There are often cases that we undertake for representation, wherein the
cases relate to enforcement of trademarks by/of mid-sized foreign corporations
that have not been filed and/or used in India against Indian companies that
have deceptively used their marks thereby constituting misrepresentation, which
might amount to passing off. Rupkatha and Poorva, interns at Khurana &
Khurana, look at some of these cases and try to identify certain parameters
based on which the mid-sized foreign companies can protect their interest.
Perry v. Truefitt[1], the English case where the
tort of passing off was first articulated had clearly pointed out that “a
man is not to sell his own goods under the pretence that they are the goods of
another trader.” The House of Lords further laid down the essential
elements of passing off in Reckitt & Colman Ltd v Borden Inc [2] as:
- The existence of claimant’s goodwill
- Misrepresentation
- Damage or likely damage
Section 27(2) of the Trade Marks Act, 1999 authorizes any trader to
institute passing off action against another in spite of the fact that his mark
is unregistered. The Hon’ble Supreme Court of India has laid down three
elements that need to be fulfilled in order to institute a passing off action
by the plaintiff in Satyam Infoway Ltd. v. Sifynet Solutions Pvt. Ltd.[3]:
- The defendant must have sold its goods or offered its services in a
manner which has deceived or would be likely to deceive the public into
thinking that the defendant’s goods or services are the plaintiffs.
- The likelihood of confusion in the minds of the public that the
goods or services offered by the defendant are the goods or the services
of the plaintiff.
- The likelihood of confusion in the minds of the public that the
goods or services offered by the defendant are the goods or the services
of the plaintiff.
Unregistered Marks of Foreign Companies
Section 18 of the Act allows foreign nationals to register their mark in
India. Once a mark is registered, the company can take action for infringement
against any person who tries to do so. The problem arises when the mark is
unregistered. Is there any remedy for the company in such a situation? Or will
it remain at the receiving end?
The Indian judiciary has played its role of filling up the gap in the
law in such situations. Time and again it has granted relief to foreign
companies who are yet to register their marks in India even though the
defendant had registered its mark. In N.R Dongre v. Whirlpool Corporation[4], injunction was granted in
favour of Whirlpool Corporation based on the fact that although their mark was
not renewed, they had gained enough goodwill and reputation in the Indian
market which was being wrongly used by the defendant.
The general trend has been to grant relief only to multinational
corporations who have a good market in India or who are big names in the
international arena. The Hon’ble Bombay High Court in Centrol Industrial
Alliance Ltd. versus Gillette U.K. Ltd.[5], the Hon’ble Delhi High Court in
Jolen Inc. vs Doctor & Company[6] and Indian Shaving Products
Ltd. v. Gift Pack[7] and several other High Courts
have held that in order to get injunction in favour of a foreign company with
an un-registered trademark, goodwill in the Indian market is an essential pre-requisite.
The problem then arises with the mid-sized companies. There are about 40
marks in the latest trademark journal published by the Controller General of
Patents, Designs and Trademark which are deceptively similar or rather have
been ‘copied’ from the trademark of some foreign company, big or small. Till
now, the trend has been to provide no relief to companies having without any
trans-border reputation. The Intellectual Property Appellate Board rejected the
opposition posed by the appellant in Kraft Jacobs Sucharc Ltd. v. Government
of India by Secretary[8] on the ground that the
opponent did not have any presence in the Indian market and did not intend to
come to do business here in the near future.
The road ahead
The Court has definitely observed in the Jolen Inc. case[9] “even if it is assumed that
such advertisements or marks do not travel beyond the borders of the countries
where the plaintiff has the business, still it has a right to protect its
reputation and goodwill. It is more so where the trade name has been pirated in
totality and not by way of having deceptive or confusing similarity.” The
Supreme Court in Milment Oftho Industries & Ors. v. Allergan Inc.[10] held that non-use
in India would be irrelevant if the plaintiff was the first in the world
market. However, the decision carried a word of caution that foreign brand
owners who have no intention of coming to or introducing their product in India
will not be allowed to stifle an Indian company by not permitting it to sell a
product in India, if the Indian company has genuinely adopted the mark.
Therefore, if it can be shown that the defendant had adopted the
complete mark knowing very well that another company of some other country has
already adopted that mark, then mala fide on part of the Indian company can be
argued.
Now, the Indian courts have been conservative in their approach and
constantly relied upon the circulation of magazines, journals and extent of
Indian travellers going abroad while deciding these types of cases. This
approach is outdated in the light of modern means of exchanging information.
The internet, for example, provides a global forum for any product manufactured
in one country. Thus, when an Indian company launches a website bearing the
trademark of some foreign company, it becomes easier to hold it liable. The
Internet Corporation for Assigned Names and Numbers (ICANN) manages the
top-level development and architecture of the internet domain name space. It
authorizes domain name registrars through which domain names can be registered
and re-assigned. Thus, any person who seeks to register a domain name is
informed about the availability of that domain name. Rule 2 of the Uniform
Domain Name Dispute Resolution Policy[11] requires an applicant to
determine that the domain name for which registration is sought does not
infringe or violate another’s rights. Thus, if the proposed domain name
violates another person’s trademark rights, it will violate Rule 2 of the
policy. In such eventuality, the registrar can refuse to register the domain
name. Thus, a domain name that is properly registered under international
requirements is still subject to the Trademarks Act if a rights owner
successfully proves that it has rights flowing from the act.
It was held in the celebrated UK case of Marks and Spencer’s v. One
in a Million[12] that any person who
deliberately registers a domain name on account of its similarity to the name,
brand name or trademark of an unconnected commercial organization must expect
to find himself on the receiving end of an injunction to restrain the threat of
passing off. This was reiterated by the Delhi High Court in Yahoo!, Inc. v.
Akash Arora[13]. After the celebrated case of
Satyam Infoway Ltd. v. Sifynet Solutions Pvt. Ltd.[14], there is no doubt that
internet domain names are subject to the legal norms applicable to trademarks.
Conclusion
A person who has directly copied the trademark of a foreign company
having a proper accessible website and trading in the same goods and services,
cannot take the plea that he was not aware of his opponent’s presence in the market.
Further, it is strongly recommended that the plight of the mid-sized companies
be addressed soon and internet as an advertising and communicating forum gets
acknowledged. After all, this is a wrong committed by the Indian company and
thus a remedy must be sort out.
[1] (1842) 6 Beav. 66
[2] [1990] 1 All E.R. 873
[3] 2004(6) SCC 145
[4] 1996(5) SCC 714
[5] 1998 PTC (18) (DB)
[6] 2002 (25) PTC 29 (Del.)
[7] [1998] PTC 698 (Del)
[8] 2004 (29) PTC 376 IPAB
[9] Supra n6
[10] 2004 (28) PTC 585 (SC)
[11] It is a process established
by ICANN for the resolution of disputes regarding the registration of internet
domain names. It currently applies to all .aero,
.asia, .biz, .cat,
.com,
.coop, .info,
.jobs, .mobi,
.museum, .name,
.net,.org,
.pro,
.tel
and .travel top-level domains,and some country code
top-level domains. Refer to http://www.icann.org/en/help/dndr/udrp
[12] 1998 FSR 265
[13] 78 (1999) DLT 285
[14] AIR 2004 SC 3540
Source: http://iiprd.wordpress.com/2012/06/02/passing-off-action-by-mid-size-foreign-companies-having-unregistered-marks-in-india/
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