Mobile apps have become very popular among Kenyans in recent times. From online shopping to same-day delivery services, apps have become irresistible to many innovative businesses looking for efficiency and convenience.
An innovator saw a niche in the burgeoning matatu industry and came up with online bus ticket booking services.
It was in the year 2017 when Buupass Kenya Limited was registered as a trademark as the absolute owner of registration number 97821.
The company has subsequently gained a great reputation and fame over the years after winning the prestigious Hult International Award 2016 for its innovation and social entrepreneurship.
Three years later, a rival company registered Buspass Kenya Ltd., and noticing that the new company was “eating” its base, Buupass Kenya filed a complaint with the Registrar of Companies accusing the former of infringing its trademark.
In the complaint filed on January 25, 2022, Buupass Kenya accused Buspass Kenya of misrepresenting and confusing users due to similar names.
The Registrar of Companies investigated the complaint and in a letter dated 10 February 2022, directed Buspass Kenya to change its name within 30 days, failing which it would be struck off the Register of Companies.
Buspass did not comply with the request, forcing Buupass to go to court to challenge the registration of the competitor’s name on the grounds that it was eroding its profits and good reputation.
In this case, there is no dispute that the plaintiff is the legal owner and absolute registrant of the BuuPass trademark as of June 29, 2017, while the defendant after following due process with the interested party established his company on November 27, 2020.
Mr. Wycliffe Omondi, co-director and founder of Buupass Kenya, explained that the innovation includes a downloadable software for urban commuters to pre-book public buses, pay using mobile phones and e-tickets, and provide SMS-based ticketing platforms for urban commuters.
The application also contains computerized ticket booking services for travel.
Mr. Omondi said he incorporated the company on November 25, 2016, as Magic Bus Ticketing Kenya Limited, with registration number PVT/2016/032650.
On May 11, 2017, it changed its name to Buupass Kenya Limited, a name that Kenyans associate with it, as it operated in the Kenyan market.
He stated that he discovered that the participating company was misrepresenting the public, and using its name to confuse people by creating a downloadable program for booking bus tickets online called BusPass and “BusPass Staff” under the Maps and Navigation category, which he considered a violation of his trademark.
Mr. Omondi added that continued use of the name would violate trademark rights and expose his company to immeasurable risks and losses.
He said the business design of using the names Buupass and Buspass interchangeably and copying his business style is intended to confuse the public, especially his customers, by providing false information that Buspass Kenya services are similar and related to his company’s services.
Mr Omondi added that since the Buspass name came into effect around 2020-2021, he has noticed a decline in the number of apps being downloaded.
He also testified that the business model is that customers download the app, book bus tickets, and Buupass makes money.
However, in this case, when customers search for Buupass on their laptops and computers, the word Buspass also appears, thus Buupass loses its customers to Buspass.
He asked the court to issue a permanent injunction preventing Buspass from using the name, and to order him to pay damages for the violation of his rights.
Mr Omondi asked the court to order Bubas to pay Sh10 million in damages.
He gave an example of this confusion, saying that the city’s ride-hailing company – Citti Hoppa, which was a client of BuuPass Kenya, uses both the names BuuPass and BusPass as an advertising and marketing strategy.
According to Mr. Omondi, the similarity lies in the name “Boo,” a slang word for “bus,” which is strikingly similar to his brand, and is likely to mislead or confuse the public.
The defendant alleged that his name was not noticeably similar to the plaintiff’s name as alleged and therefore did not cause any confusion to the public. The defendant urged this court to dismiss the plaintiff’s claim with costs to the defendant.
It stated that the defendant was established on November 27, 2020, and a certificate of incorporation was issued by the relevant party. Prior to the said incorporation, the defendant conducted an official search at the office of the relevant party, which confirmed that the name Buspass was available for registration.
She added that the defendant company started its operations after its registration, which included selling e-bus tickets. The lawyer stated that the defendant company did not infringe the plaintiff’s trademark in any way and that the only similarity between the two parties here is that they are operating in the same industry.
In opposition to the case, Busspass Kenya argued that the two names are distinct and easily distinguishable by consumers, and therefore there is no confusion or deception as alleged by the company. The company asserted that the parties should be allowed to trade under their own names as there was no infringement of trademark rights or confusion among the general public as this has not been proven.
This was because Mr Omondi did not call any member of the public to highlight the alleged confusion, to support his case.
Furthermore, Buspass said that since Mr. Omondi changed its name from Magic Bus Ticketing Kenya Limited to Buupass Kenya Limited, the goodwill associated with Magic Bus Ticketing Kenya Limited no longer exists.
In the ruling, High Court Justice Njoki Mwangi said Section 58 of the Companies Act gives the Registrar of Companies the power to direct a change of name in case of similarity to an existing name.
In this case, the judge said it was undisputed that Buupass wrote to the Registrar of Companies complaining that it had approved a name for registration which was almost phonetically and visually similar to its own name.
“In light of the evidence adduced and the documents relied upon by the plaintiff, I am satisfied that the defendant’s name Buspass is strikingly similar to the plaintiff’s trade mark and is therefore likely to deceive or cause confusion in the course of trade,” the judge said.
Justice Mwangi said the general public was likely to easily become confused about which app to use when booking travel tickets online, leading to the assumption that the two names might belong to the same company.
“Essentially, this means that the defendant exploited the plaintiff’s customer base causing him potential losses due to reduced customer traffic to his application,” Judge Mwangi said.
The judge ordered an investigation into damages or calculation of profits and payment of all amounts owed to Buupass Kenya by Buspass Kenya for manipulation and infringement of intellectual property rights.
I have directed the President of the Institute of Certified Public Accountants of Kenya to appoint an accountant to determine the profits made by Buspass Kenya through its use of the trade name and to promote the reputation of Buupass Kenya and its services.
Comments are closed, but trackbacks and pingbacks are open.