Adidas AG and Another v Pepkor Retail Limited

Adidas AG and its subsidiary brought proceedings against Pepkor Retail Limited alleging that Pepkor infringed Adidas’s registered three-stripe trade marks and passed off its sporting footwear as Adidas products. Adidas relied on four well-known registered three-parallel-stripe marks used on footwear and sporting goods. Pepkor, through its Ackermans and Pep Stores divisions, sold trainers and soccer boots bearing two and four parallel stripes on the outside of the footwear. Adidas contended that these stripes were used as trade marks and were confusingly similar to its registered marks. Pepkor denied infringement and passing off, arguing that the stripes were merely decorative, that Adidas’s rights were limited strictly to three stripes, and that the fame of the Adidas mark eliminated any likelihood of confusion. The Western Cape High Court dismissed Adidas’s application. Adidas appealed to the Supreme Court of Appeal.

The appeal was upheld with costs. The High Court’s order was set aside and replaced with an order interdicting Pepkor from infringing Adidas’s registered trade marks and from passing off its footwear. Pepkor was ordered to remove or deliver up infringing footwear, and enquiries were directed into damages or reasonable royalties for trade mark infringement and damages for passing off. Pepkor was ordered to pay costs, including the costs of two counsel.

This judgment reaffirmed strong protection for well-known trade marks in South African law, particularly non-traditional marks such as device or pattern marks. It confirmed that the use of similar marks with a different number of stripes can still infringe registered trade marks and that the fame of a mark may heighten the likelihood of confusion. The case is a leading authority on trade mark infringement and passing off involving product get-up in South Africa.