Page 10 – CIP – The Anton Mostert Chair of Intellectual Property

The incumbent of the Chair of Intellectual Property Law, Prof Owen Dean, has been selected by his peers for inclusion in the latest edition of Best Lawyers in South Africa in the practice area of Intellectual Property Law.

Congratulations to Prof Dean. To be selected by one’s peers as a leading practitioner in your field is without doubt an honour worth celebrating, made all the more significant considering that Prof Dean has been retired from full time practice for some years.

Prof Dean has been in practice as an Intellectual Property Attorney at Spoor & Fisher for more than 30 years, and is currently a consultant to the firm. He has held the Chair of Intellectual Property Law at the Faculty of Law, Stellenbosch University since 2011 and is also listed as a Senior Statesman of Intellectual Property and a Key Individual of Spoor & Fisher by Chambers and Partners in 2012 and 2013 in the Global-Wide and Pan-Regional Sections of the Chambers Global Ranking. (Read more)

The latest edition of Best Lawyers in South Africa is available here.

In the culmination of a widely followed case, on 1 October 2014 the Supreme Court of Appeal ordered the South African Reserve Bank (SARB) to repay Mark Shuttleworth over R250 million plus interest. The money had been levied against Shuttleworth when he applied to transfer his assets out of the country in 2009. He had emigrated from South Africa several years before that, and the prevailing practice at the time was to levy an exit penalty of 10% on any person who emigrated and wished to transfer more than R750,000 from South Africa. This exit levy was dropped in 2010, but this was too late for Shuttleworth as he had already paid the R250 million under protest.

In terms of South Africa’s system of exchange control, approval is required from the SARB before capital can be exported from the country. Recent regulations (discussed here) by the SARB have included intellectual property within the ambit of the term “capital”. Shuttleworth’s initial case before the High Court sought to have the whole system of exchange control declared unlawful and set aside, which many had hoped would pave the way for freer transfer of tangible and intangible assets across South Africa’s borders. However, the Supreme Court of Appeal took a much narrower view of the matter and only sought to decide the issue specific to the case – whether or not the 10% levy imposed on Shuttleworth’s assets was lawful. The Court found it unnecessary to consider the other attacks by Shuttleworth on the exchange control system, as they had no impact on the outcome of his case. The Court warned the lower courts not to engage in speculative and academic enquiries beyond the scope of the cases before them, as such findings may have an effect on future disputes that are yet to crystallise.

The Court characterised the 10% levy as a tax, and because the SARB had not followed the proper procedure required for implementing a policy or regulation that imposes a tax, namely tabling it before Parliament, the levy was held to be unlawful. The Court referred to the well-known “no taxation without representation” principle as a founding principle of Parliamentary democracy in which the executive branch of government should not itself be entitled to raise revenue but should rather be dependent on the taxing power of Parliament, which is democratically accountable to the country’s tax-paying citizens.

The case did not have nearly as far reaching effects as some had hoped, and South Africa’s Exchange Control system remains in place for now. But in a bold and astonishing move, Shuttleworth has reportedly stated that he will commit the entire R250 million into a trust fund to be used to fight worthy Constitutional challenges against the government in future. No doubt this is far from the last word on the matter.

Ralph van Niekerk

(Ed.) This is a guest editorial article for IPStell, reproduced here with permission of the author.

Ralph is a patent attorney and partner at Von Seidels. His expertise includes the preparation and filing of patents and designs, locally and internationally, and he specialises in electronic and IT related inventions. Ralph also has experience and a special focus on IP matters in the United States. He is in charge of quality standards at Von Seidels and has spearheaded the firm’s ISO 9001 certification. Ralph’s expertise includes the preparation and filing of both local and foreign patent applications, especially electronic and computer-related inventions. He is experienced in registered design application drafting, patent and general intellectual property litigation, the drafting of patent infringement opinions and the drafting of patent licence agreements. Ralph spent a year studying and working in the field of intellectual property in the United States and remains in tune with the US IP system.

This is an editorial article contributed to the 50th year Commemorative Edition of Responsa Meridiana.

“A journey of a thousand miles begins with a first step”. So said Lao-tzu, the Chinese philosopher, who lived in the fifth century BC. How true this can be of a legal career and indeed of any on-going venture. When one looks back over a career, one realises just how important the first step embarking on that career was. Often the significance of the step was not realised at the time and perhaps it was not even recognised as a first step. This only becomes apparent in retrospect.

In 1964, when I was a student at Stellenbosch University in my final year of a BA (Law) degree, an inter-varsity between the Law Faculties of Stellenbosch University and Cape Town University took place. It encompassed all sorts of sporting activities such as rugby, hockey and the like, as well as less athletic activities like boat racing (not the type done in vessels on the water). A jolly good time was had by all and by the end of the evening a great spirit of bonhomie and brotherhood prevailed. At some stage during the latter part of the evening someone suggested in a moment of euphoria that the spirit of union of the two law faculties should be symbolised by their getting together to produce a joint legal journal which would publish articles by their student members. “What a good idea” cried the assembled gathering.

Perhaps surprisingly, given the nature of gathering at which this momentous decision took place, what had transpired that evening was actually recalled and soon a plan came together giving rise to the creation of a joint editorial committee, comprising members from both universities, for the nascent journal. Thus was RESPONSA MERIDIANA born. The inaugural edition appeared later that year.

In the following year, my fourth year, I found myself representing Stellenbosch on the editorial board and the next year, my fifth year, I became the joint editor from Stellenbosch. As a member of the editorial board I felt honour bound and compelled to write and publish an article in the journal. I had not previously done any serious writing so I would be breaking new ground it was therefore a novel experience for me. My article, entitled “Solidarity” appeared in the 1965 edition.

After a six year sojourn in the Diplomatic Service, I decided that I wished to become an attorney. My economic circumstances at the time made it necessary for me to have an asking salary which was three times the going rate of the day for that of an articled clerk. Needless to say it was a hard sell. Eventually I reached an interview with Spoor & Fisher, specialist patent and trade mark attorneys. I knew absolutely nothing about this branch of the law and had very little to offer the firm. At a critical moment, my interviewer, no doubt searching for some reason why the firm could possibly contemplate or justify paying me such an inflated salary, asked me whether I had ever published any articles. I sensed that this was a make or break moment in the interview. I hastily told him about my article that had been published in RESPONSA MERIDIANA. He appeared to view this news with favour and asked me to forward a copy of the article to him, which I did. To cut a long story short, I was offered, and gratefully accepted, a job at the firm. I have little doubt that my article was the decisive factor in my getting the job, whether on account of the quality of the article, or the mere fact that I had published it, I never ascertained.

I went on to enjoy a successful and rewarding career, specialising in copyright and trade mark law, lasting 38 years with the firm and served as its Chairman for several years. During this time I published a text book, have compiled and edited another, contributed chapters to several books and published in excess of a hundred journal articles. After retiring from the firm I accepted a position of Professor at Stellenbosch University and founded the Anton Mostert Chair of Intellectual Property Law. I have travelled a thousand miles since writing my article for RESPONSA MERIDIANA.

The moral of this story is that writing my article for RESPONSA MERIDIANA proved to be the first step in the thousand mile journey of my career, although I had no inkling of this at the time. It was the “tide in the affairs of men , which, taken at the flood, leads on to fortune” (William Shakespeare – Julius Caesar). There is no knowing how my life would have evolved if I had not published that article and, flowing from that, joined Spoor & Fisher. It is certainly unlikely in the extreme that I would ever have got involved in practising intellectual property law (which turned out to be the ideal niche for me) as I had no predisposition to this field of law prior to joining the firm

The important point is that RESPONSA MERIDIANA gave me the opportunity and incentive to venture into the field of writing legal articles. As a student I had no skills in this area and little confidence to venture into it. At the time the South African Law Journal and Die Tydskrif van die Hedendaagse Romeins-Holland Reg were virtually the only legal journals in which one could publish articles and they had a distinctly aloof and ivory tower image. Writing an article for publication in either of those journals did not even come up for consideration, by me, a mere law student. RESPONSA MERIDIANA provided an invaluable opportunity for me and other students to venture into the business of writing legal articles. Fortunately, I took that opportunity, for which I am eternally grateful. This facility and opportunity remain available to students today. RESPONSA MERIDIANA has gone from strength to strength and has come a long way (a thousand miles) since its tentative first step. But in essence nothing has changed since 1965 when I took my first step on the long road ahead. The journal remains at the disposal of students aspiring to become authors and develop careers.

I urge students to publish articles in RESPONSA MERIDIANA. It is the ideal medium to explore one’s abilities to write articles and to hone writing skills. While there are many more publishing opportunities open to students in this day and age compared to the nineteen sixties, for instance publications like Without Prejudice and De Rebus, none of them compare with RESPONSA MERIDIANA as a medium for cutting one’s teeth as a serious academic writer. RESPONSA MERIDIANA is the ideal training ground for the aspirant legal academic writer. At the same time it is a respected authoritative journal in its own right and articles published in it enter into the realm of legal authority. It therefore offers a double benefit to student authors. The opportunity is there for the taking. Carpe diem!

Prof Owen Dean

NOTE: The following open letter has been delivered by email to the office of the Minister of Health of the Republic of South Africa on 31 July 2014. The contents of this letter is published here in furtherance of the debate on plain packaging legislation and the potential impact on the Constitutional rights of the proprietor.

OPEN LETTER

31 July 2014

The Honourable Minister of Health

Dr Pakishe Aaron Motsoaledi

Civitas Building

Corner of Thabo Sehume and Struben Streets

Private Bag X828

PRETORIA

0001

Dear Dr Motsoaledi,

RE: PREVENTION OF USE OF TRADE MARKS ON PACKAGING FOR CIGARETTES AND OTHER PRODUCTS.

I am addressing this letter to you to express serious concerns about the approach that you are adopting to the abovementioned matter. I believe that you ought to be aware of these concerns and should take cognisance of them.

I must begin by commending you on the enthusiasm and positive approach that you have displayed in carrying out your function as the Minister of Health and the custodian of the nation’s health. It is indeed refreshing and salutary to experience a cabinet minister displaying such dedication and conscientiousness to making a success of his portfolio and to pursuing the public interest in his field of responsibility.

You obviously feel that the smoking of cigarettes, the excessive consumption of alcoholic beverages, and unsound eating habits are detrimental to the health of the South African public. There is some substance in such a viewpoint. It is within your powers and indeed duties as the Minister of Health to address these matters if they are a cause of public concern. Should you, after establishing all the relevant facts and carefully and objectively weighing up the various interests and considerations involved, be of the view that corrective or preventative measures are necessary, it behoves you to take appropriate action to that end. Acting in this manner amounts to doing your job as a loyal servant of the public.

In deciding upon and implementing a course of action to counteract perceived ills of this nature, I respectfully submit that you must act reasonably and lawfully. In particular you must act within both the spirit and letter of our splendid Constitution, of which we are justifiably proud. With respect, you would be failing in your public duty if you were to act in a manner that is at variance with the Constitution, quite apart from the fact that you would not be acting within the bounds of the law.

The Constitution enshrines the principle that when a proposed course of action or the exercise of rights held by one party entails impinging on entrenched rights of other parties, a balancing process is necessary. One must weigh up, on the one hand, the objective to be achieved by the course of action and the likelihood of doing so by that means, or the effect of exercising the rights in question, against, on the other hand, the detriment caused to the rights being impaired. This means applying the test of proportionality to which I will revert below.

You have in the past publicly expressed the intention of emulating the government of Australia by introducing legislation to require tobacco producers to sell cigarettes with so called “plain packaging”. You reiterated this intention very recently and said that the necessary legislation would be in place by next year. The Australian legislation that you embrace provides that cigarettes must be sold in drab packets dominated by health warnings and pictorial matter illustrating the alleged dangers and consequences of smoking, with branding being limited to words in plain, small print. In particular the legislation stipulates that no trade marks in the form of logos or in fancy print may be used on the packages. It is no doubt fair to assume that your envisaged legislation will be along the same lines and to the same effect. The implication which flows from this is that, while you allow the use of plain word trade marks on cigarette packs and appear to consider that no real harm, in the sense of encouraging people to smoke, can flow from such trade mark usage, for example a word trade mark like MARLBORO appearing in plain print on a cigarette packet, the depiction of this word in a script or fancy font, will bring about the consequences that you seek to prevent, namely encouraging the smoking of cigarettes. Put differently, you appear to believe that by prohibiting the use of the trade mark MARLBORO in script form, and making it necessary for MARLBORO to be used only in plain print, you will make smoking cigarettes a less attractive proposition. With the greatest respect, this is an extremely startling proposition with which I cannot agree.

In similar vein, you have brought out legislation prohibiting the use of trade marks on baby foods which are substitutes for mother’s milk where they depict infants, doubtless because you believe that the use of such trade marks encourage the undesirable practice of mothers moving away from breast feeding their babies. You are also propagating legislation preventing the use in relation to formulated foods of trade marks which claim certain beneficial nutrients and/or ingredients with health benefits, even though the claim may be factually accurate. Presumably you consider that a trade mark such as SUPER C (which indicates that the product contains vitamin C, an element with health benefits) for sweets unduly encourages the consumption of confectionary, which is perceived to be detrimental to public health. Of course, you will be aware that there is existing legislation which provides for sanctions for the making of incorrect claims regarding the ingredients of a product or its effects. Such claims are rendered unlawful under the Consumer Protection Act and give rise to a criminal offence. The public would thus seem already to be adequately protected against trade marks which are misleading or fraudulent in this respect. On the other hand, If a claim is correct, what is the harm in making it?

It would seem that you have declared war on trade marks, especially logo or graphic marks, as being tools or weapons of evil intent and effect. (Perhaps you are against the concept of intellectual property per se; if so you should talk to your colleague, the Minister of Trade and Industries, who professes to be a supporter!) You ascribe remarkable powers to these types of trade marks to cause social ills. Conversely, you see their eradication as an important means of curing the public of bad habits and health practices. It comes as a great surprise to me, as a lawyer who has specialised in the practise of trade mark law and has worked with trade marks and their uses and effects for more than fortry years, that logo trade marks can have such amazing powers and qualities. I would never have dreamed that the MARLBORO logo could have the power to weave such magical spells, whereas the plain word mark MARLBORO by contrast is devoid of such qualities.

I put it to you that you are misguided in your view of the powers possessed by trade marks, especially logo and graphic trade marks. Furthermore, you are misinformed as to the nature, function and effect of a trade mark. A trade mark has been held by the highest court of the land to be a symbol that denotes the origin of a product in a particular manufacturer. In the case of cigarettes, for instance, the trade mark MARLBORO logo tells the consumer that the product emanates from producer A, whereas the trade mark LEXINGTON logo, tells the consumer that the product comes from producer B. These trade marks enable the consumer to distinguish between the two different makes of cigarettes. How in these circumstances, for instance, prohibiting the use of the MARLBORO logo trade mark can decrease the incidence of smoking simply defies comprehension.

Trade marks are recognised as a form of property both under the common law and under the Constitution. The Constitutional Court has made a specific pronouncement in that regard. As such, they are protected by Section 25 of the Constitution, the so-called “Property Clause”. Section 25(1) of the Constitution (comprised in the Bill of Rights) reads “No one may be deprived of property except in terms of a law of general application, and no law may permit arbitrary deprivation of property […].” It follows from this that it is contrary to the Constitution and unlawful to deprive someone of their property in the form of their trade mark and no law may permit this to happen.

Trade marks are created by using them and causing them to acquire a repute, and by registering them under the Trade Marks Act. Trade marks can be extremely valuable items of property. For example, the trade mark GOOGLE was valued at $44.3 billion in 2011.Their values are largely determined by the extent of their use and the resultant repute that they enjoy. In order to remain valid and extant a trade mark must continue to be used. When use of a trade mark ceases a registration can be cancelled and its reputation withers away and dies, as does the trade mark. Preventing a trade mark from being used thus destroys that trade mark and extinguishes the item of property that it constitutes.

Many, if not all, of the trade marks whose use you are seeking to prevent are registered in the precise form under attack. The well-known MARLBORO logo trade mark is, for instance, in its own right, and separately and distinct from the plain word MARLBORO, a registered trade mark and thus an item of property. When you prevent that trade mark from being used in relation to tobacco products by means of your proposed legislation, you destroy that trade mark and thus extinguish an item of property. You act in this regard contrary to section 25 of the Constitution, and thus unlawfully. If you require substantiation for this proposition, I invite you to read my academic article entitled “Deprivation of Trade Marks Through State Interference in Their Usage” published South African Intellectual Property Journal (2013) 1. The article can also be found at https://blogs.sun.ac.za/iplaw/2013/05/23/podcast-prof-deans-inaugural-lecture/.

Do not be fooled into thinking that, because the corresponding Australian legislation was found by the Australian Supreme Court not to be unconstitutional, our Constitutional Court will necessarily follow suit in respect of your legislation. There are important differences between the Australian Constitution and our own which will bring about a different result to litigation on this issue in this country. For the record, the Australian court actually found that preventing the use of trade marks amounted to a “taking” (i.e. deprivation) of private property, although, for reasons peculiar to the particular wording of their Constitution, it did not find their legislation to be unconstitutional.

I am not presently addressing the merits of your decision to take steps to minimise the smoking of cigarettes and the uses of certain foodstuffs, although it must be said that I am not convinced that you have obtained and carefully evaluated all the relevant facts and weighed up all the various considerations and implications relating to your proposed course of action. What I am criticising is the specific means that you have chosen to attempt to achieve your objective, namely prohibiting primarily the use of logo and graphic trade marks. Not only am I of the view that such means will be entirely ineffective, but also that they are contrary to the Constitution and are unlawful. They will result in an unjustifiable and arbitrary deprivation of property, causing considerable damage to the property owners in question, that is entirely disproportionate to any conceivable public benefit.

I have read that you have withdrawn legislation which requires medical practitioners to obtain licences to practise in particular locations, on the advice of the State Attorney, due to it being contrary to the Constitution. You are clearly mindful of the folly of proceeding with legislation which is unconstitutional. This is a prudent approach and is vastly preferable to having to face a constitutional challenge to bad legislation before the court. In the event that you go ahead with legislation which brings about an arbitrary deprivation of property through destroying trade marks, you will inevitably be confronted with court litigation to declare that legislation invalid. In recent times our courts have unfortunately been besieged by litigation dealing with unconstitutional legislation. Such litigation causes unnecessary diversions of time, energy and tax payers money, all of which can be better spent on more worthy issues such as education and combatting serious crime. Our already overburdened courts and justice system can also be spared being subjected to undue additional pressure.

You have an opportunity to rethink and change your approach regarding the appropriate means to use in order to achieve your objectives discussed above. I urge you to do so and to take competent and informed legal advice on the folly of proceeding down the path that you have outlined. In this way you can avoid embarrassment and venturing into terrain where angels ought to fear to tread.

Yours faithfully,

Owen Dean

Professor of Intellectual Property Law

University of Stellenbosch

The verb “extort” means “obtain (money, a promise, a concession, etc.) from a reluctant person by threat, force, importunity, etc.)” The noun form, “extortion”, means “the act or an act of extorting money etc.” (The New Shorter Oxford English Dictionary published by Clarendon Press, 1993). Requiring someone to pay copyright royalties for a manner of use of a literary work, when none is due in law, amounts to literal extortion. It is not a salutary practice.

Copyright in a work confers upon the copyright owner the exclusive right to perform certain acts in relation to that work (so called “restricted acts”). If any restricted act is performed without the permission or licence of the copyright owner, copyright infringement can take place. In the event that another party wishes to perform a restricted act, the permission of the copyright owner must be sought and granted in order that it might be lawful. Generally, when granting such a permission or licence copyright owners require payment of a monetary consideration, commonly referred to as a royalty. The corollary of this situation is that royalties are only payable when permission has been granted to do something which, in the absence of permission, would constitute copyright infringement. If an act performed by another person in relation to a copyright work does not in principle constitute copyright infringement, there is no basis nor justification for the payment of royalties to be required.

It has recently come to the fore that in certain circles in the publishing industry royalties are unjustifiably being required to be payed for the use of quotations from literary works. In copyright law a literary work in essence amounts to a work that is an expression in words of the results of intellectual activity, in a material form. Literary merit is not required. The perpetrators of the practice of requiring royalty payments for the use of quotations from works include publishers who hold rights (or purport to hold rights) in textbooks, law reports, dictionaries and even legislation, all of which are species of literary works. In a particular case, royalty payments are expected for using quotations from a variety of sources in a legal text book on the subject of intellectual property intended for use in education. This is indeed an extreme case in which to demand payment of royalties for the use of quotations. The authors of a book incorporating copyright law ought, after all, to have some knowledge of the circumstances in which copyright royalties are payable, and when they are not payable. Against this background it is expedient to discuss and elucidate the manner in which our copyright law approaches the question of the use of quotations from literary works in the course of writing and publishing other literary works.

A written text such as is contained in a book, a statute, a court judgement or in a dictionary, being a literary work for purposes of copyright law, enjoys copyright automatically, provided certain conditions are met, and more particularly the work must be original to the author claiming copyright. The making of an unauthorised reproduction of a substantial part of a copyright work in principle constitutes copyright infringement. Prima facie the taking of a quotation of a literary work without the authority of the copyright owner may constitute copyright infringement. However, the matter does not stop there because the legislature, in its wisdom, has incorporated certain exceptions to this general principle in the Copyright Act, in the public interest. These exceptions, or exemptions from copyright infringement, are instances where the legislature has weighed up the rights of the copyright owner against the reasonable entitlements of users of works in order to create an equitable balance between them in the public interest, and has elected to mitigate the effects of copyright in works in favour of the general public.

Indeed the basic principles of copyright law themselves seek to create something of a balance of this nature. The copyright in a literary work is not infringed by reproduction unless the person making the reproduction takes a “substantial part” of the source work. What in any given situation constitutes a “substantial part” of a copyright work is a moot question and has been the subject of many court cases. The criterion is said by the courts to be a qualitative and not a quantitative measure. Nevertheless, where a verbatim reproduction of a portion of a work is made, as in the case of a quotation, the quantity of material used is not without significance. It suffices to say for present purposes that no infringement occurs if reproduction of less than a substantial part of the source work occurs. It is conceivable that quotations entailing the use of less than a substantial part of a literary work can be made, and in this case there can be no question of copyright infringement taking place.

Perhaps because of the indeterminate nature of precisely what constitutes a “substantial part” of a work, the legislature has specifically addressed the question of taking quotations from literary works in section 12(3) of the Copyright Act. This section reads as follows:

“The copyright in a literary or musical work which is lawfully available to the public shall not be infringed by any quotation therefrom, including any quotation from articles in newspapers or periodicals that are in the form of summaries of any such work; Provided that the quotation shall be compatible with fair practice, that the extent thereof shall not exceed the extent justified by the purpose and that the source shall be mentioned, as well as the name of the author if it appears on the work”

In terms of this section, even if a substantial part of a work is taken (thus potentially rendering the reproduction an infringement of copyright if done without authority), the use of a quotation within the parameters of the section is exempted from constituting copyright infringement. There is no mystery about this section. Its meaning is clear. Quotations may freely be taken from literary works provided the conditions set out in the section are met.

In regard to the question of non-infringing reproduction of work, the legislature has gone even further in respect of certain types of literary works. Section 12(8) (a) of the copyright act provides that “no copyright shall subsist in an official texts of a legislative, administrative or legal nature, or in an official translations of such text, or in speeches of a political nature or in speeches delivered in the course of legal proceedings, or in news of the day that are mere items of press information.”

Statutes and other legislative instruments such as regulations, and court judgements, are amongst the types of works which fall within this exemption. It goes very far and not only does it allow reproduction in certain circumstances, but rather it declares that the works in question do not enjoy any copyright at all and in fact are in the public domain. They are therefore free for use by all in whatever manner or measure.

It will be apparent that the legislature has bent over backwards to allow the use of quotations from literary works in a manner and in circumstances which are reasonable. While the Copyright Act, 1978, ante-dates the South African Constitution, the provisions which have been discussed are consonant with the principle of freedom of speech enshrined in the Bill of Rights. The court will undoubtedly take account of the individual’s right of freedom of speech when interpreting the provisions of the Copyright Act which have a bearing on the use of quotations.

That is all well and good, you may say, in regard to South African works, but what about foreign works, for instance British text books, which are written and published in countries where the legislature is perhaps less generous in making provision for the use of quotations? The simple answer to the question is that the fact that a source work has a foreign origin is of no relevance whatsoever. The same principles which apply to South African works, apply equally to foreign works. The reason for this is the principle of so called “national treatment” which applies internationally in copyright law. In terms of this principle, to which South Africa and virtually all countries throughout the world subscribe, works of foreign origin are to be protected in a particular country as though they were national works. The provisions of the South African Copyright Act thus apply entirely to works of foreign origin and the copyright laws of their country of origin play no role whatsoever, and in fact are irrelevant. This means that, although there may not be a general exemption allowing the use of quotations from a work in the copyright laws of the country of origin of a foreign work, in South Africa that work is subject to the exemptions contained in the South African Copyright Act.

As it happens, virtually all copyright laws throughout the world allow for the free use of quotations to some degree, although perhaps not to quite the same extent that the South African Copyright Act does. In Britain, for example, the matter is dealt with in the first place by determining whether a quotation amounts to the reproduction of a substantial part of a source work. As previously mentioned, determining what amounts to a “substantial part” of a work in any given situation involves making a difficult value judgement. However, there can be no doubt that many quotations will not constitute the reproduction of a substantial part of a source work. The use of such quotations without authority is permissible. Furthermore, there is a specific exemption in the British Copyright Act allowing the use of extracts or quotations of a substantial part of a work that is publicly available where that quotation is a fair dealing and is for the purposes of criticism or review of the work in question or of another work; due accreditation of the source must be given (a similar provision is to be found in section 12 (4) of the South African Copyright Act and this exemption thus also exists in South African law and further enables the free use of quotations). With regard, for instance, to a quotation used in a legal textbook dealing with statutory law, the statute under discussion itself constitutes a “work” for the present purposes. It is permissible to freely use reasonable quotations from another work (for instance a commentary on the law or a court judgment) in order to review or discuss the interpretation of that statute. However, that is by the way because, as explained, the provisions of the British Copyright Act are irrelevant to quotations made from a British work in South Africa. South African copyright law prevails in this instance.

So, reverting to the propriety of publishers demanding the payment of royalties for the use of quotations from literary works, whether local of foreign, in the course of writing another literary work, it is clear that such publishers are overreaching themselves. Provided the prescribed accreditation of the source of a quotation is duly given, there is no impediment under our law against quotations being freely used in the course of writing a literary work, if they are reasonable and their usage meets the prescribed formal requirements. This is particularly so where the nascent work is for use in education. The publisher of a statute, a court judgement, a dictionary, or indeed any literary work, that seeks to extract royalties for the use of a reasonable quotation from its work, is acting without any legal foundation. That publisher, whose business is perforce founded upon, and steeped in, the application of copyright law, ought to know better and this practice is to be deprecated and ought to be discontinued. It amounts to the disregard of the public interest as identified and recognised in the Copyright Act and of the principle of freedom of speech enshrined in the South African Constitution. Literal extortion by publishers requiring royalty payment for the use of quotations is beyond the pale.

Prof Owen Dean

History has taught us that the South African Government, and the Legislature in particular, will not hesitate to make bad law. The volume of carelessly drafted, ill conceived, unconstitutional and overtly political laws that the public has been force-fed in recent years is so great that recourse to the Constitutional Court has become a pedestrian matter.

In fact, the alarm felt over perpetual ham-handed law making is only outstripped by Government’s brazen disregard for public cooperation in the democratic process. This even after the public, who are expected to prop up and thereafter obey each new law, has demonstrated to Government the gross socio-economic detriment that follow as a result of it.

Plain packaging is a perfect case in point. Ever since Parliament abolished the process of expert-committee drafting, most new laws have been produced by means of a photocopier from a staggering array of random foreign laws, opaque internal policy and input from political pressure groups. As a result, when the plain packaging bandwagon came around, Government jumped aboard bodily. It has since imported foreign law for plain packaging of baby food, drafted a zero compensation measure to expropriate (read more here) and in some cases destroy any property for reasons of public health and has hinted at plain packaging for tobacco products and alcoholic beverages.

In the case of tobacco plain packaging, Government went so far as to state that it would mimic the Australian example despite being warned of the fact that under South African law such a measure would be unconstitutional. Fortunately, South Africa has not yet taken the plunge and may therefore yet be persuaded to abandon this ill-fated plan.

To this end, the Australian experience with tobacco plain packaging is instructive. Recent reports (read more here, here, here and here) in the Australian media indicate that the most robust anti-smoking laws in the world are backfiring. Apparently, in the past 18 months after the introduction of plain packaging, sales have increased by as much as 59 million cigarettes. This reversed the 15.6% decline in sales over the previous 4 years and established a 0.3% rise in sales since the introduction of plain packaging. These figures, from an industry monitor report by InfoView, are supported by the Australian Association of Convenience Stores which reported a 5.4% increase ($120 million) in the sale of cigarettes over the past year.

These results are heralded as the first concrete data available on the impact of plain packaging and said to disprove everything the Australian minister of health claimed about the efficacy of State intervention in tobacco branding. Conversely, some commentators dismissed the InfoView report as misleading and incorrect while the Australian Government refers to figures by the Australian Bureau of Statistics’ for the period 2001 to 2012 which show a decrease in smoking, although there is no evidence to suggest that the decrease is related to plain packaging. A similar finding was published in a study by London Economics in November 2013, which showed no change in tobacco consumption in Australia after the introduction of plain packaging.

Be that as it may, both sides report an increase in the sale of low-price cigarettes, despite the fact that the Australian Government raised the excise duty of tobacco products along with the ban on tobacco branding. Furthermore, the Australian plain packaging debate has raised concerns about its impact on illicit importation of goods, particularly tobacco products, to the country.

Both of these facts are of great significance to South Africa. Clearly there is some indication that plain packaging has failed to curb smoking and has in fact, by further stigmatising the use of tobacco, imbued it with a certain charm to particularly younger consumers. However, the fact that an increase in the sale of cheap cigarettes has followed on plain packaging illustrate that the rationale for such legislation (namely to discourage users from smoking or taking up smoking) has not been served.

When this is coupled with the risk, as explained by eminent IP scholar Judge Prof Louis Harms, that plain packaging plays into the hands of counterfeit goods manufacturers and importers of such contraband products, plain packaging legislation appears ineffective and counter-productive.

In the South African context this means that if Government was to weather the inevitable storm that will follow plain packaging legislation it will deprive tobacco trade mark proprietors of their intellectual property for a reason that has been proven to be false. The logic is inescapable – plain packaging is proven to be, at least, ineffective to curb smoking and in fact increases the consumption of mainly cheap cigarettes and operates to stimulate the manufacture and smuggling of tobacco products. This means that the inevitable challenge to plain packaging on constitutional grounds is likely to succeed because a deprivation of such property (the tobacco trade marks) would be arbitrary. In simple terms, the ends cannot justify the means.

Faced with these facts, Government would have to be particularly ignorant, even by its own standards, to pursue plain packaging legislation when it is guaranteed to fail on constitutional grounds. Nevertheless, South African plain packaging legislation in the near future will not come as a surprise.

Opponents of Government regulation often refer to the “nanny State” as part of the argument against State interference in private consumption. In the South African context such nanny legislation (that seek to chastise its citizens for its behaviour, ostensibly for their own benefit) must be tested against the Constitution, which requires a weighing of the individual’s rights against those of the public at large. However, in the case of plain packaging it has now been established that the proclaimed public interest (namely health) is not being served. One must therefore ask, if Government maintains its current agenda, how will it be justified in destroying some of the world’s most established trade marks?

South Africa is by no means a nanny State, but perhaps it requires a nanny populace to whip its legislature into shape. Difficult as it may be for Government to swallow, plain packaging legislation is nonsense. Hopefully now that it has been dusted with the Australian experience, it will be a sweeter pill to swallow.

Cobus Jooste

Prof Frederick Mostert, extraordinary professor at Stellenbosch University and Academic Fellow of this Chair, received the Lifetime Achievement Award at the Luxury Law Summit 2014 for his contribution to the luxury industry according to a report by the Global Legal Post here.

Prof Mostert’s career as legal professional includes many significant contributions to legal development across the world, among others the recent landmark case involving a brand from the Richemont stable which resulted in a successful defence of IP rights in the digital environment. (This matter was recently discussed by Prof Mostert at the annual IP public lecture at Stellenbosch University.)

It therefore comes as no surprise that Prof Moster should be honoured by his peers in this manner.

Afropop Worldwide, the radio programme and online magazine dedicated to music from Africa, interviewed Prof Dean about his personal experiences during the protracted Mbube/Lion Sleeps Tonight case, how he managed to persevere despite a myriad of obstacles and his book on this case.

The interview is part of the Hip Deep special programme series funded by the National Endowment for the Humanities and is distributed by Afropop Worldwide to more than 115 radio stations in the USA, Europe and Africa.

You can listen to the interview here or on SoundCloud below (at 31:23).

Innovation and creativity are inextricably linked to the protection of intellectual property (IP). It is therefore essential, in order to promote the sciences and useful arts, that all content creators and stakeholders be aware of the legal mechanisms for the protection of IP and its application to their work.

The Chair of IP Law, in cooperation with InnovUS and Von Seidels, is proud to again host the annual public event on Stellenbosch campus to celebrate World IP Day and raise awareness about IP among students and staff from all Faculties.

In keeping with the global theme of World IP Day, Movies – A Global Passion, a free film will be screened at the Pulp Cinema. All participants will also have the opportunity to learn from IP experts about the relevant aspects of the law applicable to their field of work or study.

Attendance is free! Please RSVP to innovusp@sun.ac.za as soon as possible.

CIP – The Anton Mostert Chair of Intellectual Property

This is an editorial article contributed to the 50th year Commemorative Edition of Responsa Meridiana.

Prof Owen Dean

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