Mr. Omar Hussain owns a company named Blindt Co. incorporated under Indian Companies Act, which is very well known in India for their cornflakes and flavored cereals. The products go under the name ‘Blindt cornflakes’, ‘Blindt strawberry oatflakes’ etc. They had recently launched “chocolate flavored cornflakes” Consequently, Mr. Hussain’s company was sued by the popular chocolate company Lindt, an 1845 established Swiss Company, for trademark infringement and passing off. The suit seeks injunction to restrain Mr. Hussain’s company from using the name Blindt. They accused that the brand name Blindt was deceptively similar to their name and therefore could create confusion for the public. They also mentioned that their trademark is registered in more than 100 countries of the world including India in the year 2000, and that they have been using it extensively and exclusively. Mr. Hussain has been in this business since 1980 but did not register their mark. His brand of cornflakes is especially well recognized in India. He approached his legal attorney, Ms. Nisha Sethi, for some legal advice on the matter. Here is the conversation between the two.
Mr. Hussain: “Hi Nisha! May I come in?”
Ms. Sethi: “Yes, of course, Mr. Hussain. I was waiting for you. What brings you here?”
Mr. Hussain: “My company has been sued for trademark infringement and passing off by the company Lindt. It’s a huge corporation. I am worried. I need your advice.”
Ms. Sethi: “I see. Please tell me what you need to know.”
Mr. Hussain: “They say their trademark is registered in India and I am unregistered proprietor. Does that make me a weaker party?”
Ms. Sethi: “Absolutely not. Trademark law in India protects both registered and unregistered trademarks. Although registration grants certain useful additional benefits, it is not a pre-requisite for protection of one’s trademark. If a proprietor has used a distinctive mark (whether a name, word, logo, label or even distinctive packaging) in relation to his goods/services in the course of trade, so as to indicate the source of such goods to the buyer, that mark becomes eligible for protection as a trademark irrespective of registration. Non-registration does not make you a weaker party because the law provides substantial rights to the proprietor of an unregistered trademark whether it be for opposing the registration of a similar or identical mark or seeking injunctions against unscrupulous people copying your trademark.”
Mr. Hussain: “They have sued me for trademark infringement and passing off. Which of my activity amounts to infringement and passing off? I don’t understand these terminologies, kindly explain.”
Mr. Sethi: “A trademark is the exclusive property of the respective proprietor. Just as criminal law provides redressal against theft or misappropriation of physical properties, similarly trademark law provides remedies against illegal use of your intellectual property, i.e. your trademark. ‘Infringement’ and ‘passing-off’ are the legal remedies that are available to guard against unauthorised use of a trademark. The proprietor of a registered trademark can invoke both or either of these remedies if someone uses his trademark unauthorizedly. The proprietor of an unregistered trademark, however, can only use the ‘passing-off’ remedy.
When someone unauthorizedly uses a registered trademark, or a trademark which is identical or deceptively similar to such registered trademark, to sell similar or identical goods as those sold under the registered trademark, he is said to ‘infringe’ that registered trademark (in other words, violating the legal right of the proprietor which registration has conferred on him).
However, it may so happen that a person may be selling his goods/services to the public by merely making a fraudulent claim that they are related to or sourced from a reputed brand. He could be doing so either by copying the trademark of that brand or by simply misrepresenting the source of his goods to the buyer. In such cases, a suit for ‘passing-off’ can be instituted by the proprietor of the affected trademark, irrespective of whether it is registered or not. Proprietors of registered trademarks also often use ‘passing-off’ remedy concurrently with ‘infringement’ as a failsafe in case they are unable to prove infringement. In simpler words, passing-off means offering goods for sale under an intentionally false claim as to their source.
Lindt is alleging that your trademark ‘Blindt’ is deceptively similar to theirs and since you are also selling similar kind of goods, they allege you’re guilty of infringing their registered trademark and also passing off your goods as those of Lindt.”
Mr. Hussain: “I understand that they are a reputed company with goodwill. However, my company has a great reputation too. What do the Indian laws and cases say about such circumstances?”
Ms. Sethi: “Don’t worry, Mr. Hussain. Trademark law gives due importance to a brand’s reputation. In determining reputation, the duration & extent of use, promotion and recognition among the public, of the trademark, are seen. I know that your brand of cornflakes is especially well-recognised in India and this will be to our advantage in future litigation. Also, if you desire, we can seek registration as ‘a well-known trademark’ on the basis of Blindt’s long-standing reputation, which gives the proprietor wider protection.”
Mr. Hussain– “Why are they suing me anyway? They sell chocolates, I sell cornflakes. How can I possibly be affecting their business?”
Ms. Sethi: “There are 34 different Classes or categories of goods in which trademark protection can be sought. Each class has multiple related and similar goods within it. In assessing deceptive similarity for the purposes of infringement or passing-off, the nature of goods being sold are compared on the basis of these classes. Although your product is different from Lindt, both are similar as they are part of the same Class 30 and hence Lindt is alleging that there is a likelihood of consumers getting confused and buying your products under the assumption that they are Lindt’s, thereby affecting their sales.”
Mr. Hussain: “Is there any way I can escape liability? How do I defend my trademark?”
Ms. Sethi: “We have multiple strong defences in our favour. Firstly, our law gives preference to the rights of the prior user of a trademark or a similar one, over those of the proprietor of a registered trademark (u/s 34 of the Trademarks Act, 1999). You are trading since 1980 and Lindt got their trademark registered in India only in 2000. Therefore, as a prior user, your rights are protected (assuming that Lindt did not claim a “user date” earlier than 1980 in its application in 2000). Secondly, if Lindt claims they had ‘trans-border reputation’ in India in 1980 (which is difficult owing to the limited means of communication then), they will still have a hard time trying to justify sleeping over their rights for 40 years and will be barred by the ‘doctrine of laches’ which prohibits suits filed after an inordinate delay. Thirdly, if you have a genuine reason as to why you chose the name ‘Blindt’, we can also claim ‘honest concurrent use’ u/s 12 of the Act.”
Mr. Hussain– “If I file an application for registration today, will that help in turning the case in my favour?”
Ms. Sethi: “No, that will have no impact on the present case because as I said earlier, the law protects both registered and unregistered trademarks. If, however, you wish to register anyway, we can do so.”
Mr. Hussain: “It gave me so much relief and confidence having talked to you on this matter. Thank you so much for your time and invaluable advice!”
Mr. Shashi Shekhar Mishra has answered this conversation as a part of the IP dialogue writing competition conducted during IP Expo