Trademark Infringement and Passing Off

Trademark is the identification mark of any company or organization. A customer relates any trademark with the quality of products and reputation of the company that is using it. It is a distinctive name, word, phrase, symbol, logo, design, image, or a combination of these elements that identifies a product, service or firm that has been legally registered as the property of the firm. Trademarks grant the owner the right to prevent competitors from using similar marks in selling or advertising.

There are few important functions of trademark:

A trademark can be used for identifying and distinguishing a particular seller’s goods from others. Trademark also shows the origin of the goods i.e. a customer can identify the manufacturer and also assume about the quality of goods that all goods bearing the particular trademark are of a particular quality desired by the customers. Trademarks are widely used for the advertisement purposes also which helps to customers in associating any good with the quality, reputation and goodwill of any company. So it is very important for any organization to take precautions while allowing any one to use its trademark because the name and reputation of the company is directly associated with the trademark.

There has been various new concepts have emerged in relation to trademark due to the technological revolution in the communication, media and other areas and due to the increased knowledge and perception of individuals, business enterprises are showing more interest in registering non conventional marks such as colour marks, shape marks, smell marks, sound marks, advertisement slogans, trade dress etc. to capture the market.

How it can cause damage to a Company:

If any organization is using the registered trademark of another company without permission, that means it is not only committing a crime but also causing damage to the business of the company and damaging the brand name of that company. The organization might be using others trademark to use its market reputation and market stake to enhance its own business without extra efforts. But such companies are not using the exact trademark of other company but they generally go for use of similar marks and here the problem came in to existence. These kind of activities mainly fall under two heads Infringement and Passing Off.

Infringement:

Section 29 of the Trademark Act-1999 talks about various aspects related to infringement as given in S.29(1) that a registered trade mark is infringed by a person who, not being a registered proprietor or a person using by way of permitted use, uses in the course of trade, a mark which is identical with, or deceptively similar to, the trade mark in relation to goods or services in respect of which the trade mark is registered and in such manner as to render the use of the mark likely to be taken as being used as a trade mark.

Other subsections describes that in course of the use of the trademark it is said to be infringing the rights of other company due to use of similar or identical trademark using for marketing of similar kind of goods and services or use of identical or deceptively similar trademark for any other kind of goods and services. It is further given in the Sub Section (9) of this section that the infringement can also be done by the spoken use of those words as well as by their visual representation.

Passing Off:

The specific description of passing off is not given in the trademark act but the courts have drawn its meaning from common law that if the infringement of trademark done in such a manner where the mark is not only deceptively similar to the trademark of other company but also creating confusion for the customers, which ultimately results in damage for business of the company.

Differences between Passing Off and Infringement:

They are slightly different to each other:
· Statutory remedy is available for infringement whereas the action for passing off is a common law remedy.

· For infringement it is necessary only to establish that the infringing mark is identical or deceptively similar to the registered mark but in the case of a passing off action, the need is to prove that the marks are identical or deceptively similar which is likely to deceive or cause confusion and damage to the business of the company.

· When a trademark is registered, registration is given only with regard to a particular category of goods and hence protection can be given only to these goods and action of infringement would be taken but in a passing off action, the defendant’s goods need not be the same, they may be related or even different.

Judicial Response:

Courts have given several judgements in these kinds of disputes where the infringement and passing off of trademark were in question. Few of them I am discussing in this paper where courts have dealt with these questions and formulated several concepts related to them.

Cases of Infringement;

No one can use the trademark which is deceptively similar to the trademark of other company. As in the case of Glaxo Smith Kline Pharmaceuticals Ltd. v. Unitech Pharmaceuticals Pvt. Ltd. [1] the plaintiff claimed that defendants are selling products under the trademark FEXIM that is deceptively similar to the plaintiff’s mark PHEXIN, which is used for pharmaceutical preparations. The defendants are selling anti-biotic tablets with the trademark `FEXIM' with the packing material deceptively similarly to that of the plaintiff, whereby intending to not only to infringe the trademark but also to pass off the goods as that of the plaintiff as the two marks are also phonetically similar. The Court restrained the defendant from using the trademark `FEXIM' or any trademark deceptively similar to the trademark of the plaintiff `PHEXIN', any label/packaging material deceptively similar and containing the same pattern as that of the plaintiff.

If a party using the deceptively similar name only for a single shop and not spreading its business by use of that particular name then also that party could be stopped from using the tradename of other company. This is given in M/s Bikanervala v. M/s Aggarwal Bikanerwala[2] where the respondent was running a sweet shop in with the name of AGGARWAL BIKANERVALA and the plaintiff was using the name BIKANERVALA from 1981 and also got registered it in the year 1992. hence they applied for permanent injunction over the use of the name AGGARWAL BIKANERWALA for the sweet shop by the defendant. Court held in favour of the plaintiff and stopped defendant from manufacturing, selling, offering for sale, advertising, directly or indirectly dealing in food articles for human consumption under the impugned trade mark/trade name/infringing artistic label 'AGGARWAL BIKANER WALA' or from using any trade mark/trade name/infringing artistic work containing the name/mark 'BIKANER WALA/BIKANERVALA' or any other name/mark/artistic work which is identical or deceptively similar to the plaintiff's trademark 'BIKANERVALA'.

If the trademark is not registered by any party but one party started using it before the other then first one would have the legal authority on that particular mark. As in the case of Dhariwal Industries Ltd. and Anr. v. M.S.S. Food Products [3] where appellants were using the brand name MALIKCHAND for their product and the respondents were using the name MANIKCHAND which is similar to the previous one and both parties have not registered their trademarks. Court held in this matter that even though plaintiff have not registered their trademark they are using it from long time back and hence court granted perpetual injunction against the respondents.

Even if a company is not doing business in country, but it is a well known company or well known goods, then also it would be entitled to get authority over its trademark. As given in case of N.R. Dongare v. Whirlpool Corp. Ltd.[4] where the defendants have failed to renew their trademark ‘WHIRLPOOL’ and in the mean time the plaintiffs have got registration of the same. In this case court said that though there was no sale in India, the reputation of the plaintiff company was travelling trans border to India as well through commercial publicity made in magazines which are available in or brought in India.

The “WHIRLPOOL” has acquired reputation and goodwill in this country and the same has become associated in the minds of the public. Even advertisement of trade mark without existence of goods in the mark is also to be considered as use of the trade mark. The magazines which contain the advertisement do have a circulation in the higher and upper middle income strata of Indian society. Therefore, the plaintiff acquired trans-border reputation in respect of the trade mark “WHIRLPOOL” and has a right to protect the invasion thereof.

Cases of Passing Off

Even if the goods are not same or similar to each other, then also no one can use the registered trademark of a company for any kind of goods which may result in the harm to the business and reputation of the company which is the owner of the trademark.

In Honda Motors Co. Ltd. v. Mr. Charanjit Singh and Ors[5] defendant Company was using the trade name HONDA for ‘Pressure Cookers’ which they are manufacturing in India and even when their application for registration of this trademark had been rejected by the registrar they continued using it and again applied for registration and hence plaintiff has brought this plaint. Plaintiff is the well known company having presence all over the world in the field of Motor Cars, Motorcycles, Generators and other electronic appliances. They are doing business in India in association with the Siddharth Shriram Group with the name Honda Siel Cars India Ltd. Plaintiff has established that his business or goods has acquired the reputation and his trade name has become distinctive of his goods and the purchasing public at large associates the plaintiff's name with them. The use of trademark HONDA by respondents is creating deception or confusion in the minds of the public at large and such confusion is causing damage or injury to the business, reputation, goodwill and fair name of the plaintiff. Hence court has restricted the defendants from using the trademark HONDA in respect of pressure cookers or any goods or any other trade mark/marks, which are identical with and deceptively similar to the trade mark HONDA of the plaintiff and to do anything which amounts to passing off to the goods of the plaintiff.

In the case of Smithkline Beecham v. V.R. Bumtaria[6] the plaintiff applied for permanent injunction to restrain the defendant from infringing the trademark, passing off, damages, delivery etc. of its registered trademark ARIFLO, used in respect of the pharmaceutical preparations. Defendants were using the similar name ACIFLO for their product of the same drug in India. Plaintiffs were not doing business in India for the particular product and argued that since their advertisements are been published in medical journals hence they have a trans-border reputation and defendants should be stopped to use the similar trademark which creating deception in customers.

Court said that mere publication of an advertisement in a journal cannot establish a trans-border reputation. Such reputation if any is confined to a particular class of people, i.e., the person subscribing to the said specialized journals and the same can’t be said to be extended to the general consumers. Thus any adverse effect on the firm in such a case can’t be amounted to the offence of “passing off”.

Though the dispute resulted in compromise where the defendant agreed and accepted the plaintiffs’ exclusive right on the use of mark i.e. ARIFLO in India and abroad and further agreed to not to manufacture pharmaceutical preparations under the mark ACIFLO or any other mark identical or similar to ARIFLO.

Trade Dress:

The literal meaning of Trade Dress is - the overall image of a product used in its marketing or sales that is composed of the nonfunctional elements of its design, packaging, or labeling (as colors, package shape, or symbols). That means there is a specific way of writing any product name, its unique background and other remarkable signs. The concept of trade dress has much importance in a country like India where one third of the population is still illiterate. Trade dress helps the illiterate people who cannot read the trademark on the product as well as the manufacturers to reach the people easily.

Delhi H.C. had dealt with this concept in a detailed manner in the case of Colgate Palmolive Company and Anr. v. Anchor Health and Beauty Care Pvt. Ltd.[7] where the plaintiffs have filed the case for the ‘passing off’ of trademark and the dispute was on the colour scheme and combination of colours in a significant manner. Colgate Company was the plaintiff and questioning the use of a mark on dental product which is the combination of ‘red’ and ‘white’ in proportion of 1/3:2/3 respectively and the way of writing the name of product was also in dispute. Plaintiffs were using the mark of particular fashion from 1951 and the respondents started using it in 1996. Plaintiffs have filed the application to stop the respondents from using the particular mark.

The plaintiffs showed to the court that the look of trade dress of the two articles, one manufactured by the plaintiff and another by the defendant from the point of view of not only unwary, illiterate customer/servants of the household but semi-literate also as the trademarks "Colgate" and "Anchor" are written in English language cannot be distinguished by ordinary customer. There is every likelihood of confusion as to the source on account of the similarity of substantial portion of the container having particular colour combination and also shape of the container. Such an action on the part of infringing party also has an element of unfair competition.

Court said in this matter that may be, no party can have monopoly over a particular colour but if there is substantial reproduction of the colour combination in the similar order either on the container or packing which over a period has been imprinted upon the minds of customers it certainly is liable to cause not only confusion but also dilution of distinctiveness of colour combination. Colour combination, get up, lay out and size of container is sort of trade dress which involves overall image of the product's features. There is a wide protection against imitation or deceptive similarities of trade dress as trade dress is the soul for identification of the goods as to its source and origin and as such is liable to cause confusion in the minds of unwary customers particularly those who have been using the product over a long period.

If a product having distinctive colour combination, style, shape and texture has been in the market for decades it got attached with the reputation and goodwill of the company which could be earned at huge cost.

In the present dispute if an illiterate servant or village folk goes to the shop with the instruction to bring Colgate Tooth Power having a container of particular shop with trade dress of colour combination of Red and White in 1/3 and 2/3 proportion he will not be in position to distinguish if he is handed over "Anchor" Tooth Powder contained in a container having the identical trade dress and colour combination of "Red and White” in that order and proportion. Confusion is much large as to source and origin as the difference in name will not make any difference to such a customer and the goods of the defendant can easily be passed off as goods of the plaintiff.

Court said that significance of trade dress and colour combination is so immense that in some cases even single colour has been taken to be a trademark to be protected from passing off action. Except where the colour cannot be protected as the blue colour is for the Ink and red colour is for the lipstick or similar cases. Court said that it is been established that the defendants are using the trade dress of plaintiffs for their containers and hence Court had allowed the application of plaintiffs and restrained defendants from using the colour combination of red and white in the disputed order on the container/packaging of its goods.

Conclusion:
By this discussion we can draw following inferences:
· Registered trademark is the property of the holding company and it is directly associated with the name, reputation, goodwill and quality of products of a company.
· A company can not use the trademark of another company.
· No one can use even the similar trademark which is creating deception or confusion for the customers.
· No one can use the trademark of a company, which is well known and having a transborder reputation, even if it is not registered in India.
· Mere advertisement in a particular journal does not create transborder reputation.
· Trade dress is also a part of trade mark and no one can use the specific writing style, definite colour combination and identifiable background for packaging and labeling a product.
· Mere a single colour can also be treated as a trade dress for a specific product.

Endnotes
[1] MANU/DE/2840/2005
[2] 117 (2005) DLT 255
[3] AIR 2005 SC 1999
[4] (1996) 5 SCC 714
[5] 2003(26)PTC1(Del)
[6] MANU/DE/2890/2005
[7] 2003(27)PTC478(Del)

Why Descriptive Trademark have no legal Protection in India here is a list of judgments:
1) The Sugar Free Case - Cadila Healthcare Ltd. V. Gujarat Cooperative Milk Marketing Federation Ltd. & Ors
2) Low Absorb Case - Marico Limited V. Agro Tech Foods Limited
3) Rehydrate Case - Stokely Van Camp, Inc. V. Plaintiffs Vs Heinz India Private Limited
4) Micronix Case - Micronix India Vs Mr. J.R. Kapoor

Advertising and Trademark Infringement:
The Government announced a new industrial policy on the 24th July, 1991 which envisaged liberalization. With this liberalization and globalization of the Indian economy, the sphere of trade, industry and commerce has increased to a great extent.

Trade Secrets and Competition Act: A bird’s eye view:
A trade secret has both monopoly value and use value, but only the former will normally be affected by misuse of the secret. On this basis, some courts have held that information cannot be considered property.

Passing off under trademark
The concept of passing off has undergone changes in the course of time. At first it was restricted to the representation of one person's goods as those of another. Later it was extended to business and services. Subsequently it was further extended to professions and non-trading activities.

Infringement of trademark and what constitutes honest practice in relation to trade and business
A trademark is often defined as: a word, name, symbol or device that is used in trade with goods to indicate the source of the goods and to distinguish them from the goods of others. A service mark is the same as a trademark except that it identifies and distinguishes the source of a service rather than a product.

Section 25 of The Trade Marks Act, 1999
The present paper deals with the nature of the sending of notice by the Registrar under section 25 of the Trade Marks Act, 1999 enacted by the Parliament of India. The section 25 i.e. Duration, Renewal, Removal and Restoration of Registration falls in the periphery of the Chapter-III titled Procedure for and Duration of Registration

Registration of Unconventional Trademarks:
A trade mark may be a word signature, name, device, label, numerals or combination of colours used by an undertaking, on goods or services or other articles of commerce to distinguish it from other similar goods or services originating from a different undertaking. Under the Trade Marks Act, 1999, goods and services are classified according to the International Classification of goods and services.

Economic Dimensions in Trademark Law:
The foundations of the Trademarks Act are based on the safeguarding of the economic rights of the owners of the trademark and also to protect the common man to not to fall a prey to those who use deceptive practices in this trade.

Trade Mark Law in India and Its Violation:
A trademark or trade mark is one of the elements of Intellectual Property Right and is represented by the symbol TM or ® or mark is a distinctive sign or indicator of some kind which is used by an individual, business organization or other legal entity to identify uniquely the source of its products and/or services to consumers, and to distinguish its products or services from those of other entities.

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