Delhi HC:MNC’s can’t claim right on Trademark if they don’t use it in India

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December 01, 2017

Munish Kumar Singla Trading as Chakshu Food Products v. Jollibee Foods Corporation

Date of Judgment: November 20, 2017

In this recent case, the Supreme Court was confronted with non-use of the impugned trademark and made a scathing attack on grant of injunction by the Trial Court in the case on the very first day of decreeing the suit itself.

In the case, the Appellant appealed against the ex-parte order of Trial Court, whereby the Appellant was restrained from carrying on its business of selling spices under the trademark ‘Chakshu’ with an image of a bee.

The Respondent in the case was aggrieved with the trademark rights in the image of the bee.

The disputed image of bee used by both parties is depicted below:

Factual Matrix in the case- The respondent is based in Philippines and it is having a fast food brand under the trademark ‘Jollibee’. The word mark ‘Jollibee’ was along with an image mark of a bee.

The respondent in the case admitted that though the trademark ‘Jollibee’ with the image of a bee was registered in favour of the respondent way back in the year 2005, and from the year 2005 till today in the year 2017, the Respondent has not yet commenced its business in India. That the registrations of Respondent’s trademark is on the basis of “proposed to be used basis” .

Delhi High Court’s Order and Observation

Trial Court erred in granting injunction- That as per the facts of the case, the Respondent in spite of registration of its trademark since the year 2005 has till now not commenced business in India. In such admitted facts of a case as per the plaint itself where the respondent has not commenced business in India. In view of such facts, the Trial Court could not have passed ab ex-parte order on the first date of decreeing the suit itself.

Dissimilar business of parties- That the business of the Respondent is of a fast food chain and food products and the business of the Appellant is selling of packaged spices.

Delay in Seeking Ex-parte Injunction- That the respondent was aware about the existence of the appellant since November 2016 i.e. since when the appellant sought registration of wordmark ‘Chakshu’ with an image of bee. Therefore, on filing of the suit many months later in August 2017, respondent was hit by the principle of delay for not seeking an ex-parte injunction.

Non-Use of Trademark by Respondent- That in the present case, there was really no jurisdiction in the trial court to grant ex-parte order as the respondent had not commenced business in India in spite of registration of its trademark in India since the year 2005. In this context, Delhi High Court made reference to Supreme Court’s verdict in the case of Milmet Oftho Industries and Others vs. Allergan Inc.1, wherein it was held that multinational companies have no right to claim exclusivity of the trademark if they do not enter or intend in a reasonable time to enter into business in India and which observations squarely apply in the facts of this case where in spite of registration since the year 2005 till today in the year 2017 the respondent has not commenced his business in India.

In view of the aforesaid, Delhi High Court allowed the appeal and set aside Trial Court’s order.

Section 47 of Trademark Act, 1999 provides for removal of trademark from register on grounds of non-use of the mark. It provides that a registered trademark may be taken off the register in respect of goods or services in respect of which it is registered on application made in the prescribed manner. According to the statutory provision, any person who is aggrieved that a registered trademark has not been used for a continuous period of 5 years and 3 months from the date of which the mark was actually entered in the register of trademarks then he can make an application for removal of the trademark from the Register.

1(2004) 12 SCC 624