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Confusing skin cream labels must go

Jun 26 2011 14:56 Antoinette Slabbert

Company Data

TIGER BRANDS LIMITED [JSE:TBS]

Last traded 277.63
Change 1.93
% Change 0.01
Cumulative volume 799109
Market cap 53.27bn

Last Updated: 24/04/2014 at 04:28. Prices are delayed by 15 minutes. Source: McGregor BFA

ADCOCK INGRAM HOLDINGS LIMITED [JSE:AIP]

Last traded 60.11
Change 0.21
% Change 0.00
Cumulative volume 244004
Market cap 10.56bn

Last Updated: 24/04/2014 at 04:28. Prices are delayed by 15 minutes. Source: McGregor BFA

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Pretoria – “Confusing” camphor cream labels will have to be removed immediately.

This was the decision of the South Gauteng High Court in an urgent application by Tiger Brands against the Adcock Ingram healthcare group.

The labels have to be changed immediately.

Tiger Brands [JSE:TBS], the manufacturer of Ingram’s Camphor Cream, had earlier approached the court after Adcock Ingram Holdings [JSE:AIP] changed the packaging of its Adcock Ingram TLC Camphor Cream, resulting in the respective jars closely resembling one other.

The shape of the jar, the prominent use of the Adcock Ingram name and the colours of green, white and red used, made it difficult for consumers to distinguish between the two products, Tiger argued.

Judge Brian Spilg previously granted Tiger's urgent application, and last week announced the reasons for his decision.

Adcock Ingram was prohibited from encroaching on various Tiger trademarks related to camphor cream.

Adcock Ingram was to desist from ambush marketing and should remove the new labels from all jars of the cream still in its possession.

Although Adcock Ingram advanced various arguments questioning the validity of Tiger’s brand names, the court found that on the surface the brand names were in order. For an urgent application this was adequate.

Judge Spilg said that in earlier transactions Adcock Ingram, which had been unbundled from Tiger Brands, had waived its rights, including goodwill, in respect of Ingram’s Camphor Cream.

The health group had been generously compensated for these rights.

With this product Tiger holds 82% of the camphor cream market, having sold 12m jars in 2010. In that year it had spent R12.4m on marketing, netting R207m from the product.

In an earlier agreement between Tiger and Ingram it had been determined that Adcock could use the “Ingram” name as long as it did so together with the word “Adcock”.

Adcock called upon its legal right to use its own name.

Judge Spilg pointed out that this right was qualified if it did not comply with fair business practice.

The similar colours of the two containers and the prominent use of the Adcock Ingram name on the health group’s new labels would cause consumers to think that the two products came from the same manufacturer, ruled Spilg.

Adcock’s use of the words “New Look” on the label would strengthen the perception that it was Tiger’s product in a new packaging.

He pointed out that Adcock had conducted no concomitant advertising campaign to inform consumers that its product’s appearance had changed.

The court decided that Adcock had ostensibly been guilty of ambush marketing and could derive unfair advantage from Tiger Brands’ Camphor Cream reputation.

-    Sake24

For business news in Afrikaans, go to www.sake24.com.
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