Court in Lagos, the court is now set to hear the substantive suit which borders on trademark infringement.

Early this year, Rite Food dragged NBC and its managing director to court over alleged trademark infringement.

The plaintiff argued that it has been using and trading with the lion image since 2017, three years before the NBC’s Predator came into the market in 2020. It alleged that NBC has infringed on its trademark with its Predator energy drink, which has adopted a lion head in resemblance to the mark on its Fearless energy drinks brand.

In suit No. FHC/L/CS/92/2021, the plaintiff filed a motion ex parte for an interim injunction restraining the NBC from further promoting or using any sales promotion material for its Predator energy drink in a manner that infringes or passes off the plaintiff’s Fearless energy drink, until the interlocutory application for an injunction is determined.

Rite Foods argued that the alleged infringement negates the common law property right in the goodwill of “Fearless” energy drinks and Trade Marks Act, Cap T 13, Laws of the Federation of Nigeria 2004, which offers exclusive rights to get designs of products already in use by a proprietor.

It also argued that a business name as well as the logo is the distinguishing factor of a business, adding that it is of immense value to a brand; setting it apart from other brands.

The plaintiff further contended that while it is important that handlers of brand protect it from infringement by third parties, it is equally vital to understand that the law regulating trademark registration in Nigeria grants exclusive right of ownership to a trading name or logo.

It noted that a trading name or logo is a brand’s identity and trademarking it grants exclusive commercial rights, and that it also prevents other businesses from using a similar name or mark.

But the NBC said that there has been no trademark violation or passing off with its Predator Energy drink and maintains that the Predator brand logo has been in existence and in use in many markets even prior to the launch of Fearless by Rite Foods in the Nigerian market. It asked the court to dismiss the suit in its entirety.

While the suit was pending before the first judge, Justice Chukwujekwu Aneke, Rite Foods filed a motion for interlocutory injunction seeking to prevent NBC from marketing or distributing Predator Energy drink in Nigeria. It also filed an application before the court to hold NBC and its Managing Director, Mathieu Seguin in contempt for still producing and selling the Predator brand despite the fact that a suit had been filed on alleged trademark infringement.

Soon after, the case was transferred to Justice Ambrose Lewis-Allagoa. At the hearing of the suit, counsel to NBC, Mr Matins Okonma and that of the NBC’s managing director, Mr Oluseye Opasanya (SAN), urged the court to set aside the committal proceedings as the ex parte order complained of has been discharged. Opasanya had also informed the court that he filed a motion on notice dated October 18 and supported with a seven-paragraph affidavit together with one exhibit.

He told the court that he brought the motion to strike out the suit on a number of reasons. Counsel to the NBC, Ngo Matins Okonma, had also told the court that he filed an application dated October 15, 2021 and a motion on notice in respect of the application to regularise the application dated November 11.

In his motion on notice, he asked the court to set aside the order of committal proceeding in its entirety including all processes used by plaintiff in the proceedings. They both argued that since the said order had been discharged, the court cannot punish an alleged contemnor for any breach.

Both counsel asked the court to award punitive costs against Rite Foods if it finds no basis for the contempt proceedings

“The order upon which committal proceedings was premised has been discharged/ set aside by Justice Chukwujekwu Aneke on September 27, 2021.”

Counsel to Rite Food. Mr MuyiwaOgungbemiro in his own counter affidavit sworn to by Francis Omoniyi, dated October 21,2021 and a written address to support their case, asked the court to dismiss the Contemnors’ motion to set aside the committal proceedings.

He submitted that contrary to the position of counsel to the contemnors, the court has the power to punish a contemnor for an offence committed during the pendency of an order.

Ogungbemiro added that the order of court complained about, was violated during the pendency of the order and this require that the violator must be punished for such act.

After listening to the arguments, Justice Lewis-Allagoa on the penultimate Wednesday, set aside the contempt proceedings. He also held that there was no subsisting order that was disobeyed by the respondents.

He remarked that his learned brother Justice Aneke had on September 27, 2021, discharged and set aside the committal proceedings. He therefore awarded punitive cost of N500,000 each in favour of NBC and the alleged second contemnor, against the plaintiff, (Rite Food).

In his ruling, the judge set aside the order of committal proceeding in its entirety including all processes used by plaintiff in the proceedings.

“The motion filed by the plaintiff is qualified as nullity. A foundation of any committal proceedings is for a valid judgment, where there is no valid judgment it cannot be used. Committal proceedings can only exist having been that the order is still enforceable, the motion dated October 15 and 18, filed by the respondents has merit. I hereby set aside in its entirety the committal proceedings, including all the processes”, the judge held.

The resolution of the interlocutory applications has now cleared the pathway for the court to hear substantive suit.

Even brand and marketing specialists who are observing the legal battle between two top energy drink giants cannot wait to see how the court resolution will set a precedence for future engagements in the industry. They believe that legal tussle reminds the industry of the Cola War of the 70s. The war was one of most polarising and iconic battles among beverage brands. Coca-Cola and Pepsi went to battle to determine who becomes the ultimate champion in the soft drink market.

The tussle was part of the strong effort of each of the parties to differentiate themselves, as both of their beverages were brown, sweetened and carbonated soft drinks.

While Coca-Cola emphasised a sense of belonging and loyalty in the hearts and minds of consumers, PepsiCo focused on showcasing how their brand is up-to-date, fresh and youthful. Many still believe the battle is covertly still ongoing till date.

Interestingly, the feud between Rite Foods and NBC is not the first case of trademark infringement in Nigeria. There was a case of Nabisco Inc., v Allied Biscuits Company Limited in 1998, where the trademark RITZ was the issue before the court. Allied Biscuits first registered the mark eight months before Nabisco.

But in its resolution, the court ruled against Nabisco on the grounds that it had not used the mark sufficiently to acquire a reputation for the mark in Nigeria; and therefore its intention is to destabilise the Nigerian market and her economy.

Also on October 18, 1993, Pfizer dragged Iyke Merchandise to Court for infringing on its trademark, Combantrin Plus, with the name Combatinrein, which was likely to confuse consumers.

No doubt the outcome of the legal battle between Rite Foods and NBC would nonetheless set yet another precedence in the handling of trademark issues among Nigerian consumer brands in the future.