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Voltic Nigeria Limited v. Groupe Danone & Anor.

Court of Appeal

Judgement delivered on Thursday, July 18, 2002
Citation: 45 NIPJD [CA. 2002] 261M/2002
Suit No. CA/L/261M/2002      Jurisdiction: Nigeria

BEFORE THEIR LORDSHIPS

GEORGE ADESOLA OGUNTADE, J.C.A
PIUS OLAYIWOLA ADEREMI, J.C.A.
SULEIMAN GALADIMA, J.C.A. (Delivering the Lead Judgement)

BETWEEN

1. VOLTIC NIGERIA LIMITED (Appellant)

AND

1. GROUPE DANONE (Respondents)
2. SOCIETE DES EAUX DE VOLVIC

I. FACTS

In suit No. FHC/L/CS/180/2000, the respondents, who were the plaintiffs herein instituted an action against the appellant as defendant before the Federal High Court, Lagos, claiming inter-alia as follows:-

“i. A declaration that the use of the words “LA VOLTIC” by the defendant, constitutes an infringement of the plaintiffs’ registered trademark “VOLVIC” No. 39259 in class 32.

ii. A declaration that the adoption of the words “LA VOLTIC” by the defendant for the sale of their table water amounts to passing off of the same as and for the plaintiffs natural mineral water, sold under trademark “VOLVIC”.

iii. An order of perpetual injunction restraining the defendant, its servants, agents, directors or privies and, or any of them or otherwise howsoever, from doing the following acts or any of them, that is to say;

(a) Infringing the 2nd plaintiff registered trademark “VOLVIC” No. 39259 in class 32.

(b) Passing off, attempting to pass off, causing, enabling or assisting others to pass off bottled table water not of the plaintiffs’ manufacture or merchandise as and for the goods of the plaintiffs by the use or in connection therewith in the course of trade if the trademark “LA VOLTIC” or such other similar mark either alone or in combination with other design or logo or colourable imitation thereof as to be calculated to lead to belief that natural mineral water not of the plaintiffs manufacture of merchandise are products of the plaintiffs.

(c) Bottling, manufacturing, selling or offering for sale table water sold in packages, cans, bottles or containers bearing the word “LA VOLTIC” so closely resembling the plaintiffs’ trademark “VOLVIC” as to be calculated to lead to the belief that natural mineral water which are not of the plaintiffs manufacture and/or merchandise are products of the plaintiffs.
iv. …, vi. …., vii. …, viii. …

Further from the supporting affidavit, the following facts were meticulously exposed for the better perception of this application.
Filed alongside the particulars of claim was an ex-parte application of 26/2/2002, where the plaintiffs/respondents sought for ex-parte injunction, including an injunction restraining the defendants from “manufacturing, importing, selling or offering for sale table water sold in packages, cans or containers bearing the words “La Voltic”.

In his ruling dated 28/2/2002 Olotu (J) granted the orders. On 4/3/2002, the respondents executed the order of the lower court wherein the applicant complied with the said order permitting the respondents entry into the premises and some of the applicant’s goods carted away.

By an application dated 11/3/2002, the applicant herein sought to discharge or vacate the ex-parte order. However, by his ruling delivered on 3/6/2002, the learned trial Judge refused to discharge the ex-parte injunction.

Dissatisfied with the said ruling, the defendant hereinafter referred to as “appellant/applicant” appealed to this court and consequently, filed this present application under consideration seeking for the following orders:-

“1. An order suspending, varying or staying in terms set forth in the schedule hereto the ex-parte orders granted by the Federal High Court (Honourable Justice Olotu) on 28/2/2002 in favour of (1) Group Danone (2) Societe Des Caux De Volvic.

2. An order of stay of proceedings pending determination of the appeal filed against the ruling Honourable Justice Olotu, J. delivered on 3rd June, 2002.

3. Such further or other orders as this Honourable Court may deem fit to make in the circumstances.

As I have already stated, an affidavit of 28 – paragraphs in support of the application was filed to which a number of exhibits were annexed. The applicant on 4/7/2002 filed a further affidavit to which exhibits DR3 – DR8 were annexed. Further affidavit was again filed in 5/7/2002 to which the ruling of the lower court of 3/6/2002 was annexed as exhibit PD1.
The respondent filed counter-affidavit made up of 45 paragraphs on 9/7/2002.

On 9/7/2002, we heard argument on the application. Mr. E. O. Eghobamien, learned Senior Advocate for the applicant, moved the application in terms filed. He referred to the affidavit evidence before the court and submitted that the circumstances surrounding the bringing of this application would necessitate the granting of the prayers sought. Reliance was placed on the cases of Bettini Homes Limited v. Internorth Nigeria Limited & 3 Ors. (1999) 13 NWLR (Pt. 634) 333 at 337; Josien Holdings v. Lornamead Ltd. (1995) 1 NWLR (Pt. 371) 254. He further submitted that the applicants are ready to undertake to pay damages to the plaintiff on the event that they do not deserve being granted this application. Reliance was placed on the case of Abubakar v. Unipetrol (2002) 8 NWLR (Pt. 769) 242 at p.252 and Okotie-Eboh v. Jadesimi (1999) 8 NWLR (Pt.616) 598. It is finally submitted that the Notice of Appeal raises substantial issue for the determination of this court.

Mrs. J. M. Chunu, for the respondent opposing the application relies on the counter-affidavit of the respondent and all the exhibits particularly exhibits “CMO1 – CM013”. It is submitted that the applicant does not have a good chance on appeal because their proprietary claim to the use of the name “LA VOLTIC” is presently non-existent, and that consequent to the withdrawal of the letter of acceptance by the registrar of Trade marks in respect of the name “LA VOLTIC” the res which the applicant is seeking to protect is presently too non-existent and speculative and cannot be protected by law. The following cases were cited and relied upon: Okechukwu v. Onuorah (2002) 15 NWLR (Pt. 691) 597 at 603. Referring further to the Tate Industries Plc. v. Devcom Merchant Bank Ltd (2000) 15 NWLR (Pt. 689) 158 at 164, the learned Counsel submitted that it is an abuse of court process for applicant to rush to this court with similar application as this pending at the lower court. Counsel urged us to refuse the application.

This application seeks for the suspension or variation of the terms of the order of the lower court. Essentially, it is all about discharging, suspending or staying that part of the order of the lower court restraining the applicants from selling or offering for sale table water sold in packages containers bearing the word “LA VOLTIC” pending the hearing of the appeal now pending before this court.
The ground upon which the application is brought is as follows:

a) That an appeal (which raises substantial issues) has been filed against the ruling of the learned Judge refusing to discharge the ex-parte order granted against the applicant.

(b) The applicant is likely to be completely paralysed and wound up if the ex-parte injunction is not varied before the hearing of the appeal.

(c) The failure of the trial Judge to entertain the application for stay or vary injunction effectively grants to the plaintiffs the third relief in the plaintiffs’ particulars of claim, notwithstanding the fact that that question whether “LA VOLTIC” is similar to “VOLVIC” is yet to be determined.

(d) The appellant is challenging the jurisdiction of the lower court to grant the ex-parte order.

Sections 16 and 18 of Court of Appeal Act, 1976, govern this application. The applicants deposed that it has appealed to this court on arguable grounds of appeal which raise recondite point of law.

Further, the applicant in paragraphs 19 – 27 of the supporting affidavit deposed thus:-

“19. The learned trial Judge having declined to hear the application for variation, the applicant exercises a
constitutional right to proceed to this court for the same relief.

20. The applicant seeks a variation such that it is permitted to continue to manufacture the products in the name “LA VOLTIC” pending when the appeal against the refusal to discharge the ex-parte is heard.

21. That the applicant had complied with all the regulations to be permitted to manufacture in the name “LA VOLTIC” and had been issued with an acceptance by the Registrar of Trade Marks.

22. In reliance on that representation the applicant commenced production and has been in production since it received acceptance from the Trademark Registry.

23. That the respondents applied to the Registrar, who surreptitiously (without notice to the applicants) withdrew the earlier acceptance, immediately after which the ex-parte orders were improperly obtained.

24. That if the applicant is denied the right to sell the products, it is likely to be completely paralysed notwithstanding the fact that there is a real possibility that it might succeed on appeal.

25. That the applicants are likely to suffer irreparable damage if production in the name “VOLTIC” is halted temporally having regard to the following:-

a. The applicant has entered into contracts with third parties to manufacture products in the name “la voltic”.

b. have huge materials, which bear the name “la voltic”, and if the applicant is made to for fit the use of this material it might lead to liquidation of the applicants.

c. the applicants secured credits from banks on the security that it will produce bottled water with the name “la voltic” and halting the applicants from manufacturing such products will cause the bank to call such credits.

d. the applicants have acquired a reputation and good will in this sale of the products bearing the name “la voltic”, which cannot be quantified and compensation in damages.

e. The applicants have orders, which they need to supply to third parties, and will be threatened by litigation if not supplied.

f. That if the applicants succeeds on appeal, it might never be able to re-establish its good will and reputation, production in the name “LA VOLTIC” having been halted.

26. The applicant has been very successful in the launching, distribution and sale of the bottled mineral water bearing the name “LA VOLTIC” in that:-

a. It now has a monthly turn over of about N20.000,000.00 (Twenty million naira) and sales continue to rise.

b. It now employs over 100 staff operating its equipment. The employees are likely to lose their jobs, if it is suddenly required to stop production in the name “LA VOLTIC”.

c. Some of the equipment in the applicant’s factory are required to be in constant operation, consequently, a shut down will not only have adverse economic effects but also affect the working of the said equipments:

d. The applicant company will suffer severe financial difficulties and even bankruptcy before the appeal is heard.

27. By refusing to discharge the ex-parte order the trial Judge appear to have decided the merit of the case even though the applicant strongly believes it has a proprietary claim which will be eliminated if the injunction is not varied before the appeal is heard.

I have equally considered the depositions made in the counter affidavit of the respondents in their paragraphs 30 – 42″.

“30. That contrary to paragraph 19 of the appellant/applicants affidavit in support, I am informed by the said respondent’s counsel, whom I verily believe that the trial Judge did not at any time decline to hear the appellant/ applicant’s application for stay/variation of the interim order of the trial court. The said application is still pending before the court.

31. I am informed by the said respondent’s counsel, whom I verily believe that the appellant/applicant’s present application was previously filed at the Federal High Court as an application for suspension of the ex-parte order (which is in essence a stay of execution) and that at the lower court an application is still pending.

32. That contrary to paragraph 20 of the appellant/applicant’s affidavit in support, I am informed by the said respondent’s counsel, whom I verily believe that the applicant cannot seek for a variation of the order of Court to allow them continue to manufacture their product “LA VOLTIC” table water which constitutes an infringement of the respondents registered trademark “VOLVIC” No, 39259 in the same Class 32.

33. That contrary to paragraph 21 of the appellants/applicants supporting affidavit, and paragraph 4 of its further affidavit dated 4th July, 2002, I am informed by the said respondents’ counsel, whom I verily believe that the appellant/applicant cannot claim to have complied with the regulations to manufacture and sell the product “LA VOLTIC” table water as the respondents contend that the said “LA VOLTIC” table water constitutes an infringement of the respondents registered trademark “VOLTIC”.

34. That contrary to paragraph 22 of the appellant/applicants supporting affidavit, and paragraph 4 of its further affidavit dated 4th July, 2002. I am informed by the said respondents’ counse, whom I verily believe that an acceptance of an application for registration, was not a representation to the applicant to commence production in the name or mark sought to be registered, or a conferment of a right to use on the applicant, or a bar to a withdrawal of the letter of acceptance which is discovered constitutes an infringement of another proprietors registered trademark.

35. That contrary to paragraph 23 of the appellant/applicant’s supporting affidavit, and paragraph 5 of its further affidavit dated 4th July, 2002, I am informed by the said respondents applicant to the Registrar of Trademark is based on its right to the exclusive use of its trademark as provided for by the law.

36. Further to paragraph 34 above, I am informed by the said respondent’s counsel, whom I verily believe that the Registrar of Trademark withdrew the Appellant/applicant’s acceptance via its power to do as provided for by the law.

37. I am informed by the said respondents’ counsel, whom I verily believe that the appellants/applicant had an option in law to appeal within a specified time against such cancelation by the Registrar but it refused to do so knowing that had no legitimate claim.

38. I am informed by the said respondents’ counsel, whom I verily believe that the respondents did not obtain any ex-parte order improperly as it fulfilled all the conditions for its grants and the order was confirmed by the trial court inter parties on 3rd June, 2002, when it ruled refusing to vacate the order.

39. that contrary to paragraph 24 of the appellant/ applicant’s supporting affidavit, I am informed by the said respondent’s Counsel, whom I verily believe that the applicant company would not be completely paralysed, if it is denied the right to sell the product “LA VOLTIC” table water as it is engaged in the manufacture and sale of other products. Now shown to me marked as exhibits ‘CMO17’ & ‘CMO18’ respectively, are a copy of the appellant/ applicant’s affidavit, in support of its motion, dated 11th March, 2002, to set aside or discharge the court’s interim order, and a copy of its Statement of Affairs dated 31st December, 1999, showing that it has been and is engaged in the production of other products.

40. I am informed by the respondents’ counsel, whom I verily believe that the appellant/applicant does not have a real possibility of succeeding on appeal.

41. That contrary to paragraph 25 of the appellant/applicant’s supporting affidavit, and paragraph 6 of its. further affidavit, dated 4th July, 2002, I am informed by the said respondent’s counsel whom I verily believe that the appellant/applicant is not likely to suffer irreparable damage, if production in the name “LA VOLTIC” is temporarily or permanently halted, and if any damage at all, the damage was self inflicted for the following reasons:-

a. The appellant/applicant entered into contracts with third parties to manufacture products in the name “LA VOLTIC” after the Anton Piller order had been executed on the appellant/applicant. Now shown to me is the Local Purchase Order (LPO) dated 5th March, 2002, from CFAO Nigeria Plc procured after the said ex-parte order had been duly executed on the 4th of March, 2002, and in flagrant disregard of the order. The said LPO is marked as exhibit “DH4” and attached to the appellant/applicant’s further affidavit in support of the motion on notice. Also shown to me and both marked as “DH4” are order dated June 3, 2002, from John Holt Plc, and purchase order, dated 16th May, 2002, from Sheraton Lagos Hotel and Towers Ikeja; both of which are also attached to the said appellant/applicant’s further affidavit.

b. The appellant/applicant does not have huge materials bearing the name “LA VOLTIC”, a possible forfeiture of which would lead to its liquidation, since the use of any material in the name “LA VOLTIC” constitutes an infringement of the respondents registered trademark “VOLVIC”.

c. The appellant/applicant did not secure any credit specifically to produce bottled water in the name “LA VOLTIC” and halting of such production would not cause the bank to call in its credit.

d. The appellant/applicant has not acquired any reputation and/or goodwill in the sale of the product “LA VOLTIC” table water as it is only cashing-in on the respondents’ goodwill acquired, since 1988, and whatever damages the appellant/applicant may incur should the respondent fail in this case can adequately be compensated.

e. The appellant/applicant does not have any orders from third parties which they have to meet and no one would sue them for failing to make or meet any such supply or order.

f. The appellant/applicant cannot succeed on appeal and would not lose anything having not acquired any reputation and/or goodwill in the mark “LA VOLTIC” same being an infringement of the respondents registered trademark.

42. That contrary to paragraph 27 of the appellant/applicant’s supporting affidavit, I am informed by the said respondents’ counsel, whom I verily believe that the court has not decided the merits of the case by refusing to discharge the interim order it made and the appellant/applicant has no proprietary claim to the mark “LA VOLTIC” and same, (which is not admitted) would not be eliminated if the injunction is not varied before the appeal is heard.

I have carefully considered the grounds of appeal filed. I am of the opinion that the said grounds raise substantial issues of law, in which the law is recondite as decided in Balogun v. Balogun (1969) 1 All NLR 349. I have also considered the respective affidavit and counter-affidavit of the parties.

The applicant is complaining in this application for the grant of the Anton Piller order by the lower court. The order which is draconian in nature aims to injunct the applicant from further manufacture and sales of their product. It is because of its draconian nature that it must be granted with extreme care and caution. The practice really is that whenever it appears that where an injunction is granted as in this case, considerable damage would be done to the defendant pending appeal by stoppage of his business which could not be compensated in cost, the injunction is stayed on terms. The orders made by the lower court in the instant case are clear and they point to one direction only, that is stoppage of the entire business of manufacturing of the applicant’s products.

The applicant has stated in paragraph 25 that they are likely to suffer irreparable damage and loss if their production in the name of “LA VOLTIC” is halted albeit temporarily. They have given details. These to my mind are some collateral circumstances and inherent matters, which I consider ‘special’, which may, unless, I grant order for stay, would destroy the subject-matter of the proceedings or foist upon this court a situation of complete helplessness or render nugatory any order or orders of this court or paralyse, in one way or the other, the exercise by the applicant of their constitutional right of appeal. I have a duty to preserve the res. The status quo ought to be maintained in the circumstances. In summary, all things considered, this application succeeds and it is hereby allowed. Therefore, the ruling of the lower court delivered on 3/6/2002, refusing to discharge the orders granted against the applicant is set aside. In its place an order granting stay of execution of that order is hereby substituted on the following conditions:-

1. The appellant/applicant shall keep proper account of goods manufactured and sold.

2. The appellant/applicant shall give an undertaking in damages, in the event that the order is made unjust, and it is wrongly stayed.

3. Furthermore, the appellant/applicant shall give undertaking to prosecute the appeal with diligence with liberty reserve to the respondents to apply to this court to discharge the orders, in case the appeal should not be prosecuted with due diligence as ordered.

4. Further proceedings before the lower court are stayed pending the determination of the appeal in this court.

OGUNTADE, J.C.A.: I agree.

ADEREMI, J.C.A.: I agree.

Application granted.

Appearances: A.O. Eghobarnien, SAN (with him, A.O. Eghobarnien) for the Appellant

                      J.M. Chunu (with her, H.A. Asiegbu) for the Respondents

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