TRADEMARKS - Infringement

Infringement

Section 29 of the Trademark Act-1999 talks about various aspects related to infringement:

Infringement of trademark is a violation of the exclusive rights granted to the registered proprietor of the trademark to use the same. 

A trademark is said to be infringed by a person who, not being a permitted user, uses an identical/ similar/ deceptively similar mark to the registered trademark without the authorization of the registered proprietor of the trademark. 

Passing Off

Passing off is a common law tort used to enforce unregistered trademark rights. 

Passing off essentially occurs where the reputation in the trademark of party A is misappropriated by party B, such that party B misrepresents as being the owner of the trademark or having some affiliation/nexus with party A, thereby damaging the goodwill of party A. 

For an action of passing off, registration of a trademark is irrelevant. 

Registration of a trademark is not a pre-requisite to sustain a civil or criminal action against the violation of trademarks in India. In India, a combined civil action for infringement of trademark and passing off can be initiated. 

1. The similarity between the marks in appearance and suggestion. 
2. The similarity of the products for which the name is used. 
3. The area and manner of concurrent use.
4. The degree of care likely to be exercised by the consumers. 
5. The strength of the plaintiff's mark or how distinctive it is. 
6. Whether there is evidence that people were actually confused, which is a pretty strong sign that there's a likelihood of confusion. 
7. Whether the defendant intended to palm off his product as that of the plaintiff's. 

These factors will be weighed differently in different cases. Still, the court has often noted that the similarity of the marks, the defendant's intent, and evidence of actual confusion are of particular importance.

Relief granted by Courts in Suits for Infringement and Passing off 

The relief which a court may usually grant in a suit for infringement or passing off includes a permanent and interim injunction, damages or account of profits, delivery of the infringing goods for destruction and cost of the legal proceedings. 

The order of interim injunction may be passed ex parte or after notice. The Interim reliefs in the suit may also include an order for: 

1. Appointment of a local commissioner akin to an *’ Anton Piller Order’, search, seizure and preservation of infringing goods, account books and preparation of inventory, etc. 
2. Restraining the infringer from disposing of or dealing with the assets in a manner that may adversely affect the plaintiff’s ability to recover damages, costs or other pecuniary remedies which may be finally awarded to the plaintiff. 

*Anton Piller Order

Anton Piller K.G. v. Manufacturing Processes Ltd., [1976] 

Anton Piller was a German manufacturer of motors and electric generators used in the computing industry. The respondent was the appellant's agent in the United Kingdom. As agents, the respondents had received confidential information surrounding the appellant's business. The appellants found out that the respondents had been in secret communication with other German companies called Ferrostaal and Lechmotoren to give those companies detailed plans and drawings of the appellant's products so that they could be copied. The appellants were about to launch a new product. They feared that details of it might get into the hands of competitors if the respondents were forewarned that the appellants were aware of the respondents' breaches of confidence. Anton Piller commenced ex parte proceedings seeking an injunction to restrain copyright infringement as well as a court order to permit entry to the respondent's premises to search and remove all confidential information owned by the appellants. The injunction was granted, but the order for inspection and removal was refused. The appellants appealed the denial of the latter order. In the Court of Appeal, the order was granted. From this initial order has grown the jurisprudence on Anton Piller orders, commonly known as civil search warrants.

An Anton Piller order is extraordinary relief. As such, the test for granting an Anton Piller order requires the moving party to show: 

• a strong prima facie case; 
• very serious damage, actual or potential for the moving party; 
• convincing evidence that the respondent has in its possession incriminating documents or things; and 
• a real possibility that it may destroy such material before the discovery process can do its work.

Offences and Penalties 

In case of a criminal action for infringement or passing off, the offence is punishable with imprisonment for a term that shall not be less than six months but may extend to three years and a fine that shall not be less than INR 50,000 may extend to INR 200,000. 

Cases of Infringement

Glaxo Smith Kline Pharmaceuticals Ltd. v. Unitech Pharmaceuticals Pvt. Ltd (2005) - No one can use a trademark that is deceptively similar to another company's trademark.

The plaintiff claimed that defendants are selling products under the trademark FEXIM that is deceptively similar to the plaintiff’s mark PHEXIN, which is used for pharmaceutical preparations. The defendants are selling anti-biotic tablets with the trademark `FEXIM' with the packing material deceptively similar to that of the plaintiff, intending to infringe the trademark and pass off the goods as that of the plaintiff as the two marks are also phonetically similar. 

The Court restrained the defendant from using the trademark `FEXIM' or any trademark deceptively similar to the trademark of the plaintiff `PHEXIN', any label/packaging material deceptively similar and containing the same pattern as that of the plaintiff.

M/s Bikanervala v. M/s Aggarwal Bikanerwala (2005) - If a party using the deceptively similar name only for a single shop and not spreading its business by use of that particular name then also that party could be stopped from using the tradename of another company.

The respondent was running a sweet shop with the name of AGGARWAL BIKANERWALA and the plaintiff was using the name BIKANERVALA from 1981 and also got registered it in the year 1992. Hence they applied for a permanent injunction over the use of the name AGGARWAL BIKANERWALA for the sweet shop by the defendant. Court held in favour of the plaintiff and stopped the defendant from manufacturing, selling, offering for sale, advertising, directly or indirectly dealing in food articles for human consumption under the impugned trademark/trade name/infringing artistic label 'AGGARWAL BIKANER WALA' or from using any trademark/trade name/infringing artistic work containing the name/mark 'BIKANER WALA/BIKANERVALA' or any other name/mark/artistic work which is identical or deceptively similar to the plaintiff's trademark 'BIKANERVALA'.

Dhariwal Industries Ltd. and Anr. v. M.S.S. Food Products (2005) - If the trademark is not registered by any party, but one party started using it before the other, then the first one would have the legal authority on that particular mark.

The appellants were using the brand name MALIKCHAND for their product, and the respondents were using the name MANIKCHAND, which is similar to the previous one, and both parties have not registered their trademarks. Court held in this matter that even though the plaintiff has not registered their trademark, they are using it for a long time, and hence court granted a perpetual injunction against the respondents.

N.R. Dongare v. Whirlpool Corp. Ltd. (1996) - Even if a company is not doing business in-country, but it is a well-known company or well-known goods, then also it would be entitled to get authority over its trademark. 

The defendants have failed to renew their trademark ‘WHIRLPOOL’, and in the meantime, the plaintiffs have got registration of the same. In this case, the court said that though there was no sale in India, the reputation of the plaintiff company was travelling trans-border to India as well through commercial publicity made in magazines that are available in or brought in India.

The “WHIRLPOOL” has acquired reputation and goodwill in this country, and the same has become associated in the minds of the public. Even advertisement of a trademark without the existence of goods in the mark is also to be considered as use of the trademark. The magazines which contain the advertisement do have a circulation in the higher and upper-middle-income strata of Indian society. Therefore, the plaintiff acquired a transborder reputation in respect of the trademark “WHIRLPOOL” and has a right to protect the invasion thereof.

Honda Motors Co. Ltd. v. Mr Charanjit Singh and Ors (2002) - Even if the goods are not the same or similar to each other, then also no one can use the registered trademark of a company for any kind of goods which may result in harm to the business and reputation of the company which is the owner of the trademark.

The defendant Company was using the trade name HONDA for ‘Pressure Cookers’, which they are manufacturing in India, and even when their application for registration of this trademark had been rejected by the registrar, they continued using it and again applied for registration and hence plaintiff has brought this plaint.

Smithkline Beecham v. V.R. Bumtaria (2005) -The plaintiff applied for a permanent injunction to restrain the defendant from infringing the trademark, passing off, damages, delivery etc., of its registered trademark ARIFLO, used in respect of the pharmaceutical preparations. Defendants were using the similar name ACIFLO for their product of the same drug in India. Plaintiffs were not doing business in India for the particular product. They argued that since their advertisements are being published in medical journals,  they have a trans-border reputation. The defendants should be stopped using a similar trademark that creates deception in customers.
The court said that mere publication of an advertisement in a journal cannot establish a trans-border reputation. Such reputation, if any, is confined to a particular class of people, i.e., the person subscribing to the said specialized journals and the same can’t be said to be extended to the general consumers. Thus any adverse effect on the firm in such a case can’t have amounted to the offence of “passing off”.

The dispute resulted in a compromise where the defendant agreed and accepted the plaintiffs’ exclusive right to use the mark, i.e. ARIFLO in India and abroad and further agreed not to manufacture pharmaceutical preparations under the mark ACIFLO or any other mark identical or similar to ARIFLO.

Trade Dress

The literal meaning of Trade Dress is - the overall image of a product used in its marketing or sales that is composed of the non-functional elements of its design, packaging, or labelling (as colours, package shape, or symbols). 

That means there is a specific way of writing any product name, its unique background and other remarkable signs. The concept of trade dress has much importance in a country like India, where one-third of the population is still illiterate. 

Trade dress helps the illiterate people who cannot read the trademark on the product as well as the manufacturers to reach the people easily.

Colgate Palmolive Company and Anr. v. Anchor Health and Beauty Care Pvt. Ltd (2003)
The plaintiffs have filed the case for the ‘passing off’ of trademark, and the dispute was on the colour scheme and combination of colours in a significant manner. Colgate Company was the plaintiff and questioned the use of a mark on the dental product, which is the combination of ‘red’ and ‘white’ in the proportion of 1/3:2/3 respectively and the way of writing the product's name was also in dispute. Plaintiffs were using the mark of particular fashion from 1951, and the respondents started using it in 1996. Plaintiffs have filed the application to stop the respondents from using the particular mark.

The plaintiffs showed to the court that the look of trade dress of the two articles, one manufactured by the plaintiff and another by the defendant from the point of view of not only unwary, illiterate customer/servants of the household but semi-literate also as the trademarks "Colgate" and "Anchor" are written in the English language cannot be distinguished by ordinary customer. There is every likelihood of confusion as to the source on account of the similarity of a substantial portion of the container having a particular colour combination and the container's shape. Such an action on the part of the infringing party also has an element of unfair competition.

In the present dispute, if an illiterate servant or village folk goes to the shop with the instruction to bring Colgate Tooth Power having a container of the particular shop with trade dress of colour combination of Red and White in 1/3 and 2/3 proportion he will not be in a position to distinguish if he is handed over "Anchor" Tooth Powder contained in a container having the identical trade dress and colour combination of "Red and White” in that order and proportion. Confusion is much large as to source and origin as the difference in name will not make any difference to such a customer, and the goods of the defendant can easily be passed off as goods of the plaintiff.

The court said that the significance of trade dress and colour combination is so immense that in some cases, even single colour has been taken to be a trademark to be protected from passing off action except where the colour cannot be protected as the blue colour is for the Ink and red colour is for the lipstick or similar cases. The court said that it is being established that the defendants are using the trade dress of plaintiffs for their containers. Hence, Court had allowed plaintiffs' application and restrained defendants from using the colour combination of red and white in the disputed order on the container/packaging of its goods.

Points to Ponder

• A registered trademark is the property of the holding company, and it is directly associated with the name, reputation, goodwill and quality of products of a company. 
• A company can not use the trademark of another company. 
• No one can use even a similar trademark which is creating deception or confusion for the customers. 
• No one can use a company's trademark, which is well known and has a trans-border reputation, even if it is not registered in India. 
• Mere advertisement in a particular journal does not create a trans-border reputation. 
• Trade dress is also a part of trademark, and no one can use the specific writing style, definite colour combination and identifiable background for packaging and labelling a product. 
• A mere single colour can also be treated as a trade dress for a specific product.

Some Famous and Well known trademark case

Pizza Hut International LLC & Others Vs.Pizza Hut India Pvt. Ltd.2003

The court held: 

“I do not have any hesitation in coming to the conclusion that in the present case also the Defendants sole intention was to trade on the Plaintiffs well established and worldwide reputation and famous marks/logo.

The balance of convenience is also in favour of the Plaintiffs. The Plaintiffs, apart from their operations abroad, also started conducting business in India in 1996. On the other hand, The defendant, apart from having itself registered under the Companies Act, 1956, has done nothing. The defendant has no reputation or goodwill in India. It has never even attempted to build any reputation or goodwill in India. In the circumstances, a grant of an injunction cannot and will not prejudice the defendant in any manner. On the other hand, if the Plaintiffs are refused interlocutory reliefs, they will suffer irreparable harm and prejudice.”

Mars, Incorporated Vs. Chanda Softy Ice Cream and Ors. 2001

The respondents were using the trademarks, MILKY WAY & GALAXY,  with dishonest intention and the name board, hoarding, signboard used by the respondents (for their business in Chennai)  bear the wording "MILKY WAY GALAXY OF ICE CREAMS “.

The court held: “Why one should choose or pick up the name or mark which has already become famous and well known and whose reputation and goodwill is all-pervading and is obviously hard-earned. The only intention or object is the thrive upon the goodwill and reputation and confuse the purchasers of his goods into believing that the defendants' goods or business in one way or other are connected with the plaintiff.”

Daimler Benz Aktiegesellschaft and Another Vs. Hybo Hindustan 1994

The court held: 

"That name which is well known in India and worldwide, concerning cars, as is its symbol a three-pointed star."

“In the instant case, "Benz" is a name given to a very high priced and extremely well-engineered product. In my view, the defendant cannot dilute that by the user of the name "Benz" concerning a product like under-wears.”

William Grant & Sons Ltd. v. McDowell & Co. Ltd. 1994

Grant filed an action to restrain McDowell from copying the trade dress of GLENFIDDICH Scotch whisky. Grant had been exporting various whiskies to India since 1946 and GLENFIDDICH Single Malt Whisky since 1978. The GLENFIDDICH Single Malt Whisky was sold in a green bottle, and black cylindrical cartons bearing a label with a distinctive trade dress and unique features, which included a stag device that Grant contended had become exclusively associated with them and a thistle device which Grant alleged was a Scottish symbol indicating the origin of the product. Grant claimed trademark infringement and passing off alleging that McDowell used a label with a similar trade dress as the GLENFIDDICH label, including also a green bottle, a black cylindrical carton and stag and thistles devices. 

McDowell denied that they were guilty of infringement and passing off, contending that their container and label were different and that the devices of a stag and thistles were common to the trade. The defendants also argued that the type of consumer who buys the product is well-informed and would never be confused or deceived and that their product was clearly marked McDowell's Single Malt Whisky.

The judge also ruled that McDowell appeared to be aware of the reputation of Grant's product, that the copying was deliberate and not accidental, and that the balance of convenience lay in favour of Grant whose time, money and effort had been expended in designing its label. 

Can Bits of Linguistic Material be owned?

Should individuals and companies have the right to own parts of language? 

And if so, where do we draw the line to ensure that trademarks don’t impinge on things like freedom of expression?

To explore this subject more, here are some famous trademark cases.

Victoria’s Secret v Victor’s Little Secret

In 2002, the American lingerie retailer Victoria’s Secret brought a case against Victor Moseley, proprietor of Victor’s Secret, a small sex shop in Kentucky; proceeding with the case even after he’d changed the name to ‘Victor’s Little Secret’. The basis for their action was one of trademark dilution. Victoria’s Secret claimed that the negative association with a sex shop tarnished their brand and reduced its recognisable uniqueness.

Initially, the court ruled against Victoria’s Secret on the grounds that in trademark dilution suits, actual harm to the brand needed to be demonstrated. However, as a result of this case, the law was changed in 2006 so that only the likelihood of harm needed to be shown, and the original decision of the court was overturned.

Use of ‘VOGUE My Style'

The New York and Paris publishing houses behind Vogue magazine took a Swiss watchmaker to court in 2009 for their use of the slogan ‘VOGUE My Style’. Lawyers for Vogue argued infringement on the grounds that the iconicity of the capitalised word ‘VOGUE’ made it a distinctive sign associated with the magazine. The publishers backed this claim up by conducting a poll among Swiss residents, finding that one in four of them associated the trademark with ‘a magazine of high quality'.

In 2012, the court ruled in Vogue’s favour, which sparked some criticism from those arguing that no meaningful association between two completely different products was likely to occur in the mind of the consumer.

Superhero

One of the most controversial trademarked words is ‘superhero’ and variations upon it. The trademark was jointly registered by Marvel and DC Comics in the 1960s. There has been much debate in legal circles over its legitimacy, with many claiming the word is descriptive rather than distinctive. To this day, Marvel and DC Comics actively maintain the trademark by initiating legal proceedings against other comics that try to use the word ‘superhero’ in their title or on related products.

Whether or not Marvel and DC Comics can claim ownership of a word like ‘superhero’ has never been fully tested in court, and some critics argue that they use the trademark to discourage competitors.

Apple Corps v Apple Inc.

About nine years after The Beatles formed their multimedia company Apple Corps, Steve Jobs et al. launched Apple Computer, now Apple Inc. and associated with numerous products worldwide(iPad, iPod, iPhone, etc.) That was in 1976, and on several high profile occasions since Apple Corps has filed suits against Apple Computer for trademark infringement. The first suit was settled in 1981, with Apple Computer making a monetary settlement and agreeing to stay out of the music business.

However, the two again crossed paths, first in 1989 when Apple Computer incorporated MIDI music playing ability in their products, and then in 2003 with the launch of iTunes. On both occasions, Apple Corps launched the action, losing for the first time on the second. The two companies have since put an end to this ongoing lawsuit, with an undisclosed settlement resulting in Apple Inc. now owning the trademark and licensing it out for specific uses to Apple Corps.

Linguistically, perhaps what’s most interesting about this case is how much importance two powerful companies place on a simple word like ‘apple’

Harjo v. Pro-Football Inc. 

Pro-Football Inc is the corporate body that owns the Washington Redskins Football team, and in 1992 Susan Harjo, an activist for Native American rights, along with seven others, petitioned the Trademark Trial and Appeal Board to cancel several trademark registrations involving the use of the word ‘redskin’. Their argument was that the term was disparaging to Native Americans. Pro-Football Inc took legal action, and this resulted in the trademarks being reinstated.

The reason for their victory was due to a legal technicality known as laches, which prevents a claim from being made after an unreasonable delay. This case seems to demonstrate how discordance exists between property law and human rights in the American judicial system.

Alan Clark v The Evening Standard

Intellectual property law often treads a very fine line between creative protection and censorship, and there are perhaps few better illustrations of this than with parody and satire. For the most part, parody and satire are permitted under the legal concept of fair use, but then it has to be clear that that is what is indeed taking place.

In 1998, the Conservative MP Alan Clark made a claim against The Evening Standard for a parody of his famous diaries that they regularly published as ‘Alan Clark’s Secret Political Diary’. The publication included a photograph of Alan Clark, which, coupled with the fact that the name of the journalist was not prominently displayed, led to the claim that this misrepresented the author of the parody as being Clark himself. It was a claim backed up by the fact that angry constituents wrote to the MP attacking him for the extremist views represented by the parody.

Eventually, Clark won the case on the grounds that ‘passing off’ has occurred. However, many argue that this verdict was a slap in the face of free speech and that the satirical nature of the articles was obvious to anyone who had actually read them.

Gillette v LA Laboratories

In 2005 Gillette lost a case against LA Laboratories, a Finnish company that marketed razor blades under the trademark Parason Flexer. On the packaging for their razor blades, Parason Flexer included the words: ‘All Parason FLEXER® and Gillette SENSOR® handles are compatible with this razor blade’.

Although the distinct lettering of Gillette represented their trademark, the court ruled that this was for the purposes of making the function of the product easily recognisable to consumers. They concluded that the Parason Flexer was not trading off the Gillette brand, and in the interests of commerce and open competition in the EU, the use of the Gillette trademark was permitted.

Keep Calm and Carry On

A trademark dispute that is still currently pending concerns the slogan ‘Keep Calm and Carry On’, which has become very popular over the past few years. The slogan can be found plastered over all kinds of merchandise, from mugs to pencil cases, and it is easy to see why anyone making commercial gain from the brand would want to own the trademark.

The slogan and crown logo originate from a Government-sponsored public information campaign from 1939, intended in the event of a German invasion. In the end, most of the posters bearing the slogan were recalled, although not all. In 2000, after having discovered a copy among some new stock, the proprietors of a second-hand bookshop decided to start selling copies of the poster. As the crown copyright on creative works produced by the Government expires after 50 years, there was no issue of any trademark infringement. However, someone else has since registered a trademark in the EU (having failed to do so in the UK) and has trademarks pending in North America.

In linguistic terms, perhaps the real interest, in this case, lies in the public reaction against the trademarking of the slogan, with many arguing that the wording encapsulates the British spirit and should therefore be kept in the public domain.

Wrigley’s Doublemint

In 2003, the European Court of Justice rejected an attempt by the chewing gum company Wrigley’s to trademark the word Doublemint. The judgement boiled down to whether the word was purely descriptive or whether it activated consumers’ imagination to conjure up an impression of something uniquely identifiable with the product. In the end, the court ruled that the word is a compound that objectively references mint as a flavour and the fact that this flavour is doubled.

‘Genericide'

This point actually refers to not just one trademark case but all those trademarks that can be said to have fallen victim to genericide. The list is long and obviously includes many recognisable terms: hoover, elevator, aspirin, zipper, yo-yo.

Genericide or generification refers to when a trademark has come into general use and is no longer identifiable with a particular product. For this reason, many companies spend millions actively protecting their trademark, such as by encouraging the use of alternative generic terms. Nintendo has been known to promote the term ‘games console’. Companies also employ lawyers to regularly send letters to warn about infringement when people or companies use their trademark.

The owners of Google are particularly concerned about the effect that the verb ‘to google’ may have on their trademark. Still, in the age of the internet, it is impossible to control how people use language in the public domain, no matter how many letters are sent.