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Defendant's Business Outside The Territorial Limit Of Court In A Trademark Dispute

Jurisdictional challenges often constitute a critical aspect of legal proceedings, particularly in intellectual property (IP) litigation where disputes may span multiple territories. This article delves into a recent case where Defendant No. 1 contested an interim injunction application, raising jurisdictional objections in the context of alleged infringement of IP rights.

Defendant's Argument:
Defendant No. 1's defense primarily hinges on two key contentions. Firstly, they argue that their operations are confined to the territories of Daman and Diu, thereby absolving them of any liability pertaining to alleged infringements in Delhi. They underscore the geographical disparity between Daman and Diu and Delhi, asserting that consumers can readily distinguish between products, thereby minimizing the likelihood of confusion or harm to the plaintiff's business interests.

Jurisdictional Objection:
Central to Defendant No. 1's defense is their jurisdictional objection, asserting that the Delhi courts lack territorial jurisdiction over the matter at hand. They contend that since they have not conducted any sales or maintained a presence in Delhi, the cause of action, premised on alleged sale of counterfeit products within Delhi, lacks a substantive nexus to Defendant No. 1.

Lack of Evidence:
Defendant further contends that the plaintiff's cause of action is deficient in evidentiary support. They assert that the allegations put forth by the plaintiff are unsubstantiated, emphasizing the absence of registered offices for either party in Delhi. Defendant argues that the mere presence of a subordinate office in Delhi does not confer jurisdiction for instituting the suit in Delhi.

Court's Response:
In adjudicating Defendant No. 1's jurisdictional objection, the court invoked legal principles enshrined under Order VII Rule 10 of the Civil Procedure Code (CPC). The court elucidated that its purview at this juncture is confined to determining the admissibility of the plaint, rather than delving into the substantive merits of the plaintiff's claims. Accordingly, the court presumed the averments in the plaint to be true and accurate for the purpose of deciding the jurisdictional challenge.

Plaintiff's Cause of Action:
The court took cognizance of the plaintiff's assertions regarding the sale of counterfeit products within Delhi by certain peddlers. The plaintiff attributed these illicit transactions to Defendant No. 1's products, purportedly distributed through unauthorized channels across various states, posing a significant threat to public health and consumer interests.

After careful consideration of the plaintiff's pleading and the applicable legal principles, the court concluded that a valid cause of action within its territorial jurisdiction existed for entertaining the suit in Delhi. Consequently, the court rebuffed Defendant No. 1's jurisdictional objection and permitted the suit to proceed in Delhi.

Conclusion and Implications:
This case underscores the nuanced complexities inherent in jurisdictional disputes within IP litigation. While defendants may raise objections based on territorial limitations and evidentiary deficiencies, courts prioritize procedural fairness and adherence to legal standards. Ultimately, the determination of jurisdiction hinges on a holistic assessment of the pleadings, legal principles, and the factual matrix surrounding the alleged infringement.

The Case Discussed:
Case Title: Great Galleon Ventures Limited Vs Champa Prema Tandel
Judgment/Order Date: 01.05.2024
Case No: LPA 257/2024
Neutral Citation:NA
Name of Court: Delhi High Court
Name of Hon'ble Judge: Sanjeev Narula, H.J.

This article is meant for informational purposes only and should not be construed as substitute for legal advice as Ideas, thoughts, views, information, discussions and interpretation perceived and expressed herein are are subject to my subjectivity and may contain human errors in perception, interpretation and presentation of the fact and issue of law involved herein.

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

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