Trademark Law in India: In a Nutshell

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May 16, 2018

Evolution of Trademark Law in India

Prior to statutory enactment of regulations governing trademark law and practice in India, the proprietary rights vested in a trademark were protected through common law principles and principles of equity. Majority of Indian Laws owe their origin to English Laws which were substantially subsumed while formulating Laws for the Indian subcontinent prior to Independence. The passing of the English Act, 1875, which provided for the protection of trademarks in England prompted passing of a similar Bill in India. Subsequently, requests were made to the Bombay Government by the Bombay Chamber of Commerce and Mill Owners’ Association for introducing a Bill in the Bombay Legislative Council on the lines of the English Act. The Central Government took up the matter and circulated the Trademark Bill for public opinion in 1879. However, the Bill met heavy opposition from vested interests and commercial public and was not proceeded with further[1].

The need for a law exclusively addressing trademark practice and procedure in India was again sought for in the 19th century which eventually materialized into the Trademark Act, 1940. The Trademark Act, 1940 predominantly reflected the provisions incorporated in the UK Trademark Act, 1938. Subsequently, in the wake of ensuing trade and commerce development, the Trademark Act, 1958 was passed to address the lacunae being witnessed in the Trademark Act, 1940. The Trademark Act, 1958 also consolidated the provisions associated with trademarks in the Indian Penal Code, Criminal Procedure Code and Sea Customs.

The Trademark Act, 1958 was thereafter repealed by the Trademark Act, 1999 which at present governs trademark law and practice in India. The Trademark Act, 1999 was enacted with the intent to revise the Act in congruity with latest developments witnessed in trading and commercial practices, rapid globalization and for harmonization with International trade laws.

Some of the epoch- making inclusions in the Trademark Act, 1999 inter alia include:

  • Provision was made for trademark registration in respect of services in addition to goods;
  • Statutory protection was extended to well-known trademarks;
  • Widened the scope and purview of ‘trademark’ in India;
  • Provision for registration of ‘collective marks’;
  • Incorporated provision to prevent use of trademark as a corporate or trade name by third party.

Widened Definition of Trade Mark

The Trademark Act, 1999 under Section 2 (zb) defines “trade mark” as a mark capable of being represented graphically and which is capable of distinguishing the goods or services of one person from those of others and may include shape of goods, their packaging and combination of colours…”

Furthermore, the Act also provided for definition of ‘mark’ under Section 2(m) which enumerates a mark to include a device, brand, heading, label, ticket, name, signature, word, letter, numeral, shape of goods, packaging or combination of colours or any combination thereof.

Two essential ingredients for Trademark registration

  1. The Mark is Capable of Being Represented graphically– ‘Graphical representation’ has been defined under Section 2(1) (k) of Trademark Rules, 2007 as representation of a trademark for goods or services represented or capable of being represented in paper form and include representation in digitized form. Such graphical representation of a trademark also encompasses within its purview shape of goods, their packaging, combination of colours, in other words it brings within its ambit “trade dress”[2].This essential requisite for qualification as a valid trademark merely implies that the mark should be capable of being put on the register in a physical form and also being published in the Journal[3]. This requirement of a valid trademark was further expounded by the European Trademark Office, wherein it elucidated two primary reasons for geographical representation a trademark[4]:
  • Enable traders to identify with clarity what other traders have applied for registration as trademark and for what product;
  • Enable public to determine with precision the sign which forms the subject of trademark registration
  1. Capable of Distinguishing Good and Services of One Person From Those of Others- The definition of “trade mark” under Section 2(1)(zb)of the 1999 Act means a mark “which is capable of distinguishing the goods or services of one person from those of others”. Therefore, the use of a mark that is not capable of distinguishing the goods of such proprietor of the trade mark would not qualify for the protection under the TM Act[5]. This requisite of a trademark primarily enumerates that a trademark must be distinctive i.e. it should not be devoid of a distinctive character.

Absolute Grounds for Refusal of Trademark Registration

Section 9 of the Trademark Act, 1999 enumerates grounds on which a trademark registration can be absolutely refused. The Act provides that following marks can be refused:

  • Marks that are devoid of any distinctive character;
  • Marks which serve to designate kind, quality, intended purpose, values, geographical origin or the time of production of goods;
  • Marks which have become customary in the current language or in the established practices of trade;

Exception- Aforesaid mark shall not be refused registration if prior to date of trademark application; the mark has acquired distinctive character or is a well-known trademark.

  • Marks that may cause deception or confusion in public;
  • Mark comprises of matter that is likely to religious sentiments any class of people;
  • Mark comprises of scandalous or obscene matter;
  • Mark is prohibited under the Emblems and Names (Prevention of Improper Use) Act, 1950;
  • If the mark consists of shape of goods which results from the nature of the goods themselves;
  • Mark consists of shape of goods which is necessary to obtain a technical result;
  • Mark gives substantial value to the goods;

Mark devoid of distinctive character

This requirement entails that a trademark should be of a distinctive character. While determining that a mark is distinctive or not, it has to be seen that the mark does not have a direct and close reference to the character and quality of applicant’s goods[6]. In order to ascertain whether one mark is deceptively similar to another it is not necessary to place the two marks side by side to find out if there are any differences. It would be enough if the impugned mark bears such an overall similarity to the registered mark as would be likely to mislead a person usually dealing with one to accept the other if offered to him[7].

The term “distinctive” was defined by Lord Halsbury as the word ‘distinctive’ means distinguishing a particular person’s goods from somebody else’s goods-not a quality attributed to the particular article but distinctive in that respect that it means it is a manufacture of his as distinguished from somebody else. The manufacturer may or may not be new, but that is the sort of distinction contemplated by the Statute[8].

Extent of use for acquired distinctiveness of trademark

The Statute does not lay down the term of use that would be sufficient to determine whether a mark has acquired distinctiveness. However, the legal principle regarding the same has been settled through precedents. The Judiciary has rendered conflicting dictums on the extent of use required while proving acquired distinctiveness of a trademark. In the case of Woodlands Travels and Agencies v. K. Vasudeva Rao and anr.[9],the Madras High Court stated that a mark cannot acquire distinctiveness by using it for just a few days. User for one year prior to application is not sufficient to acquire distinctiveness under Section 9 to qualify for registration under Section 9, the mark should have acquired distinctiveness by long user[10].

Earlier, in 1961 in the case of Consolidated Foods Corporation v. Brandon and Company Private Ltd.[11]the Bombay High Court observed that for the purpose of claiming such proprietorship of a mark, it is not necessary that the mark should have been used for considerable length of time. As a matter of fact, a single actual use with intent to continue such use eo instanti confers a right to such mark as a trademark. A mere casual, intermittent or experimental use may be insufficient to show an intention to adopt the mark as a trade mark for specific article or goods. Another noteworthy observation was rendered by the Calcutta High Court in the case of East End Hosiery Mills Pvt. Ltd. v. Agarwal Textile Mills[12]wherein the Court stated that there can be no hard and fast rule, that any particular minimum period of time is required to acquire distinctiveness. In some cases the time to acquire distinctiveness may be larger than in others.

However, in a recent verdict, the Delhi High Court in the case of ITC Ltd. v. Britannia Industries[13] has settled the principle regarding term of use by holding, that to acquire secondary meaning it is not necessary that product is in the market for number of years. If a new idea is fascinating and appeals to the consumers, it can become a hit overnight.

Acquired distinctiveness of trademark prior to date of application

The date at which the distinctiveness of a mark must be established is the date of the application[14] and the rights of parties must be determined as on the date of application[15].

Acquired distinctiveness is a question of fact

Whether a trademark has established acquired distinctiveness or not is a question of fact[16]. The question whether a word is or is not capable of becoming distinctive of the gods of a particular maker is a question of fact and is not determined by its being or not being descriptive[17].

What is Secondary Significance of a Trademark?

The law stipulates that a trademark which has secured a secondary meaning or secondary significance shall not be refused registration even if it falls within the categories as enumerated under Section 9. It is settled law that in common language words and names cannot be exclusively appropriated by any trader unless and until such trade names have acquired such a great reputation and goodwill in the market that the common language word has assumed a secondary significance. Secondary significance here would mean that other traders in that line of trade acknowledge that such common word has come to denote the goods belonging to a particular trade[18]. Even a common language word can be exclusively appropriated by a party as a trade mark if the said word has acquired a secondary significance but in the case of a word which is coined, fancy, new or meaningless the claim to exclusive appropriation is sustainable without the need to prove existence of secondary significance[19].

Relative Grounds for Refusal of Trademark Registration

Section 11 provides that a mark shall not be registered:

  • If the mark causes likelihood of confusion on part of the public i.e. likelihood of association with the earlier trademark;
  • If the mark is identical to a well-known trademark in India and use of the later mark may be detrimental to the distinctive character of the well-known trademark;
  • If the mark’s use in India is liable to be prevented by law of passing off or copyright law;

The provision further envisages that where the goods are of different description refusal will not be justified but registration may be refused if the mark is likely to be deceptive or cause confusion.

Well-Known Trademarks

Read Well-Known Trademarks in India: Law and Legalities

Trademark Passing Off

The Trademark Act, 1999 under Section 27 provides for the remedy of passing off for misuse of an unregistered trademark by the Defendant. It enumerates that no person shall be entitled to institute any proceeding to prevent infringement of an unregistered trademark. The law further entails that the provision shall not affect the rights of action against any person for passing off goods or services as the goods of another person or as services provided by another person, or the remedies in respect thereof.

Section 27 of the Act recognizes common law rights of the trademark owner to take action against any person for passing of goods as the goods of another person or as services provided by another person or remedies thereof. The remedy made available under Section 27 protects the rights of the proprietor of an unregistered trademark to register complaint against another person for passing off his goods as goods the goods of proprietor. An unregistered proprietor of trademark can also oppose an application for registration on grounds as enumerated under Section 11 of the Act[20].

In an action of passing off, the Plaintiff has to establish prior use to secure an injunction and that the registration of the mark or similar mark in point of time, is irrelevant[21].

Classical Trinity Test in Passing off Action

Lord Oliver in the case of Reckitt & Colman Products Ltd. v. Borden Inc.[22] enumerated three elements for a successful passing off action: (1) Goodwill owned by a trader, (2) Misrepresentation and (3) Damage to goodwill. Thus, the passing action is essentially an action in deceit where the common law rule is that no person is entitled to carry on his or her business on pretext that the said business is of that of another[23].

Tests in the case of passing off

The Supreme Court in the case of Cadila Healthcare Ltd. v. Cadila Pharmaceutical Ltd.[24]laid down the test of passing off and observed that a passing off action depends upon the principle that nobody has a right to represent his goods as the goods of some body. In other words a man is not to sell his goods or services under the pretence that they are those of another person. As per Lord Diplock in Erwen Warnink BV v. J.Townend & Sons[25], the modern tort of passing off has five elements, namely

  • a misrepresentation
  • made by a trader in the course of trade
  • to prospective customers of his or ultimate consumers of goods or services supplied by him
  • which is calculated to injure the business or goodwill of another trade (in the sense that this is a reasonably foreseeable consequence), and
  • which causes actual damage to a business or goodwill of the trader by whom the action is brought or (in a quia timet action) will probably do so.

Further in the case of Corn Products Refining Co. v. Shangrila Food Products Ltd.[26], it was observed that the principle of similarity could not to be very rigidly applied and that if it could be prima facie shown that there was a dishonest intention on the part of the defendant in passing off goods, an injunction should ordinarily follow and the mere delay in bringing the matter to Court was not a ground to defeat the case of the plaintiff.

Is fraud an essential element of passing-off

According to Kerly[27]– Passing off cases are often cases of deliberate and intentional misrepresentation, but it is well-settled that fraud is not a necessary element of the right of action, and the absence of an intention to deceive is not a defence though proof of fraudulent intention may materially assist a plaintiff in establishing probability of deception. The burden to prove passing off is on the Plaintiff[28].

The defendant may escape liability in an action for passing off if he can show that his mark or goods, besides the essential features which are sufficient to distinguish the same from that of the plaintiff. Thus, while in an action for infringement of a registered trade mark the plaintiff has to establish either an use of his registered trade mark as such or of an identical mark or of a deceptively similar mark by the defendant, he has to establish in an action for passing off that the defendant’s mark or goods are such that the defendant can pass off his goods as those of the plaintiff[29].

Trademark Infringement

Section 29 of the Act provides remedy in cases of trademark infringement. The statutory provision also enlists the circumstances under which a mark is infringed:

  1. Infringement of a mark occurs when a person not being registered proprietor uses a mark which is identical or deceptively similar to a registered mark in relation to goods or services in respect of which the trademark is registered.
  2. When a person not being a registered proprietor uses a registered trademark which because of its identity with registered trademark and similarity with goods or services is likely to cause confusion in public.
  3. When a person not being registered proprietor of a mark uses mark which is identical or similar to the registered trademark in relation to similar goods or services and the registered mark has a reputation in India.
  4. A registered trademark is infringed by a person if he uses such registered trademark as part of his trade name of his business concern dealing in goods or services in respect of which the trade mark is registered.
  5. A registered trademark is infringed by any advertising of that trademark if such advertising takes unfair advantage and is detrimental to its distinctive character.

Under this Section we would deal with cases in which the Judiciary has shed light on trademark infringement law in India.

When mark adopted by Defendant is identical to Plaintiff’s registered trademark

 If on comparison of the trademarks of the two parties in case the trademark adopted by the Defendant is identical to that of the Plaintiff, the Plaintiff may not be required to prove anything further. Section 29 of the Trademarks Act, 1999 statutorily mandates so as well. However, when the two marks are not identical, then the plaintiff would be required to establish that the mark used by the defendant so nearly resembles the plaintiff’s registered trademark as is likely to deceive or cause confusion in the minds of the consumer public[30].

Onus to prove infringement on Plaintiff

The Supreme Court in the case of Kaviraj Pandit Durga Dutt Sharma v. Navratna Pharmaceutical Laboratories[31] held that in an action for infringement the onus would be on the Plaintiff to establish that the trade mark used by the defendant in the course of trade in the goods in respect of which his mark is registered, is deceptively similar.

How can the Plaintiff establish that the Defendant’s mark is identical or resembles the Plaintiff’s mark

This issue was elaborately discussed by the Delhi High Court in the case of Atlas Cycle Industries Ltd. v. Hind Cycles Limited[32]wherein the Court stated that in a case of trademark infringement, the plaintiff may establish that its trademark is identical with or so nearly resembles the plaintiff’s work either visually or phonetically or otherwise, that it is likely to deceive or cause confusion in relation to the case in respect of which the plaintiff got his mark registered.

Thus, if the essential features of the trade mark of the plaintiff have been adopted by the defendant, the fact that there are some additional features in the defendant’s mark which show marked differences is immaterial in an action for infringement.

Test of deception in trademark infringement cases

The Bombay High Court in the case of Thomas Bear And Sons (India) v. Prayag Narain[33], held that in judging the probability of deception, the test is not whether the ignorant the thoughtless, or the incautious purchaser is likely to be misled, but we have to consider the average purchaser buying with ordinary caution.

The Supreme Court’s decision in the case of James Chadwick & Bros. Ltd. v. The National Sewing Thread Co. Ltd.[34]can be regarded as an essential obiter dicta which aided in streamlining the interpretation of trademark infringement law in India. The Court in the case stated that in an action of alleged infringement of a registered trade mark, it has first to be seen whether the impugned mark of the defendant is identical with the registered mark of the plaintiff. If the mark is found to be identical, no further question arises, and it has to be held that there was infringement.

If the mark of the defendant is not identical, it has to be seen whether the mark of the defendant is deceptively similar in the sense that it is likely to deceive or cause confusion in relation to goods in respect of which the plaintiff got his mark registered. For that purpose, the two marks have to be compared.

How to compare marks for deception

In James Chadwick’s case, the Supreme Court held that to ascertain deception between two marks the mark need not be placed side by side, but by asking itself whether having due regard to relevant surrounding circumstances, the defendant’s mark as used is similar to the plaintiff’s mark as it would be remembered by persons possessed of an average memory with its usual imperfections, and it has then to be determined whether the defendant’s mark is likely to deceive or cause confusion.

How to determine likelihood of confusion between disputed marks

For such determination the essential features of the two marks and the main idea, if any, underlying the two marks which a purchaser of average intelligence and imperfect memory would retain in his mind after seeing the marks, have to be noticed. It has then to be seen whether they are broadly the same or there is an overall similarity or resemblance, and whether the resemblance or similarity is such that there is a reasonable probability of deception or confusion. In doing so, the approach has to be from the point of view of purchaser of average intelligence and imperfect memory or recollection, and not an ignorant, thoughtless and incautious purchaser.

Difference between Trademark Infringement and Passing off

The difference between a passing off action and an action for trademark infringement was expounded by the Delhi High Court in the case of Cadbury India Limited and Ors. v. Neeraj Food Products[35] as under:

  • An action for passing off is a common law remedy whereas an action for trademark infringement is a statutory remedy.
  • Passing off action in essence is an action of deceit that is, a passing off by a person of his own goods as those of another whereas in case of infringement, the Plaintiff on account of being registered proprietor of the disputed trademark, claims to have an exclusive right to use the mark in relation to those goods.
  • The use by the defendant of the trademark of the plaintiff may be prerequisite in the case of an action for infringement while it is not an essential feature of an action for passing off.
  • If the essential features of the trademark of the plaintiff have been adopted by the defendant, the fact that the getup, packing and other writing or marks on the goods or on the packets in which the defendant offers his goods for sale show marked differences or indicate clearly a trade origin different from that of a registered proprietor of the mark, would be immaterial for the case of infringement of the trademark. The liability of the defendant for such infringement may be absolute. In the case of passing off, the defendant may escape liability if he can show that the added material is sufficient to distinguish his goods from those of the plaintiff.

The distinction between passing off and infringement was examined by Judge Clauson in the case of Listen Ltd. V. Harley[36]wherein he opined that if you are restraining the infringement of a registered mark, you can restrain the man from using the mark; but, restrain him from selling the articles under the label containing that word without clearly distinguishing his goods from the goods of the Plaintiff is quite a different thing.

The Supreme Court in a recent case of S. Syed Mohideen v. P. Sulochana Bai[37]stated that passing off right is a broader remedy than that of infringement. This is due to the reason that the passing off doctrine operates on the general principle that no person is entitled to represent his or her business as business of other person. The said action in deceit is maintainable for diverse reasons other than that of registered rights which are allocated rights under the Act.

 

[1] Iyngar’s Commentary on Trade Marks Act; Fifth Edition

[2] Rich Products Corporation And vs Indo Nippon Food Limited; CS (OS) 246/2004

[3] KC Kailasam & Ramu Vedaraman, Law of Trademarks & Geographical Indications, 2nd Edition

[4] Swizzles Matlow Ltd. Application

[5] Pioneer Nuts & Bolts Pvt. Ltd. v. M/s Goodwill Enterprises, FAO (OS) 334/2008

[6] Shakti Vikas Sansthan v. Ayurved Vikas Sansthan, 1991 PTC 34 Del

[7] Mumtaz Ahmed v. Pakeeza Chemicals, AIR 2003 All 114

[8] Iyengar’s Commentary on Trade Marks Act; Fifth Edition

[9] 2003 (27) PTC 352 Mad

[10] Sarda Plywood Industries Ltd. v. Deputy Registrar of Trademarks, 2007 (34) PTC 352 (IPAB)

[11] AIR 1965 Bom 35

[12] AIR 1971 Cal 3

[13] CS (COMM) 1128/2016

[14] Minnesota Mining Co.’s Application (1924) 41 RPC 237

[15] McDowell’s Application (1927) 44 RPC 335

[16] See In re Leow’s Theatres, Inc. 769F.2d 764

[17] United Iron and Steel Works v. Government of India, AIR 1967 P&H 64

[18] Vijay Kumar Ahuja v. Lalita Ahuja, 95 (2002) DLT 3

[19] Globe Super Parts v. Blue Supra Flame Industries AIR 1986 DELHI 245

[20] Kaviraj Pandit Durga Dut Sharma v. Navratna Pharmaceutical Laboratories, AIR 1965 SC 980

[21] Century Traders v. Roshan Lal Duggar & Co., AIR 1978 Delhi 250

[22] (1940) 42 BOMLR 734

[23] 1953 SCR 1028

[24] 2007 (35) PTC 95 Del

[25] 1979 (2) AER 927

[26]  (1929) 4 RPC 11 (2)

[27] Kerly’s Law of Trademarks and Trade names (para 16.16)

[28] National Sewing Thread Co. v. James Chadwick & Bros., ILR (1949) Mad 4

[29] Atlas Cycle Industries Ltd. vs Hind Cycles Limited; ILR 1973 Del 393

[30] Kaviraj Pandit Durga Dutt Sharma v. Navratna Pharmaceutical Laboratories; 1997 PTC (17)(DB) 779

[31] ibid

[32] ILR 1973 Delhi 393

[33] (1940) 42 BOMLR 734

[34] 1953 SCR 1028

[35] 2007 (35) PTC 95 Del

[36] (1929) 4 RPC 11 (2)

[37] 2016 (66) PTC 1