David 2 - Goliaths 0 Grandmark secures two big wins for the Consumer

Grandmark International, a South African company that sells glass products and imported automotive parts, sought relief from the courts as the PG Group, manufacturers and distributors of Shatterprufe® and Armorplate® glass products, embarked on a widespread disinformation campaign that made use of "unsubstantiated” claims and "speculation” to disparage Grandmark and its products.

Because of these disparaging communications, Grandmark International has been granted an interim interdict that prevents the PG Group from engaging in further "anti-competitive” and "unconstitutional” conduct to discredit their products.

The PG Group claimed, in correspondence with short-term insurers and through road shows to brokers, that Grandmark uses recycled vinyl in the manufacture of the windscreens sold and fitted in South Africa.

According to the Judge, the motive for PG Group employing these tactics is "glaringly obvious…….it is afraid of competition”. "This anti-competitive behaviour is based largely on our recent success. The increased market awareness and the acceptance, and use of Grandmark Glass products as approved replacement parts by the insurance industry, has seen our market share grow rapidly. We offer quality products and services at a lower cost.” said Ian Pluke, Managing Director of Grandmark Glass Insurance Fitment Division.

In December 2012, the ruling stated that PG Group's inferences with the quality and safety of Grandmark Glass products are "unsupported by facts” and are mere "speculation”. The so-called "empirical evidence” from chemical analysis done by Sigmatec, used to support PG Group's claims provided no "scientific evidence” or "proof”. And, not supported by either Solutia or Du Pont, key international suppliers of PVB to the automotive glass industry.

However, the PG Group was not the only ones that were reprimanded in the court of law as BMW also got its share of warnings. In 1999, BMW obtained a consent (uncontested) court order against Grandmark, which prevented them from infringing certain BMW design and trade mark registrations.

After inspection in 2010, BMW declared Grandmark ignored the court order and therefore sued Grandmark for contempt of court. But, in 2012, it was ruled that BMW was unable to prove that Grandmark had deliberately flouted a court order. It was found that the four design registrations – which were for a headlight assembly, a bonnet, a grille and a front fender - were invalid for two reasons.

First, they had been wrongly registered as aesthetic designs, because the shapes of things like fenders don’t "influence choice or selection”, have "individual characteristics ... calculated to attract the attention of the beholder”, or have something that is "special, peculiar, distinctive, significant or striking about them”.

The judge said a replacement part serves only one purpose and that is being a replacement part. The judge said BMW had registered the designs as aesthetic designs in "an attempt to circumvent the exclusionary provisions relating to spare parts” under functional designs.

Secondly, the registrations were invalid, since they weren't new, in that they weren’t different from the "state of the art” at the time of registration.

He also found that mere trade variants are not new, and he made the point that in the case of each design registration, Grandmark was able to show that there had been at least one earlier 

BMW registration that was substantially the same.

BMW has since taken the judgement on appeal and the case will be heard in the Appeal Court in Bloemfontein in 2013.

Taking these two rulings into account, it goes to show that consumers now have a choice in the matter. Big monopolies do not necessarily have all the power they used to have.