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TRADEMARK INFRINGEMENT IN INDIA

Publications, Research paper

Abstract

This research paper illustrates the concept of Trademark Infringement which is a common occurrence identified in modern society. Certain goods and amenities become so well-known as a result of their quality and efficiency that people acknowledge them by their trademark. Trademark infringement is defined as the unauthorized use of a trademark or service mark. This use can be in connection with goods or services and may lead to confusion, deception, or a misunderstanding about the actual company a product or service came from[1]. A trademark owner may initiate civil lawsuit against that party who infringes on its patent trademark.

This concept is not restricted to a specific country or region, when someone or a company breaches the rights of a trademark proprietor in another country, this is referred to as international trademark infringement. Gucci and Forever 21, US at international level and Sun Pharmaceutical Industries Limited vs Cipla Limited, Sony Pictures Network India Pvt. Ltd. V/S The State of Maharashtra & Anr. in India, are certain cases of Trademark Infringement. The following research paper highlights the requirements for trademark infringement to occur and its effect around the world.

Keywords

Trademark Infringement, Misrepresentation, Trademark Dilution, Proprietor, patent, counterfeit

Introduction

“The ideal trademark is one that is pushed to its utmost limits in terms of abstraction and ambiguity yet is still readable. Trademarks are usually metaphors of one kind or another. And are, in a certain sense, thinking made visible.” ~ Saul Bass

The words of author Saul Bass highlights the necessary requirements for a trademark. In layman terms, a trademark is a mark that can be visually displayed and identifies a person’s goods and products against those offered by others. It is a form of intellectual property that can include a term, pattern, symbol, or phrase, etc. A certified or patent trademark is a text, symbol or combination that identifies a business or a commodity and distinguishes it from others in the marketplace.

There have been several situations when someone exploits a trademark of a well-known item or service in order to benefit from the goodwill and reputation of the widely recognized mark. An unlawful use undermines the respected mark by diminishing its originality and repute. In India, trademark infringement is defined as a breach of the exclusive benefits provided to a licensed proprietor under the Trademarks Act, 1999. 

Trademarks Act was implemented by Parliament in the fiftieth year of Republic India to modify and consolidate trademark legislation, to allow registration and promote greater protection of trademarks for products and services, and to prohibit the use of illegitimate marks. If trademark abuse is confirmed, the court can restrict the defendant from utilizing the trademark, and the proprietor may be given financial compensation for the loss suffered by him due to such act of infringement by the defendant. The case of Theos Food Pvt Ltd & Ors v. Theobroma Foods Pvt Ltd, highlights the rights and remedies given to the proprietor of registered trademarks under the Trademarks Act by the Delhi High Court. The plaintiff successfully established the burden of proof that their trademark was used by the defendant in the course of trade.

Passing off, similar to trademark protection, forbids a party from portraying its products and services as those of another. Three basic elements of passing off include:

  1. Misrepresentation
  2. Reputation
  3. Damage to Goodwill

Research Methodology

Government surveys, reports, news, articles and research papers by prominent writers around the world, references to cases in the Supreme Court and High Court as well as International Courts, information about the relevant topics given in Trademarks Act 1999 and other digital resources were used to gather information for this paper. It analyses various judgements given around the globe related to Trademark Infringement and Intellectual property. Proper analysis and comparison have been made with respect to trademark laws in India with trademark laws around the world.

Review of Literature

The following research paper is of both descriptive and analytical nature and the information in this paper has been gathered through various primary as well as secondary sources of information. Primary sources of knowledge such as the statue itself as well as various other legislations which govern trademarks around the world have been utilized to put together this research paper. Secondary sources of information such as News reports and articles of relevant topics and authentic websites like Upcouncel with information related to Intellectual property have also been put to use to provide comprehensive knowledge about Trademark Infringement . The case of Starbucks Corporation v. Sardarbuksh Coffee & Co, which is known to even common masses in India due to the popularity of the Starbucks brand has greatly inspired the research paper to discuss the laws that verify and govern trademarks infringement.

Methods

Trademark Infringement in India

Following independence, the Trade and Merchants Act, 1958 was implemented to oversee trademark law in India, with widely recognised trademarks being protected to the greatest extent possible. The word “well-known trademark” employed in this statute, on the contrary, was not well defined, which created significant ambiguity. A comprehensive review of existing law was deemed necessary in light of developments in commercial and trading activities. Increasing globalization of trade and industry due to LPG reforms introduced by the then Finance Minister Dr. Manmohan Singh, the need to encourage investment flows and technology transfer, and the need for simplification and harmonisation of trademark monitoring systems, the latest bill of Trademarks Act 1999 was passed in the parliament.

In India Trademarks are registered by filing an application and submitting relevant fees to Trademark Registry (TMR). The submitted application is then reviewed by TMR, and the proprietors of the accepted application are then provided with the certification of Trademark registration.

Section 2 of Trademarks Act defines various terms used in relation with trademarks and related activities. It defines “mark” as a device, brand, heading, label, ticket, name, signature, word, letter, numeral, shape of goods, packaging or combination of colours or any combination thereof.[2]

According to Section 29 of the Act, a registered trademark is infringed when an unlicensed proprietor uses the aforementioned mark for business and commercial motives[3]. Section 29(4) also emphasises that the word ‘dilution’ provides the base for trademark infringement. While assessing whether a trademark has been infringed or not, the following factors are considered:

  1. If the disputed trademark is identical to or deceptively similar to the patented mark and is related with identical or comparable products or services provided by the trademark’s owner.
  2. Moreover, if the mark is similar and relatively equivalent that it might generate confusion in the eyes of the general masses owing to the affiliation of the mark with the registered trademark.
  3. If a mark is marketed and as a consequence, it takes unfair advantage, is contrary to honest practises, or is detrimental to the unique character and prestige of the registered trademark. This is taking undue advantage of the circumstance and is regarded as infringement.
  4. If the trade name is identical to a registered trademark, it may be considered infringement.
  5. A person infringes a registered trademark if he utilizes the mark as his trade name or component of his trade name, or the name of his business concerned or part of the name, of his business concerned dealing in products or services for which the trademark is registered.
  6. A mark that seems to be similar to one that has a great reputation in India. In such circumstances, trademark infringement might occur even if the mark is utilised for products and services that are unaffiliated to the original.
  7. Where the distinctive elements of a registered trademark consist of or integrate words, both the verbal and visual representation of those words may violate the trademark, and references to using a trademark in this section should be construed as such..

The purpose of this clause is to safeguard the dignity and goodwill of trademarks. According to Section 29(4)(C), “use of the mark without due cause” unfairly benefits from or harms the registered trademark’s distinctiveness or prestige. Under Section 30 of Trademarks Act, the Parliament of India also highlighted what does not constitute as trademark infringement, to prevent the misuse of Section 29 of the said Act to obtain illicit financial compensation.

  1. When the allegedly infringing mark is utilized to specify the nature, grade, or volume of the given products and services. For instance, in the case of Rich Products Corporation And vs Indo Nippon Food Ltd[4], the owner of BELLS WHIP TOPPING filed a lawsuit for infringement against the owner of RICH’S WHIP TOPPIN. However, the court rejected the complainant’s argument, concluding that the “whip topping” was only a description of the company’s line of products and the services it provided, therefore it was not an act of infringement.
  2. When someone uses the mark in association with products and services for which the registered user had submitted a trademark application, may not have taken it down, or has at any point given their express or implicit authorization to the use of the mark.
  3. When two registered trademarks are substantially similar to one another, such utilization of a registered trademark and exercising the right to use that registered mark does not constitute trademark infringement.
  4. Utilization of a registered trademark in association with accessories and components. If a registered trademark is used in connection with components and accessories to other products or services, this usage is practically required, and its result may not be viewed as the original user’s deception due to its effect.
  5. Whenever a mark is utilised outside the parameters of a registration. For e.g., the name “ABC Mall Road” may be registered with the restriction that the registered owner could not have the sole right to the term’s “mall” and “road.” The utilization of the latter phrases by any person won’t be considered as infringement.

When a trademark is allegedly infringed, both civil and criminal legal proceedings can be initiated.   The Trademark Act of 1999 identifies trademark infringement as a cognizable offence, implying that the violators may be immediately prosecuted after filing a police report. The courts also have the legal right to undertake raids and seizures independently. On the contrary, similar violations may also be the subject of a civil lawsuit. Based upon whether the trademark is licensed, pending, or unlicensed, a lawsuit may be filed. There is no time constraint for pursuing a lawsuit because trademark infringement is a continuing offence.

If the violations are effectively proven, the court with the applicable jurisdiction may grant remedies such as prohibition or restriction against the use of a trademark; Damages that are reasonable; the transfer of assets and profits; appointment of a local commissioner by the relevant court to take control of or freeze accounts and materials that violate the law. In order to safeguard the person’s proprietary interest, the court may even go so far as to issue injunctions and order the customs authorities to stop the shipment or disposal of the infringing goods. Falsification-related trademark infringement is punishable by a minimum jail sentence of six months, a maximum of three years, and a minimum fine of 50,000 rupees, with a maximum fine of two lakh rupees.

Theos Food Pvt Ltd & Ors v. Theobroma Foods Pvt Ltd

The Delhi High Court ruled in Theos Food Pvt Ltd & Ors v. Theobroma Foods Pvt Ltd case that Theos, Delhi-NCR based confectioneries brand, was entitled to register its own mark, “THEOS”/”THEO’S,” as a mark or in any logo form thereof and make use of it only in respect of its products and services in the Delhi-NCR region. Theo’s must use a mark or name that is not identical nor confusingly similar to “THEOBROMA” if it wants to expand its business operations, either physically or online, outside of the Delhi-NCR region. The protections and remedies granted to the owner of a patented trademark under the Trademarks Act are highlighted in the following lawsuit.[5]

Starbucks Corporation v. Sardarbuksh Coffee & Co

In this particular case, the significance and essential characteristics of a trademark were proclaimed that it serves as a distinctive indicator and differentiator among both the client and the corporation in question. In India, Starbucks trademarked the term “STARBUCKS” and the associated symbol in 2001. The defendants launched Sardarbuksh Coffee & Co. as the designation of their enterprise in 2015. The symbol of Sardarbuksh included a profile of a turban-wearing leader with wavy lines on either side encompassed by a black circle. The Plaintiff demanded that the Defendants alter their symbol in 2017 through a letter of demand. Merely switching to a black and yellow colour combination in response, the defendant continued their business as usual.

It was found that similar goods and amenities are provided by the Defendant and Plaintiff. Due to the above incidents, the plaintiff brought a lawsuit against Sardarbuksh before the Hon’ble High Court of Delhi. The defendants were accused of violating the plaintiffs’ trademark by employing a mark that was misleadingly identical. The High Court of Delhi reached a verdict by referencing the Sewing Thread Co. Ltd vs James Chadwick & Bros Ltd case, that an individual of normal intellect would be misled, and so it is deceptively identical and provided a judgement in favour of the plaintiff.[6]

Trademark Infringement around the world

The law controlling trademarks in the US is mainly the Lanham Act. Common law trademark rights are immediately established and are enforced in state courts whenever a business utilises a logo or term in commercial activity. The Lanham Act offers limited federal protection to both licenced and unauthorised trademarks, although registered trademarks enjoy substantially stronger legal protection in federal courts than unlicensed marks. To determine if a trademark has been violated, the “likelihood of confusion” test is applied. A new trademark will violate an already-existing mark if it is too closely related to the initial, making the customers confused between the two marks and making them undertake incorrect transactions.

The intellectual property can only be protected in the nation in which registration took place. When a person holds a patent or trademark, it only grants them territorial rights. This implies that one’s intellectual property won’t be protected abroad by Indian trademarks and patents. One has to get in touch with the intellectual property departments in each nation to acquire more information about the safeguards they provide and how to file an application. On the webpage of the World Intellectual Property Office, one may find the contact details for IP offices all over the world.

The Patent Cooperation Treaty (PCT) makes it simple to register for patents across numerous nations. One can acquire patent protection across as many as 143 nations by submitting a single application to the United States Patent and Trademark Offices (USPTO). The USPTO website also provides relevant details about obtaining international trademark protections under the Madrid Protocol. Relations have been established between the US and other nations specifically to safeguard intellectual property rights. Because of these connections, each nation acknowledges the Intellectual properties of other country’s residents. If a business organisation believes that a trademark—which might be a slogan, term, or icon, can boost the value of its brand in another nation, then they should ponder about licensing their mark to safeguard its rights and minimize the likelihood of international trademark infringement. Businesses need to have worldwide brand control so that their unique intellectual property isn’t utilised without their authorization.[7]

Nike Vs Lulemon

Lululemon Athletica, a Canadian multinational athletic apparel company, introduced its first-ever catalogue in the sportswear market for women, with four new styles. On January 30, 2023, Nike filed a complaint against Lululemon Athletica in the Federal Court of Manhattan, alleging that Nike had incurred financial loses and significant harm as a result of Lululemon’s selling of the Chargefeel Mid, Chargefeel Low, Blissfeel, and Strongfeel line of sneakers. They assert that Lululemon has “infringed and continues to infringe ” three Nike Flyknit technology utility patents. In addition to a permanent injunction prohibiting subsequent infringement, Nike is asking for a settlement for damages, plus interest and costs as decided by the court. The Legal team of Lululemon Athletica responded that the allegations made by Nike are baseless and vile in nature and that would protect the reputation of their company in the court.[8]

Gucci Vs Guess

Gucci filed a $124 million lawsuit against Guess for trademark infringement involving the use of its stylized character “G” in 2009. The case’s hearings commenced in front of the US district court in Manhattan. The brand “Gucci” first appeared in 1953 and has been a licensed trademark since 1969. Gucci is among the most well-known and premium companies in the world. It has been involved with the fashion sector for more than 40 years. The plaintiff in this lawsuit is not required to demonstrate the trademark’s reputation, and any dilution of the Gucci brand would negatively impact the worth of the company’s image. Given how well-known Gucci is, it is reasonable to think that individuals might get perplexed by the “G” in the emblem.

The claim that Guess has despicably replicated the shoe style from Gucci is the most significant argument and accusation in this case, and as a result. It can be assumed that Guess produced or imitated the Gucci emblem and style with the goal of confusing customers, raising the likelihood of consumer confusion and dilution of the Gucci trademark. Nonetheless, the Chairman of Guess Inc. claims that Gucci’s delay in filing a lawsuit is unreasonable. Gucci cannot be accused of infringement, according to the legal representative for Guess, because the fashion business “sat on their entitlements” for at least seven years before deciding to file a complaint. Now Gucci and Guess have officially resolved all legal disputes over designs and company logos that lasted years around various courts around the globe.[9]

Suggestions

Countries should make such trademark laws that protect not only the rights and prestige of big corporations and MNCs from misrepresentation by smaller and new business companies but shall also protect the new innovative ideas and trademarks of newly established business units or companies from big corporative business organisations. Trademark Laws should be made in such a manner that it restricts brands from counterfeiting other brand’s trademark goods throughout the world. With providing subsidies, India shall also protect the trademarked and patent goods of new established companies which have come up under Make in India Programme from counterfeiting, forgery, or misuse of their trademark goods by any big corporation around the world. Madrid protocol should be utilized to make fair and just trademark laws to protect the patented goods of people around the world.

Conclusion

Trademark Infringement is applied to cases where a registered trademark is put to use by a person without prior permission of the proprietor whereas passing off is applied misuse of unregistered trademarks, to safeguard and defend them. Presently, duplication is quite prevalent, especially when a less expensive commodity or a small business mimics a premium brand. It may be concluded that Trademark Laws around the world have to be upgraded often to catch up with the ever-changing and emerging new ways of Trademark Infringement. In order to handle issues involving intellectual property effectively, law enforcement agencies must both be well-equipped and prepared.

By- Zainul Abideen Khan     

2yr BALLB

ILS Law College, Pune

[1] WINSTON & STRAWN LLP, https://www.winston.com/en/legal-glossary/trademark-infringement.html#:~:text=Trademark%20infringement%20is%20defined%20as,product%20or%20service%20came%20from. (last visited 8 April 2023)

[2] Trademarks Act, 1999, § 2, Acts of Parliament, 1999 (India)

[3] Trademarks Act 1999, § 29, Acts of Parliament, 1999 (India)

[4] Rich Products Corporation and Anr Vs Indo Nippon Foods Ltd. 2007 SCC OnLine Del 2022: (2007) 35 PTC 15

[5] Theos Food Pvt. Ltd. and Ors V THEOBROMA Foods  Pvt. Ltd. 2022 SCC OnLine Del 2309

[6] Starbucks Corporation v. Sardarbuksh Coffee & Co: CS (COMM) 1007/2018

[7] UPCOUNCEL https://www.upcounsel.com/international-trademark-infringement#:~:text=and%20Trademark%20Infringement-,International%20trademark%20infringement%20occurs%20when%20someone%20violates%20the%20rights%20of,for%20the%20Samsung%20S%204G. (last visited 9 April, 2023)

[8] ILS Tech IP Media Laws Blog https://ilstimeblog.wixsite.com/techip/post/nike-vs-lululemon-the-utility-patent-infringement-suit (last visited 9 April 2023)

[9] Patent-und Rechtsanwaltskanzlie https://legal-patent.com/trademark-law/gucci-and-guess-stop-all-trademark-ligitations/

(last visited 9 April 2023)