The First Hall Civil Court, presided over by Mr Justice Joseph Zammit McKeon, on May 16, in the case Luigi A. Sansone as special mandatary of British American Tobacco Italia vs J.L. Tobacco Co. Ltd, held, among other things, that for purposes of article 88 of the Trademark Act Chapter 416 (which stipulated the five-year period of prescription), the bona fide use of a mark before Chapter 416 came into effect on January 1, 2001, was also to be considered in determining whether plaintiff’s legal action was time-barred.

In this case the court had to decide whether British American Tobacco had exclusive rights to use the words Toscano or Toscani.

British American Tobacco stated that it was the owner of several trademarks in relation to cigar products, Toscano, Toscani, Toscani Extra Vecchi and Antico Toscano, which were sold in several countries, including Malta. Its cigars had been first imported to Malta in 1996. These cigars were manufactured in Italy from a type of tobacco called Kentucky, which had been used for cigars in the region of Toscana, Italy, since 1815.

It resulted that from the date of its incorporation in 1988 the Maltese company J.L. Tobacco Co. Ltd had manufactured and distributed, through a network of 33 agents in Malta, its home-made brand of cigar, Toscani, from different types of tobacco. It had done so openly and without opposition for many years. Eventually, J.L. Tobacco had been compelled to change its packaging to include a health warning. Other than that its packet had remained unchanged.

J.L. Tobacco’s cigar packet bore no visible resemblance to the Italian product of British American Tobacco other than for the use of the word Toscani. British American Tobacco claimed it had a right protect its trademark rights and to stop J.L. Tobacco from using the word Toscani on its cigar products. It referred to the Paris Convention of March 20, 1883 as amended.

Faced with this situation, on December 28, 2005, British American Tobacco filed legal proceedings in Malta to prohibit J.L. Tobacco Co. from using the word Toscani in respect of its cigar products in terms of article 50 (2) of Chapter 416 of the Trademark Act.

This article provides that “subject to the provisions of article 44, the proprietor of a trade mark which is entitled to protection under the Paris Convention as a well-known trademark is entitled to restrain by injunction the use in Malta of a trademark which, or the essential part of which, is identical or similar to his mark, in relation to identical or similar goods or services where the use is likely to cause confusion”.

It requested the First Hall Civil Court to declare that J.L Tobacco had infringed its trademark rights, and to prohibit the use in Malta of the word Toscani in accordance with article 50 (2).

In reply J.L. Tobacco contested the legal action against it. It raised the preliminary plea of five-year prescription under article 88 of Chapter 416, which stipulates that “civil actions under this Act shall be barred by the lapse of five years in all cases in which no other period within which such actions may be brought is fixed in this Act”. In the circumstances, well over five years had passed from when J.L. Tobacco had launched its Toscani products on the Malta market.

It pleaded that British American Tobacco had to prove all elements required under article 50 of the Trademark Act. It had to be shown that the words Toscano and Toscani were trademarks; and that it was the owner of such trademarks and had a right to protection under the Paris Convention.

J.L. Tobacco argued that British American Tobacco did not have exclusivity over the words Toscani and Toscano. It was stated that these words only indicated the type of cigars and only served to describe a product. Besides, it maintained in defence that it had used the word Toscani in good faith and in this respect article 50(3) of the Trademark Act should apply: “Nothing in sub-article (2) shall affect the continuation of any bona fide use of a trade mark begun before the coming into force of this article.”

Good faith was presumed unless the contrary evidence was produced.

On May 16, 2011, the First Hall Civil Court dismissed the requests of British American Tobacco and accepted J.L. Tobacco’s plea of prescription under article 88 of the Trademark Act. It noted that article 50(3) was intended to extend to those trademarks which were used in bona fide before Chapter 416 (the Trademark Act) came into effect. It did not result that British American Tobacco had a community trademark in respect of the words Toscani or Toscano for class 34, covering tobacco products.

The court considered that it was not permissible to pass one’s products for another in a way to deceive consumers and mislead them to confuse a person’s products for another. In Salomone noe vs Cassar noe dated February 27, 1962, it had been held that when a person had used a distinctive mark, he had the right to use it exclusively. He had a right to stop others from using it, or from copying it, to the extent of creating confusion between the products. There was no need to prove that consumers had been deceived. It was sufficient to show that confusion was likely by consumers of ordinary diligence.

In the case Somerville noe vs Schembri noe dated November 18, 1884, the House of Lords had held that “As soon therefore as a trademark has been so employed in the market as to indicate to purchasers that the goods to which it is attached are the manufacture of a particular firm, it becomes to that extent the exclusive property of the firm and no one else has a right to copy it or to appropriate any part of it, if by such appropriation unwary purchasers may be induced to believe that they are getting goods which were made by the firm to whom the trademark belongs.”

British American Tobacco had not proven bad faith on the part of J.L. Tobacco, or that it was aware that Toscani was its exclusive property and despite this it intended taking an unfair advantage of British American Tobacco’s reputation.

In The Law of Trademarks and Trade Names, Kerly writes that “it is a well-recognised principle that has to be taken into account in considering the possibility of confusion arising between any two marks that where the two marks contain a common element which is also contained in a number of other marks in use in the same market, such a common occurrence in the market tends to cause purchasers to pay more attention to the other features of the respective marks and distinguish between them by those features”.

Nor had it been established that Toscani was the exclusive and distinctive mark of British American Tobacco. The court compared the word Toscani with the word Cola, which was also a word of common use that referred to a particular kind of product. Nothing had been done to create confusion. The court was convinced that J.L. Tobacco had made bona fide use of its mark for over five years, and that there were no grounds for British American Tobacco to invoke the application of article 50(2) of Chapter 416.

British American Tobacco’s legal action was time-barred by the lapse of five years (article 88 of Chapter 416).

The court said that for purposes of article 88, it could also take into account the bona fide use of a mark before Chapter 416 came into effect on January 1, 2001.

Dr Grech Orr is a partner at Ganado & Associates.