The subject matter under scrutiny pertains to a legal dispute involving the maintainability of a suit for infringement of design filed by Plaintiff No.1 and Plaintiff No.2 jointly.

Plaintiff No.1 is the registered proprietor of the design, while Plaintiff No.2 is a wholly owned Indian subsidiary of Plaintiff No.1.

The crux of the matter revolves around the Defendants' application seeking the removal of Plaintiff No.2 from the suit on the grounds that the suit cannot be maintained by Plaintiff as the same is not a registered license of the design.

Contention of the Defendants:
The Defendants assert that a suit for infringement of design cannot be maintained by Plaintiff No.2, who is unregistered Licensee and the wholly owned subsidiary of Plaintiff No.1 in India under Sections 22 and 30 of the Designs Act, 2000 unless the assignment or license is registered with the Design office. They contend that the suit initiated by Plaintiff No.2 is not maintainable, arguing that Plaintiff No.2 should be deleted from the proceedings. The Defendants base their argument on the requirement for registration under the aforementioned sections.

Plaintiffs' Counterarguments:
The Plaintiffs present a counterargument, citing Section 30 of the Designs Act, 2000, which they interpret as conferring discretion upon the party to register the license or assignment. Additionally, they emphasize that Section 30(5) allows the Court to admit a license even if not registered. The Plaintiffs highlight the language used in Section 30(1) and Section 30(2), contending that the use of the term 'may make an application' suggests that registration is not mandatory but optional.

Court's Observations and Analysis:
Upon analyzing the arguments presented by both parties, the Court delves into the nature of Plaintiff No.2's involvement in the suit. The Court observes that Plaintiff No.2 has been included in the proceedings not as the registered owner of the design but as a wholly owned subsidiary of Plaintiff No.1. Plaintiff No.2's role is to establish critical factors such as sales, promotional expenses, and the extent of business conducted in India concerning the products in question. The Court deems Plaintiff No.2's participation as relevant and integral to the adjudication of issues pertaining to damages and the rendering of accounts.

Rationale for Maintainability:
The Court concludes that the suit for infringement of design by an unregistered licensee, specifically Plaintiff No.2, is indeed maintainable. The Court takes into account the discretionary nature of registration under Section 30, which affords parties the choice to register or not. Furthermore, the Court relies on Section 30(5) to emphasize that unregistered licenses can still be presented in the proceedings.

The Concluding Note:
In light of the aforementioned arguments and analysis, the Hon'ble Court concludes that the suit for infringement of design by an unregistered licensee, specifically Plaintiff No.2, is maintainable.

The Court's decision hinges on the discretionary nature of registration, the ability to introduce unregistered licenses, and the interpretation of relevant sections of the Designs Act, 2000.

This legal determination underscores the significance of Plaintiff No.2's role in establishing crucial evidence related to damages and financial matters in the proceedings.

The Case Law Discussed:
Case Title: Roxtec Ab and anr Versus Sukant Chakravarty and Ors
Date of Judgement/Order:07/08/2023
Case No. CS Comm 1045 of 2016
Neutral Citation: 2023:DHC:5572
Name of Hon'ble Court: Delhi High Court
Name of Hon'ble Judge: Prathiba M Singh, HJ

Disclaimer:
Information and discussion contained herein is being shared in the public Interest. The same should not be treated as substitute for expert advice as it is subject to my subjectivity and may contain human errors in perception, interpretation and presentation of the fact and issue involved herein.

Written By: Advocate Ajay Amitabh Suman, IP Adjutor - Patent and Trademark Attorney
Email: [email protected], Ph no: 9990389539