This article is written by Deepanjali Mishra, a student of Pravin Gandhi College of Law, Mumbai University.
Table of Contents
Introduction
Trademarks are extremely significant these days due to the extensive use of advertising and branding used by the various companies and the consequent advantage gained through it. In India, trademarks are regulated and protected as per the Indian Trademarks Act, 1999 (herein referred to as ‘the Act’) (see here) under which a person who is a proprietor of the trademark can apply for registering the same under section 18 of the Act.
What is the battle about?
‘Big Basket’ is an online grocery store/ supermarket and it is spread all over India. Similarly, “Daily basket” is also an online grocery store however, it is quite recent having experience of only about 1 year. Big Basket has registered its multiple trademarks with the Registry under Class 30 since class 30 of the classification of goods as published by the government, (see here) includes the edible item falling under the head of groceries.
After carrying out a public trademark search containing the word “Basket” under Class 30 it can be observed that various establishments like “Fresh Basket”, “Green Basket”, “Wholesome Basket”, etc. are registered under the same class with the Registry carrying out though not the same nevertheless similar business as that of the Big Basket.
Recently in February, Big Basket issued a Cease & Desist notice to Daily basket claiming that the latter’s trademark was deceptively confusing with the former’s and thereby demanded Daily basket to stop using the same, as a reply the daily basket has created an online web page, (see here) stating the exhaustive reasons why and how their trademark and their trade dress is dissimilar from that of the Big Basket’s trademark.
What are the legal provisions involved?
In the instant matter, the trademark of the daily basket is not registered up till now as can be observed after a public trademark search, however, it is pertinent to note that registration of a trademark or trade dress is not mandatory in India and one can seek registration after its use as well following Section 18(1) of the Act. However, there are certain rights that a proprietor with an unregistered trademark will not enjoy such as mentioned in Section 27 of the Act.
For any trademark to be valid & registered there are certain parameters laid down in the Trademarks Act, 1999. The first step is filing an application under Section 18, the same can either be accepted or refused. The Registry can refuse the application either on absolute grounds as mentioned in Section 9 of the Act or on relative grounds as mentioned in Section 11 of the Act. For instance, Section 11 bars registration of a trademark that is similar or identical to an earlier trademark. To sum up, a trademark must be distinct and not identical to any other trademark to prevent any deception or confusion likely to be caused among the public.
Apart from that, there are other remedies granted by the Act, for instance, an affected party may opt for instituting a trademark infringement suit as per Section 134 of the Act or a suit for the action of passing off as per Section 135 before the Appropriate authority.
Infringement of a registered trademark occurs as per Section 29 of the Act. However, the essentials for constituting passing off are not defined in the Act, unlike infringement. The essentials of the action of passing off have been laid down by the Courts over the course of years, to sum up, the action occurs when the trademark of a party is wrongfully used to gain profits from the goodwill of the trademark and to gain an unfair advantage by misrepresentation and deceptively confusing the public.
In the present matter, Big Basket being a registered user of their trademark, through the cease-and-desist notice has warned daily basket of initiating both a trademark infringement suit along with the passing off suit for using an identical trademark and due to other alleged similarities between the apps, websites, domain name, etc. Moreover, the big basket has alleged that daily basket has used identical trade dress to confuse and deceive the public at large.
What is the position of law with regards to similarity in trade dress in India?
Simply put, “trade dress” is the pattern, font, style, color, and other features used in creating a particular trademark. In India, trade dress is not registered separately rather it is registered with the trademark as a “Device mark”. The same can be observed by the wordings of Section 2(m) of the Act which defines “mark” to include the packaging/combination of colors used to represent. There are various judicial precedents on infringement and passing off of trade dress by entities.
One such landmark precedent laid down by the Delhi High Court being Colgate Palmolive Company & Another v. Anchor Health and Beauty Care Pvt. Ltd. (see here) wherein the matter was such that both the parties were carrying on similar trade and the defendants were using their color scheme for packaging same as that of the Plaintiff, i.e., the scheme white and red in 2/3 and 1/3 proportion. Therefore, the Court came to a conclusion that the colors being the same and the color scheme being used in the same proportion it qualified to be an action of passing off.
It is pertinent to note that the color combination used by the ‘daily basket’ is orange, green, and, white and the color scheme used by Big Basket is red, green and black. Moreover, the fonts used by both the entities are different and so is the green color which is brighter in the case of ‘daily basket’ and much darker and different in the case of ‘big basket’. The get-up, logo, writing style and, placement of terms in their respective trademark also differ widely. All of the above-mentioned details are necessary to take into consideration since the Court in the above-mentioned judgement passed the said verdict considering the similarity in color scheme and proportion.
Additionally, the Court also made the following a parameter- Whether in first glance an ordinary person is likely to be confused. However, it can be observed that any person without going into many minute details can distinguish the platform of the daily basket and big basket due to their basic distinguishing features and no similarities.
Moreover, the Court stated that no one can establish a monopoly over a color however, one should not, therefore, misuse the same by reproducing the exact color combination in similar order to confuse the public. In the instant case, the daily basket is not even using any similar color used by the big basket and consequently, the question of proportion doesn’t arrive. Therefore, the above-mentioned judgement can be distinguished in this situation or can even be referred since the principle remains the same and the facts lead to a rather different conclusion.
Can Big Basket claim monopoly over the term “Basket”?
Apart from the trade dress, the primary question that arrives is: What are the similarities in the trade names of both these establishments, it appears that the word “basket” being used by the platform daily basket is one of the main objections raised by Big Basket. Therefore, subsequently, the following question that arrives is: Whether the big basket can claim a monopoly over the term “basket”?
The Indian Judiciary has elaborated on this particular point of law at length in various precedents. The general position of law is, identical tradenames or trademarks or wordmarks should not exist because they are likely to cause confusion among the public and allow one to gain an unfair advantage from the goodwill of the original/ actual trademark. However, it is pertinent to ask whether one can go to such an extent to create a monopoly over a particular term and thus perform an unfair trade practice?
What is the judicial trend?
In Nandhini Deluxe v. Karnataka Coop. Milk Producers Federation Ltd. (2018) 9 SCC 183 (see here) the trademark registered under Class 30 “NANDHINI” was used by the appellant for their restaurant and the trademark registered under class 29 & 30 “NANDINI” was used by the Respondents for their milk products. The respondents claimed that the appellant’s trademark was identical and similar to that of the respondents and hence demanded the same should be forfeited by the appellant.
However, the Supreme Court among other reasons declared the Registry’s order to be valid which agreed to the reasoning that the term “NANDINI” which means cow was a common term, especially in India since many people in Indian use that particular name for various establishments. And hence alongside, the Court reiterated the principle that no one can claim a monopoly over a common term/name because the same will be unfair to the other party/ parties.
Furthermore, in Micronix India v. Mr. J.R. Kapoor 2003 (26) PTC 593 Del (see here) one of the issues raised by Plaintiff “MICRONIX” was that the trademark “MICRONIX” and “MICROTEL” were deceptively similar thereby the defendants with the latter trademark should be restrained from using the said trademark. Subsequently, the defendants were restrained and aggrieved by the same they appealed to the Supreme Court for specifically vacating the injunction and were successful in doing so.
The Supreme Court in its order merely considering the issue of vacating the injunction held in favor of “MICROTELL”. The reasoning laid down by the Court was that the common term “MICRO” which is alleged to have the effect of creating confusion is rather a common and general term/ word over which no person can claim a monopoly. The Court stated that the micro-chip technology was the basis of the electronic products provided by the defendants and therefore, the use of the term i.e., the prefix “MICRO” holds much significance. Not only that, the Court went on to explain that people who are engaged or who buy such technologies/products are well aware of such terminologies and therefore they are not likely to be confused or deceived.
Therefore, the Supreme Court vacated the injunction however, they left it to the Delhi High Court to decide the rest of the issues, including the one questioning the similarity in the trademark/ tradename.
After the Supreme Court’s order, the Delhi High Court held that, both the trademarks “MICRONIX” and “MICROTELL” are not identical since they are visually and phonetically dissimilar regardless of the fact that both the trademarks begin with the term “MICRO”. The Delhi High Court agreed with Supreme Court’s rationale that “MICRO” is a generic terminology and therefore it can be monopolized by anyone.
Moreover, the Courts recognized that any proprietor using the term “MICRO” in such similar trade activities cannot be debarred from using since it is a general, common term.
In the same way, considering the above-mentioned authorities it can be reasonably apprehended that the suffix “basket” used by ‘daily basket’ is a generic, common term that cannot be monopolized by Big Basket. Moreover, the use of word basket by daily basket should not be constituting any trademark infringement or passing off rather it is merely an indication of the type of store/ platform that they are.
As rightly stated by the Delhi High Court and the Supreme Court the customers are likely to identify the purpose of the goods by the prefix “MICRO” rather than being confused or deceived. Similarly, by the suffix/ word “basket” the people/ consumers are likely to be aware that it is a shopping mart/store or any such platform where things or groceries can be purchased. Moreover, there exist various stores with the suffix basket, for instance- Nature’s Basket or any other platforms as mentioned above- Green basket, etc. which are using the term basket. This indicates that the use of the term basket should not be ordinarily objected by the daily basket.
Conclusion
Therefore, in conclusion, considering the difference between the trade dress, i.e., the color combination, font, way of representing the brand, etc. and the trademark which contains merely one common term, the platforms appear to be visually and phonetically different and hence this step initiated by Big Basket seems rather unnecessary.
And as opined by the Supreme Court in National Bell v. Metal Goods reported in AIR 1971 SC 898, (see here) a person with a trademark need not take action against every infringement which does not cause prejudice or affect its distinctiveness.
Therefore, following the above chain of thought, the action initiated by Big Basket can be viewed as rather not required. Moreover, the above proposal can be one perspective/ angel to look from, to avoid unnecessary litigation and save the Court’s valuable time.
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