Recently, in the matter of Good Life Industries v. J R J Foods Pvt. Ltd. C/AO/10/2021 (Appeal), the Gujarat High Court vide order dated 22 December 2022, upheld the Trial Court’s order granting an interim injunction, restricting the use of the deceptively similar registered mark ‘MiSHi’S’ (“impugned mark”) in view of the prior existing registered mark MICHI’S.
J R J Foods Pvt. Ltd. (“Plaintiff”) claimed to have been using the trademark MICHI’S with a device of a boy in red and a specific colour combination of red and white, since 2002 and that it had become a household name due to exclusive and continuous use. In January 2018, it came to know that Good Life Industries (“Defendant”) had started using the impugned mark MiSHi’S having the same red and white colour, which was almost identical to Plaintiff’s trademark MICHI’S. The Plaintiff issued a Cease and Desist notice to the Defendant, but the said notice was not served due to insufficient address. Later, on 27 June 2020, when the Plaintiff received a query regarding a product bearing the impugned trademark, the Plaintiff sent another legal notice. Additionally, the Plaintiff also filed a Rectification Application against the impugned registered mark MiSHi’S before the Trade Mark Registry. Thereafter, the Plaintiff filed a suit for injunction against the Defendant before the Trial Court.
The Trial Court vide order dated 7 November 2020, passed an order in favour of the Plaintiff, granting injunction against the Defendant, restricting it from using the impugned mark MiSHi’S, opining that it was deceptively similar to the Plaintiff’s earlier registered mark MICHI’S and that it was registered for the same goods, due to which there was likelihood of confusion to the public.
Thereafter, the Defendant appealed against the above order in the Gujarat High Court.
The Defendant (i.e., the Appellant herein) claimed that it had registration of the impugned trademark since 2017 and as the registered owner of the said trademark, it was entitled to the benefit of the defence available under Section 28(3) of the Trade Marks Act, 1999 which provides that when two or more people are registered proprietors of identical marks or similar marks, it cannot be deemed that one of the proprietors has acquired exclusive right over the mark as against the other proprietor by registering its mark, and that rather both of them have their individual rights as if they were the sole proprietor. It also relied on Section 30 (2) (e) which provides that use of a registered trademark despite it being identical or similar to another registered trademark, in exercise of the right to the use of that trademark given by registration under this Act is not hit by infringement under Section 29. On the basis of this, the main contention raised by the Defendant was that since both parties are having registered trademarks, there cannot be any suit for infringement against the registered trademark owner and that only a passing off action can be made. It also relied on the defence of laches and acquiescence by pointing out that the Plaintiff had intentionally delayed in instituting any legal proceedings for 31 months i.e., from January 2018 when the Defendant’s mark was registered to August 2020 when the Plaintiff instituted the infringement suit in the Trial Court. It submitted that the Trial Court has erred in its judgment and consideration of facts by issuing an injunction against it.
The Plaintiff (i.e., the Respondent herein) in response, submitted that the defence of delay cannot be taken by the Defendant because the Plaintiff had issued a Notice in 2018 itself, when it first came to know about the Defendant’s registered trademark and it filed a Rectification Petition prior to instituting the suit for infringement. It further submitted that due to the phonetic and visual similarity between the two rival marks and the fact that the Defendant’s mark is registered for the same products in the same market as that of the Plaintiff’s, the public could easily be deceived. One of the arguments put forth was that the Defendant by relying on the defence as given under S 28 (3), was admitting that its mark resembled the Plaintiff. It submitted that it is the prior user of its mark MICHI’S as it has been using it since 1996 and has had it registered since 2005, which is much prior to the Defendant’s subsequent registration. The main argument was that nowhere in the Trademark Act, it is contemplated that infringement actions cannot be instituted against Defendant’s mark which is registered. It put forth Section 124 of the Trademarks Act, in which sub-section (1)(b) provides that where in a suit of infringement, the Defendant raises a defence under Section 30 (2)(e) and the Plaintiff pleads invalidity of the registration of the impugned mark, if there are any earlier filed rectification proceedings pending in front of the Registrar or Appellate Board, the infringement suit is stayed until the rectification proceeding is disposed of. Furthermore, for arguing the validity of the injunction awarded in favour of it by the Trial Court, it relied on Section 124 (5) which specifically provides that despite the stay on the infringement proceeding during this period, the Court is not precluded from passing interlocutory orders, if it is convinced of the invalidity of the registration of the impugned mark. It relied on various landmark cases, one of them being S. Narendrakumar v. Apricoat Foods Pvt Ltd. (Bom) 2013 (5) 14, wherein it was held that “Section 124 of the Act clearly shows that a suit for infringement is not barred by the mere fact that the Defendant’s mark is also registered. In fact, the said provision clearly contemplates that a suit can be filed and would lie and that the course of action to be adopted in such a suit is also provided for.”
Decision of the Court
The Hon’ble High Court firstly emphasized on the principle of law that the Court would not ordinarily interfere with the exercise of discretion in the matter of grant of temporary injunction by the Trial Court, unless the order of the Court under scrutiny had ignored the settled principles of law regulating grant or refusal of interlocutory injunctions. In the present case, the Court observed that there was no doubt that both the parties were dealing in the same products and that it was an admitted fact that the class of consumers and the market of the goods were the same. The Court, thereafter, opined that the Defendant’s impugned mark MiSHi’S would be phonetically similar to the Plaintiff’s mark MICHI’S as the only differences were the use of the letter “S” in place of the “C” and that the Defendant has used small “i” after the letters “M” and “H” instead of capital “I”. It also observed that the Plaintiff’s mark was granted registration in 2005, which was much prior than the Defendant who obtained registration for the impugned mark in 2017. Finally, it agreed upon the view taken by the Trial Court that infringement actions can be instituted against proprietors whose mark is registered and that an injunction can be passed. It placed reliance on the landmark judgment of Clinique Laboratories LLC & Anr. v. Gufic Ltd. & Anr., 2009 (41) PTC 41 (Del), wherein it was opined that “Section 31 read with the scheme of 124 leads to an un-escapable conclusion that (A) there can be a suit for infringement against the registered proprietor (B) that upon the defendant taking the plea of his registration and of there being thus no infringement, such suit has to be stayed awaiting the rectification proceedings and (C) the court is empowered in such case to pass any interlocutory order.” Therefore, the Hon’ble High Court concluded that the Trial Court, after considering all the relevant facts and circumstances of the case, had properly allowed the application of the Plaintiff for the relief of injunction and it set aside the Appeal put forth by the Defendant.
Due to the presence of provisions such as Section 28 (3) and Section 30 (2) (e) in the Trademarks Act, the general view is that use of marks that have been registered are unhindered by the presence of other existing registered marks to which the former may be identical to or similar to, and that such use would not fall under the head of ‘infringement’. Due to this view, a common averment that is raised is that infringement suits cannot be filed against a Defendant whose mark is registered. However, we see from the above judgment and various other judgments cited herein, that the presence of Section 124 in the Act clears any doubt of there being a bar against filing a suit of infringement against a registered trademark which is identical or deceptively similar to another existing registered mark. Section 124 clearly lays down a situation that where a rectification proceeding is ongoing and a Plaintiff files a suit of infringement wherein the Defendant takes the defence under Section 30 (2) (e) of having a registered trademark, such suit is to be stayed and that in the meantime the Court is free to pass interlocutory orders such as injunctions as it sees fit, if it has a prima facie finding for the issue of validity of the registered impugned trademark. Hence, we see that validity of registered trademarks can be questioned basis infringement suits as well and they can be injuncted upon basis any findings in the proceedings, alongside the final decision making in rectification proceedings in front of the Registrar or the Appellate Board.
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