Well-Known Trademarks in India: Law and Legalities

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January 15, 2018

INTRODUCTION

In India well- known trademarks have been accorded extraordinary proprietary rights against registration of identical or deceptively similar marks as well as against their misuse. This special protection accorded to well- known trademarks is a consequence of precedents and pronouncements that have been judiciously evolved by the Courts in India. Here it would be relevant to mention that statutory protection was accorded to well-known marks in India only in the year 1999. Prior to that well-known marks were protected under the common law principles of passing off. The Indian Trademark Registry’s website provides a comprehensive list of well-known trademarks in India like Google, Kit Kat, AMUL etc. At present the list has 81 trademarks declared as “well-known” by judicial and quasi-judicial authorities in India. The list can be accessed here.

PROTECTION OF WELL-KNOWN TRADEMARKS PRIOR TO THE ACT OF 1999

As mentioned above, the Indian Legislature extended extraordinary protection to well-known marks only in the year 1999 and prior to that such marks were protected under the common law principles of passing off.

One of the remarkable cases, in which well-known mark was protected under the common law principles of passing off, is the case of Daimler Benz Aktiengesellschaft & Anr v. Hybo Hindustan[1]. In the case, the Plaintiff, manufacturer of Mercedes Benz cars, alleged Defendant of using its mark BENZ for selling its undergarments. The Court restrained the Defendant from using the impugned mark and stated that there’s no valid reason as to why any trader in India should adopt the name “Benz”, which is associated with one of the finest engineered cars in the world, and use the same name with respect to ordinary goods, in this case undergarments, particularly underwear.

Spill-over reputation of the mark- The Court in the case recognized worldwide reputation of the mark BENZ and further opined that “Benz” as name of Car would be known to every family that has ever used a quality car. The name “Benz” as applied to a car, has a unique place in the world. There is hardly one who is conscious of existence of the cars/automobiles, who would not recognize the name “Benz” used in connection with cars. Nobody can plead in India, where “Mercedes Benz” cars are seen on roads, where “Mercedes” have collaborated with TATAs, where there are Mercedes Benz Tata trucks have been on roads in very large number, who can plead that he is unaware of the word “Benz” as used with reference to car or trucks.

Similarly, in the landmark case of Whirlpool Co. & Anr. v. N.R. Dongre[2], the Court on the basis of transborder reputation injuncted the Defendants from using the mark ‘Whirlpool’ for their products (washing machines). At the time of the suit, the plaintiff had a worldwide reputation and also used to sell their machines in the US embassy in India and also advertised in a number of international magazines having circulation in India.

STATUTORY PROTECTION OF WELL-KNOWN MARKS

Trademark Act, 1999

The Trademark Act, 1999 (hereinafter referred to as the Act) renders an exclusive definition of well-known trademarks. The Act under Section 2(zg) of the Act provides that a well-known trademark in relation to any goods or services, means a mark which has become so to the substantial segment of the public which uses such goods or receives such services that the use of such mark in relation to other goods or services would be likely to be taken as indicating a connection in the course of trade or rendering of services between those goods or services and a person using the mark in relation to the first mentioned goods or services.

Factors to be considered while determining whether a trademark is well-known or not?

Sections 11(6) and Section 11(7) of the Act- In view of the exigency to protect well-known trademarks against misuse and increased instances of counterfeiting, the WIPO (World Intellectual Property Office) in the year 1999 adopted a Joint Resolution Concerning Provisions on the Protection of Well-Known Marks which penned down factors to be considered while determining whether a trademark is well known or not and India being a member of WTO (World Trade Organization) has incorporated those factors under Section 11(6) of the Act for determination of well-known trademark.

  1. Knowledge about the mark in relevant section of public- What constitutes relevant section of publichas been enumerated under Section 11(7) of the Act and provides that the Registrar while determining whether a mark is well-known in a relevant section of public shall take into account the actual number of consumers, the number of people involved in the channel of distribution of goods or services and the business circles dealing with the goods or services.

It comes from “the nature of the things” that a trade mark is always turned to the public (in the meaning of all the persons – natural and legal – to whom the trade mark is addressed): it is trying to catch its attention, to startle it, to leave a mark in each and every targeted consumer’s mind so that the latter could associate a certain need of his of a good or service with the sign of which the mark is comprised[3].The relevant general public in the case of a well- known trademark would mean consumers, manufacturing and business circles and persons involved in the sale of the goods or service carrying such a trademark[4]. Knowledge obtained about the mark not only through actual use but also by means of promotion is valid to determine whether a mark is well-known or not. WIPO’s Joint Recommendation on Well-known marks provides that the degree of knowledge or recognition of a mark can be determined through consumer surveys and opinion polls as well. The point under consideration recognizes such methods without setting any standards of methods to be used or quantitative results to be obtained[5]. Hence, whether a mark is well-known or not in the relevant section of public has to be deciphered in view of facts and circumstances of each case. Qualification of a mark as a well-known mark is decidedly a question of evidence[6].

In the case of Bloomberg Finance LP v. Prafulla Saklecha & Ors.[7]the Delhi High Court observed that Section 2(zg) of the Act defines a ‘well known trade mark’ in relation to any goods or services to mean ‘a mark which has become so to the substantial segment of the public which uses such goods or receives such services that the use of such mark in relation to other goods or service would be likely to be taken as indicating a connection in the course of trade or rendering of services between those goods or services and a person using the mark in relation to the first-mentioned goods or services’.

In the case of Rolex SA v. Alex Jewellery Pvt. Ltd.[8]the Delhi High Court while determining the relevant section of public in the case took into account the advertising done in the media in India since 1947 and particularly in the years immediately preceding the suit. The Court also took note of registrations obtained to hold that relevant section of the public in India had knowledge of the trademark ROLEX in relation to the watches.

In the Rolex case, the Court further opined that over the years and very quickly in recent times, the international boundaries are disappearing. With the advent of the internet in the last over ten years it cannot now be said that a trademark which is very well known elsewhere would not be well known here. The test of a well known trademark in Section 2(zg) is qua the segment of the public which uses such goods.

Where trademark is determined to be well-known in at least one relevant section of public in India by any Court in India or Register, the same shall be considered as well-known mark[9].

2. Duration of use, extent and geographical area 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.

In the case of Sarda Plywood Industries Ltd. v. Deputy Registrar of Trademarks[10]the IPAB (Intellectual Property Appellate Board) was of the view that use of the trademark for one year prior to application is not sufficient to acquire distinctiveness under Section 9 and to qualify for registration under Section 9, the mark should have acquired distinctiveness by long user.

However, in a recent verdict, the Delhi High Court in the case of ITC Ltd. v. Britannia Industries[11] 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.[12]

WIPO’s Joint recommendation in this context provides that the duration, extent and geographical area of any use of the mark are highly relevant indicators as to the determination whether or not a mark is well known by the relevant sector of the public.

It further states that actual use of a mark in the State in which it is to be protected as a well-known mark cannot be required. However, use of the mark in neighboring territories, in territories in which the same language or languages are spoken, in territories which are covered by the same media (television or printed press) or in territories which have close trade relations may be relevant for establishing the knowledge of that mark in a given State.

3. Duration, Extent and geographical area of promotion of mark- Apart from determining the extent and geographical use of the mark, the Registrar also considers the extent of promotion of the mark. In the case of R. Dongre amd Anr. v. Whirlpool Corporation and Anr.[13]the Supreme Court while determining transborder reputation of the trademark “Whirlpool’ which at that time had no actual use in India held that even advertisement of trademark without existence of goods in the market is also to be considered as use of the mark. Similarly, in the Rolex case the Delhi High Court while determining distinctiveness of the mark took into account the advertisements of the mark in India.

4. Duration and geographical extent of registration of the mark and record of successful enforcement of the mark in other Jurisdictions- Under this Clause, the Registrar while determining whether a trademark is well-known or not will consider registration of the mark in other Jurisdictions, for instance in the USPTO, EUIPO, CIPO etc.

In the case of Honeywell International v. Pravin Thorat & Ors.[14], the Court stated that the mark was protected even under the common law rights due to its long, extensive and continuous use across the world. While determining whether the trademark ‘Honeywell’ was well-known or not, the Court considered the fact that the mark had been declared as a well-known trademark in three domain name arbitration cases.

Transborder reputation of a trademark garnered by way of trademark registration in other jurisdictions, use and promotion in other jurisdictions and successful enforcement of the mark in other jurisdictions plays a crucial role in determining secondary significance of a trademark.

TRANSBORDER REPUTATION OF A TRADEMARK

The Act under Section 11(9) recognizes the concept of transborder or spill over reputation of a trademark. It provides that for determining whether a mark is well-known or not, it is not necessary that the trademark must have been used in India[15] and that the mark is well-known to the public at large in India[16].

However, as mentioned earlier, even prior to incorporation of Section 11(9) in the Act of 1999, the Supreme Court in  N.R. Dongre v. Whirlpool Corporation[17] recognised the concept of cross-border reputation when it upheld the decision of the Division Bench Delhi High Court which granted a temporary injunction in favour of a plaintiff based abroad. At the time of the suit, the plaintiff had a worldwide reputation and used to sell their machines only in the US embassy in India and also advertised in a number of international magazines having circulation in India.

Similarly, in the case of Apple Computer Inc. v. Apple Leasing & Industries[18], the Division Bench of Delhi High Court held that it was not necessary to insist that a particular plaintiff must carry on business in a jurisdiction before improper use of its name or mark can be restrained by the Court.

PROTECTION OF WELL-KNOWN MARK ACROSS ALL CLASSES

Section 11(2) of the Trademark Act extends protection to well-known marks across all classes. It implies that if AMUL is a well-known mark in respect of dairy-based products, the said mark cannot be used or registered even in respect of electronic itemsRelevant extract of Section 11(2) is reproduced below:

A trade mark which-

(a) is identical with or similar to an earlier trademark; and

(b) is to be registered for goods or services which are not similar to those for which the earlier trademark is registered in the name of a different proprietor,

shall not be registered if or to the extent, the earlier trademark is a well-known mark in India and use of the later mark without due cause would take unfair advantage of or be detrimental to the distinctive character or repute of the earlier trademark.

Extending Protection to well-known marks across all classes- The legal proposition of extending protection to well-known marks across all classes has also been recognized by the Judiciary in plethora of judgments. For instance, in the case of Kirloskar Diesel Recon Pvt. Ltd. vs Kirloskar Proprietary Ltd.[19], the Court while extending protection to the mark ‘Kirloskar’ stated that in case of trading name which has become almost a household word and under which trading name a variety of activities are undertaken, a passing off can successfully lie if the defendant has adopted identical or similar trading name and even when the defendant does not carry on similar activity. Even if the defendant’s activities in such circumstances, are remote, the same are likely to be presumed a possible extension of plaintiff’s business or activities. In the instant case, the Respondents have established that word ‘Kirloskar’ has become a household word and their businesses cover variety of activities and that there is even a common connection with some activities of the Respondents and activities of the Appellants.

Similarly, in the Benz case, the Court while recognizing the worldwide reputation of the mark ‘Benz’ in respect of cars restrained the Defendants from using the mark Benz for their undergarments.

FILING OF TRADEMARK AS A WELL-KNOWN TRADEMARK

On March 6th, DIPP (Department of Industrial Policy and Promotion) notified the circular issuing newly formulated Trademark Rules, 2017. The Rules incorporated several newly added provisions inter alia including the Rule that a trademark now can be filed as a well-known trademark i.e. the applicant at the time of making application request for determination of a mark as a well-known mark accompanied by a statement of case alongwith evidence and documents and prescribed fee of Rs. 1, 00,000[20].

Guidelines for filing a mark as well-known– Pursuant to the aforesaid, the Indian Trademark Registry also published guidelines to be followed while filing an application for a well-known mark in India. The guidelines mention that such an application shall be filed only through comprehensive e-filing system of trademarks. As per the guidelines, the applicant shall file a statement of case and evidence claiming that the mark is a well-known trademark. While filing a well-known trademark an applicant shall provide as under:

  • Statement of case and evidence stating that the trademark is well-known mark;
  • Details of successful enforcement of rights (if any);
  • Copy of any judgment of any Court in India, where the trademark has been held to be well-known;

The guidelines can be accessed here.

WELL-KNOWN TRADEMARKS AND DOCTRINE OF DILUTION

The Act does not render an exclusive definition of the concept of Trademark Dilution, however its essence can be found in Section 29(4)(c) of the Act, which provides that a registered trademark is infringed by a person who not being a registered proprietor or person using by way of permitted use, uses in the course of trade, a registered mark which has a reputation in India and the use of the mark without due cause takes unfair advantage of or is detrimental to, the distinctive character or repute of the registered trademark.

The Doctrine of Dilution was analyzed by the Delhi High Court in the case of Tata Sons Ltd. vs Manoj Dodia & Ors.[21]. In the case the Court stated that the Doctrine of Dilution which has recently gained momentous, particularly in respect of well-known trademarks emphasizes that use of a well-known mark even in respect of goods or services, which are not similar to those provided by the trademark owner, though it may not cause confusion amongst the consumer as to the source of goods or services, may cause damage to the reputation which the well-known trademark enjoys by reducing or diluting the trademark’s power to indicate the source of goods or services.

When does Trademark Dilution Occur?

Dilution of a well-known mark occurs when a well-known trademark loses its ability to be uniquely and distinctively identified and consequent change in perception which reduces the market value or selling power of the product bearing the well-known mark.

Dilution may also occur when the well-known trademark is used in respect of goods or services of inferior quality. If a brand which is well known for the quality of the products sold or services rendered under that name or a mark similar to that mark is used in respect of the products which are not of the quality which the consumer expects in respect of the products sold or services provided using that mark, that may evoke uncharitable thoughts in the mind of the consumer about the trademark owner’s product and he can no more be confident that the product being sold or the service being rendered under that well-known brand will prove to be of expected standard or quality[22].

In the case of Kamal Trading Co. vs. Gillette UK Limited[23], injunction was sought against the Defendants who were using the mark 7’O Clock on their toothbrushes. The Bombay High Court held that the plaintiff had acquired an extensive reputation in all over the world including India by using the mark 7’O Clock on razors, shaving creams and the use of an identical mark by the defendant would lead to the customer being deceived.  

Remedies available to an owner of well-known mark against Dilution·

  • Seek cancellation of infringing mark;
  • Prevent registration of a trademark which is same or similar to the well-known mark irrespective of whether the impugned mark is in relation to identical or similar goods or services or in relation to other categories of goods or services;
  • Prevent others from incorporating the well-known trademark as a part of their corporate name/business name.
  • Even if a well-known trademark is not registered in India, its owner may avail these rights in respect of the trademark registered or used or sought to be registered or used in India, provided that the well-known mark is otherwise known to or recognized by the relevant section of public in India through transborder or spillover reputation.

PUNITIVE DAMAGES ON INFRINGEMENT OF WELL-KNOWN MARKS

The Judiciary has in several cases has propounded that awarding punitive damages to the owner of well-known mark would deter trademark infringers from causing dilution of well-known trademarks. For instance, in the Tata case, the Court awarded punitive damages of Rs.2 lacs to the Plaintiff and observed that most of the products sold by these companies are branded products, the marks on them having transborder reputation and enjoying tremendous brand equity. It is, therefore, becoming increasingly necessary to curb such trade mark piracies lest they drive away the huge foreign investment our country is attracting. The Court should not give premium to dishonesty and unfair practices by those who have no compunctions in blatantly using the trademark of others for making unearned profits. Our country is now almost in the league of advanced countries. More and more foreign companies are entering our markets, with latest products. They would be discouraged to enter our country to introduce newer products and make substantial investments here, if the Courts do not grant adequate protection to their intellectual property rights such as patents, trademarks and copyright. 

Similarly, in the case of Kabushiki Kaisha Toshiba Trading v. Mr. S.K.Sil & Anr.[24], the Delhi High Court while awarding punitive damages of Rs. 5 lacs to the Plaintiff stated that that the intention behind awarding punitive damages is to deter those who may be waiting in the wings and may be tempted to imitate the trade mark of others, in case those who are sued before the Courts are not made to pay such damages as would really pinch them. Awarding token damages may, therefore, not serve the desired purpose.

Other cases wherein the Courts have adequately compensated the Plaintiff for infringement of their well-known marks are Time Incorporated vs. Lokesh Srivastava & Anr.[25],wherein the Court awarded the Plaintiff punitive damages of Rs. 5 lakhs in addition to compensatory damages also of Rs. 5 lakhs and stated that Courts in cases of IP infringement shall grant compensatory as well as punitive damages. Similarly, in the case of Microsoft Corporation & Anr. vs Kurapati Venkata Jagdeesh Babu[26]the Delhi High Court awarded the Plaintiff compensatory as well as exemplary damages

VULNERABILITY OF WELL-KNOWN TRADEMARK IN CYBER AGE

The susceptibility of a well-known mark to be infringed has augmented in the internet world leading to diminishing of boundaries and universal access to trademarks and brands. In the Kabushiki Kaisha Toshiba case, the Court took account of the rapidly expanding cyberspace and stated that on account of advancement of technology, fast access to information, manifold increase in international business, international travel and advertising, publicity on internet, television, magazines and periodicals, which now are widely available throughout the world, of goods and services during fairs/exhibitions, more and more persons are coming to know of the trademarks, which are well known in other countries and which on account of the quality of the products being sold under those names and extensive promotional and marketing efforts have come to enjoy transborder reputation. It is, therefore, being increasingly felt that such trademark needs to be protected not only in the countries in which they are registered but also in the countries where they are otherwise widely known in the relevant circles so that the owners of well-known trademarks are encouraged to expand their business activities under those marks to other jurisdictions as well.

In the Rolex case, the Court opined that over the years and very quickly in recent times, the international boundaries are disappearing. With the advent of the internet in the last over ten years it cannot now be said that a trademark which is very well known elsewhere would not be well known here. The test of a well-known trademark in Section 2(zg) is qua the segment of the public which uses such goods

 

[1] AIR 1994 Del 239

[2] (1996) PTC 415 (Del)

[3] The Concept of Relevant Public and its Application in the CTM System; Vassil Tenchev Dundov, University of Sofia “St Kliment Ohridski”

[4] Tata Sons v. Manoj Dodia & Ors. [CS(OS) No. 264/2008]; Ihhr Hospitality Pvt. Ltd. V. Bestech India Pvt. Ltd. [CS(OS) No. 207/2011]

[5] Joint Recommendation Concerning Provisions on the Protection of Well-Known Marks, WIPO Geneva 2000; Notes on Article 2

[6] Societes Des Produits Nestle v. Swaraj Industrial and Domestic Appliances [2013(56) PTC 94 IPAB]

[7]  2013(56) PTC 243

[8]  2014(60)PTC 131

[9] Canon Kabushiki Kaisha v. Assistant Registrar of Trademarks, 2009(39)PTC 530(IPAB)

[10] 2007 (34) PTC 352 IPAB

[11] CS (COMM) 1128/2016

[12] Mrs. Ishi Khosla v. Anil Aggarwal [2007 (34) PTC 370 Del]

[13] Appeal (Civil) 10703 of 1996

[14] 222 (2015) DELHI LAW TIMES 533

[15]  Section 11(9)(i)

[16] Section 11(9)(v)

[17] 1996 PTC (16)

[18] 1992 (1) ALR 93

[19]  AIR 1996 Bom 149

[20] Rule 124 of Trademark Rules, 2017

[21] CS(OS) No. 264/2008

[22] Tata Sons case (ibid)

[23] 1998 IPLR 135

[24] CS(OS) No.1298/2010

[25] 2005 (30) PTC 3 (Del.)

[26] CS(OS) 2163/2010 & I.A. No.14225/2010