In India, trademarks are protected through a combination of both specific statutes (eg, the Trademarks Act 1999) and ancillary legislation incorporated under, for example, the Customs Act 1962 and the Companies Act 1956.
The Trademarks Act and related rules prescribe the procedure to be followed before the Trademarks Registry. In the case of civil proceedings initiated before the courts, the Code of Civil Procedure 1908 applies, while in the case of customs recordal, the Intellectual Property Rights (Imported Goods) Enforcement Rules 2007 apply. Where trademarks or names are used in a company name, the Companies Act applies, alongside the rules prescribed under it. Criminal enforcement cases are brought under the Penal Code 1860. In addition, there are government guidelines, as well as other guidelines from regulators such as the Advertising Council. In some cases, unique legislation, such as the Emblems and Names (Prevention of Improper Use) Act 1950, also apply.
The Indian courts have taken the lead in issuing landmark decisions on several issues, including recognition of trans-border reputation and goodwill, domain name trafficking, metatagging, hyperlinking, phishing and other issues related to the Internet, the definition and enforcement of advanced remedies, and issues relating to conflicts between company names and trademarks.
On July 8 2013 India became the 90th member of the Madrid Protocol, paving the way for local businesses to protect their marks in multiple jurisdictions by filing one application.
In India, an unregistered trademark is entitled to protection under the tort of passing off. Section 27(2) of the Trademarks Act expressly provides for an action for passing off.
The plaintiff must prove that:
- the trademarks are similar;
- the defendant is deceptively passing off its goods as those of the plaintiff; and
- there is bound to be confusion in the minds of consumers. The test to be applied is whether a person of average intelligence and of imperfect recollection would be confused.
While the Indian courts prefer evidence (eg, sales or advertisements) pertaining to India, they have come a long way in terms of recognising trans-border reputation and goodwill as a basis for enforcing rights. Certain rulings have even taken cognisance of a mark specific to one industry, stating that even in the absence of any physical use in India, knowledge and awareness of a mark or business can be attributed and enforced against dishonest use. For example, in the context of pharmaceuticals, the Supreme Court held in Milment Oftho Industries v Allergan Inc (2004 (28) PTC 585) that the first entrant in the market has the right in the mark; the court even considered the word ‘market’ to extend to the global market.
In WWE v Reshma Collection (October 15 2014) the Delhi High Court held for the first time in India that due to advancements in technology and the changing ways of conducting business online, it is possible for an entity to have a virtual presence in a place some distance from its physical presence. The availability of website transactions is virtually the same thing as the seller having shops in that place in the physical world.
In many cases, advertising for a mark or business has also been used as a basis for asserting rights and signifying intent to do business in India.
At the same time, the courts have taken the view that merely filing an application for registration or a registration per se (if granted in India) does not prove use, as observed in Marico v Agrotech (2010 (43) PTC 39 (Del)).
Using a later mark and taking unfair advantage of an earlier mark give statutory recognition to the concept of trademark dilution.
In Bloomberg Finance LP v Saklecha (2013 (56) PTC 243 (Del)) the court found that a trademark is diluted when its uniqueness is lost owing to unauthorised use in relation to products that are not identical or similar to the rights holder’s product. The court held that even marks which do not qualify as well known enjoy anti-dilution protection.
In Caterpillar Inc v Mehtab Ahmed (2002 (25) PTC 438 (Del)) the court recognised trademarks as either invented, arbitrary, suggestive, descriptive or generic – holding that no evidence of use is required to register or protect the first three types.
Sections 29 and 30 of the Trademarks Act clearly allow for an action based on infringement. Unlike passing off, in an infringement action there is hardly any burden on the plaintiff since entitlement is already established through registration. However, an infringement action does not lie against a prior user, implying that Indian courts attach a greater degree of importance to prior use (in many cases including prior international use) than to prior registration.
Searches for identical marks, phonetic equivalents and device marks can be carried out in the Trademarks Registry’s online records.
The registrar examines the mark and may communicate to the applicant any objections to it through a consolidated examination report. The applicant may then file a claim to contest or seek a hearing.
Opposition can be filed within four months of the mark being published in the Trademark Journal. Anyone may oppose or object to a registration on the grounds of possible deception, confusion, dilution or descriptiveness.
If the mark is unopposed or the opposition dismissed, it proceeds to registration. The applicant may withdraw the application at any time during the opposition proceeding. Section 91 of the Trademarks Act provides for an appeal against an order or decision of the registrar to the IP Appellate Board.
Once granted, a registration can be cancelled on the grounds that it was wrongly granted or remains on the register contrary to the law or due to a failure to observe certain limitations or conditions imposed thereon. A registered trademark can also be cancelled on the grounds of continuous non-use for five years and three months from date of grant of registration. A registered trademark can be cancelled by the registered owner on making an appropriate request to the relevant authority. The rectification action must be instituted by an aggrieved party. Partial cancellation for certain goods or services is possible. The petition can be filed with the Trademarks Registry or the IP Appellate Board.
The Indian Supreme Court observed in Bajaj Auto Ltd v TVS Motor Co Ltd (2008 (36) PTC) that all courts and tribunals hearing IP cases should proceed on a day-to-day basis and final judgment should be given within four months of the date that the suit was filed.
Damages and other reliefs: Previously, the only remedies available in an action for infringement or passing off was an injunction (interim or final) and, in some cases, damages and/or costs, delivery of infringing stock of goods and/or rendition of accounts.
In many cases an injunction is the most appropriate remedy. In ICICI Bank v Ashok Thakeria (CS (OS) 1744/2013) the court granted an ex parte injunction to the plaintiff, directing the producer to censor defamatory content in a movie referring to the plaintiff and its mark ICICI and the ‘i’ device.
In some cases, the plaintiff may also seek an order for a court commissioner to visit the defendant’s premises to:
- search and seize any infringing goods in the defendant’s possession; and
- seal the defendant’s premises (Anton Piller injunction).
Another relief is an order to freeze the defendant’s assets or books of accounts pending adjudication (Mareva injunction). In Tata Sons Ltd v HP Singhal the court passed an order freezing the defendant’s assets as it was involved in duping gullible employment seekers by using Tata’s brand name.
The courts have taken an aggressive stance against infringement by awarding damages, particularly in cases relating to the violation of well-known trademarks. Leading cases on damages in India include:
- Time Incorporated v Shrivastava (2005 (30) PTC 3) – the court found the ‘red border’ design distinctive and directly associated with the plaintiff’s magazine. Consequently, it awarded punitive damages of $111,111 and compensatory damages of $111,111, with a further $133,333 in interest.
- Disney Enterprises Inc v Bharti (2013 (54) PTC 372 Del) – compensatory damages of Rs200,000 and punitive damages of Rs300,000 were awarded against the defendant.
Customs actions: The government has recognised the need for IP rights protection at its borders as a key defence against infringement. Under the Intellectual Property Rights (Imported Goods) Enforcement Rules, rights holders may register their IP rights with Customs to safeguard themselves against imports of counterfeits. In Cisco Technologies v Shrikanth (IA 3725/2005) the court held that the authorities must prohibit imports that would result in or abet the violation of a rights holder’s proprietary interest.
John Doe orders: The judiciary’s approach to counterfeiting shows an increasing trend of granting of John Doe orders if a strong prima facie case is established. In Taj Television v Mandal ( FSR 22) the court issued its first John Doe order, authorising a court-appointed commissioner to enter the premises of any cable operator in India and record evidence of unauthorised telecasting of the 2002 World Cup football matches. Subsequently, the court has granted injunctions restraining named defendants, as well as infringers, whose whereabouts were unknown at the time of the suit. In M/s Sandisk Corporation v John Doe CS ((OS) 3205/2014) the court appointed three local commissioners to seize counterfeit memory cards bearing the plaintiff’s SANDISK marks and the Red Frame logo and make a list of anyone found in possession of such counterfeits.
Counterfeit purchase undertakings: Counterfeit purchase undertakings are increasingly used to reduce costs, avoid litigation and ensure certainty. The rights holder’s lawyers/representatives personally confront a counterfeiter and serve a cease-and-desist letter upon a retailer selling counterfeit goods. The retailer must agree to comply with the undertaking or risk legal action.
Plea bargaining: There is a growing trend for settling IP infringement matters by way of plea bargaining. InState v Prakash (FIR 189/05 (Del)), a case involving steel buckets bearing the mark TATA, the court settled the matter by way of a plea bargain, following which the accused parties paid a fine of $222 each.
Unique orders: Where the defendants cannot pay damages, courts have tactically passed unique orders ensuring effective deterrence. In Dharampal Premchand v Tata Zarda Factory (CS (OS) 2/2006), which concerned a trademark for tobacco-based products, the court ordered the defendants to install 50 spittoons in a cancer hospital. In Luxottica SRL v Munny (CS (OS) 1846/2009) the court disposed of the case following an agreement between the parties that instead of damages, the defendants would donate a specified amount to charity and 500 pairs of unbranded glasses to the visually disabled.
Cross-border reputation: The courts have also recognised that a mark can acquire reputation or goodwill without actual use in India. In Jolen Inc v Jain (MIPR 2010 (2) 176) the Delhi High Court applied the principle of cross-border reputation (established in NR Dongre v Whirlpool Corporation (AIR 1995 Delhi 300)) to recognise the plaintiffs’ right over the JOLEN mark owing to its prior adoption outside India and its international reputation and goodwill.
Restrains even where products are restricted: The court in Playboy International Incorporated v Malik(2001 PTC 328 (Del)) concluded that the PLAYBOY mark had become exclusively associated with the plaintiff due to extensive use all over the world, even though the products sold under this mark were banned in India.
Parallel imports: The judiciary’s attempts to combat parallel importation are commendable. In Samsung Electronic Co Ltd v Lalani (CS (OS) 1600/2006) the court restricted the parallel import of goods on the doctrine of material differences under trademark law, whereby substantial differences – physical or non-physical (eg, absence of warranty, insufficient instructions or inadequate labelling) – are considered material differences and therefore legitimate reasons for banning parallel imports.
In Wadhwa v Samsung Electronics Co Ltd (FAO (OS) 93/2012) the Delhi High Court recognised the concept of international exhaustion under Indian trademark law. The principle of international exhaustion of rights removes the right to control the further sale and distribution of the goods. The dispute is now before the Supreme Court, as Samsung has filed an appeal against the order of the Delhi High Court.
Three-dimensional, shape, sound and texture marks: These marks are registrable and enforceable. InZippo v Moolchandani (CS (OS) 1355/2006) protection extended to the shape mark ZIPPO based on a shape mark registration. In Louis Vuitton v Malik (CS (OS) 1825/2003) Louis Vuitton brought a case for violation of its EPI STYLE trademark and surface pattern before the Delhi High Court. The court issued an ex parteinterim injunction and Anton Piller order against the defendant. In Ferrero SPA v MAA Distribution (India) Pvt Ltd (2010 (44) PTC 717 (Del)) the Delhi High Court restrained the defendants from marketing or selling chocolates or confectionery in order to protect the device, shape and distinctive wrapping of the plaintiffs’ FERRERO ROCHER mark. Further, in Ferrero SPA v Dugar (2013 (55) PTC 277 (Del)) the court granted an injunction on the grounds that the continued marketing and sale of the defendant’s product would result in continued infringement of both the registered trademark and trade dress of the plaintiffs’ products. In India, the Yahoo! yodel and the ICICI tune are protected as sound marks.
Trade dress: The test of deceptive similarity applies in a passing-off action regarding the trade dress of the product. In Colgate Palmolive Co v Anchor Health and Beauty Care Pvt Ltd (108 (2003) DLT 51) the red and white colour scheme of the Colgate toothpaste was protected against its use by the defendants as part of the latter’s COLLEGIATE mark.
Gesture/motion marks: Protection has been granted in India in relation to gesture or motion marks that have become distinctive through use.
Well-known marks: The Trademarks Act clearly stipulates grounds under which a mark may be considered well known.
In recent years both the Indian courts and the Trademark Registry have held an increasing number of marks (eg, TOSHIBA, TATA, FORD, POLO, GE MONOGRAM, ICICI) to be well known in India. Consequently, these have been granted protection against use for unrelated goods. In Disney Enterprises, Inc v Singh (CS (OS) 1451/2011) the Delhi High Court ruled in favour of the plaintiff and stated that the trademark WALT DISNEY and the various Disney characters had acquired tremendous reputation and goodwill throughout the world; hence, any unauthorised use of such characters in relation to any items of merchandise would create a high degree of confusion and deception, resulting in passing off.
The Trademarks Registry has issued a (non-exhaustive) list of well-known trademarks based on judicial pronouncements. MICROSOFT was recently added on being declared a well-known trademark by the Delhi High Court in Microsoft Corporation v Kurapati Venkata Jagdeesh Babu (February 3 2014).
Ownership changes and rights transfers
Assignment and licensing
A trademark, either registered or unregistered, can be assigned. There are certain restrictions on assignment and transmission in order to prevent the creation of multiple exclusive rights. The courts have recognised the ability of plaintiffs to enforce rights in the absence of a recordal of assignments and devolution of title based on the execution of title documents.
In Sun Pharmaceuticals Industries Ltd v Cipla Ltd (2009 (39) PTC 347 (Del)) the court ruled that where a trademark has been assigned, the fact that it is pending registration will not preclude the claimant from bringing an action for either passing off or infringement.
A person entitled to a registered trademark by assignment or transmission is merely required to apply to the registrar in order to be registered as the mark owner. The applicant must prove its title only where there is reasonable doubt about the veracity of a statement or document.
A single object may enjoy multiple IP rights protection – namely, as a trade secret, copyright, patent and/or trademark. The copyright and trademark regimes may both apply to the same item, while design and trademark registrations may both be obtained for the same sign.
The ‘.in’ Domain Name Dispute Resolution Policy (.inDRP) sets out the terms and conditions applying to disputes between the registrant of an ‘.in’ domain name and a complainant.
In order to protect a domain name under the law of passing off, it is essential that the second-level domain name is not a generic word, but rather an invented or coined word. In Plus Inc v Consim Info Private Limited (2010 (42) PTC 507 (Bom)) the court denied protection under the law of passing off to a registered domain name, owing to its descriptive nature.
In all, the legal framework for trademarks in India seems well balanced, notwithstanding some procedural delays.
This article first appeared in World Trademark Review. For further information please visit www.worldtrademarkreview.com.