A final order of permanent injunction was passed by the Delhi High Court in a suit for infringement of trademark, passing off, rendition of accounts filed by the Plaintiff, Larsen and Toubro Ltd. (L&T) against the Defendants, Lachmi Narain Traders. The case proceeded to trial while the interim injunction operated in favor of L&T. The court came to the conclusion that in a passing off action where marks are similar and confusion is apparent then it does not matter if the other party acted fraudulently or otherwise.
The plaintiff’s contention:
- They are a company incorporated under the Companies Act, 1956, carrying on business, inter alia, as Engineers, Construction Contractors, Manufacturers of switch gears, etc.
- The history of the Plaintiff dates back to the year 1938 when two Danish Nationals, Henning Holk-Larsen and Soren Kristian Toubro formed a partnership. In the year 1946 this partnership was incorporated into a limited company and the name of the Plaintiff contains the surnames of the aforesaid two partners.
- Since incorporation, the Plaintiff has been carrying on business in India and over the years the name Larsen and Toubro has acquired distinctiveness in respect of various goods sold and services provided by them and the short form "L&T" brings to the mind of any person the Plaintiff's name “Larsen” and “Toubro”.
- The Plaintiff has also obtained registrations for the marks “Larsen and Toubro” and “L&T” in various classes.
- The words “Larsen” and “Toubro” have acquired such distinctiveness that any use by any person or Company of the word “Larsen” or “Toubro” or the abbreviation “L&T” is bound to cause confusion amongst the traders and members of the public. The word/abbreviation “L & T” has acquired a secondary meaning and is associated exclusively with the Plaintiff.
- In the first week of June, 2003, the plaintiff learnt that the Defendants were using the name/abbreviation “LNT”/“ELENTE” as a brand name for their electrical goods including electrical distribution systems like miniature circuit breakers etc.
- Thereafter, the Plaintiff addressed a cease and desist letter to the Defendants asking them to cease use of the brand name “LNT/ELENTE” in relation to their business. However, the Defendants failed to comply.
The Defendant’s contention:
- They have been carrying on business under the trade name Lachmi Narain Trades since April, 2001, and trademark registration was applied for LNT on 17th April, 2001 and the Defendants had commenced trade to deal in the brand name LNT in relation to Electric Miniature Circuit Breaker, Electric Rotary Switches, Electric PVC Insulating Tape and Electric Fluorescent Chokes.
- LNT is the abbreviated form of its firm name Lachmi Narain Trades and ever since the products were launched by the said company extensive advertisement has been carried out for their brand LNT.
- In the year 2002 the representatives of the Plaintiff company had met the Defendants to discuss about the Miniature Circuit Breakers (MCB) being sold by them. After the discussion it was decided that the Defendants would change the colour of MCB and its packing and that thereafter the Plaintiff would have no objection.
- The Plaintiff has acquiesced in the Defendants using the brand name LNT as they were aware that the Defendants have been using the brand name LNT/ELENTE since April, 2001 and there is also delay in filing the action.
- The brand name LNT/ELENTE is not similar to the trademark L&T used by the Plaintiff and as the rival products also differ there is no cause for confusion and deception.
After considering the pleadings, evidence, and case laws relied on by the parties, the court made the following findings:
- With regard to passing off, the court held that a person may sell his goods or deliver his services under a trading name or style and with the lapse of time such business or services associated with a person acquire a reputation or goodwill which becomes a property which is protected by courts. When a competitor initiates sale of goods or services in the same name or by imitating that name it results in injury to the business of one who has the property in that name. Therefore, the law does not permit any one to carry on his business in such a way as would persuade the customers or clients in believing that the goods or services belonging to someone else are his or are associated therewith. It does not matter whether the latter person does so fraudulently or otherwise. In the instant case the rival marks; L&T and LNT/ELENTE are deceptively similar and chances of confusion and deception are apparent.
- With regard to the issue of delay, the court observed that the defendants have no case of delay as being the ex-stockist of the plaintiff’s product. The adoption was tainted and dishonest. Wherever and whenever fresh deceitful act is committed, the person deceived would naturally have a fresh cause of action in his favour. Thus, every time when a person passes off his goods as those of another he commits the act of such deceit. Similarly whenever and wherever a person commits breach of a registered trade mark of another he commits a recurring act of breach or infringement of such trade mark giving a recurring and fresh cause of action to the party aggrieved.
- The Defendants also raised a point that the mark LNT is registered in the name of third party and the plaintiff has taken no action. The court however, observed that no issue in this regard is framed and no evidence has been produced to that effect.
In view of the above a decree for permanent injunction was passed restraining the Defendants from using in any manner in relation to any of its business/services/goods/products the name/words/abbreviation “LNT/” “ELENTE” or any other deceptively similar mark to the Plaintiff’s L&T mark.