Tag Archives: trademark infringement

Bombay High Court: no infringement in Cipla v. Cipla

invntree-background-image

A Full Bench of the Bombay High Court announced their decision in the matter of Cipla Limited v. Cipla Industries Pvt. Ltd. on March 1, 2017. This case explores an important issue in trademark infringement regarding the use of a registered mark in a corporate or trade name, with respect to entities dealing with dissimilar goods/ services.

The Plaintiff, Cipla Limited, is a manufacturer of pharmaceutical products and has registered the trademark “CIPLA” under Class 5, which relates to pharmaceutical products. The Defendant, Cipla Industries, manufactures household items such as ladders and photo-frames, and has registered the trademark “CIPLA PLAST” under Class 21, which relates to household items such as utensils, containers, and combs, among others.

The Plaintiffs filed a suit against the Defendants for trademark infringement and passing off in 2012, claiming that the Defendants are violating the trademark rights of the Plaintiff by using “CIPLA” in their corporate or trade name. Two important things to note about this case are that the Defendant manufactured dissimilar goods when compared to the Plaintiff and the Defendants used the Plaintiff’s registered mark as part of their corporate or trade name.

This case takes precedence from the Raymond Limited v. Raymond Pharmaceuticals case, wherein the textile and clothes manufacturer, Raymond Limited (Plaintiff), alleged that Raymond Pharmaceuticals (Defendant) infringed on the Plaintiff’s trademark “Raymond” by using it in their corporate name.

Trademark infringement of well-known marks is dealt with under § 29(4) and infringement by use in trade or business name is dealt with under § 29(5) of The Trade Marks Act, 1999 as reproduced below:

§ 29(4) A registered trade mark is infringed by a person who, not being a registered proprietor or a person using by way of permitted use, uses in the course of trade, a mark which—

(a) is identical with or similar to the registered trade mark; and

(b) is used in relation to goods or services which are not similar to those for which the trade mark is registered; and

(c) the registered trade mark has a reputation in India and the use of the mark without due cause takes unfair advantage of or is detrimental to, the distinctive character or repute of the registered trade mark.

§ 29(5) A registered trade mark is infringed by a person if he uses such registered trade mark, as his trade name or part of his trade name, or name of his business concern or part of the name, of his business concern dealing in goods or services in respect of which the trade mark is registered.

Here, the Court reasoned that in order to establish infringement according to § 29(4), the Plaintiff has to show that the Defendant’s mark is identical or similar to the Plaintiff’s registered mark and that the Defendant is using the mark in relation to goods which are dissimilar to the goods corresponding to the Plaintiff’s registered mark, among other grounds mentioned in § 29(4). Consequently, since the case concerned the use of the registered mark as a corporate/trade name, §29(4) was overlooked in favour of §29(5). However, according to §29(5), infringement is only considered valid in case of “dealing in goods or services in respect of which the trade mark is registered.” Since the two entities in this case dealt with dissimilar goods, namely, textiles and medicines, the Court decided that the Defendants did not infringe on the Plaintiff’s trade mark rights.

The Court did not grant an injunction against Raymond Pharmaceuticals in Raymond Ltd. v. Raymond Pharma., and was of the view that this matter needed reconsideration. Hence, in Cipla Ltd. v. Cipla Industries, the Court sought to clear the matter by outlining four questions that needed to be answered for added clarity on this matter. The questions and their conclusions are as given below.

  1. Where a party is found to be using a registered trade mark as a 'name', viz., as a corporate or trading name or style, though in respect of goods dissimilar to the ones for which the trade mark is registered, is the proprietor of the registered trade mark entitled to an injunction on a cause of action in infringement under Section 29(5) of the Trade Marks Act, 1999?

Conclusion: No.

 

  1. Whether the use of a registered trade mark as corporate name or trading name or style is excluded from the purview of Sections 29(1)29(2) and 29(4) of the Trade Marks Act, 1999, and whether those Sections are restricted to the use of a trade mark 'as a trade mark', i.e., in the 'trade marky' sense?

Conclusion: Yes. The sub-sections will apply in "trademark versus mark" situations.

 

  1. Whether Sections 29(4)and 29(5) operate in separate and mutually exclusive spheres, i.e., whether, if the defendant uses the registered trade mark only as a corporate name or trading name or style in respect of dissimilar goods, a Plaintiff can have no remedy and is not entitled to an injunction?

Conclusion: Yes.

  1. Whether the view taken by the Division Bench in Raymond Ltd V Raymond Pharmaceuticals Pvt Ltd (2010(44) PTC 25 (Bom) (DB)) is a correct view?

Conclusion: Yes.

The Judges noted that § 29(4) uses the terms “in the course of trade” and “in relation to good and services”, which are not present in § 29(5). Further, the Court noted that “as his trade name or part of his trade name, or name of his business concern or part of the name, of his business concern” was not present in § 29(4). The Court made use of this difference to determine that § 29(4) would apply in a “trademark v. mark” situation while § 29(5) would apply in a “trademark v. trade/corporate/business name” situation.

In other words, § 29(5) states that an infringement has occurred with respect to a registered mark only when the goods in question are similar. Since the Plaintiff and the Defendant in this case dealt with dissimilar goods, namely household goods and medicines, the Judges decided that no trademark infringement was committed by the Defendants.

In our opinion, this decision would significantly limit the ability of entities with even well-known registered marks to act against infringement in certain situations. Further, the law regarding this matter seems to leave a loop-hole for potential infringers with dissimilar goods who may use a registered mark in their corporate or trade name.

We hope this article was a useful read. 

Please feel free check our services page to find out if we can cater to your requirements. You can also contact us to explore the option of working together. 

Best regards – Team InvnTree   

This work is licensed under a Creative Commons Attribution-NonCommercial 3.0 Unported License

Delhi High Court makes a decision in Hybrid Cotton Seeds case

invntree-background-image

The Delhi High Court ruled in favour of Nuziveedu Seeds Limited in Monsanto Technology’s case against Nuziveedu on 28th March 2017.

India is the world’s largest producer of cotton, accounting for about 26% of the world’s total cotton production. Naturally, a case concerning the sale of cotton seeds involved in patent and trademark issues becomes important. This decision is related to a particular type of hybrid cotton seeds manufactured by Monsanto Technology called Bt cotton seeds, which are resistant to an insect called Bollworm that has the ability to destroy cotton crops and cause huge losses to farmers.

The Plaintiffs in this case are Monsanto Technology, Monsanto Holdings Private Limited and Mahyco Monsanto Biotech, all part of a multi-national agrochemical and agricultural biotechnology corporation and a leading producer of genetically engineered seeds. The Plaintiffs filed a case against Nuziveedu Seeds Limited, Prabhat Agri Biotech Limited and Pravardhan Seeds Private Ltd. (Defendants), which are Indian agribusiness companies that market seeds and supply hybrid seeds to Indian farmers.

The Plaintiffs alleged that the Defendants continued to market and sell Genetically Modified Hybrid Cotton Planting Seeds despite the termination of sub-license agreements between the Plaintiffs and the Defendants. The Plaintiffs also alleged violation of intellectual property rights of their registered patent (IA 214436) and their trademark sub-licenses for ‘Bollgard’ and ‘Bollgard II’. The Plaintiffs alleged trademark infringement and ‘passing off’ by the Defendants when they sold their products with labels of ‘Bollgard’. The Plaintiffs wanted to initiate a permanent injunction against the Defendants, along with disclosures, recalls of infringing products and award of damages.

RECAP OF PRIOR EVENTS

Monsanto developed and commercialised Bt cotton technology named BG I and BG II, and sub-licensed these technologies to Indian seed manufacturers including the Defendants in 2004, and renewed the license in 2015. A lifetime fee of Rs. 50 lakh was charged along with a recurring ‘trait value’ as compensation. Trait values are generally high, and contribute to a significant cost for the cotton seed producers. However, due to disputes related to the high trait value of the Bt cotton seeds, several states like Andhra Pradesh, Maharashtra, Gujarat and Telangana enacted price-control measures between 2007 and 2009, thus fixing the cotton seed prices and the trait values chargeable by the seed developer. The fixed trait values were significantly lower than the ones charged by Monsanto, making them more affordable for cotton-growing farmers.

In July 2015, Nuziveedu approached Monsanto to discuss charging the cotton seed packets at the trait value rates determined by the local government, and reconciling accounts for the excess trait value that was paid after comparison with the trait value set by the legislation. Monsanto however, refused and sent a notice to Nuziveedu in November 2015 regarding the termination of their sub-license with Nuziveedu for non-payment of duties. Consequently, Nuziveedu and some other seed producers approached the Competition Commission of India (CCI), alleging “abuse of dominant position” and “anti-competition agreements” by Monsanto. Subsequently, the Commission found that Monsanto violated Sections 3 and 4 of the Competition Act, 2002, which involve the allegations mentioned previously.

Meanwhile, during these proceedings, the central government fixed the minimum support price (MSP) and trait value of Bt cotton seed packets for the financial year 2016-2017 for the whole of India under the Cotton Seeds Price (Control) Order, 2015. The MSP for BG I was fixed at Rs. 635 per packet with zero payable trait value and Rs. 800 per packet for BG II, inclusive of seed value, trait value and taxes.

Further, the Government of India published the "Licensing and Formats for GM Technology Agreement Guidelines, 2016" through the Ministry of Agriculture and Farmers Welfare. The Guidelines obliges the licensor and licensees to ensure that all agreements executed by them "fulfil the criteria" provided therein, primarily ensuring non-discriminative licensing to encourage competition and availability of GM cotton seeds to cotton farmers at fair and reasonable prices. In particular, the fourth para of these Guidelines direct the Licensor and the Licensee to conform the sale of cotton seeds with the trait value, seed value and MSP values fixed by the Central Government, for the benefit of cotton farmers.

             Subsequently, the Plaintiffs initiated the present lawsuit in February 2016 before the Delhi High Court. The High Court allowed the Defendants to sell seeds that were manufactured and packed before 30th November 2015 and include the Plaintiff’s trademark on the packaging. The High Court ordered the Defendants not to sell seeds manufactured after that date until further orders of the Court. These directions were subsequently modified by various subsequent orders from the High Court. The next issue of contention involved subsequent seeds that may be reaped from the planted Bt cotton seeds.

            DECISION OF THE HIGH COURT

When the Plaintiffs alleged infringement by the Defendants, the Defendants responded by filing a counter-claim seeking revocation of the suit patent. However, the Court decided not to look into the issue of patent validity at the interim stage as it would have required evidence to be led through a trial.

The Defendants also tried to make use of Section 26 of the Plant Variety Protection Act, which may be used when a new plant variety is registered under the same Act. According to this Act, a party that developed a new plant variety, of which genetic material has been used in an invention, may seek to share potential benefits arising from the invention. The Court rejected the Defendant’s claims related to Section 26.

The Plaintiff on the other hand, argued that their contract allowed the termination of the contract if royalty payments were not received within a fixed period. The Defendant countered that the Plaintiff was required to renegotiate the rates following the revision of cotton seed rates by various State Governments.

The High Court was of the opinion that the termination of the contract by the Plaintiffs was incorrect. The Judge states: “the Plaintiffs were duty bound to consider the request of the defendants as made by the communications beginning July 2015, for modification of the terms as to the rate of trait fee payable under the 2015 sub-license agreements for which the mechanism had earlier been agreed upon in the form of Article 11.03. Since the plaintiffs did not adhere to their obligation under the contract, the demand of payment under the contract terms being not lawful, it apparently being higher than the trait fee permitted by the law in force, the defendants could not have been found to be in default or to have breached their obligations within the meaning of Article 9.02” (Emphasis added)

The High Court emphasized on two points: Article 11.03 of the sub-license agreement between the Plaintiffs and the Defendants, which obliges the parties to keep the contract in accordance with the local laws at all times; and Section 23 of the Indian Contract Act, 1872 which forbids unlawful consideration. Further, the High Court pointed out the illegality of Monsanto’s sudden termination of the contract and hence, upheld the contract between the Plaintiffs and Defendants. Additionally, the Court allowed the Defendants to continue using the technology by paying trait fees in accordance with the prevalent State laws.

This matter related to Bt cotton seeds saw multiple parties playing important roles, from the Plaintiffs and Defendants to the State and Central Governments, including a few other government bodies. However, what comes as a relief is that in the end, the order was favourable towards the real beneficiaries of this situation, namely, the numerous Indian farmers who wish to continue growing cotton crops at reasonable and affordable costs.

We hope this article was a useful read. 

Please feel free check our services page to find out if we can cater to your requirements. You can also contact us to explore the option of working together. 

Best regards – Team InvnTree   

This work is licensed under a Creative Commons Attribution-NonCommercial 3.0 Unported License

Place of business: How important is it for instituting a suit of infringement?

invntree-background-image

In an order dated 22nd July, 2016, a single Judge of the Delhi High Court delivered his Judgement over a suit of infringement of trademark. The single Judge believed that the Court had territorial jurisdiction to entertain the suit. However, the alleged act of infringement took place in Kolkata (where the Defendant’s Office is located), while the Plaintiffs do not even have an Indian presence. A permitted user of the Plaintiff’s trademark has a presence in Delhi. In light on this, can the permitted user institute the suit? Does the Delhi Court have the authority to provide judgement on this matter? Let’s see.

History and Facts

This dispute arose when US based Exxon Mobil Corporation (“EMC”) alleged infringement of its registered trademark “Exxon” by Kolkata based “Exon Engineering Corporation” (“EEC”), and filed an action before the Delhi High Court. Exxon Mobil Corporation (Plaintiff 1), does not have an office in India. However, a wholly owned subsidiary (Plaintiff 2) of Exxon Mobil Corporation has an office in Delhi and is a permitted user of the trademark “Exxon”. Kolkata-based Exon Engineering Corporation (Defendant) is the registered proprietor of the trademark “Exon Engineering Corporation” and has an office in Kolkata. Section 134(2) of the Act empowers a plaintiff to institute a suit for trademark infringement at any place where its office is located. The plaintiffs here contended that the Delhi High Court was vested with the jurisdiction to adjudicate upon the matter as Plaintiff 2, being the permitted user of the trademark, has its presence in Delhi. On the other hand, the Defendant argued that it was carrying on business in Kolkata, so a court in Delhi would not have jurisdiction to adjudicate upon the matter. Further, the Defendant argued that in light of Section 53 of the Act, Plaintiff 2, by being a permitted user, could not institute the suit. Further, the Defendant was of the opinion that Section 134(2) could not come to the aid of Plaintiff 2, since Plaintiff 1 does not have an office in India.

The judge held that the explanation to Section 134(2) of the Act allowed this, and ruled that a “permitted user” would be empowered to institute a suit. The judge based this judgement on a case which involved an interpretation of Section 62(2) of the Copyright Act. The judge also accepted Plaintiff 2’s contention that Plaintiff 1 would be deemed to use the mark in Delhi owing to its use by its wholly owned subsidiary. The Defendant appealed before the Division Bench against this judgment, resulting in the judgment under consideration.

Division Bench Ruling

The Division Bench first looked into whether or not Plaintiff 2 could institute a suit in this case. The Division Bench held that Section 53 of the Trademarks Act clearly prohibits a permitted user from instituting a suit for infringement. The Bench pointed out the difference between a permitted user and a registered user and how, under the provisions of the Trademarks Act, a registered user and not a permitted user of a trademark can institute a suit.  Hence, the Bench ruled that Plaintiff 2 was not legally empowered to institute the suit.

Next, the Court went on to decide whether the Delhi High Court had jurisdiction to adjudicate upon the suit. For this, the Bench relied on the case of Ultra Home Construction vs. Purushottam Kumar Chaubey. The Bench assumed Plaintiff 2’s office in Delhi to be a subordinate (branch) office. Further, referring to Sections 134(2) and 62(2) of the Trademarks Act, 1999, the Bench contemplated that when the cause of action neither arises at the place of the principal office nor at the place of the subordinate office but at some other place, the Plaintiffs could institute a suit at the place of its principal office but not at the place of its subordinate office. The Bench then ruled that the Plaintiff 1's principal office is in USA and its assumed subordinate office is in New Delhi, but the cause of action has arisen in Kolkata. Unfortunately, the place where the plaintiff No.1 could sue under Section 134(2) would then be in USA which is not available to it because Section 134(2) is in respect of the suits filed in India alone. Consequently, the Delhi Court would not have territorial jurisdiction to entertain the present suit. Therefore, the Bench reversed the single judge’s decision and rejected the plaint for lack of jurisdiction.

The court order can be found here

We hope this article was a useful read. 

Please feel free check our services page to find out if we can cater to your requirements. You can also contact us to explore the option of working together. 

Best regards – Team InvnTree   

This work is licensed under a Creative Commons Attribution-NonCommercial 3.0 Unported License

Delhi High Court settles Domain Mark Dispute For Thoughtworks

invntree-background-image

Nowadays, many companies are setting up websites to create an online presence. However, quite often, a company looking to use its trademark as a domain name will find that another entity owns/uses that domain name. In such cases, complaints can be filed at the Indian Domain Name Dispute Resolution Policy (INDRP), wherein an arbitrator resolves such disputes.

The same incident occurred with ThoughtWorks, a U.S-based company founded in 1993. ThoughtWorks claimed that in March, 2015, they became aware the domain name ‘ThoughtWOrks.in’ was registered by another company, Super Software, when a ThoughtWorks analyst accessed Super Software’s website after mistaking it to be ThoughtWorks Inc.’s website. Subsequently, ThoughtWorks had filed an INDRP complaint in order to recover the domain name ‘thoughtworks.in’ from. However, in their defence, Super Software claimed that the ‘ThoughtWorks’ trademark was generic in nature, and hence they did not infringe on any existing trademark or copyright. Further, Super Software pointed out that it had registered the domain prior to the complaint and that ThoughtWorks had not registered that domain even though it had been available for a long time.

In this case, the INDRP Arbitrator denied ThoughtWorks’ complaint due to various reasons. The Arbitrator stated that ThoughtWorks was not able to provide sufficient evidence regarding its incorporation and the registration of its trademarks. Further, the Arbitrator mentioned that the addresses of the entities that owned the trademarks were different. The Arbitrator also mentioned that ThoughtWorks had not objected when Super Software registered the domain of ‘thoughtworks.in’.

ThoughtWorks challenged the arbitral award, and won the case when it was brought before the Delhi High Court. The Delhi High Court found that the Arbitrator’s proceedings were in violation of the principles of natural justice. Further, the Delhi High Court reversed the decision of the Arbitrator by highlighting the fact that since the domain mark included the entire name of the US Company, it is obvious that the trademark most definitively belonged to ThoughtWorks, and that it was deceptively similar to the company’s name.

The case file of ThoughtWorks Inc vs Super Software Pvt Ltd. & Anr can be found here

We hope this article was a useful read. 

Please feel free check our services page to find out if we can cater to your requirements. You can also contact us to explore the option of working together. 

Best regards – Team InvnTree   

This work is licensed under a Creative Commons Attribution-NonCommercial 3.0 Unported License

Huge relief for Prius Auto Industries – Judgement on trademark infringement given against Toyota motor corp.

We had earlier written on how Toyota Motor Corp. won case against Prius Auto Industries for the infringement of trademark “Prius”. Prius Auto Industries, a Delhi based automotive accessories company, were found guilty of using Toyota Motor Corp.’s “well-known” trademarks. The single-judge Bench of Justice Manmohan, on July 8, 2016, had given an order preventing Prius Auto Industries from manufacturing, selling or using the Toyota Motor Corp.’s trademarks such as “Prius”, “Toyota” and “Innova”. In addition to this, the court had also directed Prius Auto Industries to pay INR 10 lakhs, to Toyota Motor Corp. as compensation for trademark infringement.

Aggrieved, Prius Auto Industries appealed against the judgement. The appeal was heard by justice Pradeep Nandrajog of the division bench of the Delhi High Court, on 23rd December 2016. Upon hearing both the parties, judgement was given favouring Prius Auto Industries saying that the use of “Prius” by Prius Auto Industries does not infringe on Japanese car maker Toyota Motor Corp.’s trademarks.

Prius Auto Industries had appealed saying that trademarks should be determined in context to a similar class of goods and in a relevant geographical market. Accepting Prius Auto Industries arguments, Delhi high court gave judgement in favour of Prius Auto Industries that,

“Toyota is a big company. It has had a presence in India for over two decades when the suit was filed. It was well entrenched in the Indian market in the year 2001. Obviously no consumer of Toyota car or buyer of an auto part sold by Toyota was ever confused by the appellants selling their products under the trade mark Prius, for if this was so, in ten years somebody would have complained to Toyota or at least would have made known said fact to Toyota.”

The judgement also quashed Toyota Motor Corp.’s argument that Prius Auto Industries had been benefited from the trans-border reputation. Toyota Motor Corp. relied on reports in the Indian newspapers, that published news about Toyota’s new hybrid car “Pirus” in Japan in 1997. The Court, however, held that,

“Though published in a newspaper, the publication is in the nature of an article written and thus the weight of its evidentiary worth in the context of an explosive news on a fact of history being made known to the public would be minimal.”

Regarding trans-border reputation, the judgment states,

“The weight of the evidence led by Toyota would be that it has simply established that when it launched the hybrid car Prius in the market in Japan in 1997, the event was reported as a news item in different countries including India but not with such prominence that the public at large became aware of the same. The law on trans-border reputation requires two facts to be established. The first is reputation in foreign jurisdictions of the trade mark. The second is knowledge of the trade mark due to its reputation abroad in a domestic jurisdiction.”

“There being no advertisements published by Toyota for its car Prius in India and coupled with the fact that not all cars marketed under different trade marks by Toyota acquire a global reputation and much less in India, internet penetration as of the year 2001, being low in India, the weight of the evidence leans in favour of the view that by April 2001 Toyota had not established a global reputation in its trade mark Prius which had entered India.”

Read the full division bench judgement here.

Read the single judge judgment here.

We hope this article was a useful read. 

Please feel free check our services page to find out if we can cater to your requirements. You can also contact us to explore the option of working together. 

Best regards – Team InvnTree   

This work is licensed under a Creative Commons Attribution-NonCommercial 3.0 Unported License