This article has been written by Buddhisagar Kulkarni pursuing the Diploma in Business Laws for In-House Counsels from LawSikho.

Introduction

Nowadays, there has been a rise in cases of trademark infringement. The unauthorized use of a trademark or service mark on or concerning products and/or services in a way that is likely to mislead, deceive, or mistake about the origin of the products and/or services is referred to as trademark infringement. A plaintiff must prove in court that it owns a valid mark, that it has priority (its rights in the mark(s) are before the defendant’s), and that the defendant’s mark is likely to confuse consumers about the origin of the products or services offered under the parties’ marks. In this article, we will study the provisions governing trademark infringement in India and Canada. We will further look at how Amul won a trademark infringement case in Canada.

Trademark violation rules in India

Section 29 of the Trademark Act, 1999 (“the Act”)contains the provisions regarding the infringement of the trademark.

To file a trademark infringement action, the trademark must be registered.

The conditions for an infringement action to be initiated

1. The supposedly infringing mark must be identical to or confusingly similar to the registered trademark;
2. The goods/services for which the allegedly infringing mark is utilised must be protected by the registered trademark’s registration;
3. The allegedly infringing mark must be used in the course of business; and
4. The usage must be made in such a way that it is likely to be misinterpreted as a trademark.

When does the use of a trademark infringe on a registered trademark?

1. Its resemblance to a registered trademark and similarity to the goods or services covered by registration; or
2. Its resemblance to a registered trademark, as well as its identity with the goods or services protected by registration; or
3. Its identity with a registered trademark, as well as its identity with goods and services covered by the registration

is likely to trigger public uncertainty (in case 3 above, uncertainty is assumed), or is likely to have a connection with the registered trademark.

If a registered trademark has a reputation in India and an identical or similar mark is used without due cause concerning products or services that are not similar to those for which a registered trademark is registered, such usage amounts to infringement. The following acts would constitute a violation of the Registered Trademark under the Act:

1. Utilization of the registered trademark as a brand name or part of a brand name for products or services similar to those for which the registered trademark is registered; or
2. Use of the trademark in marketing if such marketing takes the undue influence of and is opposite to genuine practice in industrial or commercial matters, or is harmful to its unique identity; or is harmful to the trademark’s reputation.
3. Even oral use of the mark can be considered infringement under the Act.

Who has the right to sue for infringement?

Infringement can be pursued by the registered proprietor, his heirs, and the registered user(s). A registered trademark assignee may also sue for violation. If the registration of the trademark is obtained before the final hearing of the passing off suit, the passing off suit can be converted into a combined action of infringement and passing off.

Passing off

• An unregistered trademark user is barred from bringing an infringement action. However, if the mark in question has become well known in India, the owner of such a trademark has redress and may seek redress through passing off action. 
• The goal of this tort is to protect commercial goodwill and ensure that one’s business reputation is not harmed. Because business goodwill is an asset and thus a type of property, the law protects it from encroachment as such.
• In a passing off activity, the plaintiff must prove that the mark, name, or get-up – the use of which by the defendant is the subject of the action – is distinctive of his goods in the eyes of most people or a specific class of the general public and that his goods are recognised in the market by a specific mark or logo.

Suits for infringement and passing off

• The court may issue injunctive relief in an action for infringement of a registered trademark or for passing off for either a registered or unregistered mark.
• Along with the surrender of the violating marks for deletion, the court may also grant damages or an order for an account of profits.
• In addition to civil remedies, the Act includes strict criminal provisions governing crimes and punishment.

Trademark violation rules in Canada

Unregistered trademarks – are they protected?

• Both registered and unregistered (common law) trademark rights are recognised in Canadian law. The mark must be registered to bring a trademark infringement action under Canada’s Trademark Act (“TMA”).
• Even if the mark is not registered, it may still be protected through a passing-off action, which can be brought under the common law tort of passing-off or under specific sections of the TMA that effectively codify the tort of passing-off.
• To prevail in a passing-off action, the Supreme Court of Canada in Ciba-Geigy Canada Ltd. v Apotex Inc had held that the claimant must demonstrate:

a. The presence of goodwill concerning the trademark.

b. Public deception by the defendant as a result of a misrepresentation.

c. Actual or potential harm to the claimant as a result of the misrepresentation.

How is a violation of a registered trademark determined?

Under Section 19 and/or Section 20, violation actions brought under the TMA can only be brought for registered marks. A violation under Section 19 of the TMA is more limited. It effectively covers the defendant’s use of an exactly similar trademark in connection with similar goods/services. Violation of trademark under Section 20 of the TMA is wider and takes place when a defendant utilizes a trademark or trade name that is confusingly similar to the claimant’s registered mark. The defendant’s infringed mark does not have to be similar to the claimant’s mark, nor does it have to be used with similar goods/services.

In determining whether a trademark is perplexing, the court will consider all conditions, including certain factors listed in Section 6(5) of the TMA, such as:

• The marks’ intrinsic uniqueness.
• The period for which they have been in use.
• The nature of the items and the distribution routes.
• The degree to which the marks resemble one another.

Sections 19 and 20 of the TMA both require the defendant to use the contested mark. Section 22 of the TMA prohibits anybody from using another person’s registered trademark in a way that, while not confusing, is likely to reduce the value of the goodwill connected with it.

In Veuve Clicquot Ponsardin v. Boutiques Cliquot Ltée, the Supreme Court of Canada stated that the claimant must demonstrate that:

• The defendant used the claimant’s mark. 
• The claimant’s mark is well-known to have substantial goodwill.
• The claimant’s mark was utilized in a way that was probably to harm its goodwill.
• The likelihood is that the goodwill will be denigrated.

Who has the right to sue for trademark infringement?

• Holder of a Trademark

The owner of a registered trademark has the legal right to sue for infringement.

• A Licensee with sole authority

A trademark licensee (exclusive or non-exclusive) can also file a lawsuit for infringement, subject to any contract terms to the contrary. The license itself frequently specifies whether a licensee is permitted to take this step.

Where otherwise not tackled by contract, Section 50(3) of the TMA states that a licensee may ask that the trademark owner bring infringement proceedings, and if the proprietor is unable or fails to do so within two months, the licensee may carry proceedings and join the proprietor as a defendant.

For the licensee’s use of the mark to accrue to the trademark owner, trademark licences in Canada must meet specific criteria. Trademark licences, on the other hand, are not required to be registered with the Canadian Trademarks Office. As a result, to file a case for violation, a trademark licensee does not need to be registered.

What choices does a trademark holder have when it comes to enforcing its rights?

Civil prosecution

The Federal Court has the authority to implement any of the TMA’s provisions or any privilege or cure conferred or defined by it.

The Federal Court or a provincial superior court, under Section 53.2(1) of the TMA, can make any order it deems appropriate in the circumstances, including:

• Preliminary injunction.
• Compensation for the claimant’s losses.
• Profits of the defendant must be accounted for.
• Penal damages.
• Disposal of any offending products, packaging, labels, or advertising material, as well as any equipment used to produce the goods, packaging, labels, or advertising material.

Section 53.2 of the TMA is not comprehensive. There is also common law and equal and fair remedies available.

Criminal prosecution

If criminal proceedings are brought by the government, the Criminal Code of Canada (“Criminal Code”) contains several provisions relating to trademarks that can result in indictable offences or summary convictions. Offenses that are important include:

• Forgery of a trademark (Sections 406 to 407 of Criminal Code).
• Passing-off (Section 408 of Criminal Code).
• Instruments for forging trademark (Section 409 of Criminal Code).
• Defacing a trademark or using bottles bearing another’s trademark to defraud (Section 410 of Criminal Code).
• Selling or marketing utilized refurbished goods bearing another person’s trademark or trade name without full disclosure (Section 411 of Criminal Code).

Border controls

A court can use Section 53(4) of the TMA to prevent the future importation of goods bearing an invalid mark. At the request of a registered trademark owner, the judge can order the Minister of Public Safety and Emergency Preparedness to hold up trade-marked goods that are to be imported or released in violation of the TMA under Section 53.1 of the TMA.

The TMA’s Sections 51.02 – 51.12 provide methods to help registered trademark holders in holding up imported and exported fake goods. The Canada Border Services Agency (CBSA) is in charge of enforcing the regime, which allows customs officials to seize and give samples of goods alleged to be fake.

The Request for Assistance (RFA) is at the heart of the anti-counterfeit system, through which the proprietor of Canadian trademark registration and/or registered or unregistered copyright can file an RFA application with the CBSA, enumerating its rights and providing information to allow customs officers to more easily recognize and seize suspected fake items at the border. When CBSA inspectors come across alleged fake items during their inspections, they will contact the brand owner to enable the detention of the goods and the initiation of court proceedings for infringement.

Now, we will analyze how Amul Dairy obtained a significant victory in a trademark infringement case in the Federal Court of Canada.

Facts and issues underlying Amul’s case

• The Kaira District Cooperative Milk Producers Union Limited (commonly known as ‘Amul Dairy’) and the Gujarat Cooperative Milk Marketing Federation (‘GCMMF’), which markets the Amul brand, sued Amul Canada and four others – Mohit Rana, Akash Ghosh, Chandu Das, and Patel (the first name not known) – in the Federal Court of Canada.Amul Dairy and GCMMF are collectively referred to as Plaintiffs.
• Since 2010, the Plaintiffs have offered for sale, advertised, sold, and distributed various AMUL branded items in Canada.
• Plaintiffs, in particular, have held the Canadian Trademark “AMUL” since 2014, and it had been in use in Canada since June 30, 2020.
• Plaintiffs also owned the Canadian trademark design with the tag line “Amul the Taste of India,” which had been used in Canada in connection with products such as “coffee, tea, chocolate, coffee replacements, sugar, milk, and so on.”
• Amul Dairy also held the mark and design for the phrase “Amul Pasteurized Butter utterly butterly delicious”, which was used in conjunction with dairy products, edible oils, and fats.
• In January 2020, Plaintiffs discovered that the said group had overtly duplicated the trademark “Amul” and the logo of “Amul-The Taste of India,” as well as made a false LinkedIn profile.
• Plaintiffs claimed that Defendants used the trademarks and trade names AMUL and Amul Canada Ltd. on LinkedIn to advertise, market, offer for sale, sell, and supply items identical to the Plaintiffs’ goods.
• The suspect had set up a LinkedIn page called ‘Amul Canada’ and mentioned themselves as employees of the company.
• Amul Canada’s LinkedIn page also included icons for “see jobs” and “follow,” and the four offenders were listed as Amul Canada employees.
• They had failed to answer the legal summons, prompting Plaintiffs’ attorneys to file an ex-parte motion for default verdict.
• Defendant also claimed to have employees in Canada, even though the Plaintiffs had never authorized or assented to Amul Canada or any of the four individual accused persons using the Plaintiffs’ trademarks and copyrights in any way.

The court’s inferences 

• Observing the Defendants’ deceptive behavior and the Plaintiffs’ exhaustion of all sensible efforts to have the Defendants cease and desist their behavior both even before and during the beginning of these proceedings, the Bench held that the Plaintiffs had every power to invite the Motion for Default Judgment ex parte to cease the misuse of their intellectual property.
• The Bench stated that there were potential damages that could have related, whether through sales, marketing, distribution, and/or recruiting employees, and that the Defendants had engaged in purposeful dishonest behavior and had aimed people’s attention to its business in such a way as to lead to confusion in Canada between the Defendants’ goods and business and those of the Plaintiffs.
• Plaintiffs have satisfied all of the elements for establishing the “passing off” test, which includes the existence of goodwill, deception of the public due to misrepresentation, and actual or potential damages to Plaintiffs, according to the Federal Court of Canada. It further stated that not only has Plaintiffs Brand continued to exist for well over 50 years and is marketed worldwide through digital and other channels – and thus obtained uniqueness over time – and the quantities of milk and cheese distribution demonstrate that Plaintiffs’ products have a public image within at least a certain segment of the consumer market in Canada.
• The act of incorrectly advertising their desire to rise butter sales in Canada for the Defendants to entice more purported employees, distributors, and/or consumers through social media pages was held by the Court to be unauthorized use of the Plaintiffs’ mark adequate to violate the right to exclusivity contrary to Sections 19 and 20(1)(a) of TMA.
• Similarly, the Defendants had brought their business to the attention of the public in such a way that it caused or was likely to cause confusion in Canada, at the time they began doing so, between their goods and the Plaintiffs’ goods and business, in violation of Section 7(b) of TMA.

Judgment

In light of the foregoing, the Bench came to the following findings:

• To perpetually forbid violating the Plaintiffs’ trademark and copyright – ‘Amul’ and ‘Amul-The Taste of India’ – and guiding public attention to the Defendants’ products or business in such a manner as to create or be likely to create confusion in Canada.
• All LinkedIn pages/accounts used by the Defendants must be transferred to Plaintiffs within thirty (30) days. This includes any other LinkedIn pages/accounts, domain names and social media sites owned or controlled by the Defendants that display Plaintiffs’ trademarks or copyright.
• To deliver a list of all entities that contacted the Defendants about the Defendants’ business via the LinkedIn pages, as well as their contact information.
• The Plaintiffs were granted $10,000 in damages for violations of TMA, $5,000 in damages for violations of the Copyright Act, and the lump sum costs of $17,733.

Conclusion

By long-standing in the market, high-quality products/services, and tremendous demand in the market, considerable promotional activities, and affable relations with the trade people and consumers, Plaintiff’s mark has become a household name and is well-reputed and well-known among the consumers.

Defendants are using identical/deceptively similar marks of Plaintiffs. Due to such close resemblance of the Defendants’ mark with the prior adopted and widely used mark of Plaintiffs, the consumers and trade people were getting confused/deceived into believing that the Defendant’s mark is in some way connected to or associated with Plaintiffs. So, if Defendants supplied inferior quality products, it would harm the Plaintiff’s goodwill and consequently affect its sale. Hence, the Canadian court’s decision in favor of Plaintiffs is a very big win for Plaintiffs and it is also its first overseas victory in a trademark case. This case has set a good precedent for trademark violation cases overseas.

References

1. https://uk.practicallaw.thomsonreuters.com/w-010-8439?transitionType=Default&contextData=(sc.Default)&firstPage=true.
2. http://www.nishithdesai.com/fileadmin/user_upload/pdfs/Research_Papers/Intellectual_Property-Law_in_India-Web.pdf.
3. https://www.scconline.com/blog/post/2021/07/14/amul/.
4. https://www.opindia.com/2021/07/canada-amul-dairy-wins-trademark-case-to-receive-19-59-lakhs-as-damages/.
5. https://timesofindia.indiatimes.com/city/vadodara/amul-wins-its-first-trademark-violation-case-outside-india/articleshow/84304212.cms.
6. https://laws-lois.justice.gc.ca/eng/acts/T-13/page-2.html#h-450214.

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