In a recent case, Oriental Cuisines Private Ltd vs. Star Restaurants Pvt. Ltd, the Delhi High Court decided a case of passing-off based on the principles of common law.
The Plaintiff is in the business of hospitality management and operation of restaurants. It is the proprietor of a label mark “THE NOODLE HOUSE” in respect of restaurant services serving Indo-Chinese cuisine. The Plaintiff adopted the mark in 2003. By virtue of extensive use and popularity of the restaurant bearing the mark, the same came to be associated with the Plaintiff. The Defendant was engaged in the business of hospitality and restaurant management. In 2008 the Plaintiff came to learn that the Defendant planned to start a restaurant offering the same cuisine as it did, also named THE NOODLE HOUSE and in the vicinity of the Plaintiff. In this background the Plaintiff sued.
The intention of the Defendant was obviously to cash in on the goodwill and reputation of the Plaintiff’s business and pass off its restaurant as that of the Plaintiff’s. The use of the identical mark by the Defendant would have resulted in the public associating the Defendant’s restaurant with that of the Plaintiff and in the process result in the Plaintiff’s mark being diluted. There was no explanation forthcoming from the Defendant as to why it adopted and proposed to use the same name.
Although the registration of the Plaintiff’s mark was pending, the Court held that the Plaintiff was entitled to assert its rights and seek relief under common law arising on account of prior adoption and use of the mark. Pursuant to an application of the Plaintiff, the Court passed an order restraining the Defendant from using the impugned mark or any other confusingly and deceptively similar mark in any manner. The five elements of the modern tort of passing-off as laid down by Lord Diplock in Erwen Warnink BV Vs. J Townend & Sons viz. (i) misrepresentation; (ii) made by a trader in the course of trade (iii) to customers of goods and services supplied by him (iv) which is calculated to injure the business or goodwill of another trader and (v) which causes actual damage to a business or goodwill of a trader, were taken into consideration whilst providing the injunctive relief sought by the Plaintiff. In the absence of proof that actual damages were suffered, the Plaintiff was disentitled to any damages.
In passing the order, apart from considering the similarity of the mark and the services provided, the Court took into consideration the fact that the Defendant’s restaurant was in the vicinity of the Plaintiff’s and this was certain to cause irreparable loss and injury to the Plaintiff on account of the inevitable confusion/deception being caused in the minds of the general public and more so, in the minds of the loyal customers of the Plaintiff. The Defendant’s mala fide intentions were glaring.