M/S
S.M. Dyechem Ltd. Vs. M/S Cadbury (India) Ltd. [2000] INSC 303 (9 May 2000)
M.J.Rao,
Y.K.Sabharwal M. JAGANNADHA RAO, J.
Leave
granted. In trade mark cases, the tension is between protectionism on the one
hand and allowing competition on the other. In the late nineteenth century
where law was regarded as a science, the legal formalists laid down principles
and legal rules, treating trade mark as 'property'. In the beginning of this
century, legal realists laid emphasis on pragmatic considerations of economic
policies and "real world results" and the 'likelihood of confusion'.
Of late, the tension between protectionism and competition has increased. ( See
Vol.59 'Law and Contemporary Problems, 1996, No.2 P.5 at p.14) ( A Personal
Note on Trade Mark etc. by Milton Handler). This is a plaintiff's appeal
against the judgment of the Gujarat High Court in A.F.O. No. 203 of 1999 dated
24.8.1999, by which the High Court of Gujarat allowed the appeal preferred by
the respondent-defendant and set aside the temporary injunction which was
initially granted on 25.2.99 and which was confirmed on 23.3.99. The injunction
was sought by the appellant to restrain the respondent from using the word
PICNIC as it allegedly amounted to infringement of the appellants' registered
trade mark for the use of the word PIKNIK. The suit was on the basis of
infringement of trade mark and also on the basis of passing off. The brief
facts of the case are as follows: The appellant company(plaintiff) claimed that
it started business in 1988 in four products like potato, chips, potato wafers,
corn-pops and preparations made of rice and rice flour. In January 1989 it
started using the trade mark PIKNIK. It applied for registration on 17.2.1989
of the said word in class 29 ( for preserved dried and cooked fruit vegetables
etc. including all goods included in class 29) under application No. 505531B.
Plaintiff also applied for registration of same trade mark in class 30 ( for
tea, coffee, corns, jaggery etc. including confectionery chocolates, honey
etc.) under application 505532. A third application under same name was ( for
beverages, beers, mineral and irrigated water) under application No. 505533.
Registration
was granted on 29.7.1994 after advertisement on 1.9.93. The appellant renewed
the trade mark last for 7 years from 17.2.1996. Respondent-defendant was found
using the mark 'PICNIC' for chocolates. Appellant gave notice on 16.3.1998.
Respondent replied on 7.4.98. Thereafter, the appellant filed the suit on
18.2.1999 based on alleged infringement of trade mark 505532 and passing off.
Pending the suit, appellant applied for temporary injunction. (The respondent
filed an application on 19.3.1999 in the Bombay High Court for rectification
and the same is pending). The respondent-defendant contended in this
interlocutory application that 'CADBURY'S PICNIC' was introduced in 1998 for
chocolates. It was registered earlier under No. 329970 in class 30 of 4th
schedule in 1977 for dairy milk chocolates, wafers bar, dairy milk chocolate,
confectionery etc. ( The said trade mark expired after 7 years and was not
renewed). Defendant applied for rectification of the plaintiff's trade mark by
application dated 19.3.99.
Defendant
had also filed a subsequent application for registration of CADBURY PICNIC in
August 1999 ( appln. No.
712676).
It pleaded that CADBURY PICNIC and/or PICNIC and/or label with the said word
was registered by the defendant's parent company in over 110 countries all over
the world and the defendant had transborder reputation and goodwill. The
plaintiff could not claim monopoly in the variations of the ordinary dictionary
word PICNIC or any misspelling thereof. Plaintiff had never intended to do
business in chocolates. Its main business was in dyes and chemicals. Its
business in food products was ancillary and fell under NAMKINS and PAPADS. Even
otherwise, both labels were different in essential features. The registration
by plaintiff was only of a label and could not be and was not of the word
PIKNIK. The said word was a misspelling of an ordinary dictionary word and was
not "distinctive." Registration thereof under section 9 was invalid.
There was also delay in filing the suit on 18.2.1999 and injunction could not
be granted. The trial Court held that the plaintiffs' registration of the word
PIKNIK ( including for chocolates) was and is in force, that the defendant's
earlier registration had expired, that the defendant did not oppose
registration by plaintiff, that there was no unreasonable delay in filing the
suit, that injunction in these circumstances could not be refused even if there
was some delay, plaintiff had a prima facie case and balance of convenience was
in plaintiff's favour. It held that the defendants' mark was 'deceptively
similar' within section 2(1)(d) of the Trade and Merchandise Marks Act, 1958,
that confusion could be created in the minds of purchasers either because the
marks were similar visually or ocularly or phonetically. Here there was clear
phonetic resemblance.
The
contention that what was registered was the label and not the word 'PIKNIK'
could not be accepted. The 'essential features' of the trade marks were
similar. Section 2(1)(f) referred to `mark' as including a device brand,
heading, label, ticket, name, signature, word, letter, numeral or any
combination thereof. Even if the 'essential features' of the words 'PIKNIK'
were taken into consideration, the defendant's mark 'PICNIC' was deceptively
and phonetically similar. The defendant had cleverly designed the word 'PICNIC'
by change of spelling and the word was so designed on its label in large
letters. The plaintiff's trade mark was registered under class 30 which
included 'chocolates'.
Section
9(1)(d) or (e) would not help the defendant inasmuch as the plea that this was
a common dictionary word was not correct. In fact the defendant had himself
registered the word PICNIC in 1977 in India and the same word was registered in other countries. Defendant had
again applied in India in 1998-1999 for registration of
the same word.
Section
28 of the Act conferred a statutory right on plaintiff on account of
registration. The said mark was registered without opposition under section 21.
On the above reasoning, the trial Court granted temporary injunction in favour
of the appellant. On appeal by the defendant, the High Court reversed the
judgment and held that the word PIKNIK could not be called an 'essential
feature'. The plaintiff's label consisted of the peculiar script of the word
'PIKNIK' in a curved fashion with the caricature of a little boy with a hat in
between the words 'K' and 'N'. The script and the figure of the little boy were
the essential features and not the word 'PIKNIK'. The plaintiff's label had to
be looked at as a whole. Plaintiff was marketing potato chips and potato wafers
in a polythene pouch and not chocolates, though plaintiff had registration
under class 30 for chocolates. Defendant was marketing under trade label
'Cadbury's PICNIC' in a polythene pouch and hence both marks were different.
Defendant was not using the plaintiff's label with the caricature of a boy.
It was
true there was phonetic similarity but the word 'PIKNIK' was a misspelling of
the common dictionary word PICNIC and hence could not be the subject of any
proprietary right. Here the products too were different and there was no confusion.
The fact that the plaintiff was using the word 'PIKNIK' could not be compared
to cases where well known trade names were under use - like Cadbury - and if
the defendant used the word PICNIC along with the word Cadbury, for a different
product, there could be no infringement.
Cadbury
was a household name in India and defendant had been marketing
chocolates since 1948. The said word had almost become synonymous with
chocolates in India as in the case of 'Cadbury Dairy
Milk', 'Cadbury Five Star' etc. The same was true with 'Cadbury Picnic'. There
was absolutely no scope for deception. There was neither infringement nor
passing off. Based on this reasoning the High Court allowed the appeal of the
respondent-defendant and set aside the order of temporary injunction. In this
appeal, learned senior counsel for the appellant-plaintiff Sri P. Chidambaram
contended that the defendants, by merely filing a rectification application on
19.3.99, after the appellants filed the suit on 18.2.99 for injunction based on
infringement, could not scuttle the suit or this application for temporary
injunction. In the present suit or in the application, the respondent could not
raise a defence that the registration of the plaintiff's trade mark was
"invalid" on the ground that the word PIKNIK was not
"distinctive" and that it was akin to a dictionary word or that the
trade mark did not satisfy various clauses of section 9(1). Section 31 raised a
presumption of validity of plaintiff's registered mark. It was sufficient if
the plaintiff's mark had became distinct even by the actual date of
registration. For purposes of section 31, the deeming clause in section 23(1)
did not apply. Under section 32 of the Act, if seven years had elapsed from the
date of registration ( i.e. date of application for registration as deemed by
section 23), then the plea of invalidity of registration, namely, that
plaintiff's registration of trade mark was not 'distinctive', could not be
raised in this suit nor in defence to this application nor even in the
rectification proceedings. Seven years had elapsed by 17.2.96, long before the defence
in the suit was raised as also by the date of filing of the rectification
application on 19.3.1999. Date of the registration in section 32 [unlike the
position under section 31(2)] was to be deemed as date of application for
registration in view of section 23(1).
Hence
the defendant could not be permitted to raise any plea that the word 'PIKNIK'
was not 'distinctive' by 17.2.89 within section 9. In this context, the decision
of this Court in National Bell Co. vs. Metal Goods Mfg. Co.
[1970
(3) SCC 665] was relevant. Learned counsel also argued that under section 2(j)
and 2(v), 'mark' included a label. In any event, the plaintiff's trade mark was
valid as it fell within the various clauses of section 9, even if it be assumed
that section 32 did not bar the defendant's plea. In view of the rights
conferred by registration of the trade mark under section 28, it must be held
that the trade mark was infringed within section 29 inasmuch as the defendant
used its mark which was 'deceptively similar' to the plaintiff's trade mark.
Apart from the right arising out of infringement, the defendant was guilty of
'passing off' of the defendant's goods as the plaintiff's goods. In Ethicon
Ltd. (1975(1) All. E.R.504(HL), it is sufficient if a triable issue is raised.
No prima facie case need be proved. Hence the appellant should be granted
temporary injunction. On the other hand, learned senior counsel for the
defendant Sri Dushyant Dave contended that even if in view of section 111(5) of
the Act, the temporary injunction applications could go on, the defence that
plaintiff's trade mark was invalid as it did come within section 9 could be
raised in these interlocutory proceedings. Plaintiff's trade mark was invalid
as the conditions in section 9 were not satisfied and in any event, being akin
to a dictionary word, it was not "distinctive" within section
9(1)(e). The presumption under section 31(2) did not apply and the bar in section
32 also did not apply since seven years had not elapsed from "the date of
registration", by the time the defence was raised in this suit that
plaintiff's mark was not distinctive. In any event, the case fell within the
exceptions mentioned in section 32 and in particular the one in section 32(e).
Counsel also contended that there was no deception within section 29 read with
section 2(d). The plaintiff's mark was the entire label and not the word
'PIKNIK' alone. The conditions specified in section 29 were not satisfied.
Further, the defendant's mark PICNIC had cross-border reputation in 110
countries over a long period and the use of the said word in India would not
infringe the plaintiff's trade mark nor would such use amount to 'passing off'
defendant's goods as the plaintiff's goods. In view of 1999(7) SCC 1), the
relative strength of the case above need be considered. On these contentions,
the following points arise for consideration: (1) Whether the defendant could,
in the present interlocutory proceedings, based on infringement and passing
off, raise any defence that the registration of plaintiff's mark was itself
"invalid" because the plaintiff's mark did not satisfy the
ingredients of clauses (a) to (e) of section 9(1) and was, in particular, not
"distinctive" as required by section 9(1)(e)? (2) Whether, on the
other hand, plaintiff could rely on the presumption in section 31 and also
contend that under Section 32 the "validity" of the registration of
the plaintiff's mark had become conclusive on the expiry of 7 years long before
defence was raised in the suit (such time reckoned from date of application for
rectification under section 23(1)) and whether there were any exceptions to the
said bar? (3) Whether, assuming that section 31 and section 32 did not come in
the way of the defendant, on merits the word 'PIKNIK' was not distinctive and
did not satisfy section 9(1)(e)? (4) For grant of temporary injunction, should
the Court go by principle of prima facie case ( apart from balance of
convenience) or comparative strength of the case of either parties or by
finding out if the plaintiff has raised a 'triable issue'? (5) Whether,
assuming that plaintiff's registration was valid, the comparative strength of
the case on the question of infringement is in favour of plaintiff? (6)
Whether, alternatively, the plaintiff had made out that for grant of temporary
injunction treating the suit as a 'passing off' action, the relative strength
of the case, was in plaintiff's favour? (7) Whether there was unreasonable
delay on the part of the plaintiff in filing suit and whether the High Court
was justified in interfering in appeal in interlocutory proceedings? POINT 1, 2
and 3:
The
provisions of section 111 deal with 'stay of proceedings where the validity of
registration of the trade mark is questioned etc.'. In the present case, while
the plaintiff appellant has filed the present suit on 18.2.99 for permanent
injunction etc. against the defendant-respondent on the ground of
'infringement' and 'passing off', the defendant has filed an application for
rectification on 19.3.99 in the High Court of Bombay. Now Section 111 is
intended to protect the plaintiff. The defendant, by filing a rectification
proceeding later in the High Court cannot preclude the plaintiff from seeking
interim relief in view of section 111(5). Under section 111(1)(a), if in any
suit the defendant pleads invalidity under section 9 of the plaintiff's trade
mark, then, (i) the Civil
Court trying the
infringement suit shall stay the suit if rectification proceedings are pending.
(ii) if no such rectification proceedings are pending, the Civil Court has to raise an issue as to
validity of plaintiff's trade mark and refer the parties to the High Court to
seek rectification. Under clause (2) if a rectification application is filed as
directed, the suit is to be stayed till rectification proceedings are over. If
such an application is not filed for rectification, it shall be deemed that the
plea is abandoned by defendant. Under section 111(5), even if the suit is to be
stayed pending rectification proceedings, the plaintiff can file and have
interlocutory applications for temporary injunction etc. to be disposed of. The
point raised by the learned senior counsel for the appellant Sri P. Chidambaram
is that the policy of the Act is not to allow the defendant to raise any issue
relating to the "invalidity" of the plaintiff's trade mark as a defence
in a Civil Suit for infringement at any time at the pleasure of the defendant
and that a question as to validity can be decided only in rectification
proceedings, provided, on facts, such proceedings are in time ( as prescribed
in section 32) and are otherwise maintainable. If such issues cannot be raised
in the main suit itself, they cannot be raised even in interlocutory proceedings.
It is pointed out that even where no rectification proceedings are pending, if
a question relating to the "invalidity" of registration of
plaintiff's mark is raised in defence, the Court has to direct the defendant to
move for rectification and is to adjourn the suit. Learned senior counsel, in
this context, pointed out the distinction, between the Trade Marks Act and the
Patents Act, by referring us to section 107 of the Patents Act, 1970. That
section reads as follows: "Section 107- Defences, etc. in suits for
infringement: (1) In any suit for infringement of a patent, every ground on
which it may be revoked under section 64 shall be available as a ground for defence.
(2) In any suit for infringement of a patent by the making, using or
importation of any machine, apparatus or other article or by the using of any
process or by the importation, use or distribution of any medicine or drug, it
shall be a ground for defence that such making, using, importation or
distribution is in accordance with any one or more of the conditions specified
in section 47." It is true that under section 107 of the Patents Act, it
is permissible in any suit for infringement of a patent, for the defendant to
raise all pleas in defence which he could have raised under section 64 of the
Act for revocation and there is no similar provision in the Trade Marks Act,
1958.
However,
the question is as to what extent under the Trade Marks Act, 1958 sections 31
and 32, come in the way of the defendant. Now section 9(1) sets down the various
requisites for a "valid" registration of a trade mark in parts A and
B of the register. Section 9(1) is to be read alongwith section 9(3) which
defines the word 'distinctive' used in section 9(1)(e). Section 9 reads as
follows:
"Section
9: Requisites for registration in Parts A and B of the register - (1) A trade
mark shall not be registered in Part A of the register unless it contains or
consists of at least one of the following essential particulars, namely: - (a)
the name of a company, individual or firm represented in a special or
particular manner; (b) the signature of the applicant for registration or some
predecessor in his business; (c) one or more invented words; (d) one or more
words having no direct reference to the character or quality of the goods and
not being, according to its ordinary signification, a geographical name or a
surname or a personal name or any common abbreviation thereof or the name of a
sect caste or tribe in India; (e) any other distinctive mark. (2)
....................................
(3)
For the purposes of this Act, the expression 'distinctive' in relation to the
goods in respect of which a trade mark is proposed to be registered means
adapted to distinguish goods with which the proprietor of the trade mark is or
may be connected in the course of trade from goods in the case of which no such
connection subsists either generally or, where the trade mark is proposed to be
registered subject to limitations, in relation to use within the extent of the
registration." For the present, we are not referring to the other sub-
clauses of section 9. If a trade mark does not satisfy section 9, it is well
settled that it is to be treated as 'invalid'. The defence of the
defendant-respondent based on section 9(c),(d) and (e) is that the word
'PIKNIK' is akin to a dictionary word and is not an inventive word nor a word
having no direct relation to the character or quality of goods nor a
distinctive word and hence sub- clauses (c), (d) (e) of section 9(1) do not
apply and the registration of the plaintiff's trade mark is in itself invalid.
This brings us to sections 31 and 32 for deciding whether the plea can be
raised in defence in these interlocutory proceedings. Section 31 states that
registration is to be prima facie evidence of validity.
Section
31 reads as follows: "Section 31: Registration to be prima facie evidence
of validity - (1) In all legal proceedings relating to a trade mark registered
under this Act (including application under section 56), the original
registration of the trade mark and of all subsequent assignments and
transmissions of the trade mark shall be prima facie evidence of the validity
thereof. (2) In all legal proceedings as aforesaid a trade mark registered in
Part A of the register shall not be held to be invalid on the ground that it
was not a registrable trade mark under section 9 except upon evidence of
distinctiveness and that such evidence was not submitted to the Registrar
before registration, in all legal proceedings as aforesaid, if it is proved
that the trade mark had been used by the registered proprietor or his
predecessor in title as to have become distinctive at the date of
registration." Section 32 deals with conclusive proof of validity of the
trade mark and reads as follows: "Section 32: Registration to be
conclusive as to validity after seven years - Subject to the provisions of
section 35 and section 46, in all legal proceedings relating to a trade mark
registered in Part A of the register ( including applications under section
56), the original registration of the trade mark shall after the expiration of
seven years from the date of such registration, be taken to be valid in all
respects unless it is proved - (a) that the original registration was obtained
by fraud; or (b) that the trade mark was registered in contravention of the
provision of section 11 or offends against the provision of that section on the
date of commencement of the proceedings; or (c) that the trade mark was not at
the commencement of the proceedings, distinctive of the goods of the registered
proprietor." While section 31 raises a presumption as to validity of
registration, section 32 bars any such question being raised after seven years,
subject of course to some exceptions. In our view, any decision on the question
of `validity' of the appellant's trade raised as a defence in the present
application filed under Order 39 Rule 1 CPC will seriously jeopardise a
decision on the same issue now pending in the rectification proceedings filed
by the respondent in the Bombay High Court. We would therefore not go into the
question of 'validity' or 'distinctiveness' of the plaintiff's trade mark nor
into the applicability of National Bell
Co. Case ( 1970(3) SCC 665) as those
issues are to be decided in the rectification proceedings. We are of the view
that the case before us can be disposed of by considering whether there is
prima facie any deception and hence infringement and whether there is any
'passing off'. Points 1, 2 and 3 are therefore not decided. POINT 4: This point
deals with the principles applicable for grant of temporary injunction in trade
mark cases. Before American Cyanamid Co,. vs. Ethicon Ltd. ( 1975(1) ALL E.R.
504(HL), it was customary for the Courts to go into prima facie case in trade
mark cases for grant or refusal of temporary injunction. But in American
Cyanamid, it was observed that it was sufficient if a "triable issue"
was presented by the plaintiff and the merits need not be gone into. The said
judgment was referred to by this Court SCC 727). The judgment in Wander Ltd.
was followed in Coca Cola Co. ( 1995(5) SCC 545), this Court again adverted to
the prima facie case principle while granting temporary injunction. All these
rulings have been reviewed recently (1999(7) SCC 1). It was pointed to this
Court that there was considerable criticism of the principles laid down in
American Cyanamid. ( See also Floyd, Interlocutory Injunctions since Cyanamid (
1983 E 1 PR 238), (Cole, Interlocutory Injunctions in U.K. Patent Cases ( 1979.
E 1 PR 71) ( see also Edenborough M and Tritton, American Cyanamid revisited
(1996 E1 PR 234) and Philipps in 1997 JBL 486). This Court referred to the
recent judgment of Laddie in UK. In U.K., Laddie, J. reconsidered the principle recently and
explained American Cyanamid in his judgment in The learned Judge observed that
in American Cyanamid, Lord Diplock did not lay down that the relative strength
of the case of each party need not be gone into. Thereafter, this Court in
Palmolive case has referred to Laddie J's view and said that the view of Laddie,
J. is correct and that American Cyanamid cannot be understood as having laid
down anything inconsistent with the 'old practice'. We may also add that now
the courts in England go into the question whether the
plaintiff is likely or unlikely to win in the suit i.e. into the comparative
strength of the case of the rival parties - apart from the question of balance
of convenience. [See again Laddie, J. in Barclay's Bank Inc is posed and where
Series 5 Software was followed.
Therefore,
in trade mark matters, it is now necessary to go into the question of
`comparable strength' of the cases of either party, apart from balance of
convenience. Point 4 is decided accordingly. POINT 5: Under this point, we
propose to trace the legal principles applicable to cases of infringement with
particular reference to dissimilarities in essential features of a devise or
mark. Under section 29 of the Act, a plaintiff in a suit on basis of
infringement has to prove not only that his trade mark is infringed by a person
who is not a registered proprietor of the mark or a registered user thereof but
that the said person is using a mark in the course of his trade, "which is
identical with or deceptively similar to the trade mark of the plaintiff, in
such manner as to render the use of the mark likely to be mistaken as the
registered trade mark". Under section 2(d), the words "deceptively
similar" are defined as follows: "a mark shall be deemed to be
deceptively similar to another mark if it so nearly resembles that other mark
as to be likely to deceive or cause confusion". We shall now refer to the
broad principles applicable to infringement actions and in particular to
devices, labels and composite marks.
Essential
Features if copied: It is well-settled that the plaintiff must prove that
essential features of his registered mark have been copied. The onus to prove
'deception' is on the part of the plaintiff who alleges infringement. A mark is
said to be infringed by another trader if, even without using the whole of it,
the latter uses one or more of its "essential features". The
identification of an essential feature depends partly on the courts' own
judgment and partly on the burden of the evidence that is placed before it.
Ascertainment of an essential feature is not to be by ocular test alone; it is
impossible to exclude consideration of the sound of words forming part or the
whole of the mark. (Kerly, Law of Trade Marks and Trade Names, 11th Ed. 1983, para
14.21). It is no answer to a charge of infringement - as contrasted with a
passing off action - that the defendant's mark, whilst including the
plaintiff's mark, includes other matters too.
Still
less is it an answer that by something outside that actual mark the defendant
has distinguished his goods from those of the plaintiff - by adding his own
name (Kerly para 14.22). But this principle is not absolute. It is also
accepted that addition of his own name by defendant is an element to be
considered and may turn the scales in favour of the defendant. In same para
14.22, Kerly says: "But the use of the defendant's name as part of the
mark complained of is an element to be considered and in some cases it has
Andrew & Atkinson (1911) 28. R.P.C. 293)" Jewsbury case was a case
relating to infringement. (Of course, in para 14.25 Kerly also refers to cases
where addition of defendant's a name has not turned the scales). So far as
resemblance in words is concerned, Justice Parker in Pianotist Co's Application
(Pianola):(1906) 23 RPC 774 (at 777) has stated as follows: "You must take
the two words.
You
must judge of them, both by their look and by their sound. You must consider
the goods to which they are to be applied. You must consider the nature and
kind of customer who would be likely to buy the goods. In fact, you must
consider all the surrounding circumstances and you must further consider what
is likely to happen if each of these trade marks is used in a normal way as a
trade mark for the goods of the respective owners of the marks. If considering
all those circumstances, you come to the conclusion that there will be
confusion - that is to say, not necessarily that one man will be injured and
the other will gain illicit benefit, but there will be confusion in the mind of
the public which will lead to confusion in the goods - then you may refuse
registration, or rather you must refuse registration in that case". This
dictum has been quoted Manners and Co.Pvt. Ltd. ( AIR 1970 SC 2062). Devices
and Composite Marks: But the considerations relating to words, however, differ
appreciably when device marks are to be compared or when a device mark is to be
compared with a word mark. ( Kerly para 17.07). After referring to the factors
mentioned by Parker, J. in the above case, it is stated in Halsbury's Laws of
England, (Vol.38, 3rd Ed., para 986) as follows: "These considerations
differ to some extent when device marks are being compared or when a device
mark is compared with a word mark." Dissimilarity in essential features in
devices and composite marks more important than some similarity: It has been
stressed for the appellant that since the word PICNIC is used by defendant
while plaintiff is using its misspelling PIKNIK, this is an essential feature
which is similar phonetically or visually, and there is therefore infringement.
It is argued that presence of even one essential feature in defendant's mark is
sufficient. In our opinion, in the case of devices and composite marks, the
above principle has not been strictly applied. The English Courts have laid
emphasis more on dissimilarities in essential features rather than on
similarity. The "whole thing" principle is based on first impression
as seen by the Court. We shall now refer to these principles laid down in the
English cases. When the question arises whether a mark applied for bears such
resemblance to another mark as to be likely to deceive, it should be determined
by considering what is the leading character of each. The one might contain
many, even most, of the same elements as the other, and yet the leading, or it
may be the only, impression left on the mind might be very different. On the
other hand, a critical comparison of the two marks might disclose numerous
points of difference, and yet the idea which would remain with any person
seeing them apart at different times might be the same. Thus, it is clear that
a mark is infringed if the essential features, or essential particulars of it,
are copied. In cases of device marks, especially, it is helpful before
comparing the marks, to consider what are the essentials of the plaintiff's
device. ( Kerly para 17.08) The trade mark is the whole thing - the whole
picture on each has to be considered. There may be differences in the parts of
each mark, but it is important to consider the mode in which the parts are put
together and to judge whether the dissimilarity of the part or parts is enough
to make the whole dissimilar. It has been said that if the only resemblances
between two marks are in parts which are common, so that the owner of the one
has taken nothing which is peculiar to the other, then there is at all events
no infringement, at any rate unless the plaintiff had a distinctive arrangement
of the common elements. ( But this approach is hardly suited to a comparison of
word marks;
and
even in relation to label marks or other features of get-up, it would be more
appropriate to consider the case as a whole, with due regard to the background
provided by any other marks shown to be in use ( Kerly para 17.17).
Therefore,
the question is whether the defendant has, - so far as the common feature is
concerned, - copied any distinctive arrangement of the common elements? Or has
copied any unusual feature of the common element ( Crispin's Appln.(1917) 34
RPC 249) ( see Kerly para 17.19, fn.77).
The
marks, names or get-up concerned must always be considered as the whole thing,
as the true test is whether the totality of the impression given both orally
and visually is such that it is likely to cause mistake, deception or confusion
(Halsbury Vol.38, 3rd Ed. para 987).
We
next come to the crucial test laid down by Evershed M.R.
in Broadhead's
Application [( 1950) 67 RPC 209 at 215] which was a case relating to opposition
to registration. The Master of Rolls followed the observations of Lord Russell
in which was an infringement action )[(1942) 59 RPC 127) and observed as
follows: "Where you get a common denominator, you must in looking at the
competing formulas, pay much more regard to the parts of the formulas which are
not common - although it does not flow from that that you must treat the words
as though the common part was not there at all".
Where
common marks are included in the rival trade marks, more regard is to be paid
to the parts not common and the proper course is to look at the marks as whole,
but at the same time not to disregard the parts which are common.
Halsbury
( 3rd Ed. para 992) also says: where there are common elements to two or more
marks, more regard must be paid to the parts that are not common but the common
parts cannot be disregarded. (Coca Cola Co. of Canada Ltd. vs.
Pepsi
Cola Co. of Canada Ltd. (1942 (1) All.E.R. 615(PC).
The
above principles have been laid down in English law.
Decisions
of this Court -infringement, essential features and the whole thing This Court
has laid down in Corn (AIR 1960 SC 142), which was a case of infringement, that
it would be for the court to decide whether the marks were similar. It was
observed that "in deciding the question of similarity between two marks,
the marks have to be considered as a whole". Again in K.K. Chinna Krishna
146), where the question of similarity arose at the stage of opposition to the
appellant's mark by the respondents ( who had a registered trade mark), it was
observed that: "it is for the court to decide the question on a comparison
of the competing marks as a whole." The resemblance between the two marks
must be considered with reference to the ear as well Co.Pvt. Ltd. ( AIR 1970 SC
2062), the question of 'deceptive similarity' was raised by the appellant ( a
registered trade mark holder) for removal of the respondent's trade mark, in
rectification proceedings. (The decision is relevant in an infringement action
except that the burden of proof in an infringement action is on the plaintiff
while in an application for rectification it is the applicant). It was again observed
in the above case that: "it is necessary to apply both the visual and
phonetic tests". "It is also important that the marks must be
compared as whole". "The true test is whether the totality of the
proposed trade mark is such that it is likely to cause deception or confusion
or mistake in the minds of persons accustomed to the existing trade mark".
In yet another case of an infringement action, Parle Products the question was
in relation to a wrapper with the words 'Gluco biscuit' and the particular colour
scheme, the general get up used for sale of Parle's Gluco Biscuit' so printed
on the wrapper. There was a farmyard with a girl in the centre carrying a pail
of water and cows and hens around her in the background of a farm-house. The
defendant was selling biscuits with the name 'Glucose Biscuits'. The wrapper
contained picture of a girl supporting with one hand a bundle of hay on her
head and carrying a sickle and a bundle of food, with cows and hens around, in
the background of a building. This Court held, on those facts, that in an
infringement action, it was sufficient if there was 'overall similarity' as
would mislead a person usually dealing with one to accept the other if offered
to him. Here the packets were of the same size and the colour scheme and design
were having close resemblance. The marks should not be kept side by side and
compared. The essential features of both marking were a girl with one arm
raised and carrying something in the other while the cows or hens were near
her, in the background of a house. The decision of this Court in ( AIR 1965 SC
980), was a case where the respondent-registered holder of the trade mark
opposed the appellant's registration. The question of deception arose in that
context. Both were using the word 'Navratna Pharmaceutical laboratories' in
connection with sale of Ayurvedic medicines. It was held that for judging
whether the later mark was deceptive, it was sufficient if the similarity was
so close visually, phonetically or otherwise.
If the
essential features had been proved to be adopted by the opposite party, that
was sufficient. The fact that the get-up, packing and other writing or marks on
the goods or packets showed marked difference was not material, though such
features could be material in a passing-off action and the defendant might
escape liability by showing some additional matter to distinguish his goods.
The purpose of comparison was to see if the essential features were different.
The object of inquiry was to find out if the defendant's mark was as a whole
similar to the plaintiff's Zamindara Engineering Co. ( 1969(2) SCC 727) was
again a case of an infringement action. It was admitted that the words 'Ruston and Rustam' were deceptively
similar and the fact that to the latter, "India" was suffixed made no difference. The court pointed
out the difference between an infringement action and a passing off action and
held that if there was colourable imitation, the fact that the get up was
different was not relevant in an infringement action though it might have had
relevance in a passing off action, Jump Perfect Ltd. [(1941) 58 RPC 147 (161)].
Broadly, under our law as seen above, it can be said that stress is laid down
on common features rather than on differences on essential features, except for
a passing reference to a limited extent in one case. Difference in essential
features are also relevant under Indian Law: It appears to us that this Court
did not have occasion to decide, as far as we are able to see, an issue where
there were also differences in essential features nor to consider the extent to
which the differences are to be given importance over similarities. Such a
question has arisen in the present case and that is why we have referred to the
principles of English Law relating to differences in essential features which
principles, in our opinion, are equally applicable in our country. Application
of Principles to facts of this case: If differences in essential features are
relevant, the next question is as to what is the position on facts.
The
first question therefore is as to what, on the facts, are the essential
features of the plaintiff's mark? It is clear that apart from the word PIKNIK,
the essential features are also the special script of these words in block
letters and the curve in which these words are inscribed and the caricature of
the boy with a hat occurring between the words K and N on the plaintiff's mark.
On the other hand, the defendant's mark contains the words PICNIC in a straightline,
the script is normal and the words `Cadbury' are written above the words
PICNIC. Neither the peculiar script nor the curve nor the boy with a hat are
found in the defendant's mark. It is true that there is phonetic similarity and
use of the word PICNIC. But what is the effect of the dissimilarities? This is
the crucial part of the case. It is here that sufficient care is to be taken in
applying the principles. In our opinion, in the present case, three tests to
which reference has been made above, have to be applied. The first one is this:
Is there any special aspect of the common feature which has been copied? The
second test will be with reference to the `mode in which the parts are put
together differently? That is to say whether the dissimilarity of the part or
parts is enough to mark the whole thing dissimilar (Kerly para 17.17 referred
to above). The third test is whether When there are common elements, should one
not pay more regard to the parts which are not common, while at the same time
not disregarding the common parts? What is the first impression? As to the
first test, whether there are any peculiar features of the common part which
have been copied, it is seen that the peculiar aspects of the common features
of PIKNIK namely the peculiar script and the curve have not been copied; then,
as to the second test, we have to see the dissimilarity in the part or parts
and if it has made the whole thing dissimilar. Absence of the peculiar script
in the letters, the curve and the absence of the caricature of the boy with a
hat, in our view, have made the whole thing look dissimilar. Then, as to the
third test, the above three dissimilarities have to be given more importance
than the phonetic similarity or the similarity in the use of the word PICNIC
for PIKNIK. That is how these three tests have to be applied in this case. On
first impression, we are of the view that the dissimilarities appear to be
clear and more striking to the naked eye than any similarity between the marks.
Thus, on the whole, the essential features are different. Learned senior
counsel for the respondent had Chandra Rakhit ( AIR 1955 SC 558) to contend
that, in any event, the plaintiff had registered only the label and not the
words PIKNIK. In that case, this Court quoted (P.565) (at 191)] to the
following effect: "The truth is that the label does not consist of each
particular part of it, but consists of the combination of them all." We do
not propose to go into the applicability of the above decision to the case
before us. There, the question was whether the Registrar could insist that a
particular word contained in the label should be disclaimed. In the result, we
hold on the question of infringement that on an examination of the relative
strength of the pleas, as stated in Palmolive, it is shown that the chances, on
facts, are more in favour of the defendant rather than in favour of the
plaintiff and that the plaintiff is not entitled to temporary injunction.
This
finding on facts is confined to these interlocutory proceedings only. Deceive
or confuse: Our discussion under this head is again in the context of the
relevant strength of the case of the parties and for the purposes of the
temporary injunction as laid down in Palmolive. Section 29 uses the words
`deceptively similar' and section 2(1)(d) defines `deceptively similar' as
situations where one is `deceiving' others or `confusing' others. We have to
keep in view the distinction between the words `deceive' and `confuse' used in
section 2(1)(d). These words which occur in the various trade mark statutes
have been explained in Parker-Knoll vs. Knoll International [(1962) RPC 265(HL)
(pp.273-274)] by Lord Denning as follows: "Looking to the natural meaning
of the words, I would make two observations:
first,
the offending mark must `so nearly resemble' the registered mark as to be
`likely' to deceive or cause confusion. It is not necessary that it should be
intended to deceive or intended to cause confusion. You do not have to look
into the mind of the user to see what he intended.
It is
its probable effect on ordinary people which you have to consider. No doubt, if
you find that he did not intend to deceive or cause confusion, you will give
him credit for success in his intentions. You will not hesitate to hold that
his use of it is likely to deceive or cause confusion.
But if
he had no such intention, and was completely honest, then you will look
carefully to see whether it is likely to deceive or cause confusion before you
find him guilty of infringement. Secondly, `to deceive' is one thing. To cause
`confusion' is another. The difference is this: when you deceive a man, you
tell him a lie. You make a false representation to him and thereby cause him to
believe a thing to be true which is false. You may not do it knowingly, or
intentionally but still you do it, and so you deceive him. But you may cause
confusion without telling him a lie at all, and without making any false
representation to him. You may indeed tell him the truth, the whole truth and
nothing but the truth, but still you may cause confusion in his mind, not by
any fault of yours, but because he has not the knowledge or ability to
distinguish it from the other pieces of truth known to him or because he may
not even take the trouble to do so." The above passage has been quoted by
this Court in Roche vs. Geoffrey Manners [AIR 1970 SC 2062 (2064)]. Therefore
if, in a given case, the essential features have been copied, the intention to
deceive or to cause confusion is not relevant in an infringement action. Even
if, without an intention to deceive, a false representation is made, it can be
sufficient. Similarly, confusion may be created unintentionally but yet the
purchaser of goods may get confused for he does not have the knowledge of facts
which can enable him not to get confused. In the present case, this aspect need
not detain us in as much as we have already held that the relative strength of
the case is in favour of the defendant. Further this aspect is connected with
the type of buyer whom the law has in mind and we shall be presently dealing
with this aspect also. It is not necessary for us to go into the contention of
the respondent that the defendant was using the word PICNIC in other countries
over a long period along with the word `Cadbury' and that a question of transborder
reputation protects the defendant. Reliance is placed for the respondent on N.R.Dongre
vs. Whirlpool Corporation and Anr. [1996 (5) SCC 714] for this purpose. We do
not think it necessary to go into this aspect. Such a question, if raised in
the suit, can be gone into on its own merits. For the above reasons, we hold
that on the question of the relative strength, the decision must go in favour
of the defendant that there is no infringement and the High Court was right in
refusing temporary injunction. Point 5 is decided accordingly. Point 6: Passing
off and infringement- differences: Here the point is in relation to relative
strength of the parties on the question of `passing off'.
As
discussed under Point 5, the proof of resemblance or similarity in cases of
passing off and infringement are different. In a passing off action additions,
get up or trade-dress might be relevant to enable the defendant to escape. In
infringement cases, such facts do not assume Phamaceutical Laboratories Ltd.
(AIR 1965 SC 980); Ruston ( 1990 Supple. SCC 727)]. It is
possible that, on the same facts, a suit for passing off may fail but a suit
for infringement may succeed because the additions, the get up and trade dress
may enable a defendant to escape in a passing off action. A somewhat similar
but interesting situation arose in a dispute between two companies. In N.S.Thread
& Co. vs. James Chadwick & Bros. [AIR 1948 Mad. 481], the passing off action failed. But thereafter
James Chadwick Co. succeeded in an appeal arising out of the registration
proceedings and the said judgment was confirmed by this Court in N.S.Thread
& Co. vs. James Chadwick & Bros. [AIR 1953 SC 357]. It was held that
the judgment in the passing off case could not be relied upon by the opposite
side in latter registration proceedings. In the same tone, Halsbury (Trade
Marks, 4th Ed., 1984 Vol.48, para 187) says that in a passing off action the
"degree of similarity of the name, mark or other features concerned is
important but not necessarily decisive, so that an action for infringement of a
registered trade mark may succeed on the same facts where a passing off action
fails or vice versa". As to vice-versa, Kerly says (para 16.12), an
infringement action may fail where plaintiff cannot prove registration or that
its registration extends to the goods or to all the goods in question or
because the registration is invalid and yet the plaintiff may show that by
imitating the mark or otherwise, the defendant has done what is calculated to
pass off his goods as those of plaintiff. In Schweppes Ltd. vs. Gibbens (1905)
22 RPC 601(HL) Lord Halsbury said, while dealing with a passing off action that
"the whole question in these cases is whether the thing - taken in its
entirety, looking at the whole thing - is such that in the ordinary course of
things a person with reasonable comprehension and with proper insight would be
deceived". Defendant's name on his goods is an indication of there being
no case of passing off: In the present case, defendant's goods contain the
words `Cadbury' on their wrapper. As per the principle laid down in Fisons Ltd.
vs.
E.J.Godwin
[(1976) RPC 653], the occurrence of the name `Cadbury' on the defendant's
wrapper is a factor to be considered while deciding the question of passing
off.
Similarly
in King & Co. Ltd. vs. Gillard and Co. Ltd. [22 RPC 327] and
Cadbury-Schweppes pty Ltd. vs. The Pub.
Squash
Ltd. (1981) RPC 429, it was held that the presence of defendant's name on his
goods was an indication that there was no passing off, even if the trade dress
was similar. The fact that the defendant's wrapper contains the word `Cadbury'
above the words PICNIC is therefore a factor which is to be taken into account.
Buyer's ignorance and chances of being deceived: As to scope of a buyer being
deceived, in a passing off action, the following principles have to be borne in
mind. Lord Romer, LJ has said in Payton & Co. vs. Snelling Lampard & Co.
(1900) 17 RPC 48 that it is a misconception to refer to the confusion that can
be created upon an ignorant customer. The kind of customer that the Courts
ought to think of in these cases is the customer who knows the distinguishing
characteristics of the plaintiff's goods, those characteristics which
distinguish his goods from other goods in the market so far as relates to
general characteristics. If he does not know that, he is not a customer whose
views can properly be regarded by the Court. [See the cases quoted in N.S.Thread
& Co. vs.
Chadwick
& Bros. (AIR 1948 Mad. 481), which was a passing off action]. In Schweppes'
case, Lord Halsbury said, if a person is so careless that he does not look and
does not treat the label fairly but takes the bottle without sufficient
consideration and without reading what is written very plainly indeed up the
face of the label, you cannot say he is deceived. In our view, the trial Court
in the present case went wrong in principle in holding that there was scope for
a purchaser being misled. The conclusion was arrived at without noticing the
above principles. In the result, on the question of passing off, the relative
strength of the case again appears to us to be more in defendant's favour.
Point
6 is decided accordingly. Point 7: The issue of laches of the
appellant-plaintiff, though relied upon by the respondent, does not, in view of
our finding at Point 5, assume any significance in this case. Coming to the
question whether the appellate court was right in interfering with the
discretion of the trial Court and in vacating injunction, we are of the view
that, on facts, interference was justifiable. If wrong principles were applied
by the trial Court under Order 39, Rule 1 CPC, the appellate Court could
certainly interfere in interlocutory proceedings under Order 39, Rule 1 CPC.
Here, the trial Court gave importance to phonetic similarity and did not refer
to the differences in essential features. It did not also have the wary
customer in mind. On the other hand, the High Court's approach in this behalf
was right as it noticed the dissimilarities in the essential features and
concluded that viewed as a whole, there was neither similarity nor scope for
deception nor confusion. (No doubt both Courts went into the validity of the
plaintiff's registered mark and into the question of `distinctiveness' of the
word PIKNIK under section 9(1)(e). But in our view that was not necessary).
Thus, when wrong principles were applied by the trial Court while refusing
temporary injunction, the High Court could certainly interfere. Point 7 is
decided accordingly. In the result, the appeal is dismissed. We, however,
reiterate the direction given by High Court in regard to maintenance of
accounts and the undertaking to be given by the defendant for damages, if any,
that may be granted in the suit, in case the suit succeeds. We make it clear
that the above findings on facts are for the purpose of the temporary
injunction and will not come in the way of the Court in the suit to decide the
matter on the evidence produced.
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