2016 April - http://judis.nic.in/Judis_Andhra/list_new2.asp?FileName=13609
THE HONBLE SRI JUSTICE A.RAJASHEKER REDDY
C.M.A. No.784 of 2015
29-04-2016
M/s. Shine Chem Laboratories, A Partnership firm, rep. by its Proprietor
M.Dasanjaneyulu. ... Appellant
Standard Reagents Private Limited, Rep. by its MD Sri M.Srinivas....Respondent
Counsel for the Appellant: Sri Ashok Ram Kumar
Counsel for the Respondent: Sri Venkatesh Deshpande.
>HEAD NOTE:
? Cases referred
1.(1996) 5 Supreme Court Cases 714
2 2008 (36) PTC 168 Del
3 2003 (26) PTC 593 Delhi
4 (2011) 8 SCLR 030
5 2010 (1) ALD 199
6 Civil Appeal Nos.6314_15 of 2001
7AIR 2005 Supreme Court 1999
8 (2004) 5 Supreme Court Cases 257
9 AIR 1998 Andhra Pradesh 86
10 AIR 2002 Supreme Court 275(1)
11 1944 (2) AII ER 269
HONBLE SRI JUSTICE A.RAJASHEKER REDDY
CMA No. 784 OF 2015
JUDGMENT:
This appeal is filed challenging the order dated
21.07.2015 passed in I.A.No.658 of 2014 in O.S.No.1067 of
2014 by the XVI Additional District Judge and Sessions Judge
cum XVI Additional Metropolitan Sessions Judge, Ranga Reddy
District at Malkajgiri, wherein the injunction petition filed by the
respondent/plaintiff was allowed and the defendant was
restrained from manufacturing and selling his product Karl
Fisher Reagent under Trade name of Stable 2Y++, pending
disposal of the suit.
2. Defendant in the suit is the appellant herein. The parties
hereinafter will be referred to as arrayed in the suit.
The plaintiff filed petition under Order XXXIX, Rules 1 and
2 CPC read with Section 151 CPC for grant of ad-interim
injunction restraining the defendant from manufacturing,
selling, marketing, advertising, distributing of the product Karl
Fisher Reagent bearing the plaintiffs trade name Stable 2Y++
Single Solution KF Reagent pending disposal of the suit. The
plaintiff is a Private Limited Company incorporated under
Companies Act. It has been doing business of manufacturer of
sales of high performance laboratory solvents, reagents,
standard solutions and fine chemicals. By using specific
proportion of Aromatic Heterocyclic Compound with other raw
material as ingredients to produce a Pyridine-free Karl-Fisher
Reagent Solution of the strength 5.0 to 6.0 mg/ml of water, with
minimum two years stability and as such it is named as Stable
2Y++ Single Solution KF Reagent and is being approved for its
stability for a minimum of 2 years from the recognized and
authorized laboratories. The words Stable 2Y++ Single Solution
KF Reagent describe the produce as to the stability of the
produce in the packed bottle for a minimum period of 2 years.
The Managing Director of the plaintiff-company made an
application to Registrar of Trademarks for registering the brand
name of the trade name and same is pending. The plaintiff has
been using the said trademark since the year 2005 onwards and
no other company in India using the same. The plaintiffs trade
mark signifies the highest standards of quality, innovation,
reliability, output and integrity.
3. The proprietor of the defendants Company worked in the
plaintiffs Company as a Marketing Manager for a period of 7
years from the year 2002-2009. Thereafter, he started a separate
business and imitated the label, the trade name of the product
Stable 2Y++ Single Solution KF Reagent and packed the
product in a similar looking bottle and packing case and selling
the same in the open market exhibiting as if the product being
sold by the defendant as of his own product similar to that of the
plaintiffs product with an intention to create confusion and
deception in the minds of the customers and with an ulterior
motive to injure his business, reputation and goodwill. That the
said action of the defendant came to the knowledge of the
plaintiff in the first week of September, 2014 and on that the
plaintiff procured a sample of the product manufactured and
marketed by the defendant. The act of defendant amounts to
gross misrepresentation and passing off of goods branded
deceptively in the name of the plaintiffs Company. Hence
petition for injunction as noted above.
4. The defendant filed counter denying the allegations in the
affidavit filed in support of the petition stating that there cannot
be a passing off for a product KF Reagent as the origin inventor
was one Mr.Karl Fisher, who is a German Chemist. The KF
Reagent itself indicates the person Karl Fisher Reagent. The
word Single Solution is a common English word and no one
can claim proprietorship over the same. Further the word
connotes that there is only one solution as an old process
Pyridine which has two solutions. The words Stable 2Y++ Single
Solution KF Reagent significantly describes as to the stability of
the product in the packed bottle which is for a minimum period
of two years. Thus, the trade mark is an indicative of the nature
of the product which is a generic word and the plaintiff has no
exclusive rights over the generic words. The registered
partnership firm of the defendant consists of four partners,
constituted for the purpose of doing business of manufacturing
and trading of all types of industrial and laboratory chemicals,
laboratory glassware and laboratory instruments. The
defendant is doing business since the year 2014 onwards. One
of the partners of the defendant firm was former employee of the
plaintiff. In the year 2009, the said partner left the services of
the plaintiff and started M/s. Shine Chem Laboratories in the
year 2014 for the purpose of manufacturing Karl Fisher
Reagent and doing business in the said product. That most of
the chemical companies are manufacturing Karl Fisher
Reagent without pyridine in their style of process, as such,
Karl Fisher Reagent without Pyridine has become a generic
product and it is not an invention of anybody. The product
packed in the bottle will be shown in the symbolic 2Y, 2Y++ or
5Y etc., Thus, the usage of 2Y++ along with a trade mark of the
plaintiff does not confer any right over it. That the application
of the plaintiff for registration is still pending and the same does
not qualify for being registered under Section 9 of Indian Trade
Marks Act, 1999 as the trade mark is descriptive in nature. The
defendant sold its generic Karl Fisher Reagent with its own
conceived and coined Trade Mark of KF 2Y with very distinctive
coloured (yellow) packing slip. Since all the buyers of the
plaintiff are educated, having scientific background, the
question of purchasing the product of the defendant as that of
the plaintiffs product does not arise. The package label of the
defendant is distinctive, unique and shall not have any
resemblance with that of the plaintiffs product. The defendant
has his own version of generic product of Karl Fisher Reagent
with brand of KF 2Y, which is distinctive and shall not have
any similarity or deceptive similarity with the Trade mark of the
plaintiff that is Stable 2Y++. The defendant has not
misrepresented and misused the Trade Mark or good will of the
plaintiff, as such, passing off goods should not be attributed to
the defendant as the product of the plaintiff has not attained
secondary meaning. The Trade Mark of the plaintiff Stable
2Y++ itself is not having the essentials of a Trade Mark for not
having distinctiveness and therefore, the plaintiff is not entitled
for relief of injunction.
5. The trial Court, after considering the documentary
evidence i.e., Exs.P1 to P85 marked on behalf of the plaintiff and
Exs.R1 to R5 marked on behalf of the defendant, granted ad-
interim injunction restraining the defendant from
manufacturing, selling and marketing his product Karl Fisher
Reagent under Trade name of Stable 2Y++ pending disposal of
the suit. Aggrieved by the same, present appeal is filed.
6. Sri Ashok Ram Kumar, learned counsel for the defendant-
appellant, strenuously contended that since the Stable 2Y++
Single Solution KF Reagent is nothing but a descriptive nature
of the product being reagent and the plaintiff is questioning the
description of the product and not passing off of a brand. He
also contends that there cannot be a claim of proprietorship on
a descriptive terminology as there are several descriptive
terminologies such as Karl Fisher, Pyridine Free, Reagents,
Longer Shelf Life, Stability and Single Solution etc. He also
submitted that the trial Court having found that the defendant
is selling its product under Trade Mark KF 2Y and not Stable
2Y++, erred in restraining the defendant from selling its product
of Karl Fischer Reagent KF 2Y++. That the impugned order
will adversely affect the prosperous business of the defendant
and there is likelihood of stamping the defendant as pirate. He
further contended that any mark which is descriptive in nature
is not protected since the same should be allotted to use by
different vendors of the similar product to describe the product
in their marketing literature. In support of his contentions, he
relied on the decisions reported in N.R.Dongre v. Whirlpool
Corporation , Cadila Healthcare Ltd., v. Gujarat Co-operative Milk ,
Micronix India v. Mr.J.R.Kapoor , Commissioner of Central Excise,
Mumbai v. M/s.Kalvert Foods India Pvt. Ltd., .
7. On the other hand, learned counsel for the plaintiff
submits that plaintiff-company is the owner of the trade mark
Stable 2Y++ Single Solution KF reagent and enjoying exclusive
right over the same. It has been using the said trade mark since
the year 2005 and no other company in India is using the same
trademark. The proprietor of the defendant company is an ex-
employee of the plaintiff company, who worked as Marketing
Manager during the years 2002-2009. The trade mark of the
plaintiff signifies highest standards of quality, innovation,
reliability, output and integrity. The plaintiff company has
gained enormous goodwill over a period of 10 years in respect of
the product. He further submits that the trade mark of the
defendants product is deceptively similar as that of the
trademark of the plaintiffs product, which is creating any
amount of confusion among the customers and there is every
likelihood of the customers believe that the product marketed by
the defendants company in the name of Stable 2Y++ Single
Solution KF Reagent as that of the product of the plaintiffs
company. He further submits that the defendant wants to trade
upon the goodwill, name and reputation of the plaintiffs
company, which it has built-up during the last 10 years and the
conduct of the defendant in branding their product as that of
the plaintiffs product is fraudulent. In support of his
submissions, reliance has been placed on the following
decisions: a)Ashwini Chemical Works, Hyderabad v. Aswini Homeo
Pharmacy, R.R.District ; b) T.V.Venugopal v. Ushodaya Enterprises
Ltd., ; c) Dhariwal Industries Ltd., v. M/s.M.S.S. Food Products ; d)
Godfrey Philips India Ltd., v. Girnar Food & Beverages (P) Ltd., ; e) Sri
Sai Agencies Pvt. Ltd., v. Chintala Rama Rao and f) Laxmikant V. Patel
v. Chetanbhat Shah .
8. In view of above rival contentions, the following points
emerge for consideration in this appeal.
1) Whether the alleged trade mark of the
Plaintiffs product is descriptive in nature and whether
the same has attained secondary meaning?
2) If so, whether ad-interim injunction granted in
favour of the plaintiff is liable to be vacated?
9. POINTS 1 and 2:
It is relevant to extract the provisions of Sections 27 and
134 of the Trade Marks Act, 1999 reads as under:
27.No action for infringement of unregistered trade mark:
1) No person shall be entitled to institute any proceeding to prevent,
or to recover damages for the infringement of an unregistered
trade mark.
2) Nothing in this Act shall be deemed to affect rights of action
against any person for passing off goods or services as the goods
of another person or as services provided by another person, or
the remedies in respect thereof.
Section 134. Suit for infringement, etc., to be instituted before
District
Court:
(1) No suit.
a) For the infringement of a registered trade mark; or
b) Relating to any right in a registered trade mark; or
c) For passing off arising out of the use by the defendant of any
trade mark which is identical with or deceptively similar to the
plaintiffs trade mark, whether registered or unregistered,
shall be instituted in any court inferior to a District Court having
jurisdiction to try the suit.
A reading of the above provision shows that no action for
infringement will lie in respect of an unregistered trade mark,
but recognises the common law rights of the trade mark owner
to take action against any person for passing off goods as the
goods of another person or as services provided by another
person or the remedies thereof. In order to prove passing off by
the defendant, the plaintiff has to establish that the defendant is
misrepresenting to the general public to sell his product as that
of the products of the plaintiff, damaging the business or
goodwill of the plaintiff.
9. A trademark is said to be infringed when a registered
trademark is used by a person who is neither the registered
proprietor nor the licensee of the said trademark in relation to
the goods or services for which it is registered. From the scheme
of the Act, it is discernable that trademark infringement means
violation of exclusive rights granted to the registered proprietor
under the Act, to use the same in relation to the goods or
services in respect of which the trademark is registered. Section
29 and Section 30 of the Act, provides for protection of
registered trademark in case the same is infringed upon by a
person not being a registered proprietor or a licensee.
Action for Passing off the goods arises when an
unregistered trademark is used by a person who is not the
proprietor of the said trademark in relation to the goods or
services of the trademark owner. Passing off is a tort actionable
under common law and mainly used to protect the goodwill
attached with the unregistered trademarks. It is founded on the
basic tenant of law that one should not benefit from the labour
of another. An action for infringement for registered trademark
or tort of passing off for both registered as well as unregistered
trademark are essentially two ways of achieving the same
objectives i.e. protection of goodwill attached with a mark.
10. A perusal of the averments in the affidavit in respect of
the injunction petition filed by the plaintiff goes to show that the
Managing Director of the defendants company invented the
process using specific proportion of aromatic Heterocyclic
Compound with other raw material as ingredients to produce a
Pyridine-free Karl Fisher Reagent solution with minimum two
years stability, which was named as Stable 2Y++ Single
Solution KF reagent and same has been approved for its
stability, for a minimum of 2 years, from the recognized and
authorized laboratories through lab tests conducted for 2 years
by M/s. Startech Labs, who issued the analysis reports during
the period from April, 2003 to March, 2005 and confirmed that
the said product has stability for minimum 2 years. The words
Stable 2Y++ Single Solution KF Reagent significantly describe
the produce as to the stability of the produce in the packed
bottle for a minimum period of 2 years. The unique quality of
the product is described by these words and same was being
produced and marketed by the plaintiff company under the
brand name Stable 2Y++ Single Solution KF reagent since
2005. The said product has attained good reputation among the
customers and goodwill in the business. The products of the
plaintiff with trade name Stable 2Y++ Single Solution KF
Reagent are being advertised and doing business as such. The
plaintiff made application to Registrar of Trade Marks, Chennai
vide TM Application No.2310332 on 04.04.2012 for registering
the trade name Stable 2Y++ Single Solution KF Reagent which
in chemical equations indicates that the product stability is for a
minimum period of 2 years. Moreover, the application made by
the plaintiffs company is pending consideration for registration.
11. That these averments in the affidavit of the plaintiff go to
show that Stable 2Y++ is a descriptive term for describing the
stability of the product for a minimum period of 2 years and the
words Stable 2Y++ is description of the product regarding
stability of the product. As such, it can safely be held that the
words Stable 2y++ indicates description of the product
regarding stability and it is not a trade name.
12. The words Karl Fisher Reagent is invented by one Karl
Fisher, who is a German Scientist. When once it is not disputed
that Karl Fisher who is a German Scientist invented the
Reagent, named as Karl Fisher Reagent, nobody can claim
proprietorship over such invention, as such, the plaintiff cannot
claim proprietorship over Karl Fisher Reagent. As far as the
words Single Solution are concerned, they are in the nature of
generic words, and no one is permitted to claim proprietorship
over generic words, unless those words attain secondary
meaning. The entire alleged trademark is clearly indicative of
the nature of the product, which otherwise is a disqualification
for registration under Section 9 (1) (a) of the Act. Section 9(1)
(a) of the Act reads as follows:
9. Absolute grounds for refusal of registration:
(1) The trade marks-
(a) which are devoid of any distinctive character, that is
to say, capable of distinguishing the goods or services of
one person from those of another person;
(b)
(c ).
shall not be registered.
A perusal of the trade mark which is sought to be
registered under Trade Marks Act, i.e., Stable 2Y++ Single
Solution KF reagent, there is no distinctive character capable of
distinguishing the goods with that of the plaintiffs Stable 2Y++.
As such, no exclusive right is conferred on the plaintiff. It is
pertinent to note that the defendant had sold generic Karl Fisher
reagent with its own conceived and coined trade mark of KF 2Y
with very distinctive coloured (Yellow) packing slip and
corrugated packaging box and that there is huge distinction and
variation in the phonetics as well as the colour combination of
the labels adopted by both the parties.
13. A perusal of the said labels of both products show
printed matter pertaining to science, warnings and precautions
as well as descriptions and directions, which are mandatory as
per the provisions of law. The packing of the product of plaintiff
is in blue colour and the packing of the defendants is in yellow
colour. Moreover, the logo used by the plaintiff is Standard
Reagents and the defendant is using its logo as Shine Chem
Laboratories. As such, the contention of the plaintiff that the
labels used by the defendant are deceptively similar to that of
plaintiffs, cannot be accepted. There is a substantial difference
between both the labels i.e., KF Reagent used by the
defendants product and Stable 2Y++ Single Solution KF
Reagent used by the plaintiffs product. Since the product of
the defendant is sold as KF Reagent, there is no passing off as
alleged by the plaintiff.
a) In N.R.Dongre and others v. Whirlpool Corporation and another
(supra), the Honble Apex Court held as follows:
An infringement action is available where there is violation
of specific property right acquired under and recognised by
the statute. In a passing- off action, however, the plaintiffs
right is independent of such a statutory right to a trade
mark and is against the conduct of the defendant which
leads to or is intended or calculated to lead to deception
Passing- off is said to be a species of unfair trade
competition or of actionable unfair trading by which one
person, through deception, attempts to obtain an economic
benefit of the reputation which another has established for
himself in a particular trade or business. The action is
regarded as an action for deceit. The tort of passing-off
involves a misrepresentation made by the trader to his
prospective customers calculated to injure, as a reasonably
foreseeable consequence, the business or goodwill of
another which actually or probably, causes damages to the
business or good of the other trader.....".
In the above cited judgment, suit is in the nature of
passing off action filed by the respondents to restrain the
appellants from manufacturing, selling, advertising or in any
way using the trade mark Whirlpool in their product (washing
machine) deceptively or confusingly. In the said case, the
respondent has long association with the word Whirlpool who
acquired trans-India reputation in respect of the same and that
there was no reliable evidence of the appellants having marketed
their product in that name for a considerable length of time and
that irreparable injury would be caused to respondents
reputation and goodwill as the product of appellants baring that
mark was of lower standard and quality. Accordingly, the
Honble Supreme Court, confirmed the injunction granted by the
High Court in favour of the respondent therein. No evidence is
produced in this case to show that the alleged trademark
attained secondary meaning. In the instant case on hand,
plaintiff has also not produced any evidence to show that the
product sold by the defendant is deceptively similar to that of
the plaintiffs product thereby causing irreparable injury to
reputation and goodwill of the product of the plaintiff.
b) The Supreme Court in Cadila Healthcare Ltd., v. Gujarat Co-
operative Milk (supra) laid down certain broad principles, while
granting injunction, the relevant portion is as follows:-
18. Over the years, the Law of Passing off has gradually undergone a
paradigm shift. Whilst the principles of the Law have not changed in
principle, the judicial approach whilst adjudicating upon an action for
passing off has gradually changed as the Courts have become more
circumspective of those who complain of deception. This is primarily
owing to the propensity of traders in adopting purely descriptive words as
trade marks, which, in effect, has a direct bearing on other potential traders
intending to use such descriptive words for highlighting the characteristic
attributes of their products. Though there is no restrain on traders from
using purely descriptive words as trade marks, any trader who adopts a
trade mark of such nature is proscribed by the cannone of fair competition
to claim monopoly or exclusivity in respect of thereof. Even though an
action for passing off, in essence, continues to protect the distinctiveness
associated with trade marks, it has become a challenge for Courts of law to
ensure that no passing off action results in creating monopoly rights in the
use of trade marks which are inherently descriptive or public Jurisdiction in
nature.
51. It is noteworthy that throughout the course of the
proceedings before this Court, the main plank of the plaintiff's
contentions has been that the right to use a descriptive word even
when it has acquired a secondary meaning would be permissible if
and only if that is the only manner in which the product can be
described and in no other. To make good its point, the plaintiff has
proposed various similar permutations and combinations, viz. 'No
Sugar', 'Without Sugar', 'Free of Sugar', etc., using which the
defendant can convey the special attributes of its product Pro
Biotic Frozen Dessert. This contention of the plaintiff per se does
not impress me. Simply because a number of alternatives are
available to defendant to describe its product Pro Biotic Frozen
Dessert does not imply that the plaintiff be allowed to arrogate to
itself the monopoly to use the expression 'Sugar Free', especially
when the said expression being inherently descriptive in nature
has become public Jurisdiction in relation to foods and beverages.
54. It is important to be borne in mind that use of a descriptive
expression as a trade mark by a trader, irrespective of the said trade
mark having acquired a secondary meaning and distinctiveness in
relation to the trader's products, does not entitle such trader from
precluding other traders from using the said expression for the
purposes of describing the characteristic features of their products. I
have no hesitation in stating, albeit without prejudice to the rights
and interests of the plaintiff in the present suit, that by adopting
such a purely descriptive and laudatory expression 'Sugar Free' as
its trade mark, the plaintiff must be prepared to tolerate some degree
of confusion which is inevitable owing to the wide spread use of such
trade mark by fellow competitors. Simply because the plaintiff claims
to be using the expression 'Sugar Free' as a trade mark much prior
to the launch of the defendant's product Pro Biotic Frozen Dessert in
the market does not give this Court a good ground for imposing a
blanket injunction on the defendant from using the expression
'Sugar Free', especially when the defendant intends to use this
expression only in its descriptive sense and not as a trade mark, and
even otherwise, when the use of this expression is widespread in
relation to foods and beverages.
57. No doubt that the confusion emanating from the conspicuous
display of the expression 'sugar free' on the packaging of the
defendant's product is hard to ignore. However, I am afraid that
imposing a blanket injunction on the use of a public Jurisdiction
expression like 'sugar free' will inequitably allow the plaintiff to
monopolise the use of such expression, and this, in effect, will be
antithetical to fair competition in trade and commerce. Thus, the
challenge, in essence, before this Court is to provide such relief
which would maintain the balance between the private right of the
plaintiff to use the expression 'Sugar Free' as its trade mark and the
larger public right of traders to use the said expression in its
descriptive sense.
As held in Cadila Healthcare Ltd., v. Gujarat Co-operative Milk
(supra) imposing a blanket injunction on the use of a public
jurisdiction expression will be antithetical to fair competition in
trade and commerce.
c) In Commissioner of Central Excise, Mumbai v. M/s.Kalvert
Foods India Pvt. Ltd., (supra), the Honble Supreme Court held as
follows:
32. In our considered opinion, the aforesaid brand name "New
Improved Quick Frozen French Fries" is a descriptive word and the
same could not have been termed and coined either as a "house name"
or a "brand name" under any circumstances. There can be no dispute
therefore with regard to the proposition of law laid down by this Court
in the aforesaid decision..
In the instant case on hand, the use of descriptive words
Stable 2y++ Single Solution KF reagent describes the stability
and quality of the product, cannot be claimed by the
respondent/plaintiff as its trade mark, there is every likelihood
of confusion which is inevitable owing to the wide spread use of
such trade mark by fellow competitors. Simply because the
respondent/plaintiff claims to be using the expression Stable
2y++ Single Solution KF reagent as a trade mark much prior to
the launch of the appellants product Stable 2y++ in the market
is not a good ground for imposing a blanket injunction on the
appellant from using the expression 'Stable 2y++, especially
when the appellant/defendant intends to use this expression
only in its descriptive sense and not as a trade mark, and even
otherwise. As stated supra, the words Stable 2Y++ Single
Solution KF reagent is descriptive in nature. It has been held
that no one can claim proprietorship over the trade mark in
respect of descriptive words. As such, the appellant/defendant
cannot be prevented from using a descriptive term in its original
descriptive sense, unless it has wholly lost that descriptive sense
and become distinctive of the respondent/plaintiff in every
context.
14. In Ashwini Chemical Works, Hyderabad v. Aswini Homeo
Pharmacy, R.R.District and another (supra), the trade mark of the
appellant/defendant Ashwini is held deceptively similar in
sound as that of the trade mark of the respondents/plaintiffs
i.e., Aswini and there is any amount of confusion among the
customers believe that the detergent cake marketed by the
appellant/defendant in the nature of Ashwini as that of
respondent/plaintiff. The purchasers on looking at the product
of the appellant/defendant with trademark Ashwini there is
every likelihood of their believing that the product is that of the
respondents/plaintiffs. As the respondents/plaintiffs therein
have satisfied all the essential ingredients for grant of temporary
injunction, the injunction granted in favour of the
respondent/plaintiff is confirmed by this Court.
15. A descriptive trade mark may be entitled to protection
if it has assumed a secondary meaning which identifies it with
a particular product or as being from a particular source. A
mark which is prima facie descriptive will only be protected if
it can be shown to have acquired secondary meaning that is to
say, if it has become distinctive of the respondent/plaintiff.
No doubt, injunction can be granted in respect of passing off
action even in respect of descriptive word when the same has
attained secondary meaning as held in T.V.Venugopal v.
Ushodaya Enterprises Ltd.s case (supra), wherein it is held as
follows:
100. The respondent companys mark Eenadu has acquired
extra-ordinary reputation and goodwill in the State of Andhra Pradesh.
Eenadu newspaper and TV are extremely well known and almost
household words in the State of Andhra Pradesh. The word Eenadu
may be a descriptive word but has acquired a secondary or subsidiary
meaning and is fully identified with the products and services provided
by the respondent company.
16. In Office Cleaning Services Limited v. Westminster Office
Cleaning Association wherein the Court observed that the word
office cleaning was held to be a descriptive word, for it is a
descriptive of the business they carry on. It was held that the
plaintiff could assume or establish monopoly on the said word
only when they show that they have acquired a secondary or
subsidiary meaning. But in the present case, no evidence is let
in to show that the Stable 2y++ has attained secondary
meaning regarding the product of the respondent/plaintiff.
Moreover, the application for registration of trade mark applied
by the respondent/plaintiff in respect of the subject trade mark,
admittedly is pending and the same has to be considered by the
Registrar of Trade Marks. The trial Court erroneously held that
the appellant/defendant has not placed any material before the
Court to show that there is definite formula to describe the
product as Stable 2y++. In fact, the plaintiff himself stated in
the affidavit in support of the injunction petition that the word
Stable 2Y++ is indicative of stability of the product. In fact, the
burden of proof lies on the plaintiff to prove his case.
17. In Sri Sai Agencies Pvt. Ltd., v. Chintala Rama Rao (supra),
this Court observed that the seller introducing products earlier
is entitled for injunction. It is a case wherein the producers of
ghee using the trade marks as Mathura ghee and Mathurag
ghee and the only difference between two trade marks is
alphabet G. Both the trade marks are phonetically similar and
there is not much of difference in pictorial and monogram and
the use of trade mark Mathurag by rival producer commencing
after lapse of five years is likely to deceive and confuse
customers. The owner of the trade mark Mathura popularized
his mark by investing huge amount for advertisements, through
different media right from the date of marketing his goods. As
such, the prior user of the product i.e., Mathura is entitled for
injunction.
18. Though the Court below held that Stable 2Y++ is unique
style of the plaintiff to describe its product, but no evidence is
placed evidencing the same. The Court below also found that
the defendant is using his product under trade name KF 2Y
and not as Stable 2Y++. When plaintiff is using the trade mark
of KF 2Y, no cause of action arises for granting of injunction, as
such, granting of injunction restraining the defendant from
using the trade mark KF 2Y++ is erroneous. A perusal of
Exs.P3 to P13 and Exs.R2 to R5 goes to show that labels and
style of font mentioning as Stable 2Y++ and the colour and logo
are also not similar and back ground is also not similar.
Besides the logo, the plaintiff is using the word Standard
Reagents whereas the defendant is using Shine Chem
Laboratories. As far as Single Solution is concerned, it is
descriptive word and Stable 2Y++ even according to the
plaintiff, is descriptive in nature. The numeral 2 along with
Y++ refers to the stability period being 2 years and single
solution refers to composition of the solution. The mark Stable
2Y++ Single Solution of the plaintiff does not have any
distinctiveness and the descriptive sentence Single Solution KF
Reagent cannot be called as a proprietary mark or the
trademark. Whether the words Stable 2Y++ has attained
secondary meaning regarding the products of the plaintiff has to
be gone into in the suit after evidence is let in by both parties.
In view of above facts and circumstances other decisions relied
on by both sides have no application to the facts of the case.
19. Apart from above, the plaintiff had not produced any
documentary evidence showing that it has suffered damage or is
likely to suffer damage because of the sale of the product by the
defendant as that of the plaintiff. In the absence of the same,
there cannot be any passing-off by the appellant as claimed by
the respondent/plaintiff.
In LAXMIKANT V. PATELs case ( supra), the Supreme
Court has explained the essentials which constitute passing off
action, by holding as under:
12The three elements of passing off action are the
reputation of goods, possibility of deception and likelihood of
damages to the plaintiff. In our opinion, the same principle,
which applies to trade mark, is applicable to trade name.
13. In an action for passing off it is usual, rather
essential, to seek an injunction, temporary and ad-interim. The
principles for the grant of such injunction are the same as in the
case of any other action against injury complained of. The
plaintiff must prove a prima facie case, availability of balance of
convenience in his favour and his suffering an irreparable injury
in the absence of grant of injunction.
Accordingly, both the points are answered in favour of the
appellant.
In view of above facts and circumstances, the impugned
order of the Court below is set aside. It is needless to state that
the Court below shall dispose of the suit, after considering the
oral and documentary evidence of both sides, without being
influenced by any of the observations made hereunder.
Accordingly, the Civil Miscellaneous Appeal is allowed.
There shall be no order as to costs. As a sequel thereto,
miscellaneous petitions, if any, pending shall stand closed.
____________________________
A.RAJASHEKER REDDY, J
29.04.2016
THE HONBLE SRI JUSTICE A.RAJASHEKER REDDY
C.M.A. No.784 of 2015
29-04-2016
M/s. Shine Chem Laboratories, A Partnership firm, rep. by its Proprietor
M.Dasanjaneyulu. ... Appellant
Standard Reagents Private Limited, Rep. by its MD Sri M.Srinivas....Respondent
Counsel for the Appellant: Sri Ashok Ram Kumar
Counsel for the Respondent: Sri Venkatesh Deshpande.
>HEAD NOTE:
? Cases referred
1.(1996) 5 Supreme Court Cases 714
2 2008 (36) PTC 168 Del
3 2003 (26) PTC 593 Delhi
4 (2011) 8 SCLR 030
5 2010 (1) ALD 199
6 Civil Appeal Nos.6314_15 of 2001
7AIR 2005 Supreme Court 1999
8 (2004) 5 Supreme Court Cases 257
9 AIR 1998 Andhra Pradesh 86
10 AIR 2002 Supreme Court 275(1)
11 1944 (2) AII ER 269
HONBLE SRI JUSTICE A.RAJASHEKER REDDY
CMA No. 784 OF 2015
JUDGMENT:
This appeal is filed challenging the order dated
21.07.2015 passed in I.A.No.658 of 2014 in O.S.No.1067 of
2014 by the XVI Additional District Judge and Sessions Judge
cum XVI Additional Metropolitan Sessions Judge, Ranga Reddy
District at Malkajgiri, wherein the injunction petition filed by the
respondent/plaintiff was allowed and the defendant was
restrained from manufacturing and selling his product Karl
Fisher Reagent under Trade name of Stable 2Y++, pending
disposal of the suit.
2. Defendant in the suit is the appellant herein. The parties
hereinafter will be referred to as arrayed in the suit.
The plaintiff filed petition under Order XXXIX, Rules 1 and
2 CPC read with Section 151 CPC for grant of ad-interim
injunction restraining the defendant from manufacturing,
selling, marketing, advertising, distributing of the product Karl
Fisher Reagent bearing the plaintiffs trade name Stable 2Y++
Single Solution KF Reagent pending disposal of the suit. The
plaintiff is a Private Limited Company incorporated under
Companies Act. It has been doing business of manufacturer of
sales of high performance laboratory solvents, reagents,
standard solutions and fine chemicals. By using specific
proportion of Aromatic Heterocyclic Compound with other raw
material as ingredients to produce a Pyridine-free Karl-Fisher
Reagent Solution of the strength 5.0 to 6.0 mg/ml of water, with
minimum two years stability and as such it is named as Stable
2Y++ Single Solution KF Reagent and is being approved for its
stability for a minimum of 2 years from the recognized and
authorized laboratories. The words Stable 2Y++ Single Solution
KF Reagent describe the produce as to the stability of the
produce in the packed bottle for a minimum period of 2 years.
The Managing Director of the plaintiff-company made an
application to Registrar of Trademarks for registering the brand
name of the trade name and same is pending. The plaintiff has
been using the said trademark since the year 2005 onwards and
no other company in India using the same. The plaintiffs trade
mark signifies the highest standards of quality, innovation,
reliability, output and integrity.
3. The proprietor of the defendants Company worked in the
plaintiffs Company as a Marketing Manager for a period of 7
years from the year 2002-2009. Thereafter, he started a separate
business and imitated the label, the trade name of the product
Stable 2Y++ Single Solution KF Reagent and packed the
product in a similar looking bottle and packing case and selling
the same in the open market exhibiting as if the product being
sold by the defendant as of his own product similar to that of the
plaintiffs product with an intention to create confusion and
deception in the minds of the customers and with an ulterior
motive to injure his business, reputation and goodwill. That the
said action of the defendant came to the knowledge of the
plaintiff in the first week of September, 2014 and on that the
plaintiff procured a sample of the product manufactured and
marketed by the defendant. The act of defendant amounts to
gross misrepresentation and passing off of goods branded
deceptively in the name of the plaintiffs Company. Hence
petition for injunction as noted above.
4. The defendant filed counter denying the allegations in the
affidavit filed in support of the petition stating that there cannot
be a passing off for a product KF Reagent as the origin inventor
was one Mr.Karl Fisher, who is a German Chemist. The KF
Reagent itself indicates the person Karl Fisher Reagent. The
word Single Solution is a common English word and no one
can claim proprietorship over the same. Further the word
connotes that there is only one solution as an old process
Pyridine which has two solutions. The words Stable 2Y++ Single
Solution KF Reagent significantly describes as to the stability of
the product in the packed bottle which is for a minimum period
of two years. Thus, the trade mark is an indicative of the nature
of the product which is a generic word and the plaintiff has no
exclusive rights over the generic words. The registered
partnership firm of the defendant consists of four partners,
constituted for the purpose of doing business of manufacturing
and trading of all types of industrial and laboratory chemicals,
laboratory glassware and laboratory instruments. The
defendant is doing business since the year 2014 onwards. One
of the partners of the defendant firm was former employee of the
plaintiff. In the year 2009, the said partner left the services of
the plaintiff and started M/s. Shine Chem Laboratories in the
year 2014 for the purpose of manufacturing Karl Fisher
Reagent and doing business in the said product. That most of
the chemical companies are manufacturing Karl Fisher
Reagent without pyridine in their style of process, as such,
Karl Fisher Reagent without Pyridine has become a generic
product and it is not an invention of anybody. The product
packed in the bottle will be shown in the symbolic 2Y, 2Y++ or
5Y etc., Thus, the usage of 2Y++ along with a trade mark of the
plaintiff does not confer any right over it. That the application
of the plaintiff for registration is still pending and the same does
not qualify for being registered under Section 9 of Indian Trade
Marks Act, 1999 as the trade mark is descriptive in nature. The
defendant sold its generic Karl Fisher Reagent with its own
conceived and coined Trade Mark of KF 2Y with very distinctive
coloured (yellow) packing slip. Since all the buyers of the
plaintiff are educated, having scientific background, the
question of purchasing the product of the defendant as that of
the plaintiffs product does not arise. The package label of the
defendant is distinctive, unique and shall not have any
resemblance with that of the plaintiffs product. The defendant
has his own version of generic product of Karl Fisher Reagent
with brand of KF 2Y, which is distinctive and shall not have
any similarity or deceptive similarity with the Trade mark of the
plaintiff that is Stable 2Y++. The defendant has not
misrepresented and misused the Trade Mark or good will of the
plaintiff, as such, passing off goods should not be attributed to
the defendant as the product of the plaintiff has not attained
secondary meaning. The Trade Mark of the plaintiff Stable
2Y++ itself is not having the essentials of a Trade Mark for not
having distinctiveness and therefore, the plaintiff is not entitled
for relief of injunction.
5. The trial Court, after considering the documentary
evidence i.e., Exs.P1 to P85 marked on behalf of the plaintiff and
Exs.R1 to R5 marked on behalf of the defendant, granted ad-
interim injunction restraining the defendant from
manufacturing, selling and marketing his product Karl Fisher
Reagent under Trade name of Stable 2Y++ pending disposal of
the suit. Aggrieved by the same, present appeal is filed.
6. Sri Ashok Ram Kumar, learned counsel for the defendant-
appellant, strenuously contended that since the Stable 2Y++
Single Solution KF Reagent is nothing but a descriptive nature
of the product being reagent and the plaintiff is questioning the
description of the product and not passing off of a brand. He
also contends that there cannot be a claim of proprietorship on
a descriptive terminology as there are several descriptive
terminologies such as Karl Fisher, Pyridine Free, Reagents,
Longer Shelf Life, Stability and Single Solution etc. He also
submitted that the trial Court having found that the defendant
is selling its product under Trade Mark KF 2Y and not Stable
2Y++, erred in restraining the defendant from selling its product
of Karl Fischer Reagent KF 2Y++. That the impugned order
will adversely affect the prosperous business of the defendant
and there is likelihood of stamping the defendant as pirate. He
further contended that any mark which is descriptive in nature
is not protected since the same should be allotted to use by
different vendors of the similar product to describe the product
in their marketing literature. In support of his contentions, he
relied on the decisions reported in N.R.Dongre v. Whirlpool
Corporation , Cadila Healthcare Ltd., v. Gujarat Co-operative Milk ,
Micronix India v. Mr.J.R.Kapoor , Commissioner of Central Excise,
Mumbai v. M/s.Kalvert Foods India Pvt. Ltd., .
7. On the other hand, learned counsel for the plaintiff
submits that plaintiff-company is the owner of the trade mark
Stable 2Y++ Single Solution KF reagent and enjoying exclusive
right over the same. It has been using the said trade mark since
the year 2005 and no other company in India is using the same
trademark. The proprietor of the defendant company is an ex-
employee of the plaintiff company, who worked as Marketing
Manager during the years 2002-2009. The trade mark of the
plaintiff signifies highest standards of quality, innovation,
reliability, output and integrity. The plaintiff company has
gained enormous goodwill over a period of 10 years in respect of
the product. He further submits that the trade mark of the
defendants product is deceptively similar as that of the
trademark of the plaintiffs product, which is creating any
amount of confusion among the customers and there is every
likelihood of the customers believe that the product marketed by
the defendants company in the name of Stable 2Y++ Single
Solution KF Reagent as that of the product of the plaintiffs
company. He further submits that the defendant wants to trade
upon the goodwill, name and reputation of the plaintiffs
company, which it has built-up during the last 10 years and the
conduct of the defendant in branding their product as that of
the plaintiffs product is fraudulent. In support of his
submissions, reliance has been placed on the following
decisions: a)Ashwini Chemical Works, Hyderabad v. Aswini Homeo
Pharmacy, R.R.District ; b) T.V.Venugopal v. Ushodaya Enterprises
Ltd., ; c) Dhariwal Industries Ltd., v. M/s.M.S.S. Food Products ; d)
Godfrey Philips India Ltd., v. Girnar Food & Beverages (P) Ltd., ; e) Sri
Sai Agencies Pvt. Ltd., v. Chintala Rama Rao and f) Laxmikant V. Patel
v. Chetanbhat Shah .
8. In view of above rival contentions, the following points
emerge for consideration in this appeal.
1) Whether the alleged trade mark of the
Plaintiffs product is descriptive in nature and whether
the same has attained secondary meaning?
2) If so, whether ad-interim injunction granted in
favour of the plaintiff is liable to be vacated?
9. POINTS 1 and 2:
It is relevant to extract the provisions of Sections 27 and
134 of the Trade Marks Act, 1999 reads as under:
27.No action for infringement of unregistered trade mark:
1) No person shall be entitled to institute any proceeding to prevent,
or to recover damages for the infringement of an unregistered
trade mark.
2) Nothing in this Act shall be deemed to affect rights of action
against any person for passing off goods or services as the goods
of another person or as services provided by another person, or
the remedies in respect thereof.
Section 134. Suit for infringement, etc., to be instituted before
District
Court:
(1) No suit.
a) For the infringement of a registered trade mark; or
b) Relating to any right in a registered trade mark; or
c) For passing off arising out of the use by the defendant of any
trade mark which is identical with or deceptively similar to the
plaintiffs trade mark, whether registered or unregistered,
shall be instituted in any court inferior to a District Court having
jurisdiction to try the suit.
A reading of the above provision shows that no action for
infringement will lie in respect of an unregistered trade mark,
but recognises the common law rights of the trade mark owner
to take action against any person for passing off goods as the
goods of another person or as services provided by another
person or the remedies thereof. In order to prove passing off by
the defendant, the plaintiff has to establish that the defendant is
misrepresenting to the general public to sell his product as that
of the products of the plaintiff, damaging the business or
goodwill of the plaintiff.
9. A trademark is said to be infringed when a registered
trademark is used by a person who is neither the registered
proprietor nor the licensee of the said trademark in relation to
the goods or services for which it is registered. From the scheme
of the Act, it is discernable that trademark infringement means
violation of exclusive rights granted to the registered proprietor
under the Act, to use the same in relation to the goods or
services in respect of which the trademark is registered. Section
29 and Section 30 of the Act, provides for protection of
registered trademark in case the same is infringed upon by a
person not being a registered proprietor or a licensee.
Action for Passing off the goods arises when an
unregistered trademark is used by a person who is not the
proprietor of the said trademark in relation to the goods or
services of the trademark owner. Passing off is a tort actionable
under common law and mainly used to protect the goodwill
attached with the unregistered trademarks. It is founded on the
basic tenant of law that one should not benefit from the labour
of another. An action for infringement for registered trademark
or tort of passing off for both registered as well as unregistered
trademark are essentially two ways of achieving the same
objectives i.e. protection of goodwill attached with a mark.
10. A perusal of the averments in the affidavit in respect of
the injunction petition filed by the plaintiff goes to show that the
Managing Director of the defendants company invented the
process using specific proportion of aromatic Heterocyclic
Compound with other raw material as ingredients to produce a
Pyridine-free Karl Fisher Reagent solution with minimum two
years stability, which was named as Stable 2Y++ Single
Solution KF reagent and same has been approved for its
stability, for a minimum of 2 years, from the recognized and
authorized laboratories through lab tests conducted for 2 years
by M/s. Startech Labs, who issued the analysis reports during
the period from April, 2003 to March, 2005 and confirmed that
the said product has stability for minimum 2 years. The words
Stable 2Y++ Single Solution KF Reagent significantly describe
the produce as to the stability of the produce in the packed
bottle for a minimum period of 2 years. The unique quality of
the product is described by these words and same was being
produced and marketed by the plaintiff company under the
brand name Stable 2Y++ Single Solution KF reagent since
2005. The said product has attained good reputation among the
customers and goodwill in the business. The products of the
plaintiff with trade name Stable 2Y++ Single Solution KF
Reagent are being advertised and doing business as such. The
plaintiff made application to Registrar of Trade Marks, Chennai
vide TM Application No.2310332 on 04.04.2012 for registering
the trade name Stable 2Y++ Single Solution KF Reagent which
in chemical equations indicates that the product stability is for a
minimum period of 2 years. Moreover, the application made by
the plaintiffs company is pending consideration for registration.
11. That these averments in the affidavit of the plaintiff go to
show that Stable 2Y++ is a descriptive term for describing the
stability of the product for a minimum period of 2 years and the
words Stable 2Y++ is description of the product regarding
stability of the product. As such, it can safely be held that the
words Stable 2y++ indicates description of the product
regarding stability and it is not a trade name.
12. The words Karl Fisher Reagent is invented by one Karl
Fisher, who is a German Scientist. When once it is not disputed
that Karl Fisher who is a German Scientist invented the
Reagent, named as Karl Fisher Reagent, nobody can claim
proprietorship over such invention, as such, the plaintiff cannot
claim proprietorship over Karl Fisher Reagent. As far as the
words Single Solution are concerned, they are in the nature of
generic words, and no one is permitted to claim proprietorship
over generic words, unless those words attain secondary
meaning. The entire alleged trademark is clearly indicative of
the nature of the product, which otherwise is a disqualification
for registration under Section 9 (1) (a) of the Act. Section 9(1)
(a) of the Act reads as follows:
9. Absolute grounds for refusal of registration:
(1) The trade marks-
(a) which are devoid of any distinctive character, that is
to say, capable of distinguishing the goods or services of
one person from those of another person;
(b)
(c ).
shall not be registered.
A perusal of the trade mark which is sought to be
registered under Trade Marks Act, i.e., Stable 2Y++ Single
Solution KF reagent, there is no distinctive character capable of
distinguishing the goods with that of the plaintiffs Stable 2Y++.
As such, no exclusive right is conferred on the plaintiff. It is
pertinent to note that the defendant had sold generic Karl Fisher
reagent with its own conceived and coined trade mark of KF 2Y
with very distinctive coloured (Yellow) packing slip and
corrugated packaging box and that there is huge distinction and
variation in the phonetics as well as the colour combination of
the labels adopted by both the parties.
13. A perusal of the said labels of both products show
printed matter pertaining to science, warnings and precautions
as well as descriptions and directions, which are mandatory as
per the provisions of law. The packing of the product of plaintiff
is in blue colour and the packing of the defendants is in yellow
colour. Moreover, the logo used by the plaintiff is Standard
Reagents and the defendant is using its logo as Shine Chem
Laboratories. As such, the contention of the plaintiff that the
labels used by the defendant are deceptively similar to that of
plaintiffs, cannot be accepted. There is a substantial difference
between both the labels i.e., KF Reagent used by the
defendants product and Stable 2Y++ Single Solution KF
Reagent used by the plaintiffs product. Since the product of
the defendant is sold as KF Reagent, there is no passing off as
alleged by the plaintiff.
a) In N.R.Dongre and others v. Whirlpool Corporation and another
(supra), the Honble Apex Court held as follows:
An infringement action is available where there is violation
of specific property right acquired under and recognised by
the statute. In a passing- off action, however, the plaintiffs
right is independent of such a statutory right to a trade
mark and is against the conduct of the defendant which
leads to or is intended or calculated to lead to deception
Passing- off is said to be a species of unfair trade
competition or of actionable unfair trading by which one
person, through deception, attempts to obtain an economic
benefit of the reputation which another has established for
himself in a particular trade or business. The action is
regarded as an action for deceit. The tort of passing-off
involves a misrepresentation made by the trader to his
prospective customers calculated to injure, as a reasonably
foreseeable consequence, the business or goodwill of
another which actually or probably, causes damages to the
business or good of the other trader.....".
In the above cited judgment, suit is in the nature of
passing off action filed by the respondents to restrain the
appellants from manufacturing, selling, advertising or in any
way using the trade mark Whirlpool in their product (washing
machine) deceptively or confusingly. In the said case, the
respondent has long association with the word Whirlpool who
acquired trans-India reputation in respect of the same and that
there was no reliable evidence of the appellants having marketed
their product in that name for a considerable length of time and
that irreparable injury would be caused to respondents
reputation and goodwill as the product of appellants baring that
mark was of lower standard and quality. Accordingly, the
Honble Supreme Court, confirmed the injunction granted by the
High Court in favour of the respondent therein. No evidence is
produced in this case to show that the alleged trademark
attained secondary meaning. In the instant case on hand,
plaintiff has also not produced any evidence to show that the
product sold by the defendant is deceptively similar to that of
the plaintiffs product thereby causing irreparable injury to
reputation and goodwill of the product of the plaintiff.
b) The Supreme Court in Cadila Healthcare Ltd., v. Gujarat Co-
operative Milk (supra) laid down certain broad principles, while
granting injunction, the relevant portion is as follows:-
18. Over the years, the Law of Passing off has gradually undergone a
paradigm shift. Whilst the principles of the Law have not changed in
principle, the judicial approach whilst adjudicating upon an action for
passing off has gradually changed as the Courts have become more
circumspective of those who complain of deception. This is primarily
owing to the propensity of traders in adopting purely descriptive words as
trade marks, which, in effect, has a direct bearing on other potential traders
intending to use such descriptive words for highlighting the characteristic
attributes of their products. Though there is no restrain on traders from
using purely descriptive words as trade marks, any trader who adopts a
trade mark of such nature is proscribed by the cannone of fair competition
to claim monopoly or exclusivity in respect of thereof. Even though an
action for passing off, in essence, continues to protect the distinctiveness
associated with trade marks, it has become a challenge for Courts of law to
ensure that no passing off action results in creating monopoly rights in the
use of trade marks which are inherently descriptive or public Jurisdiction in
nature.
51. It is noteworthy that throughout the course of the
proceedings before this Court, the main plank of the plaintiff's
contentions has been that the right to use a descriptive word even
when it has acquired a secondary meaning would be permissible if
and only if that is the only manner in which the product can be
described and in no other. To make good its point, the plaintiff has
proposed various similar permutations and combinations, viz. 'No
Sugar', 'Without Sugar', 'Free of Sugar', etc., using which the
defendant can convey the special attributes of its product Pro
Biotic Frozen Dessert. This contention of the plaintiff per se does
not impress me. Simply because a number of alternatives are
available to defendant to describe its product Pro Biotic Frozen
Dessert does not imply that the plaintiff be allowed to arrogate to
itself the monopoly to use the expression 'Sugar Free', especially
when the said expression being inherently descriptive in nature
has become public Jurisdiction in relation to foods and beverages.
54. It is important to be borne in mind that use of a descriptive
expression as a trade mark by a trader, irrespective of the said trade
mark having acquired a secondary meaning and distinctiveness in
relation to the trader's products, does not entitle such trader from
precluding other traders from using the said expression for the
purposes of describing the characteristic features of their products. I
have no hesitation in stating, albeit without prejudice to the rights
and interests of the plaintiff in the present suit, that by adopting
such a purely descriptive and laudatory expression 'Sugar Free' as
its trade mark, the plaintiff must be prepared to tolerate some degree
of confusion which is inevitable owing to the wide spread use of such
trade mark by fellow competitors. Simply because the plaintiff claims
to be using the expression 'Sugar Free' as a trade mark much prior
to the launch of the defendant's product Pro Biotic Frozen Dessert in
the market does not give this Court a good ground for imposing a
blanket injunction on the defendant from using the expression
'Sugar Free', especially when the defendant intends to use this
expression only in its descriptive sense and not as a trade mark, and
even otherwise, when the use of this expression is widespread in
relation to foods and beverages.
57. No doubt that the confusion emanating from the conspicuous
display of the expression 'sugar free' on the packaging of the
defendant's product is hard to ignore. However, I am afraid that
imposing a blanket injunction on the use of a public Jurisdiction
expression like 'sugar free' will inequitably allow the plaintiff to
monopolise the use of such expression, and this, in effect, will be
antithetical to fair competition in trade and commerce. Thus, the
challenge, in essence, before this Court is to provide such relief
which would maintain the balance between the private right of the
plaintiff to use the expression 'Sugar Free' as its trade mark and the
larger public right of traders to use the said expression in its
descriptive sense.
As held in Cadila Healthcare Ltd., v. Gujarat Co-operative Milk
(supra) imposing a blanket injunction on the use of a public
jurisdiction expression will be antithetical to fair competition in
trade and commerce.
c) In Commissioner of Central Excise, Mumbai v. M/s.Kalvert
Foods India Pvt. Ltd., (supra), the Honble Supreme Court held as
follows:
32. In our considered opinion, the aforesaid brand name "New
Improved Quick Frozen French Fries" is a descriptive word and the
same could not have been termed and coined either as a "house name"
or a "brand name" under any circumstances. There can be no dispute
therefore with regard to the proposition of law laid down by this Court
in the aforesaid decision..
In the instant case on hand, the use of descriptive words
Stable 2y++ Single Solution KF reagent describes the stability
and quality of the product, cannot be claimed by the
respondent/plaintiff as its trade mark, there is every likelihood
of confusion which is inevitable owing to the wide spread use of
such trade mark by fellow competitors. Simply because the
respondent/plaintiff claims to be using the expression Stable
2y++ Single Solution KF reagent as a trade mark much prior to
the launch of the appellants product Stable 2y++ in the market
is not a good ground for imposing a blanket injunction on the
appellant from using the expression 'Stable 2y++, especially
when the appellant/defendant intends to use this expression
only in its descriptive sense and not as a trade mark, and even
otherwise. As stated supra, the words Stable 2Y++ Single
Solution KF reagent is descriptive in nature. It has been held
that no one can claim proprietorship over the trade mark in
respect of descriptive words. As such, the appellant/defendant
cannot be prevented from using a descriptive term in its original
descriptive sense, unless it has wholly lost that descriptive sense
and become distinctive of the respondent/plaintiff in every
context.
14. In Ashwini Chemical Works, Hyderabad v. Aswini Homeo
Pharmacy, R.R.District and another (supra), the trade mark of the
appellant/defendant Ashwini is held deceptively similar in
sound as that of the trade mark of the respondents/plaintiffs
i.e., Aswini and there is any amount of confusion among the
customers believe that the detergent cake marketed by the
appellant/defendant in the nature of Ashwini as that of
respondent/plaintiff. The purchasers on looking at the product
of the appellant/defendant with trademark Ashwini there is
every likelihood of their believing that the product is that of the
respondents/plaintiffs. As the respondents/plaintiffs therein
have satisfied all the essential ingredients for grant of temporary
injunction, the injunction granted in favour of the
respondent/plaintiff is confirmed by this Court.
15. A descriptive trade mark may be entitled to protection
if it has assumed a secondary meaning which identifies it with
a particular product or as being from a particular source. A
mark which is prima facie descriptive will only be protected if
it can be shown to have acquired secondary meaning that is to
say, if it has become distinctive of the respondent/plaintiff.
No doubt, injunction can be granted in respect of passing off
action even in respect of descriptive word when the same has
attained secondary meaning as held in T.V.Venugopal v.
Ushodaya Enterprises Ltd.s case (supra), wherein it is held as
follows:
100. The respondent companys mark Eenadu has acquired
extra-ordinary reputation and goodwill in the State of Andhra Pradesh.
Eenadu newspaper and TV are extremely well known and almost
household words in the State of Andhra Pradesh. The word Eenadu
may be a descriptive word but has acquired a secondary or subsidiary
meaning and is fully identified with the products and services provided
by the respondent company.
16. In Office Cleaning Services Limited v. Westminster Office
Cleaning Association wherein the Court observed that the word
office cleaning was held to be a descriptive word, for it is a
descriptive of the business they carry on. It was held that the
plaintiff could assume or establish monopoly on the said word
only when they show that they have acquired a secondary or
subsidiary meaning. But in the present case, no evidence is let
in to show that the Stable 2y++ has attained secondary
meaning regarding the product of the respondent/plaintiff.
Moreover, the application for registration of trade mark applied
by the respondent/plaintiff in respect of the subject trade mark,
admittedly is pending and the same has to be considered by the
Registrar of Trade Marks. The trial Court erroneously held that
the appellant/defendant has not placed any material before the
Court to show that there is definite formula to describe the
product as Stable 2y++. In fact, the plaintiff himself stated in
the affidavit in support of the injunction petition that the word
Stable 2Y++ is indicative of stability of the product. In fact, the
burden of proof lies on the plaintiff to prove his case.
17. In Sri Sai Agencies Pvt. Ltd., v. Chintala Rama Rao (supra),
this Court observed that the seller introducing products earlier
is entitled for injunction. It is a case wherein the producers of
ghee using the trade marks as Mathura ghee and Mathurag
ghee and the only difference between two trade marks is
alphabet G. Both the trade marks are phonetically similar and
there is not much of difference in pictorial and monogram and
the use of trade mark Mathurag by rival producer commencing
after lapse of five years is likely to deceive and confuse
customers. The owner of the trade mark Mathura popularized
his mark by investing huge amount for advertisements, through
different media right from the date of marketing his goods. As
such, the prior user of the product i.e., Mathura is entitled for
injunction.
18. Though the Court below held that Stable 2Y++ is unique
style of the plaintiff to describe its product, but no evidence is
placed evidencing the same. The Court below also found that
the defendant is using his product under trade name KF 2Y
and not as Stable 2Y++. When plaintiff is using the trade mark
of KF 2Y, no cause of action arises for granting of injunction, as
such, granting of injunction restraining the defendant from
using the trade mark KF 2Y++ is erroneous. A perusal of
Exs.P3 to P13 and Exs.R2 to R5 goes to show that labels and
style of font mentioning as Stable 2Y++ and the colour and logo
are also not similar and back ground is also not similar.
Besides the logo, the plaintiff is using the word Standard
Reagents whereas the defendant is using Shine Chem
Laboratories. As far as Single Solution is concerned, it is
descriptive word and Stable 2Y++ even according to the
plaintiff, is descriptive in nature. The numeral 2 along with
Y++ refers to the stability period being 2 years and single
solution refers to composition of the solution. The mark Stable
2Y++ Single Solution of the plaintiff does not have any
distinctiveness and the descriptive sentence Single Solution KF
Reagent cannot be called as a proprietary mark or the
trademark. Whether the words Stable 2Y++ has attained
secondary meaning regarding the products of the plaintiff has to
be gone into in the suit after evidence is let in by both parties.
In view of above facts and circumstances other decisions relied
on by both sides have no application to the facts of the case.
19. Apart from above, the plaintiff had not produced any
documentary evidence showing that it has suffered damage or is
likely to suffer damage because of the sale of the product by the
defendant as that of the plaintiff. In the absence of the same,
there cannot be any passing-off by the appellant as claimed by
the respondent/plaintiff.
In LAXMIKANT V. PATELs case ( supra), the Supreme
Court has explained the essentials which constitute passing off
action, by holding as under:
12The three elements of passing off action are the
reputation of goods, possibility of deception and likelihood of
damages to the plaintiff. In our opinion, the same principle,
which applies to trade mark, is applicable to trade name.
13. In an action for passing off it is usual, rather
essential, to seek an injunction, temporary and ad-interim. The
principles for the grant of such injunction are the same as in the
case of any other action against injury complained of. The
plaintiff must prove a prima facie case, availability of balance of
convenience in his favour and his suffering an irreparable injury
in the absence of grant of injunction.
Accordingly, both the points are answered in favour of the
appellant.
In view of above facts and circumstances, the impugned
order of the Court below is set aside. It is needless to state that
the Court below shall dispose of the suit, after considering the
oral and documentary evidence of both sides, without being
influenced by any of the observations made hereunder.
Accordingly, the Civil Miscellaneous Appeal is allowed.
There shall be no order as to costs. As a sequel thereto,
miscellaneous petitions, if any, pending shall stand closed.
____________________________
A.RAJASHEKER REDDY, J
29.04.2016
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