Case BriefsHigh Courts

“Principles laid down for Courts to deal with injunction applications, in a pending suit, seeking relief against passing off”

 Karnataka High Court:  A  Division bench of Aravind Kumar and Pradeep Kumar Yerur dismissed the appeal and affirmed the order dated 22-06-2021 passed in O.S.No.177/2021 by LXXXIV Additional City Civil and Sessions Judge (CCH-85) (Commercial Court), Bengaluru.

 The facts of the case are such that the plaintiffs i.e. ITC Limited launched itself into the manufacturing and sales of ‘instant noodles’ in September 2010, under the brand name, ‘Sunfeast YiPPee!’ having different variant of noodles, including ‘Magic Masala’, ‘Mood Masala’, ’Classic Masala’, to name a few. The Plaintiff claimed protection from alleged misrepresentation and copyright infringement in respect of the ‘overall visual appearance’ (wrapper) of ‘Magic Masala’ variant of Sunfeast Yippee noodles by the defendants i.e. CG (India) Private Limited who manufactures and sells in the instant noodles market under the brand name ‘WAI WAI’ and the product under challenge is one of its white-noodles product, ‘WAI WAI Xpress Noodles Majedar Masala”. Plaintiff claims that the action of the defendant has caused damage to its goodwill and reputation in the market and as such defendant has to be restrained from using same and thus the plaintiff has sued defendant and it bases its cause of action in passing off and copyright infringement.

Counsel for the appellant- plaintiff Mr. K.G Raghavan submitted that that extent of similarity is sufficient to ‘deceive’ that class of persons who are likely to buy plaintiff’s goods. It was further submitted that the court below has fallen into error on a matter of principle in so far as it has laid emphasis on the ‘dissimilarities’ between the competing wrappers, instead of estimating the effect of the similarities.

Counsel for the respondent- defendant Mr. Dhyan Chinappa submitted that on an overall consideration of the competing wrappers, after ignoring the descriptive marks and marks common to trade, it is the ‘brand names’ that is really distinctive of the plaintiff and since the brand names are completely dissimilar; there is no likelihood of confusion. If the plaintiff’s case is that the colour scheme has been copied to the extent that it may lead to confusion, the plaintiff will have to show that the ‘orange-red’ colour scheme has acquired such a high level of distinctiveness in the market, that the ordinary purchaser would ignore all other features and rely solely on the colour scheme to identify the products of the plaintiff.

Concept of “passing off”

One of the cause of action upon which the plaintiff relied was passing-off and to establish an arguable case in passing-off action, the plaintiff must show a misrepresentation express or implied that the defendants wrapper is connected with or may be associated with the plaintiffs’ business and that as a consequence damage is likely to result to the plaintiffs.  In passing-off, following points are under consideration:

  1. Distinctiveness of the plaintiffs mark
  2. Deceptive Similarity

 The entire basis of an action for the tort of passing-off lies in the making of a misrepresentation by the defendant which is calculated to cause damage to the business or goodwill of the claimant. The design that a typical form of misrepresentation generally takes is for the defendant to adopt that feature of the plaintiff’s mark which the ordinary purchaser is most likely to associate or use to identify the goods as that of a plaintiff.

Concept of “distinctiveness”

Professor Wadlow claims that term ‘distinctive’ has a meaning of its own, in the legal sense, which does not coincide with the ordinary use of the term in common parlance. In its legal sense, a name, mark or get-up can be said to be distinctive ‘if it denotes the goods of the claimant to the exclusion of all others’. What plaintiff claims to be distinctive may be ‘distinctive in fact’ but the plaintiff cannot have the final say on what is distinctive in law. The concept of ‘distinctiveness’, can be concluded as the features relevant for our analysis, does not include all features (that is, overall get up) as claimed by the plaintiff, but it is those distinguishing features which perform the function of a trade mark – the function of a trade mark being that of ‘source identification’.

The Court observed that even a bare look at the wrapper of the Magic Masala brand would indicate that ‘Yippee’ written in yellow color and relatively, the largest font (in both 12 Rs packs and 48 Rs pack) stands out in contrast to the ‘Sunfeast’ logo which is written in red font against a red background; and with respect to Magic Masala, which is written in dark blue color in a much smaller font size against an orange background. ‘Yellow’ being a light as well as bright colour , coupled with the fact that Yippee bears a stylised script and large font, appears to strike itself to the sensory organs quite easily purely on first impression as well.

The Court further observed that the features which can be said to be ‘distinctive’ in law in the sense that the relevant public would rely on such features to associate the goods as that of the plaintiff or to identify the goods as that of plaintiff or to distinguish the goods of the plaintiff from others would be, essentially, the brand ‘Sunfeast Yippee’ and to a lesser extent, the sub-brand which indicates the various flavours – in this case, ‘Magic Masala’.

The Court thus observed that the misrepresentation must be believed by those to whom it is communicated [through word marks, visual marks, labels or the entire get up as a whole], and such persons must be likely to act in reliance of the supposed misrepresentation. As noted, persons are likely to act in reliance of those features of a plaintiffs product which is said to be ‘distinctive’ of it in the legal sense. Hence the question of distinctiveness and that of misrepresentation are not independent of each other but are strongly interdependent and are always capable of interacting with each other.

Examination of ‘deceptive resemblance’ vis a vis present case

The test to determine ‘deceptive resemblance’ is essentially decided by asking two questions:

  1. Person / Hypothetical purchaser
  2. ‘Rules of Comparison’

 It was observed that in general it would not be an easy task for a plaintiff to establish a case of passing off by “get up” alone, especially at the interlocutory stage, unless the resemblance between the goods is so close that it can hardly have occurred except by deliberate imitation.

The Court observed that on careful analysis of the marks, logos, pictures and how the products are listed on digital platforms and physical stores it is clear that from the perception of the hypothetical purchaser, even after making allowance for imperfect recollection, the point of reference for purchasing the plaintiff’s goods is primarily the brand – Sunfeast Yippee, or the mark – Yippee or the phrase ‘Yippee Magic Masala’. “We find it rather unconceivable, at this stage (without any data or evidence in front of us) to conclude that the hypothetical purchaser would go and ask for ‘red-orange noodles’. Even if he does, it is very unlikely that a shopkeeper would straightaway handout the ‘Yippee Magic Masala’ brand of noodles since it has been show to us that there are other wrappers which may though not have, strictly speaking, an identical colour scheme but have similar colours on their wrappers.”

 Test of Copyright Infringement

 The Court observed that while deciding the question of copyright infringement it is not necessary that the defendants work must be an exact reproduction of the plaintiffs work. What is essential is to see whether there is a reproduction of the substantial part of the plaintiffs work. It was further stated that if the plaintiff cannot demonstrate that substantial features of the plaintiff’s get up has been reproduced in the defendant’s get up, then merely showing similarity or identity in other non-essential features will be of no consequence.

The Court further laid down principles for Courts to deal with injunction applications, in a pending suit, seeking relief against passing off. [Refer judgment]

The Court thus held “that order of learned trial Judge dismissing the applications filed by the plaintiff for grant of temporary injunction deserves to be affirmed.”

[ITC Limited v. CG Foods (India) Private Limited, 2021 SCC OnLine MP 1906, decided on 28-09-2021]

 


Arunima Bose, Editorial Assistant has reported this brief.


Appearances:

For Appellants: Mr. K G Raghavan , Dharmendra Chatur and Sanjanthi Sajan Poovayya and Co.

For Respondents: Mr. Dhyan Chinappa, Lomesh Kiran N, Mr. Abhinay V and Mr. Tejas

Case BriefsHigh Courts

Delhi High Court: Asha Menon, J., addressed a suit for trade mark infringement, wherein the Court additionally addressed the scope of Section 124 of Trade Marks Act.

Instant petition, petitioner was aggrieved that on account of the fact that his suit, which he had filed against the defendants for infringement of his proprietary trade mark “RACER” as also passing off their goods as that of the petitioner and other reliefs, was stayed by the trial court.

The stated order was challenged and was further disposed of by permitting the petitioner to withdraw that petition and granting liberty to approach the Tribunal (sic.) by review petition.

Counsel for the petitioner, S.K. Bansal relied upon the judgment of this Court in J. K. Oil Industries v. Adani Wilmar Ltd., 2018 SCC OnLine Del 9367 to submit that when a suit was filed for infringement of trade mark as also for passing off, the filing of a rectification petition before the Intellectual Property Rights Board would result in the stay of the suit as far as infringement of trade mark was concerned under Section 124 of the Trade Marks Act, 1999, but that suit with regard to passing off was to continue.

With regard to the prayer of the petitioner for continuing the suit for passing off, the counsel submitted that since an injunction was already in force against the respondents and the respondents were not using the trade mark “RACER”, no prejudice was being caused to the petitioner, if the suit waiting for the disposal of the rectification petition filed by the respondents before the IPRB. Thus, the counsel submitted that the present petition deserved to be dismissed.

Analysis, Law and Decision

Bench stated that it is settled law that Section 124 of the Trade Marks Act does not provide for stay of action against the passing off and was applicable only where a rectification application/cancellation has been sought against the registered trade mark that a plaintiff claims to be exclusively it’s own.

The above is intended to avoid conflicting decisions by the Civil Courts and the Tribunal.

There is no such occasion arising in a suit for passing off. It is only when clever drafting discloses the intent of the plaintiff to get over the statutory bar, being aware of the rectification proceedings commenced against the trade mark that it claims is exclusively it’s own.

Hence, Court held that the trial court had misread the judgments of this Court in Micolube India Ltd. v. Maggon Auto Centre,    2010 SCC OnLine Del 138, and an error apparent on the face of the impugned order. Trial Court ought not to have directed that the entire suit be stayed, though, this Court including J.K. Oil Industries v. Adani Wilmar Ltd., 2018 SCC OnLine Del 9367, has consistently held that while the suit for infringement of trade mark has to be stayed under Section 124 of the Trade Marks Act, when a rectification petition is filed before the IPRB, an action for passing off could continue.

In view of the above petition was allowed. The order passed by the trial court was modified to read that Civil Suit No.577/2016 [New No.10725/2016] shall remain stayed under Section 124 of the Trade Marks Act qua the action for infringement of trade mark, but shall continue qua the relief sought against passing off and connected reliefs. [Parveen Kumar Gupta v. Ravi Chadha, 2021 SCC OnLine Del 3916, decided on 6-08-2021]


Advocates before the Court:

For the Petitioner: S.K. Bansal and Ajay Amitabh Suman, Advocates

For the Respondents: Ashish Deep Verma, Kamya Ritu Verma, Vijay Singh and Bharti Sharma, Advocates

Case BriefsHigh Courts

Delhi High Court: C. Hari Shankar, J., addressed a matter regarding passing off and granted interim relief.

Plaint alleged that defendant 1 was passing off its products as those of the plaintiffs by using the label which was confusingly and deceptively similar to that of the plaintiffs.

The product sold and manufactured by the plaintiff is “KESRI MARHAM” and the plaintiff claimed to have adopted the same in 1998.

Plaint asserted that the label of the plaintiffs reflected a unique trade dress with individual components being placed at specific locations.

Defendant is engaged in manufacturing and marketing of ayurvedic product including pain relief balms, dant manjan, creams etc. The said balm was sold under the name “Paharhi Garhwali Balm”.

Identical 

Prima facie on a bare glance of the labels of the defendant and plaintiffs, it was indicated that there had been a conscious effort to copy the plaintiff’s labels, to the extent that the colours used by the defendant, placing of various features on the label and the photographs representing the ailments which the balm was expected to alleviate are also identically placed.

Therefore, in view of the above discussion and finding, prima facie it appeared that defendant was passing off its products as those of the plaintiffs.

High Court opined that plaintiffs made out a good prima facie case for grant of ex-parte ad interim relief.

Bench also added that in case the relief was not granted and the market was permitted to be flooded with defendant’s product, prejudice to the plaintiffs would be irreparable.

Plaintiffs are directed to comply with the provision of Order XXXIX Rule 3 CPC within the time stipulated in that regard. [B C Hasaram and Sons Ayurvedic Pharmacy v. Pahari Garhwali Ayurvedic Pharmacy, 2021 SCC OnLine Del 3057, decided on 17-05-2021]


Advocates before the Court:

For the Plaintiffs: Ms. Tusha Malhotra & Ms. Yamini Jaiswal, Advs

Case BriefsHigh Courts

Bombay High Court: G.S. Patel, J., disposed of an interim application with respect to the suit for trade mark and copyright infringement, while holding that ‘Copyright registration is not mandatory under the Copyright Act, 1957.”

Trade Mark in question is a label mark, not  a word or a device mark.

Plaintiff claimed copyright in the artistic work comprised in the label.

It has been stated that Narayani Trading’s Label uses very nearly – or indistinguishably the same – principal background colour.

Counsel Mr Burad for Narayani Trading submitted that the two labels are entirely distinct and no one will mistake one for another. Court rejected the same and elaborated that the key features, integers, or elements that have been described by the Bench in Sanjay Soya’s Label all find place in Narayani’s Trading Label with only minor variations.

Factual Matrix

Sanjay Soya has been manufacturing and selling edible oils of various kinds, including soyabean oil, for many years. Narayani Trading is a sole proprietorship. Sanjay Soya claimed to have the necessary ISO certifications for quality and other certifications. Sanjay Soya stated that it is the successor-in-title of one SK Oil Industries, in May 2003 SK Oil adopted the label, mark and artistic work in relation to edible oil which has distinctive get up, layout and schematic arrangements.

Recital (2) of the Deed of Assignment stated that SK Oil conceived, created, designed and developed a SOYA DROP label and that is the artwork that is the issue of concern in the present matter.

Counsel Mr Khandekar for Sanjay Soya submitted that the label is an original artistic work within the meaning of Section 2(c) of the Copyright Act. Further, it was added that, Sanjay Soya has used the mark, with some variants, openly and continuously since adoption.

In brief, Sanjay Soya’s Argument:

Sanjay Soya claimed that Narayani Trading has entirely lifted and unauthorisedly and illicitly copied Sanjay Soya’s registered label mark and the copyright-protected artistic work in the label. It says that Narayani Trading’s label is a reproduction and an illicit copy of a substantial part of Sanjay Soya’s original and distinctive artwork.

Piggyback on Sanjay Soya’s reputation?

Narayani Trading’s adoption of the label mark is dishonest, not bona fide, with an ulterior motive and intended to trade upon and encash the goodwill, recognition and reputation of Sanjay Soya’s business.

The Court noted that earlier decision of the Court in Dhiraj Dharamdas Dewani v. Sonal Info Systems (P) Ltd., 2012 (3) Mh LJ 888 held that registration under the Copyright Act is mandatory before a plaintiff can claim relief. So also, the decision in Gulfam Exports v. Sayed Hamid, 2000 (20) PTC 496 Bom says that registration is required. Noting the settled law, the present Bench held that these two decisions are per incuriam on the question of compulsory registration under the Copyright Act.

High Court observed that Copyright and Trade Mark operate in different spheres, though in some cases – as in the present one – these may overlap or intersect.

Copyright is a recognition of originality, granting rights of commercialisation and exclusivity in that commercialisation to the author of a work, a person who, by sweat of his brow, has brought into being the original expression or realisation of an idea. The emphasise is on originality, labour and skill in expression and realisation. 

Section 51 of the Copyright Act does not per se, demand prior registration. The said provision is to be read with Section 45(1) which states that the owner of copyright may apply for registration.

Importantly, copyright infringement lies in the unlicensed use of original works, in which the author has a spectrum of exclusive rights.

Essence of Copyright Protection

There is always the slight escape of the fair use doctrine, but the underlying principle is that no author may claim as his or her own the original authorship work of another. That is the essence of copyright protection.

The Supreme Court decision in Engineering Analysis Centre of Excellence (P) Ltd. v. Commissioner of Income Tax, Civil Appeal Nos 8733-8734 of 2018, authored by Rohinton Fali Nariman, J., explained the nature of copyright.

Registered proprietor of a mark or the owner (not registrant) of copyright may have recourse to the jurisdictional venues in Section 134 or Section 62, in addition to those under CPC Section 20.

The owner of a copyright has a panoply of jurisdictional choices, including one that is available only to him (and not to an ordinary plaintiff in a regular civil suit).

Rationale behind allowing a trade mark registrant or a copyright owner additional jurisdictional choice is that the right claimed is in rem, against the world at large. The infringement thus takes place where the proprietor of the trade mark or the owner of copyright resides or works. This is, therefore, no ground to hold that copyright registration is mandatory.

There is no law or precedent that requires that a declaration that a decision is rendered per incuriam be made only by a hierarchically superior court. 

Bench while expressing its observations, stated that it is impossible to believe, given Sanjay Soya’s prima facie established product popularity and reputation, that Narayani Trading was unaware of Sanjay Soya’s market presence, also it Narayani Trading does not show that the artistic work and label was in use before Sanjay Soya or SK Oil began using it.

Sanjay Soya v. Narayani Trading | Label Mark 

Bench held that knowing of Sanjay Soya’ s presence in the market, of its label and of its artistic work, Narayani Trading illicitly and without bona fide intent adopted a label that is confusingly, deceptively and strikingly similar to that of Sanjay Soya; and in doing so, copied substantially, if not wholly, the artistic work comprised in Sanjay Soya’s trade dress and packaging, and of which copyright Sanjay Soya through its predecessor-in-title is indeed the owner.

Cause of Action in ‘Passing Off’ || Classic Trinity

 High Court expressed that in 1978–79, Diplock LJ set out five guidelines for ‘passing off’ actions in Erven Warnink v. Townend & Sons Ltd.  [1979] AC 731, 742 (HL), this is the famous ‘Advocaat’ case. Oliver LJ in Reckitt & Colman Products Ltd v. Borden Inc., [1990] 1 All ER 873 distilled these into the three probanda in the tortious actions in passing off that we now know as the ‘Classic Trinity’:

  • goodwill owned by a claimant;
  • (ii) misrepresentation; and
  • (iii) damage to that goodwill.

Classic Trinity places on a plaintiff the burden of proving goodwill in its goods or services, trade dress, brand mark or even the thing itself.

In view of the above, Bench stated that Sanjay Soya prima facie did prove the above.

Further, the plaintiff needs to show the false representation to the public that leads it to believe that the goods or services of the defendant are those of the plaintiff. Fraud is not necessary.

The above, was also achieved by Sanjay Soya.

“Test of deception or its likelihood is that of the common person.”

A plaintiff need not prove actual or special damage; a reasonably foreseeable probability is sufficient.

“…in the case of beauty, similarity and its extent are matters that lie in the eyes of the beholder, and in all intellectual property matters, the beholder is, perhaps unfortunately, in the first instance always the judge tasked with deciding the dispute.”

Lastly, while concluding the matter, Bench expressed that looking at the two packets of which the images have been rendered at the start, all that the Court can say is “which is whose? I cannot tell.”

Finding the defence of Narayani Trading to be utterly frivolous and possibly moonshine, Court imposed costs on them. [Sanjay Soya (P) Ltd. v. Narayani Trading Company,  2021 SCC OnLine Bom 407, decided on 09-03-2021]


Advocates before the Court:

For the Plaintiff: Mr Rashmin Khandekar, with Ms Janhvi Chadha and Mr Hardik Sampat, i/ b Krishna and Saurasri Associates LLP.

For the Defendant: Mr Pritesh Burad, with Ms Amruta Patil & Mr Mitesh Visaria, i/ b Pritesh Burad Associates.

Case BriefsHigh Courts

Andhra Pradesh High Court: R. Raghunandan Rao, J., addressed a matter wherein the law relating to Trade Mark and Passing off was highlighted wherein the trademarks of the parties are similar or identical.

Permanent Injunction was sought by the respondent to restrain the appellant from infringing on the trademarks or passing off trademarks held by the respondent and further sought for damages, rendition of accounts under the Trademarks Act, 1999 and infringement of Copy Rights Act, 1957 against the appellant.

Background

Plaintiff had been carrying on the business of manufacture of white lime wash and distributing and selling the same under the flagship brand name Surya and the device mark of “Rising Sun”.

Plaintiff had been using the mark “Surya” in collocation with various other words and in a combination with the device “Rising Sun with seven rays”.

Unique, uncommon and distinctive features of the trademarks “SURYA” and logo “SUN” are an inventive combination.

Plaintiff submitted that under the common law and as a result of extensive prior usage since 1985, vested rights in the Trademark “SUN” as a logo and “SURYA” as a word and to protect the same have already filed Trademark Applications and the same is pending.

Plantiff’s case was that the plaintiff’s mark came to obtain recognition among the general public relating to the standard and quality of the products of the plaintiff and is recognized all over the country.

Hence, plaintiff claimed that its mark “Surya” which is recognized all over the country would be treated as a well known mark defined under Section 2 (zg) of the Trademarks Act, 1999.

Plaintiff filed a criminal complaint against the defendant on knowing that he was indulging in illegal activity by selling its products by adopting the name “Surya Magica White”.

But the stated criminal complaint was not acted upon, which compelled the plaintiff to file a private complaint which again came to be pending, therefore plaintiff approached the Court.

Defendants’ use of the essential features of the plaintiff mark demonstrates that his instent was to utilise the goodwill of the plaintiff by deceiving the general public.

Analysis, Law and Decision

Bench reviewed the law relating to Trade Marks.

While reviewing the same, Court stated that the Act regulates the recognition of trade marks, their registration and protection.

Protection of Trade Marks is defined in Section 2(1)(zb):

“Trade Mark” means a mark capable of being represented graphically and which is capable of distinguishing the goods or services of one person from those of others and may include shape of goods, their packaging and combination of colours; and 

(i) in relation to ChapterXII (other than section 107), a registered trade mark or a mark used in relation to goods or services for the purpose of indicating or so as to indicate a connection in the course of trade between the goods or services, as the case may be, and some person having the right as proprietor to use the mark; and

(ii) in relation to other provisions of this Act, a mark used or proposed to be used in relation to goods or services for the purpose of indicating or so to indicate a connection in the course of trade between the goods or services, as the case may be, and some person having the right, either as proprietor or by way of permitted use, to use the mark whether with or without any indications of the identity of that person, and includes a certification trade mark or collective mark.

The primary purpose of the a trade mark is to indicate the source of the goods/services that are sold in the market.

Whenever and wherever if there is an attempt to deceive buyers about the source of goods/services with usage of an identical or similar Trade Mark the law would assist the proprietor of the trade mark to protect his identity as the only supplier of the said goods/services.

Section 29. Infringement of registered trademarks:

Bench added to its analysis that there could be a case of infringement where there is similarity in the trade mark or where trademarks are identical, leading to confusion in the mind of the buyer that the goods being purchased by him under the offending trade mark are the goods being produced or sold by the proprietor of the original trade mark.

Test of the likelihood of confusion or deception arising from similarity of marks is the same both in infringement and passing of actions.

Question that generally needs to be answered by the Court in a Trade Mark case, filed as an action of passing off or an action for infringement:

Whether a buyer would get confused between the goods of the Defendant and the plaintiff because of the usage of the offending trademark by the defendant?

In regard to the instant case, Bench noted that an action for infringement and passing off, both have been sought.

For passing off action, plaintiff failed to produce any evidence of the quantum and length of sales, reputation or goodwill built, therefore no action for passing off can be looked into.

Action for infringement

For the said action, plaintiff has to demonstrate that his trademark is registered and the defendant’s trademark is similar enough to the plaintiff’s trademark which would in result create confusion in the minds of the buyers.

In the present case, the trademark of the plaintiff is registered, both the parties are selling goods which are falling in the same category.

In view of the above, the only question that remains is:

Whether they are creating confusion in the minds of the buyers?

Court stated that the plaintiff has claimed that he has a trade mark in the name “Surya”, which is a generic word which connotes “Sun”.

In the above-stated circumstances, plaintiff/respondent cannot contend that he has a trademark on the name “Surya”.

In the present case, however, the plaintiff submitted that the mark is “Surya” written in a specific style with a specific foreground and background.

Even though, there cannot be a trade mark in the name “Surya” there could always be a trade mark in a particular stylistic way of using the word “Surya”.

Since the trademarks exhibited by plaintiff had been the words “Surya Cem or Surya Agrilline” etc., the trademark would have to be construed as a collocation of both the words Surya and Cem or Surya Lime or mortar etc.

Perusal fo the above discussion would depict that the trade mark of the defendant would show that there are differences in the manner in which the word “Surya” is depicted.

Hence, it can’t be said that the trademarks of the plaintiff and the defendant are identical or totally similar.

Supreme Court’s decision in Ruston & Hornsby Ltd. v. Zamindara Engineering Company, (1969) 2 SCC 727, it was held that in any action for infringement where the defendant’s trade mark is not the exact mark on the register but something similar to it, the test of infringement is the same as in an action for passing off.

Bench added to its observations that in the instant case, there is a possibility of a buyer going to the shop and asking for Surya cem and get confused by the mark of the defendant and accept the product of the defendant as it would be sold as Surya Blue or Surya ujala.

In light of the Delhi High Court decision of Surya Agro Oils Ltd. v. Surya Coconut Oil Industries, 1994 SCC OnLine Del 266, it will be held that there is every likelihood that buyers would tend to get confused and plaintiff would be entitled to an injunction as granted by trial court.

In view of the above, CMA was dismissed. [Gaurav Polymers v. Delight Chemicals (P) Ltd., 2020 SCC OnLine AP 1484, decided on 20-11-2020]


Advocates for the Parties:

Advocate for the petitioner: Advocate, K V Raghu Veer

Advocate for the respondent: Advocate, Ashok Ram Kumar

Case BriefsHigh Courts

Bombay High Court: G.S. Patel, J., refused to pass an interim injunction restraining Zee Entertainment from using the word “Plex” in its new pay-per-view channel.

Plaintiff sought restraint against the defendant’s use of the word ‘PLEX’ in an online movie channel service which was to be launched on 2-10-2020. Defendant (Zee) has a number of media channels and services including internet, OTT, DTH, Satellite, cable, etc.

On 1-10 2020, it announced its proposed launch about a month later of a ‘cinema-to-home’ pay-per-view service.

Plaintiff was represented by Tulzapurkar and claimed that it adopted this mark in May, 2008 in the United States. Further, Plex obtained international trademark registrations in several jurisdictions, but not India. It however claims that it had its first registered user in India on 23-07-2008.

Tulzapurkar, Advocate claimed that PLEX had built up a user or subscriber base of 5,50,00 users.

Bench stated it is concerned with domestic sales and these are used to provide prima facie evidence of reputation and goodwill.

Mr Tulzapurkar’s complaint is that despite the two words being used disjunctively in the actual branding Zee seems to have combined the two words into a single unit ‘ZEEPLEX’.

Court stated that the plaintiff had an objection to the use of ‘Plex’ by Zee for any service and in any manner, whether it is combined with Zee as one word or is used in conjunction with Zee as two words.

The question, therefore, is not about the use of Plex as the second of two words.

Question is whether the Plaintiff has been able to show any prima facie case in passing off.

“Passing off” is an action for damages in the tort of deceit, that is to say, deception by Zee in duping or misleading consumers as to the provenance and leading them to believe that Zee has somehow tied up with PLEX.

Plex must establish its reputation and must demonstrate that it has such brand recognition and awareness amongst even Zee’s consumers or digital consumers that such an association at least in India would readily be made.

Bench stated that it does not see sufficient material from Plex to be able to establish its reputation at least within India, whatever may be its reputation, registrations and sales in other jurisdictions.

There is musch greater reputation and standing of Zee amongst subscribers across the length and breadth of the country with a large number of channels in various languages.

Mr Dwarkadas pointed out that the word Plex was being used by Zee to specifically connote the niche or specialized service now being offered, i.e. a variety of regional and other licensed films being streamed on a pay-per-view basis to the subscribers.

To show deception and especially to show deception to obtain a quia timet injunction the Plaintiff must be able to show considerably more.

High Court stated that merely pointing to other established and reputed players in the field is not enough, and it is hardly a credible argument to say that “if Sony provides content and has a reputation, since I, too, provide content, I must be presumed to have an equivalent reputation. So if Sony could maintain such action and get an order, so must I.”

Every claimant in a passing-off action stands or falls on his own merits and case.

“…parties in IPR matters cannot expect Courts to push aside all other cases.”

Court added that it repeatedly happens, whether it is movie releases or otherwise. It must stop. It is unfair to courts and it is unfair to other litigants waiting their turn.

Where a plaintiff has had enough notice and yet chooses to move at the eleventh hour — and makes no allowance at all for any adjustment that may be required — the plaintiff must be prepared to face the consequences.

In the present matter, bench found no prima facie case.

The grant of the injunction Plex sought would cause immense and immediate financial loss and harm to Zee — it says it has already spent more than Rs 11 crores (rather more than Plex’s combined India sales for the last five years) on this new channel.

Hence, the Court found no reason to grant an ad-interim injunction. [Plex, Inc v. Zee Entertainment Enterprises Ltd., 2020 SCC OnLine Bom 989, decided on 01-10-2020]

Case BriefsHigh Courts

Madras High Court: While deciding the question that whether the expression “Magic Masala” can qualify as a trademark and that whether it is capable of being monopolised, Bench of C. Saravanan, J., held that the words “Magic” and its derivative “Magical” are common to the trade; therefore, neither the plaintiff (Sunfeast Yippie Noodles) nor the defendant (Maggi Noodles) can claim  monopoly over the expression “Magic” or “Masala” for they are very common words in Indian culinary industry and packaged food industry.

The instant suit was filed by the ITC Ltd. (Sunfeast Yippie Noodles) in order to restrain the defendant, Nestle India Ltd. (Maggi Noodles) from passing off their products i.e. instant noodles by use of the offending mark “Magical Masala” or any mark similar to plaintiff’s mark “Magic Masala”. The plaintiff represented by P.S. Raman, contended that that both expressions “Magic Masala” and “Magical Masala” are the respective sub-brands and the latter is phonetically similar to the former. Since both the plaintiff and the defendant are in the same business, i.e. sale of instant noodles, there is deception and confusion and thus there is passing-off by the defendant. On the contrary, the defendant via their counsel Hemant Singh argued that, the expressions “Magic Masala” and “Magical Masala” have been used both by the plaintiff and the defendant as a flavour descriptor and therefore is incapable of being protected and thus the suit is liable to be dismissed. 

Scrutinizing the contentions of the parties and the concerned provisions of Trade Marks Act, 1999, the Court observed that Section 2(zb) of the Trade Marks Act, 1999 defines trade mark as a mark capable of being represented graphically and which is capable of distinguishing the goods or services of one person from those of others. Thus the purpose of a trademark is to identify the goods of the proprietor and it is intended to catch the attention of the consumer instantly in order to make a ‘on the spot’ decision to buy the goods or services of a proprietor. A word or expression becomes trademark if it is either distinctive or is intended to distinguish the product. On the other hand, a generic mark describes the quality of the product and unlike trademarks, they can neither be monopolised nor they can be registered. A descriptive trade mark can be entitled to protection if only it has assumed a secondary meaning and identifies a particular product or as being from a particular source. On the other hand a suggestive term used as a mark which indirectly suggests the qualities and characteristics of the product may be accorded protection.

Vis-à-vis ‘passing off’, the Court observed that expression has not been defined under the Trade Marks Act, 1999. The expression means to “pass-off one’s goods as that of another person’s whose product has a reputation in the market. This results in deceiving the consumers and is intended to cause injury to the proprietor of the trademark”. A passing off action is broad common law remedy to protect an unregistered trademark and to restrain an unfair trade practice by a competitor who misleads the consumer.

With these points in the mind, the Bench observed that the word “Magic” is commonly used in the food and cosmetic industry. It is also used in a variety of the products cutting across different segments of goods. The adoption of the word “Magic” by the plaintiff was inspired from the use of the word across the industry. The defendant’s use of the same word was inspired not only from the words which are common to the trade but also from some of its own products, therefore the adoption cannot be termed as malafide. It was further noted that the plaintiff has used the expression “Magic Masala” in a laudatory manner and laudatory epithet cannot be given monopoly or protection. Moreover, “Magic” and “Masala” both the expressions are not invented and distinctive words. Therefore dismissing the instant suit, the Court held that, since both the expressions are common to the packaged food industry, thus it will be unfair to recognise or confer any monopoly over these words. [ITC Ltd. v. Nestle India Ltd., 2020 SCC OnLine Mad 1158  , decided on 10-06-2020] 

Case BriefsHigh Courts

Delhi High Court: Pratibha M. Singh, J. while addressing a petition concerning the protection of the trademark ‘DA MILANO’, issued certain guidelines for the online intermediaries involved and held as follows:

“Role of Facebook and Instagram, insofar as posts put up by concerned third parties is governed by the Information Technology (Intermediaries Guidelines) Rules, 2011. Considering the provisions of the stated guidelines, online platforms which claim to be intermediaries not performing any active role in the posting of such information by 3rd party alleged infringers, have a duty only to take down the posts which are brought to their notice by plaintiff in terms of Section 79(3).

The above-mentioned guidelines along with Section 79(3) of the IT Act have been interpreted by a very significant Supreme Court case of Shreya Singhal v. Union of India, (2015) 5 SCC 1, “to mean that “any information received by the platforms would be by means of a Court order”.

In Shreya Singhal case, pertaining to Section 79 (3)(b), following was held which is relevant in respect to the present matter:

“Section 79(3)(b) has to be read down to mean that the intermediary upon receiving actual knowledge that a court order has been passed asking it to expeditiously remove or disable access to certain material must then fail to expeditiously remove or disable access to that material. This is for the reason that otherwise it would be very difficult for intermediaries like Google, Facebook, etc. to act when millions of requests are made and the intermediary is then to judge as to which of such requests are legitimate and which are not.”

The facts in the present case are that the plaintiff who claims to be the owner of ‘DA MILANO’ filed a suit against the Defendants 1 to 4 in respect to seek permanent injunction, restraining infringement of trademark and passing off and under Section 74 of IT Act, 2000 seeking protection of the trademark ‘DA MILANO’.

It has been further stated that, Defendants 1 to 4 are alleged infringers who have posted on “Facebook” and “Instagram” advertising and offering to sell products bearing the mark ‘DA MILANO’. Plaintiff while seeking a permanent injunction against infringers impleaded the stated online platforms to ensure that posts comprising the infringing marks are taken down.

Trial Court, had sought the personal appearance of Facebook and Instagram in the present matter. Therefore, the grievance was the direction of personal appearance of the representatives of Facebook and Instagram.

Senior Counsel, Parag Tripathi, submitted that his clients are willing to comply with interim order which has already been passed and since the said defendants are not contesting the matter on merits against the plaintiff and are merely intermediaries; their personal presence is not required.

High Court on perusal of the facts and the guidelines mentioned above along with relying on the Supreme Court case of Shreya Singhal v. Union of India, (2015) 5 SCC 1, agreed on the fact that the stated platforms are mere intermediaries and have no active role in the matter, which therefore demands no personal appearance. Further, the following directions were issued:

  • Plaintiff shall inform Instagram and Facebook whenever they came across use of the mark ‘DA MILANO’ either in word form, logo or in any other form on their platforms.
  • Once such information is received, as per Rule 3(4) of the 2011 Guidelines, the said posts shall be taken down, within the timelines prescribed.
  • If platforms have any doubt as to the violative or offending nature of posts, they shall intimate the plaintiff.
  • Upon any order being passed by a Court of competent jurisdiction, the same shall be intimidated to the platform, which shall abide by the said order.

Thus, the suit is decreed against Facebook and Instagram in the above terms. [Facebook Inc. v. Surinder Malik, 2019 SCC OnLine Del 9887, decided on 28-08-2019]

Case BriefsHigh Courts

Delhi High Court: Pratibha Singh, J., while allowing the suit brought by Sun Pharma Laboratories Ltd., passed an order injuncting Ajanta Pharma Ltd. from selling any medicinal preparations, nutritional food supplements or any other preparations for human consumption for treating any illnesses or diseases under the trademark GLOTAB or any other mark identical or deceptively similar to the Sun Pharma’s mark GLOEYE.

The dispute between the plaintiff and the defendant was is in respect of two products used by patients of the age-related dimness of vision and diabetic retinopathy. They are sold under the trademarks GLOEYE and GLOTAB, respectively. Both are ocular medicines. Since they contain plant extracts, they are termed as “nutraceuticals” under Section 22 of the Food Safety and Standards Act, 2006.

Plaintiff’s case was that it commenced use of the mark GLOEYE in July 2005 and it was their registered mark. The defendant was also using the mark GLOTAB for the same purpose, i.e. medicine used by patients for the age-related dimness of vision and diabetic retinopathy. Incidentally, defendants mark was also a registered mark. The defendant was using the said trade mark since 2013. The plaintiff filed the present suit for an interim injunction.

Since both the trademarks were registered, the case for infringement of trademark could have been maintainable; thus,  the suit proceeded on the principles of “passing off”, as recognised under Section 27(2) of the Trade Marks Act, 1999. The High Court considered the question — is the test for infringement and passing off for nutraceutical products the same as the test applicable for pharmaceuticals?

Kapil Wadhwa, Devyati Nath and Deepika Pokharia, Advocates representing Sun Pharma, submitted that it was a clear prior user of the said mark by atleast 8 years. Mr Wadhwa submitted that the fact that the composition of two products is different enhances the chances of confusion, especially in products that are consumed for the same ailments. Per contra, Senior Advocate Sandeep Sethi, Jayant Mehta, Afzal B. Khan and Suhrita Majundar, Advocates appearing for Ajanta Pharma, resisted the suit. Mr Mehta submitted that both the products are prescription drugs, and the prefix ‘GLO’ is common to the trade. In addition, Mr Sethi submitted that since there had been no confusion for the last 6 years, this was not a case for grant of interim injunction.

The High Court found that nutritional food supplements and nutraceuticals are akin to medicines and pharmaceutical preparations. Reliance was placed on Cadila Health Care Ltd. v. Cadila Pharmaceuticals Ltd., (2001) 5 SCC 73 for the proposition that — “in respect of medicines and pharmaceuticals deception and confusion need to be avoided.”

Holding that the tests laid down in Cadila case were fully applicable to the present case, the Court observed: “the mere fact that these products are nutritional food supplements or nutraceuticals and are not pharmaceuticals in the strict sense is not convincing enough for adoption of a less stringent test … The mere fact nutraceuticals are termed so, as they contain ingredients derived from plants, does not mean that a lenient test needs to be adopted in respect of these products. The effects of the products and the consumers of the products all being similar in nature, the test applicable to pharmaceutical products would be applicable even to nutraceuticals. The Court, thus, rejected the defendant’s contention that the decision in Cadila case was not applicable.

Comparing the two products, the Court found that while both products are used for similar medical conditions and are anti-oxidant retinopathy drugs, there are marked differences between the two products. The Court was of the view that the two products were used for treating similar medical conditions, and it was not possible to accept the defendant’s explanation that it was a bona fide adopted of the mark GLOTAB. Moreover, the following were the factors which persuaded the Court to hold that the defendant’s mark was deceptively similar to that of the plaintiff’s mark:

a) ‘GLOTAB’ and ‘GLOEYE’ have the same prominent prefix, namely, ‘GLO’;

b) The Plaintiff’s product ‘GLOEYE’ is a tablet. ‘TAB’ is nothing but a short form for ‘tablet’;

c) The composition of these two products is different though both are ocular medicines.

d) The suffixes ‘EYE’ and ‘TAB’ in fact do not sufficiently distinguish the two products – and in fact, enhance the chances of confusion;

e) Both are nutritional food supplements. Both contain bilberry extract, but the remaining ingredients are different;

f) The chances of ‘GLOTAB’ being prescribed in place of ‘GLOEYE’ or a patient being dispensed with ‘GLOTAB’ in place of ‘GLOEYE? is quite high and cannot be eliminated

It was also observed that: “the settled law in passing off is that of probability or likelihood of confusion and not actual confusion. In Cadila, the Supreme Court has warned that in case of products used for the same ailments but with different composition, a more stringent test needs to be adopted.”

Holding that the nutraceuticals ought to be treated on par with pharmaceuticals, and applying the principles laid down in Cadila case, the Court held that Sun Pharma was entitled to an interim injunction. For all the above reasons, Ajanta Pharma was restrained as already mentioned above. Since Ajanta Pharma’s manufacturing license was of 2013, it was permitted to sell existing stock of its products and packaging under the mark GLOTAB subject to filing quarterly accounts of the same.[Sun Pharma Laboratories Ltd. v. Ajanta Pharma Ltd., 2019 SCC OnLine Del 8443, decided on 10-05-2019]

Case BriefsHigh Courts

Delhi High Court: A Single Judge Bench comprising of Jayant Nath, J. passed a permanent injunction decree against the defendants, restraining them from using the trademark “AAJ TAK AAMNE SAAMNE”; “AAJ TAK”; “aajtakaamnesaamne.com” or any other trademark deceptively or phonetically similar to registered trademark “AAJ TAK”.

In the present case, the plaintiffs filed the suit for permanent injunction against the defendants for infringement and passing off trademark “AAJ TAK” or any other trademark deceptively similar to plaintiffs registered trademark “AAJ TAK” in relation to magazine, newspaper, journal etc.

The contentions as placed upon by the plaintiffs were that they were the registered owner of immensely popular trademark “AAJ TAK” which has been licensed to Plaintiff 2 for running a 24 hour Hindi news channel. Defendant 1 was an individual who claimed to own, print and publish fortnightly magazine “AAJ TAK AAMNE SAAMNE”. Plaintiffs came to know recently of the infringement and violation of their trademark by the defendants when they received an email through defendant’s employee.

Further, the plaintiff submitted that the act of the defendant was not only dishonest, illegal and malafide but clearly infringed upon the intellectual property rights of the plaintiffs. Plaintiff 1 was the registered proprietor of the trademark “AAJ TAK” along with various other composites in various classes which were mentioned in the plaint within the meaning of Section 2(zg) of Trade Marks Act, 1999. The said trademark “AAJ TAK” had earned the status of a “Well-Known Trademark”. Defendants were clearly trying to ride and encash the goodwill earned by the plaintiffs over a long period of use.

Therefore, the High Court was of the view that the averments made in the plaint and the unrebutted evidence filed by the plaintiffs established that they were the registered proprietor of the said trademark “AAJ TAK”, thus they had a statutory right to the exclusive use of the same. A decree of permanent injunction was passed in favour of the plaintiffs due to the clear violation of their rights and lacking bonafide on the part of the defendants. [Living Media India Ltd. v. Mandeep Kaur, CS (COMM) 990 of 2016, decided on 16-11-2018]

Case BriefsHigh Courts

Delhi High Court: A Single Judge Bench comprising of Pratibha M. Singh, J., while disposing of a suit challenging the use of a movie title, held that neither there was copyright nor the plaintiff was entitled to the action of passing off.

The plaintiff had registered the title Double Trouble for their punjabi movie. The title was not used as of this day by the plaintiff. Meanwhile, the defendant — Mukta Arts Ltd. — adopted the same title and released a punjabi movie in the said name. The plaintiff had, in July 2013, registered the title with Indian Motion Pictures Producers Association, which is a voluntary organisation working in the film industry permitting the producers, directors, etc. to register movie titles in order to show priority in adoption of the same. The defendant also had registered the same title with another body — Indian Film and T.V. Producers Council — in August 2013. The question before the Court was whether the plaintiff had any copyright in the title or goodwill therein.

The High Court noted that the plaintiff had not, till date, used the title. It merely holds registration with IMPPA. The Court relied on the Supreme Court decision in Krishna Lulla v. Shyam Vithalrao Devkatta, (2016) 2 SCC 521 wherein it was held that there can be no copyright over titles. Thus, the movie titles may be entitled to protection, if substantial reputation and goodwill are established, per se. However, in absence of the same, they would not be protectable. In the present case, it could not be said that the title had acquired distinctiveness qua the plaintiff. For the same reason, the plaintiff was not entitled even for protection under the law of passing off. The Court also noted that the process of making and releasing a film is a lengthy process, and the period required for a title to acquire goodwill is equally long. The sanctity given to registration and adoption of titles, by persons in the industry who are members of the above-mentioned bodies, ought to be decided, lest the process of registration become meaningless. The suit was disposed of with such observations. [Prism Motion Pictures (P) Ltd. v. Mukta Arts Ltd.,2018 SCC OnLine Del 11152, dated 31-08-2018]

Op EdsOP. ED.

A man is not to sell his own goods under the pretence that they are goods of another….”

— Lord Langdale M.R. in Perry v. Truefitt[1]

A simple truism stated almost two centuries ago has over the years evolved into a multifaceted branch of law — given the myriad means that human ingenuity can conjure in order to subtly convey this “pretence”. However, the law has slowly but distinctly kept pace with the creativity of those seeking to ride another’s goodwill.

Dishonest adoption as a distinct head of challenge: Midas and its legal basis

The Supreme Court, in a short and pithy order, observed that an injunction must necessarily follow: “if it prima facie appears that the adoption of the mark (or trade dress) was itself dishonest”.[2] It was again reiterated in Heinz Italia v. Dabur India Ltd.[3] that “if it could be prima facie shown that there was a dishonest intention on the part of the defendant in passing-off goods, an injunction should ordinarily follow”. Though captured in cryptic language, these observations rest on sound legal foundations and are a logical culmination of decades of development of the law.

“Dishonesty” being a state of mind, it could well be argued that this is a matter of trial and hence cannot be presumed at the interim stage. It therefore becomes essential to examine the circumstances in which an inference of “dishonest adoption” must necessarily be drawn, even at the interim stage.

As Lord Simonds opined in Office Cleaning Services Ltd. v. Westminster Window and General Cleaners Ltd.[4]:

Confusion innocently caused will be restrained. But if the intention to deceive is found, it will be readily inferred that deception will result. Who knows better than the trader the mysteries of his trade.

So the question that begs an answer is, how is this “intention to deceive” to be inferred? As far back as in 1977 the Delhi High Court in Anglo-Dutch, Colour & Varwish Works (P) Ltd. v. India Trading House[5], while considering the protection of colour combinations, quoted Harman Lord Justice who had observed[6] that:

“Goods of a particular get-up just as much proclaim their origin as if they had a particular name attached to them, and it is well known that when goods are sold with a particular get-up for long enough to be recognised by the public as goods of a particular manufacturer it does not matter whether you know who the manufacturer is.”

Having appreciated the significance of colour combinations, the Court then quoted with approval the observations of Graham J.[7]:

I cannot see why other manufacturers should want to adopt the applicants’ colour arrangements here except for the improper motive of trying to benefit from the latter’s established goodwill.

Later the same High Court observed in Cadbury, that “the question why the defendant chose to adopt a particular name or get-up, is always highly relevant”.[8]

The test of confusion in such a case, as rightly accepted by the Delhi High Court in Cadbury[9] is what was laid down in Slazenger & Sons v. Feltham & Co.[10] where the Court held that:

One must exercise one’s commonsense, and if you are driven to the conclusion that what is intended to be done is to deceive if possible, I do not think it is stretching the imagination very much to credit the man with occasional success or possible success. Why should we be astute to say that he cannot succeed in doing that which he is straining every nerve to do?

The same sentiment has been echoed by the Australian High Court in Australian Woollen Mills Ltd. v. F.S. Walton and Co. Ltd.[11]:

… the instinct and judgment of traders is not to be lightly rejected, and when a dishonest trader fashions an implement or weapon for the purpose of misleading potential customers, he at least provides a reliable and expert opinion on the question whether what he has done is in fact likely to deceive.

In N.R. Dongre v. Whirlpool Corpn.[12], the Supreme Court upheld the observations of the High Court to the effect that:

There is no plausible and convincing explanation by the appellants as to how they came to adopt the mark “WHIRLPOOL”. In absence of any satisfactory explanation by the appellants, the adoption of the mark by them cannot prima facie be regarded as honest….

In other words, by seeking an explanation for the adoption of a particular mark, the Supreme Court implicitly shifted the onus on to the subsequent entrant into a field who chooses to consciously adopt a get-up or name that is seemingly fancy for that particular trade and which enjoys sufficient goodwill. This lay the germ for the proposition that the subsequent entrant into a market owes a duty to ensure that he chooses his own mark and trade dress in such manner as to cause minimal consumer confusion or damage to established goodwill.

This obligation of a subsequent entrant into the market was specifically accepted in N. Ranga Rao v. Anil Garg[13] in the following words: “Thus, in Harold F. Ritchie Inc. v. Chesebrough-Pond’s Inc.[14], it was held that the second comer has a duty to so name and dress his product as to avoid all likelihood of confusion amongst the consumers.”

In T.V. Venugopal v. Ushodaya Enterprises Ltd.[15], while reiterating that a mark or trade dress may consist of common or descriptive elements to begin with but may “acquire” distinctiveness over a period of time by virtue of extensive user, the Supreme Court emphatically laid down that

once it is found by the court that such a mark has attained distinctiveness and is associated with the business of the plaintiff for a considerable time and thereafter the defendant adopts a similar word (or trade dress) to induce innocent consumers … which itself establishes dishonest intention and bad faith…. In such a situation, it becomes the bounden duty and obligation of the Court not only to protect the goodwill and reputation of the respondent Company but also to protect the interest of the consumers.[16]

This case also accepted the principle that where a mark or trade dress enjoys extensive goodwill by virtue of long user, likelihood of erosion or dilution thereof would per se be actionable inasmuch as dilution itself is evidence of damage. The more extensive the user, the larger the field in which protection will be granted including allied or even unconnected goods. In Mattel Inc. v. Jayant Agarwalla[17], the Delhi High Court while dealing with the question whether the word “scrabble” had become generic for similar word games, held that in case of established goodwill by virtue of long and extensive use, “genericness” cannot be argued at the interim stage and must be established at trial, for by bringing the action the plaintiffs are seeking to prevent this very possibility of loss of distinctiveness.

American courts have generally applied an allied logic and have accepted the obverse principle, namely, that the very fact of copying is itself persuasive evidence of the existence of secondary meaning and in such event the law imputes the subsequent entrant, who attempts an imitation, with the intent to capitalise on this acquired goodwill.[18] “There is no logical reason for the precise copying, save an attempt to realise upon a secondary meaning that is (evidently) in existence.” For, who knows the pulse of the trade better than the trader himself! In other words, the act of intentional imitation itself raises a presumption that the mark or trade dress has acquired distinctiveness and goodwill and hence an injunction must follow at the interim stage.

Thus, as a matter of legal proposition it can be stated that, at least in case of long and extensive user of a trade dress (in terms of length of time as well as turnover), more so where it is coupled with worldwide reputation, the act of imitation by a rival or even a close resemblance of the trade dress, itself demonstrates dishonest adoption and the law, in such circumstances imputes an intention to deceive. In such event an injunction must necessarily follow at the interim stage itself and defences, if any, must be established only at trial.

The duplicity of different labels : The law of “dilution” and the attempted dilution of that law

In Schweppes Ltd. v. Gibbens[19], a case involving virtually identical bottles of soda water bearing different labels and which, seen from a distance, bore a strong resemblance to one another, Lord Halsbury L.C. famously observed:

… if a person is so careless that he does not look, and does not, as I think Lord Macnaghten described it in another case, “treat the label fairly”, but takes the bottle without sufficient consideration and without reading what is written very plainly indeed upon the face of the label on which the trader has placed his own name, then you certainly cannot say he is deceived — in fact he does not care which it is. … it seems to me it is only necessary here to put the two things side by side to say that, if you do look and if you do treat the two labels fairly, no human being could be deceived.

He further observed that “I should have thought if you looked at the two bottles together no human being could have mistaken one for the other.”

These observations of Lord Halsbury themselves created a lot of confusion in the minds of the consuming legal fraternity! Defendants have often relied upon these observations to argue that different names or labels are sufficient to obviate the possibility of confusion even if the trade dress is similar.

In William Edge & Sons v. William Niccolls (hereinafter referred to as “Dolly Blue case” the House of Lords had struck a different note and had in fact gone as far as to say that affixing their own label to the plaintiff’s trade dress would in effect tantamount to “appropriation of the get-up [by the defendant] as their own”.[20] These observations are significant inasmuch as they bring out the principle that adopting a trader’s trade dress and thereafter seeking to ostensibly distinguish the goods by affixing a different label, even if displayed prominently and even in absence of evident deception, nevertheless inevitably leads to the dilution of the original trade dress over time.

Finally in Reckitt & Colman Products Ltd. v. Bonden Inc.[21], Lord Oliver consigned the observations of Lord Halsbury to the facts of that case and observed that “it can be no answer, in a case where it is demonstrable that the public has been or will be deceived, that they would not have been if they had been more careful, more literate or more perspicacious”.[22]

However, in Kellogg Co. v. Prawin Kumar Bhadabhai[23] a Division Bench of the Delhi High Court accepted Lord Halsbury’s view, without noticing Reckitt & Colman. In this case corn-flakes were being sold in cartons that were similar in get-up, though a different trade name was displayed on the carton. It was held that the labels were sufficient to dispel deception. It was also observed, quoting Kerly, that “Such [trade dress] cases are rare, since few traders rely on get-up alone to distinguish their goods….” and that “… these days, in this country, a difference in names is enough to warn the public that they are getting one trader’s goods and not the others.[24] (M. Sapers Ltd. v. Specter’s Ltd. and Boxes Ltd.)25

Courts have been struggling to distinguish the Kellogg’s judgment since it has not been specifically overruled. In N. Ranga Rao26 a Single Judge distinguished the above judgment on the ground that it was passed in circumstances where the consumers were found to be “sophisticated and discerning”. The Calcutta High Court also sought to distinguish Kellogg’s on the same ground in Euro-Solo Energy Systems Ltd. v. Eveready Industries India Ltd.27 However, Kellogg’s again seems to have been relied upon recently by the Division Bench of Delhi High Court in Real House Distillery (P) Ltd. v. Pernod Ricard SA.28

The observations of Lord Halsbury again found acceptance in S.M. Dyechem Ltd. v. Cadbury (India) Ltd.29, wherein the Supreme Court observed that Halsbury (3rd Edn., para 992) says:

Where there are common elements to two or more marks, more regard must be paid to the parts that are not common….

It was further observed that30:

As to scope of a buyer being deceived, in a passing-off action, the following principles have to be borne in mind. Lord Romer, L.J. has said in Payton & Co. v. Snelling, Lampard & Co.31 that it is a misconception to refer to the confusion that can be created upon an ignorant customer. The kind of customer that the courts ought to think of in these cases is the customer who knows the distinguishing characteristics of the plaintiff’s goods, those characteristics which distinguish his goods from other goods in the market so far as relates to general characteristics. If he does not know that, he is not a customer whose views can properly be regarded by the Court. (See the cases quoted in National Sewing Thread & Co. Ltd. v. James Chadwick and Bros. Ltd.32 which was a passing-off action.) In Schweppes case33 Lord Halsbury said, if a person is so careless that he does not look and does not treat the label fairly but takes the bottle without sufficient consideration and without reading what is written very plainly indeed up the face of the label, you cannot say he is deceived.

However, the Supreme Court was quick to rectify the above error and Dyechem, to the above extent, was specifically overruled by a larger Bench in Cadila Health Care Ltd. v. Cadila Pharmaceuticals Ltd.34 It was reiterated that while comparing marks or trade dress, the focus must remain on similarities rather than dissimilarities and that the question of confusion must necessarily be examined “from the point of view of a man of average intelligence and imperfect recollection”. The test of a discerning customer with a subtle and keen sense of observation, was emphatically rejected and so was the test of a “side by side” comparison.

Thus it can be safely stated that after Cadila, Kellog is also no longer good law and stands implicitly overruled. It is no answer in case of a dishonest adoption of trade dress, to affix a different label and contend that as a result thereof the consumer is likely to discern the difference between the two sources. Even if the label is prominently displayed, Dolly Blue case35 rightly observed that this in effect would tantamount to “appropriation of the get-up (by the defendant) as their own” and consequently lead to the dilution of the original trade dress, irrespective of whether or not confusion can be shown. In such a case misrepresentation occurs by subtle association and damage to the goodwill by way of dilution.

In other words if, despite all the myriad permutations of marks and colours available, a trader seeks to achieve maximum proximity to an established trade dress in order to subtly convey a trade connection and yet seemingly seeks to distinguish his goods by affixing a different label, he nevertheless employs an implement designed to mislead customers. In such event the law presumes that he shall succeed in his endeavour to ride upon the goodwill of another.

The problem of de facto monopoly over colours

Though what is protected under law is the get-up and colour combination with reference to the particular goods, having regard to the goodwill acquired by virtue of long user, it is often argued by those who seek to ride on that goodwill that there can be no monopoly over common words or colours. This argument often tends to negate the very concept of acquired distinctiveness.

In “Jif” lemon case36 what was protected was the trade dress of the product itself, namely, the yellow lemon-shaped containers used for the purpose of selling lemon juice. While doing so Lord Oliver laid down the larger principle that deception occurs whenever goods are sold in circumstances so fashioned as to suggest that they emanate from the source with which the public is familiar.37 He further observed that

“In the end, the question comes down not to whether the respondents are entitled to a monopoly in the sale of lemon juice in natural size lemon-shaped containers but whether the appellants, in deliberately adopting, out of all the many possible shapes of container, a container having the most immediately striking feature of the respondents’ get-up, have taken sufficient steps to distinguish their product from that of the respondents”.38 Lord Jauncy in the same case, took the argument head-on and observed that in a case where a trader has established his goodwill in a particular get-up or colour combination, and the get-up has in fact acquired distinctiveness, a passing-off action will necessarily recognise the de facto monopoly of the trader over that colour combination.39 He further accepted the principle that passing-off law will protect the overall get-up and trade dress of the article itself.40

It would be an erroneous approach to breakdown the trade dress into its constituent elements and then argue that what is sought to be protected by the plaintiff are but common colours. Indeed what is protected is not the individual colours but the entirety of the trade dress in the particular context of those goods. The complexity or simplicity of the colour combination might be a pointer towards its inherent distinctiveness or the period of use required to be shown in order to establish “acquired” distinctiveness — but having acquired such distinctiveness, it would be antithetical to then contend that the trade dress protection seeks to monopolise colours.

“Variations in detail”: A typical subterfuge

Deception by subtle associations is nevertheless deception. Hence courts have always endeavoured to stultify attempts by rivals to subtly conjure up an association with existing marks or trade dress, which may be less evident on a micro-comparison of the competing get-up and yet may subconsciously convey a kinship as to the source of the goods. It is for this reason that a side by side comparison of the two marks or trade dress has always been considered an erroneous approach. This was accepted by the Supreme Court in Parle Products (P) Ltd. v. J.P. and Co. wherein it was held that what is to be considered is the overall similarilty and the general idea conveyed by the two marks or trade dress41. Furthermore, while making a comparison the focus must remain on the similarities rather than the dissimilarities between the two.

An ingenious method often employed by the defendants to subtly circumvent the above approach is to introduce or suggest minor variations in the mark or trade dress during the course of hearing or trial, thereby subconsciously shifting the discourse onto the details rather than the “overall similarity”; as also shifting the focus from similarities onto dissimilarities. A Judge is bound to explore the possibility of a compromise and hence is sure to examine the variations introduced — and for that purpose end-up focussing on the differences.

However, this tendency undermines the emphatic observations approved by the Supreme Court in Parle that “… variations in detail might well be supposed by customers to have been made by the owners of the trade mark they are already acquainted with for reasons of their own.”42

In Reckitt & Colman case43, Lord Jauncey also recognised the peril of such an argument based on variations in detail and observed:

“If, … goods have been in the market for a long time with a particularly distinctive get-up then A, seeking to market his goods with a similar get-up, will require to take far more drastic steps to inform the public that his goods are not those of B, since the public, having long become used to such a get-up as identifying the goods of B, are likely to be less mindful of differences in detail.”

As discussed above, it is the subsequent entrant into a market who owes a duty to ensure that he chooses his own mark and trade dress in such manner as to cause minimal consumer confusion or damage to established goodwill. A “deliberate attempt to achieve maximum proximity with the plaintiff’s trade dress” in order to test the legal limits of tolerable transgression, as it were, is itself frowned upon as being dishonest.44 For, as was observed in Florence Mfg. Co. v. J.C. Dowd & Co.45

It is so easy for the honest businessman, who wishes to sell his goods upon their merits, to select from the entire material universe, which is before him, symbols, marks and covering which by no possibility can cause confusion between his goods and those of his competitors, that the courts look with suspicion upon one who, in dressing his goods for the market, approaches so near to his successful rival that the public may fail to distinguish between them.

Thus this tendency of defendants to satisfy the conscience of the court by tweaking the details in a trade dress, thereby shifting the focus onto the differences rather than on similarities, must be eschewed.

Significantly, in Seven Towns Ltd. v. Kiddiland46 the Delhi High Court, while relying on the above principles laid down in Parle47 and in Colgate48, rejected this endeavour by the defendant and concluded that in the absence of compromise acceptable to parties, it would be a flawed approach for the court to examine the minor variations introduced by the defendant (post?institution of the suit) and consider whether the same would be enough to allay apprehensions of confusion. The Court rightly held that in the absence of agreement, a defendant can use a variant only at the peril of contempt and the trial court has to decide the question based on the impugned trade dress used at the time of filing the suit.

Stretching the limits: Is misrepresentation or deceit an essential ingredient of the classical trinity of passing off

As observed by the Supreme Court49, goodwill, misrepresentation and damage have long been considered to be the classical trinity of prerequisites for a successful passing-off action. However, at times brands that achieve an iconic status, over the years also tend to signify an “idea” apart from a source indication — such as a Rubik’s cube may signify brilliance or the name of an iconic actor (as a brand) may signify stardom and authenticity. There may be several examples but they are best left unmentioned. The point here is that there may be cases where traders may seek to abstract just this idea and use it to promote their own product, for example, an advertisement for a mind-games television series that may show Rubik’s cubes hanging in the backdrop or a service provider seeking to describe himself or his services by using the analogy of an iconic actor. It may be difficult to discover deceit in this portrayal or ascribe confusion in the mind of a consumer as to the source — yet it cannot be gainsaid that the goodwill of the established brand suffers. It suffers dilution inasmuch as its portrayal as an abstract idea weakens its strength as a source indicator; it suffers erosion of reputation to the extent the latter hasn’t achieved the iconic status that it seeks to ride on.

Should a passing-off action fail in such event because it fails to establish deceit or confusion as to the source? At the same time, if goodwill is property then damage to goodwill is certainly a tort, of which passing off is but a species, and should be actionable.

As observed by Lord Scarman in Cadbury Schweppes Pty. Ltd. v. Pub Squash Co. Pty. Ltd.50, “… the tort of passing off is no longer anchored in its early 19th century formulation….” Should we then be tied down by the shackles of establishing overt deceit or misrepresentation in order to succeed in a passing-off action? It may not be incorrect to say that deceit is implicit whenever a person seeks to ride on the reputation of another, whether or not the customer is likely to be deceived as to the source of the goods.

Another way of approaching the issue is to take cue from the proposition already accepted by the Delhi High Court in N. Ranga Rao51, relying on Yves St Laurent Parfums v. Louden Cosmetics Ltd.,52 a judgment of the High Court of New Zealand, to the effect that “… a misrepresentation need not to be crass, but may involve a complex mechanism of misrepresentations. Thus, the representation may operate in a number of ways, no single one of which may be compelling but a combination of which is effective”.53 In other words, misrepresentation may be subtle yet actionable. The misrepresentation involved in the above examples lies in the subtle appropriation of the abstract idea that the established brand symbolises; at the same time the erosion of goodwill cannot be gainsaid.

Thus, in the further development of this field, especially considering the ingenuity that defendants employ, it is hoped that courts may accept the wider proposition that no business entity ought to be permitted to derive commercial advantage at the expense of another’s goodwill, whether or not it involves overt deceit or pretence as to the source of the goods.

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* Advocate, practising at the Supreme Court.

[1] (1842) 6 Beav 66, 73. This pithy statement has been approved by the Supreme Court in S. Syed Mohideen v. P. Sulochana Bai, (2016) 2 SCC 683, 699-700, para 31.1 while observing that a “passing-off action is essentially an action in deceit where the common law rule is that no person is entitled to carry on his or her business on the pretext that the said business is of that of another …”

[2]  Midas Hygiene Industries (P) Ltd. v. Sudhir Bhatia, (2004) 3 SCC 90, 91, para 5.

[3]  (2007) 6 SCC 1, 7-8, para 16.

[4]  (1946) 63 RPC 39, 42.

[5]  1976 SCC OnLine Del 55 : AIR 1977 Del 41.

[6]  F. Hoffmann-La Roche & Co. AG. v. DDSA Pharmaceuticals Ltd. : 1972 RPC 1, 20.

[7]  Smith, Kline and French Laboratories Ltd. v. Applications, Trade Mark, 1974 RPC 91, 99.

[8]  Cadbury India Ltd. v. Neeraj Food Products, 2007 SCC OnLine Del 841 : (2007) 142 DLT 724, 735, para 32.

[9]  Id., para 30.

[10]  (1889) 6 RPC 531.

[11]  1937 HCA 51 : (1937) 58 CLR 641, 657.

[12]  (1996) 5 SCC 714, 724, para 10.

[13]  2005 SCC OnLine Del 1293 : (2006) 32 PTC 15, 667.

[14]  126 USPQ 310 (2d Cir. 1960).

[15]  (2011) 4 SCC 85.

[16]  Id., 111, paras 75 & 92(d).

[17]  2008 SCC OnLine Del 1059 : ILR (2009) 2 (Del) 193.

[18]  Ideal Toy Corpn. v. Plawner Toy Mfg. Corpn., : 685 F 2d 78, ; Ferrari v. Carl Roberts, : 944 F 2d 1235.

[19]  (1905) 22 RPC 601, 606-607.

[20]  1911 AC 693, 709.

[21]  (1990) RPC 341 (HL).

[22]  Id., RPC, p. 415.

[23]  1996 SCC OnLine Del 170 : (1996) 62 DLT 79 (DB) : (1996) 16 PTC 187.

[24]  Id., DLT, p. 82.

[25]  (1953) 70 RPC 173.

[26]  2005 SCC OnLine Del 1293 : (2006) 32 PTC 15, 51.

[272009 SCC OnLine Cal 1991 : (2009) 4 Cal LT 116.

[28]  2014 SCC OnLine Del 977 : (2014) 58 PTC 309.

[29]  (2000) 5 SCC 573, para 31.

[30]  Id., para 54.

[31]  (1900) 17 RPC 48.

[32]  1947 SCC OnLine Mad 289.

[33]  (1905) 22 RPC 601.

[34]  (2001) 5 SCC 73.

[35]  1911 AC 693.

[36]  Reckitt & Colman, 1990 RPC 341 (HL).

[37]  Id., RPC, p. 411.

[38]  Id., p. 414.

[39]  Id., p. 422.

[40]  Id., p. 425-426.

[41]  (1972) 1 SCC 618, paras 8-9.

[42]  (1972) 1 SCC 618, paras 8.

[43]  1990 RPC 341 (HL).

[44]  Frito-Lay India v. Radesh Foods, 2009 SCC OnLine Del 714 : (2009) 40 PTC 37, 51.

[45]  178 F 73, 75 (2d Cir. 1910).

[46]  2016 SCC OnLine Del 5168 : (2016) 160 DRJ (SN) 675.

[47]  Parle Products (P) Ltd. v. J.P. and Co., (1972) 1 SCC 618.

[48]  Colgate Palmolive Co. Ltd. v. Patel, 2005 SCC OnLine Del 1439 : (2005) 31 PTC 583.

[49]  S. Syed Mohideen v. P. Sulochana Bai, (2016) 2 SCC 683, para 31.1.

[50]  (1980) 2 NSWLR 851.

[51]  2005 SCC OnLine Del 1293 : (2006) 32 PTC 15.

[52]  (1997) 39 IPR 11.

[53]  2005 SCC OnLine Del 1293 : (2006) 32 PTC 15, 80.

Case BriefsSupreme Court

Supreme Court: R. Banumathi, J. while delivering the Judgment for herself and Ranjan Gogoi, J. dismissed an appeal filed against the Judgment of Calcutta High Court wherein the respondents were allowed to use the word MALABAR in conjunction with the word ‘BAROMA’ for selling basmati rice.

Appellant claimed to use the mark ‘MALABAR’ to sell biryani rice since 2001. Appellant filed a suit for infringement and passing off against the respondents who were using the mark ‘MALABAR GOLD’ which was being used to sell the same product, i.e., biryani rice. An interim injunction was granted against the respondents restraining them from using the said mark. In course of the proceedings, the respondents submitted the modified mark that they proposed to use, having the word BAROMA in conjunction with the word MALABAR, and with changed get up. Consequently, the interim injunction was vacated. Aggrieved, this appeal was filed by the appellant.

The Supreme Court found that the appellant had their label mark registered under Class 30 which had a disclaimer (limitation) that there was no exclusive right in the word ‘MALABAR’. Accordingly, the appellant could not claim to use the word MALABAR to the exclusion of everyone else. Other marks registered under the same class using the word MALABAR in conjunction with other words were brought to the notice of the Court. In Court’s view that High Court was right in holding that appellant did not have exclusive right over the word MALABAR. On comparison, the Court held that the marks of both the parties seem different. The proposed mark of the respondents was different in get up as well as the word BAROMA used in conjunction made it distinct. Holding that there was no deceptive similarity between the two marks, the Court found no infirmity with the impugned order. The appeal was dismissed. [Parakh Vanijya (P) Ltd. v. Baroma Agro Product,  2018 SCC OnLine SC 686, decided on 12-07-2018]