This article has been written by Vaibhavi S U, pursuing a Diploma in Advanced Contract Drafting, Negotiation and Dispute Resolution from LawSikho. It has been edited by Ojuswi (Associate, LawSikho).
It has been published by Rachit Garg.
A trademark is a sign which helps in differentiating the products or services of one organization from those of other organizations.
A trademark is a type of intellectual property right. Intellectual property rights allow people to retain ownership of their innovative products and creative activity. A trademark is a name, word, or sign that distinguishes one company’s goods from the goods of other companies. Marketing goods or services becomes much easier with a trademark because product recognition is assured and simplified. The owner has the right to prevent another competitor from using his trademark or sign. A trademark can be a logo, a picture mark, or a slogan.
Trademark piracy is described as the use of a trademark by unauthorised or illegal means in trading. If there is a trademark infringement, the owner of the registered trademark can take legal action, whereas the only option for an unregistered trademark is passing off.
This article discusses the usage of a registered trademark by someone, other than the proprietor, in relation to goods and services outside the scope of trademark registration.
What does the trademark act say
The Trade Marks Act of 1999 gives a trademark proprietor an exclusive right to utilize that trademark in relation to the goods and services for which it has been registered. It protects the owner by granting them the exclusive right to use a trademark or to allow others to use it in exchange for money. It is a tool for the registered proprietor to prevent others from using his trademark in an unauthorised manner.
According to Section 28 of the Act, no trademark infringement suit can be filed by its proprietor against someone who has a registration of such trademark in a different class or for other goods/services. As a result, the question that arises is whether the proprietor of such a registered trademark can stop people who use a registered trademark without registration, in relation to goods and services outside the scope of trademark registration. Such use of the registered trademark, which is not covered by Section 28 of the Act, might be in relation to goods/services in the same class as the goods/services for which the trademark is registered, as well as goods/services in a class other than the one listed in the registration.
The common law remedy of passing off provides the answer to the question. This is due to the fact that the right of a Plaintiff in a passing off case is distinct from the statutory rights obtained through trademark registration and is directed against the defendant’s conduct that caused, is intended to cause, or is predicted to cause deception, resulting in a negative impact on the plaintiff’s goodwill. This was held in N. R. Dongre v. Whirlpool Corporation.
It makes no difference in a passing-off action if the parties’ goods are different, their trading methods are different, or their pricing is different. In the case of Toyota Jidosha Kabushiki Kaisha v. Prius Auto Industries Ltd. & Ors, it was observed that the focus in a passing-off action is deciding whether two marks are deceptively or confusingly similar. Furthermore, if the plaintiff’s goodwill in the market is established, a simple possibility of confusion in the minds of the general public is sufficient to establish a passing-off case, and no proof of prejudice or actual injury is required. Furthermore, a passing-off case does not necessitate that the defendant and plaintiff should be in direct competition in order for the defendant’s use of the plaintiff’s mark to cause harm to the plaintiff.
Use of a registered trademark for goods or services in a different class
In various instances, the courts have often barred the utilization of a registered trademark for products unrelated to the product for which the trademark was registered by the proprietor, especially when the registered trademark is a well-known one.
The trade connection test is used to establish the possibility of confusion when an identical or deceptively similar trademark is being used for goods that are not of the same description as the goods for which the trademark is registered. However, it is important to remember that the absence of a trade connection between the two goods for which the plaintiff and defendant are using the trademark does not rule out the possibility of deception or confusion.
In Sunder Parmanand Lalwani and Ors. v. Caltex, while deciding whether there was any possibility of confusion involving Caltex watches, Caltex gasoline, and other oil products, it was held that although there wasn’t any trade connection among the parties’ goods and there was dissimilarity between the same, there was a risk of deception or confusion since anyone who saw the mark affixed to the watches would believe they came from the same place as Caltex petrol.
In the case of Bata India Ltd v. Payrelaland Co. Meerut City, the plaintiff was manufacturing shoes and the defendant was manufacturing foam and related goods. According to the Court, a passing off action arises when there is a possibility of creating a false impression regarding the product’s origin, even if the defendants do not manufacture products similar to those of the plaintiff, denying the claim that there was no possibility of deception on the buyers of foam materials.
In the case of Mahendra & Mahendra Paper Mills Limited v. Mahindra & Mahindra Limited, refusing to accept the appellant’s argument that its products are not similar to the respondent’s products and businesses, the court held that using the words ‘Mahindra’ and ‘Mahindra & Mahindra’ in the respondent’s business for over five decades has resulted in the name acquiring distinctiveness. As a result, the general public now links the term ‘Mahindra’ with a specific level of goods and services, and any effort to use the name would give the idea that there is a relationship with the respondent’s group of entities. As a result, the appellant/defendant, which had yet to begin operations, was barred from using the names ‘Mahendra’ or ‘Mahendra & Mahendra’.
In Aktiebolaget Volvo & Ors. v. Mr. Vinod Kumar & Ors., the Delhi High Court investigated whether the plaintiff’s trademark VOLVO, which was registered for a variety of commodities including buses, cars, automobile components, and so on, could be infringed by the defendant selling ice cream under the VOLVO mark without registration. The defendants challenged the claim that the products offered under the VOLVO mark were not identical or similar to the products for which the plaintiff’s trade mark is used. Rejecting this argument, the Court stated that due to the plaintiff’s use of the mark all over the world since 1915 and in India since at least 1975, the mark has acquired significant uniqueness and repute, and so its infringement is prohibited under Sec 29(4)(c) of the Trade Mark Act.
Recently, in the case of Kaira District Cooperative Milk Producers Union Ltd. and Anr. v. Maa Tara Trading Co. and Ors., the defendants were prohibited from using the plaintiff’s AMUL mark which was a registered mark and a well-known one. The Calcutta High Court issued an interim order prohibiting the defendants from using the AMUL mark in relation to selling candles, notwithstanding the fact that they function in a different class of business.
Use of registered trademark for different goods or services in the same class
When a person uses a registered trademark with respect to goods or services in the same class as those for which the trademark has been registered, the trademark proprietor has a passing-off action against the person who uses the same trademark with respect to different goods or services in the same class. Furthermore, the proprietor might argue that the registered trademark is well-known and should be protected across all goods/services and classes.
In Corn Products Refining Company v. Shangrila Food Products Limited, the Supreme Court stated that when competing marks are used in relation to goods of a different description, the trade connection is utilised to determine the possibility of deception or misunderstanding. In this matter, the appellant had registered in Class 30 for the mark ‘Glucovita’ for dextrose or glucose powder as well as babies’ food and objected to the respondent’s request to register ‘Gluvita’ in Class 30 for biscuits. The appellant’s trademark had earned a reputation among the public, and the respondent’s proposed mark was likely to induce confusion or deceit, according to the Supreme Court.
In Nandhini Deluxe v. Karnataka Cooperative Milk Producers Federation Limited, the appellant sought registration of the trademark ‘Nandhini’ for goods such as meat, fish, poultry, and hen, as well as other food articles, the respondent used its registered trademark ‘Nandhini’ for milk and milk products. It was held that, despite both marks being in the same class, 29 and 30, monopoly cannot be enjoyed over the entire class of goods because the respondent does not intend to manufacture the same products as the appellant does. Consequently, the appellant has been granted the right to register the mark “Nandhini” for any of the goods listed in classes 29 and 30, excluding those covered by the respondent’s trademark.
There is no trademark infringement when a registered trademark is used in circumstances beyond the scope of registration, i.e. when it is used in relation to goods and services other than those covered by the registration. As a result, a trademark proprietor cannot prohibit anyone from using a trademark registered by him for specific goods/services in relation to other goods/services through a suit for trademark infringement. It is important to note that the proprietor of a registered trademark does not acquire monopoly rights over the entire class of goods simply by registering their mark for goods or products in a category that falls under one class. Therefore, a mark that is identical or similar to a registered trademark may be used on registered goods/services that belong to the same class as the registered trademark, since granting the registered proprietor a monopoly over all products and services in that class would result in trademark trafficking, which does not reflect the purpose or object of the Trade Marks Act.
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