The three judges bench (full bench) of Bombay High Court was recently, on reference by a single judge of the same court, asked to clarify scope of infringement provisions provided in the Trademarks Act. In particular interpretation of Section 29 (5) that applies to use of a registered mark by a third party as part of its corporate name/trading style. The full bench was asked to determine whether

  1. a registered proprietor can invoke infringement provision under Section 29 (5) to restrain use of a registered mark by a third party as a corporate name/trading style for dissimilar goods or services.
  2. a registered proprietor can rely upon well known mark provisions under Section 29 (4) of the Trademarks Act to seek an injunctive relief against a third party's use of the corporate name/trading style for different goods or services.

The above issues came up in the context of a trade mark infringement and passing off action filed by Cipla Limited (hereinafter referred to as Cipla) against Cipla Industries Private Limited & Another (hereinafter referred to as Cipla Industries) objecting to use of 'Cipla' as part of company name by Cipla Industries. Cipla's business was primarily in medicinal and pharmaceutical trade whereas Cipla Industries was using 'Cipla' as part of the company name in respect of goods falling in class 21 such as soap dishes, photo frames, ladders etc. Further, it was registered proprietor of CIPLA PLAST mark in class 21 since the year 1999. Cipla Industries had not used the mark for pharmaceutical preparations. In this context the decision of two judges bench (Division Bench) of Bombay High Court in Raymond Limited v Raymond Pharmaceuticals Private Limited (2010 (44) PTC 25 (Bom) (hereinafter referred to the Raymond's case) was argued to be applicable. In Raymond's case, the Division Bench held that Sections 29(4) and 29(5) are mutually exclusive. Thus, it was held that Raymond Pharmaceuticals' use of corporate name does not amount to infringement as it was not dealing in the textile and readymade clothing in respect of which RAYMOND trade-mark of Raymond Limited is registered.

The single judge when hearing Cipla case differed with the findings of the Division Bench in Raymond case. Thus made a reference to three judges (full bench) on four issues for adjudication:

  1. Where a party is using a registered trade mark as a corporate or trading name in respect of goods dissimilar to the ones for which the trade mark is registered, is the registered proprietor entitled to an injunction on a cause of action in infringement under Section 29(5) of the Trade Marks Act, 1999?
  2. Whether the use of a registered trade mark as a corporate name or trading name is excluded from the purview of Sections sub sections (1), (2), (3) and (4) of Section 29 of Trade Marks Act, 1999, and whether those Sections are restricted to the use of a trade mark 'as a trade mark' ?
  3. Whether Sections 29(4) and 29(5) operate in separate and mutually exclusive sphere, i.e., if the defendant uses the registered trade mark only as a corporate name or trading name in respect of dissimilar goods, a plaintiff has no remedy (under infringement provisions) and is not entitled to an injunction?
  4. Whether the view taken by the Division Bench in Raymond's case is a correct view?

The three judges bench vide order dated 1st March 2017 held that:

  1. Definition of 'mark' which includes name is not relevant while interpreting Sections 29 (4) and (5).
  2. Section 29(5) applies when a registered trade mark is used as a company name provided the infringer is dealing in the goods/ services in respect of which the trade mark is registered. Thus, no protection is available under Section 29(5) if the registered mark is used as a part of the company name in respect of dissimilar goods/ services in respect of which registered proprietor holds no registration.
  3. Sub sections (1), (2) and (4) of Section 29 do not apply when use of a registered mark is made as a part of the company name by the defendant. The said provisions apply when the mark is used in the course of trade in relation to goods and services.
  4. Sub sections (4) and (5) of Section 29 are mutually exclusive. If the defendant uses the registered trade mark as a corporate name or trading name in respect of dissimilar goods, the plaintiff has no remedy under Sub sections (4) and (5) of Section 29 and is not entitled to an injunction (under these provisions).
  5. Inconvenience or prejudice to registered proprietors is no ground while interpreting the applicability of Section 29 (4).
  6. The words 'dealing in goods or services in respect of which Trade Mark is registered' were specifically included in Section 29(5) on the recommendation of Parliamentary Standing Committee. In the absence of such words, use of registered mark by the defendant as a company name even in respect of dissimilar goods would have amounted to infringement.
  7. Section 29(8) has no relevance while interpreting Sections 29 (4) and (5). Section 29(8) applies only in case of advertising of trade mark.

Our comment

A corporate name is commonly understood to serve as an identifying symbol of goods and services sold by a company and perform function of a trademark. More so considering the companies use corporate name as their house mark on all products and services. Thus confusion and deception that can ensue by use of a well known mark as part of corporate name by a third party is not only detrimental to the reputation of the mark but can also cause consumer confusion. In that context the ruling is a setback for brand owners who cannot invoke statutory remedy under Section 29 of the Trademarks Act to stop such use and may have to solely proceed on the basis of common law remedy of passing off. The last word is yet to be written on this as Cipla is likely to Appeal against the order to the Supreme Court.