Service Merchandise argued on appeal that the registration should instead be regarded as having commenced in 2014 because of an official seal bearing the date 23 October 2014 on its certificate. The company therefore contended that its registration remained valid during the period relevant to the action. The Court rejected that argument.

It held that the operative date for determining the duration of trademark protection was the filing date of the application, not the date on which an official seal was subsequently affixed to the certificate. The evidence showed that the ‘AURA’ mark had been registered on 4 August 2003.

The Court also relied on the evidence of the plaintiff’s own representative, who admitted during cross-examination that the certificate was issued in 2003, that he was unaware of the ten-year lifespan of a trademark certificate and that he had no other trademark certificate apart from the one produced in court.

The Court consequently agreed with the High Court that the registration had expired and that maintaining an active registration was a prerequisite for obtaining statutory protection under Act 664. It emphasised that, subject to statutory exceptions and the separate protection available under the tort of passing off, an unrenewed trademark does not enjoy the statutory protection provided by Act 664.

Court rejects allegation that defendant manufactured fake fans

The Court also found that Service Merchandise had failed to substantiate its allegation that Owusu-Ansah was manufacturing counterfeit Crompton Greaves ceiling fans. During cross-examination, the company’s representative admitted that he had never seen Owusu-Ansah manufacturing Crompton ceiling fans. Instead, he had only seen him selling what he described as imitation fans.

The evidence further established that the impugned fans had been imported from foreign markets or purchased from other importers for resale. The Court noted that the mere fact that a product was manufactured in China did not, by itself, establish that it was fake. Evidence before the Court showed that Crompton fans were available in markets in China, Dubai and other countries.

Court applies doctrine of exhaustion

A significant aspect of the judgment was the Court’s discussion of the doctrine of exhaustion, also known in this context as the principle governing parallel imports. The Court explained that where goods bearing intellectual property rights have been placed on the market by the intellectual property owner, or with the owner’s consent, the owner’s rights are exhausted in relation to the resale or redistribution of those goods across markets.

The principle is expressly recognised under section 9(6) of Act 664, which provides that trademark rights do not extend to acts concerning articles that have been placed on the market in any country by the registered owner or with the owner’s consent.

The Court held that, even assuming the ‘AURA’ registration had been valid, the doctrine of exhaustion would have permitted the defendant and other traders to import legitimately manufactured Crompton ‘AURA’ ceiling fans from China, Dubai and other countries for resale in Ghana.

The Court therefore rejected the company’s position that its status as the alleged sole distributor in Ghana automatically gave it the power to prevent other traders from reselling genuine products obtained through legitimate channels. It stressed that intellectual property regimes operate alongside free-market principles and that, unless authorised by statute, protection of a particular distributor against legitimate resale would amount to an impermissible form of protectionism.

Sole distributorship claim also unsupported

The Court further found that Service Merchandise had not produced sufficiently cogent and admissible evidence to establish that it was the sole entity authorised by Crompton Greaves to distribute the products in Ghana.

The company’s attempts to introduce evidence concerning its alleged authorisation from Crompton Greaves Consumer Electricals Ltd were opposed at the trial and did not establish the claim. The Court therefore held that the burden of proof on that issue had not been discharged.

Court rejects challenge to defendant’s attorney as witness

The appeal also challenged the defendant’s use of his lawful attorney, Kwadwo Nimo Dumfe, as a witness. Service Merchandise argued that the attorney was not an employee of the business and therefore lacked the requisite capacity or interest to testify.

The Court described the objection as misguided. It distinguished capacity from locus standi, explaining that the appointment of an attorney to testify did not concern the capacity of the party to the suit.

More importantly, the Court held that any challenge to the competence of the attorney to testify ought to have been raised before the trial court. A party could not ordinarily raise on appeal an issue which could have been raised at trial but was not, particularly where doing so would deprive the opposing party of an opportunity to address the objection.

The Court also observed that the defendant was a natural person trading under the name and style of Angola Trading. Angola Trading was not a separate corporate legal entity, meaning the action had properly been brought against Daniel Owusu-Ansah personally. He was therefore entitled to appoint an attorney to act and testify on his behalf.

GH¢10,000 costs described as ‘on the low side’

The Court also upheld the award of costs to the defendant. It explained that costs are awarded at the discretion of the trial court, guided by factors including expenses reasonably incurred, court fees, the complexity and duration of proceedings, and the conduct of the parties and their lawyers.

In this case, the defendant had incurred legal expenses and travel costs and had experienced business disruption during the litigation. The Court noted that he had also been arrested at the plaintiff’s instance and that his goods had been seized pursuant to an earlier ex parte or Anton Piller order.The Court stated that the GH¢10,000 awarded by the High Court was, in fact, “on the low side” given the circumstances.

It further observed that the circumstances could have justified an award of general damages for loss of business and inconvenience. However, because the defendant had not made a case on damages for the Court’s consideration, no such award was made.

Appeal dismissed

In the final determination, the Court of Appeal held that the appeal was without merit and affirmed the High Court’s judgment of 17 July 2024. The Court consequently dismissed Service Merchandise Limited’s appeal and awarded GH¢30,000 in costs to Daniel Owusu-Ansah.

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