New York Stock Exchange-listed Time Warner Inc and Kenyan chewing gum and sweets maker Kenafric Industries are in discussion for an out-of-court settlement over a copyright infringement suit.
Lawyers representing the two firms told the High Court Tuesday that their clients are in negotiation and asked for more time to conclude the talks, a request that was granted by Justice Jonathan Havelock.
The judge had directed the two parties to report the progress to court on May 6, but the court was not sitting on the date and parties are now expected to take a new date when they will file their report.
The US firm, through its TV unit The Cartoon Network Inc, moved to the Nairobi High Court applying for Kenafric to be stopped from using the BEN 10 character in packaging its products.
It alleges that the association of chewing gum with its brands can damage the reputation of Ben 10 and of goods branded with the label, which include toys, video games and clothing valued at Sh275 billion.
Cartoon Network says the BEN 10 character has been developed over a long period through promotion and advertisements, and its association with the Kenafric brand could damage its reputation.
Cartoon Network relied on the Madrid agreement on international registration of trademarks adopted in April 1891 and the international registration of trademarks adopted in Madrid in June 1989.
The Madrid Protocol provides that once a trademark is registered in a signatory country, it becomes protected in all other countries that have adopted the treaty.
The company, says that having registered BEN 10 as a trademark in US, it becomes protected in Kenya too.
But Kenafric in its response said Time Warner cannot use the Madrid Agreement to stop it from wrapping sweets with the cartoon-branded packages.
Kenafric says Cartoon Network products are not captured under the food segment of the protocol and hence cannot challenge the Kenyan firm given that they deal in different products.
It argues that the US firm has no local operations that can make consumers links its products with those of Kenafric, which are mostly sold within East Africa.
Kenafric alleged that the line of trade of the two companies is distinct and there are no similarities between their goods that can confuse customers.