In this article, Rituparna Padhy, pursuing Diploma in Entrepreneurship Administration and Business Laws from NUJS, Kolkata discusses the penalties for trademark infringement

Introduction

A trademark is an identifiable badge, expression or image that indicates a particular item or benefit and lawfully separates it from every other item. A trademark serves to exclusively distinguish an item or service with a particular organization and is an acknowledgement of that organization’s responsibility for the mark. Trademarked items are by and large considered a type of property. One of the principle reasons for having an item trademarked is to shield the item from being utilized without the consent of the source organization. Trademarks, for example, Coca Cola, HP, Canon, Nike and Adidas fill in as a sign of origin of the products and also a sign of quality.

‘TM’ means Trademark and ‘SM’ means Servicemark. The utilization of TM and SM images implies to the general population that the organization is claiming exclusive ownership of trademark and can be utilized by one who has recorded a trademark application. The ® image can be utilized just once the trademark is registered and the registration certificate is issued. Likewise, you may utilize the registration symbol only regarding the products as well as services in regard to which the trademark is registered. The registration procedure is the same for both trademarks and servicemarks.

Registration of Trademark and Exclusivity of Right to Use

For a trademark to be registered, the user must submit an application for such registration. Subsequent to all the assignments and transfers of the trademark, the original registration shall be deemed to be the prima facie evidence of the validity.

As per Section 29(6) of the Trade Marks Act 1999, the “use of the registered trademark” includes

1. affixing the mark on the goods or its package;
2. displaying the goods with the mark, supplying the goods to the market for sale, rendering or proposing to render service under the mark, or storing the goods;
3. importing or exporting the goods with the mark;
4. using the mark on business papers or advertisements.

India recognises the concept of the “Well-known Trademark”. A well-known trademark in relation to any goods or services means a mark that has become so intrinsic to the substantial segment of the public, which utilizes such goods/services such that the use of such a mark in relation to other goods/services is likely to be considered as a connection between the two marks.

When does Infringement of Trademark occur?

A trademark will be considered to be infringed and the user/proprietor can seek relief when any person other than the registered user/proprietor uses a mark which is:

1. identical to the trademark and the goods or services for which it is used are similar to the goods or services covered by the registered trademark;
2. similar to the trademark, and the goods or services for which it is used are identical to the goods or services covered by the registered trademark; or
3. identical to the registered trademark, and the goods or services for which it is used are identical to the goods or services covered by the registered trademark; and
4. which results in the apprehension that the public may be confused or may get the wrong impression that the mark has an association with the registered trademark.

Furthermore, a registered trademark can be deemed to have been infringed by any person other than the registered user uses a mark which may be similar to the registered trademark, or is used for any service/good similar to that of the originally registered trademark.

The provisions for trademark infringement focus on three main objectives of any person who is not the registered user but uses the mark in the course of his trade –

1. the intent to use the trademark despite the knowledge of such use being unlawful,
2. dishonest intention to take undue advantage, or
3. damages the uniqueness or reputation of such a registered trademark.

Furthermore, an advertisement may also cause an infringement of the trademark if such advertisement takes unfair advantage of the trademark or damages its uniqueness/reputation. In addition, if the certain words impart uniqueness to the registered trademark, the trademark may be infringed if the spoken use of such use and its visual presentation references association with it.

In light of the relevance of advertisements in the current consumer ecosystem, multiple courts have elaborated on what can constitute trademark infringement in the context of an advertisement. In the case of Reckitt Benckiser India Limited v. Hindustan Unilever Limited, the defendant had allegedly portrayed Dettol soap (appellant’s product) as a normal soap which “allows germs to enter through the cracks of the skin” while advertising their own product, Lifebuoy soap. The appellant claimed that such portrayal caused great damage to its goodwill and reputation as the viewers would recognize the familiar characteristic features of Dettol soap even if the logo was not shown. The court ruled in favour of appellant, opining that the general public (and not a particular section of society) would indeed view the advertisement as a whole and possibly be influenced to see Dettol as ineffective. The court further justified awarding punitive damages if circumstances so warranted.

When will it be not considered as Infringement?

To prove innocence, the defendant must prove that such usage is in line with the honest commercial/industrial practices, and does not take unfair advantage of the repute of the trademark. To prove the above, the following pointers help in understanding when a trademark is not infringed and can be used–

1. the use also specifies the “kind, quality, quantity, intended purpose, value, geographical origin, the time of production of goods or the rendering of services.”
2. The registration does not extend to the use of the trademark when the registration is subject to any conditions/limitations.
3. The registered proprietor/user had allowed such use of the trademark or if the use is intended to indicate such usage by the registered user/proprietor himself.
4. Neither the purpose nor the effect of the use of the trademark is to signify any connection with the registered good/service.

It is to be noted that there can be no infringement of an unregistered trademark, for only upon registration does the user/proprietor receive the exclusive right to use the trademark for their goods or services.

Penalties for Infringement of Trademark

Registration of a trademark is not a prerequisite to institute civil or criminal proceedings against violation of trademarks in India. Significantly, infringement of a trademark is a cognizable offence and criminal proceedings can be initiated against the infringers. Such enforcement provisions are expected to encourage the protection of marks in India and limit infringement of trademarks.

The relief which a court may usually grant in a suit for infringement or passing off includes a permanent and interim injunction, damages or account of profits, delivery of the infringing goods for destruction and cost of the legal proceedings.

The order of interim injunction may be passed ex parte or after notice. The Interim reliefs in the suit may also include an order for:

1. Appointment of a local commissioner, which is akin to an “Anton Pillar Order”, for search, seizure and preservation of infringing goods, account books and preparation of the inventory, etc.
2. Restraining the infringer from disposing of or dealing with the assets in a manner which may adversely affect plaintiff’s ability to recover damages, costs or other pecuniary remedies which may be finally awarded to the plaintiff.

In case of a criminal action for infringement or passing off, the offence is punishable with imprisonment for a term which shall not be less than six months but which may extend to three years and fine which shall not be less than INR 50,000 but may extend to INR 2,00,000.

In many cases, if circumstances so warrant, the courts can impose punitive/exemplary damages on the parties also.

Conclusion

Trademarks are an integral part of the use of goods and utilization of services because it prevents dishonest individuals/groups from taking undue advantage of a person’s work and traversing credit away from the actual user/creator.