Role Of Anti-Dissection Rule In The Battle Of D’Mart Composite Labels

It is a well-known concept in the Trademarks law that a mark when compared to another mark, must be seen as a whole. One must not analyse each component of the mark separately but must compare it as a whole visually, phonetically and structurally. It must also be seen how the consumers will perceive the mark in the market, to rule out any “likelihood of confusion”. This principle in the field of trademark law is known as the “Anti-Dissection Rule”.

Especially, while evaluating the similarity between two composite marks, this principle is applied. A composite mark has various elements in it starting from different words, colours, graphical elements etc. However, when parts/components of such a mark are seen separately, it does not hold great recollection value. The essence of this principle is adequately expressed in sections 15 and 17 of the Trademarks Act, 1999 (“the Act”), the essence of this principle is adequately expressed.

In a recent decision of Dolphin Mart Private Limited vs. Avenue Supermarts Limited and Anr. (CS(COMM) 177/2017) dated August 21, 2023, before the Hon’ble Delhi High Court, an application under Order XI Rule 1(10) of the Civil Procedure Code, 1908 (CPC) was preferred by the defendants to file additional documents namely, the registration certificates of its marks in classes 14, 21 and 25, and its Annual Report for the financial year 2020-21. However, the plaintiff contested that the said documents must not be permitted and taken on record.

However, the Hon’ble Court allowed the said application of the defendants and stated that as far as the registration certificates are concerned, these documents were not in the power, possession, control and custody of the defendants when the written statement was filed. Further, the Court agreed to the contention made by the Plaintiff with regards to the Annual Report that the rights of the parties were crystallized at the time of filing of the suit. However, the Court held that the Report does not otherwise prejudice the plaintiff as the revenue generated in 2016 by the defendants was Rs. 8,000 crores whereas the revenue by the plaintiff that year was Rs. 17.46 crores.

As far as the other application filed by the plaintiff is concerned, the factual matrix relevant for the same is that the plaintiff company is part of the Dolphin Group established in the year 1989. It was also put on record that the Dolphin Group Companies are ISO-certified companies having won many accolades and awards. It was also submitted that the plaintiff company with a glorious journey of more than 25 years has established renowned brands such as d’mart, d’mart Exclusif and Woodmart Exclusif, etc. offering the best products in international home décor, art pieces, corporate gifts, furniture, and furniture accessories.

It was further submitted that the plaintiff had coined and adopted the name “d’mart” in 1992 wherein the prefix “d” stands for ‘Dolphin’ representing the trade name of the plaintiff and “mart” symbolising the size of the store. The plaintiff had built various departmental stores all around the world especially India and submitted that it has spent crores of rupees in favour of the brand’s promotions and advertisement. The plaintiff also stated that its sales increased exponentially over the years and that it was also the owner of various d’mart composite marks in classes 14, 21 and 25.

However, the defendant was engaged in the business of supermarkets with a focus on foods, non-foods (FMCG), general merchandise and apparel products. Further, the plaintiff informed the Court that it came across an advertisement from the defendant for an Initial Public Offering (IPO) for its supermarket business under the brand DMART and the trademark 1368370a.jpg. The plaintiff then came across the marks D MART/DMART (device)/D MART MINIMAX applied for registration by the defendant in classes 14, 21 and 25.

The plaintiff contested that on account of its registrations of the d’mart trademarks, the plaintiff acquired statutory rights by virtue of Section 28(1) of the Act to their exclusive use as well as to take action for infringement of the trademarks against third parties under Section 29 of the Act. The defendant’s use of an identical mark for identical goods infringes the statutory rights of the plaintiff. However, the defendants vehemently denied the contentions of the plaintiff and stated that the plaintiff cannot claim exclusive right over the word “d’mart” per se as it has registrations for only composite marks.

Further, the defendant also mentioned that the “Rule of Estoppel” applies to the plaintiff as it had differentiated its mark 1368370b.jpgwith another d’mart formative mark in the response to its examination report. The defendant also contended that the plaintiff is not entitled to equitable relief of interim injunction on account of unexplained delay and acquiescence in filing this suit in 2017 as the plaintiff had sent a notice to the sister concern of the defendant in the year 2003 related to the use of the mark 1368370a.jpgand concealed this fact from this Court.

The defendants further argued that the “balance of convenience” lies in their favour as from the year 2003 to 2017, the business of the defendant had grown exponentially, and that grave irreparable harm and injury would be caused to the defendants if they are restrained from using their own unchallenged registered trademarks.

The Hon’ble Court in this case decided on quite a few issues including maintainability of the suit as the defendant contested that trademarks 1368370c.jpg , 1368370d.jpgand 1368370b.jpg in of the plaintiff were not renewed at the time of filing of this suit and their registrations had lapsed. However, the Court held that upon renewal filed by the plaintiff, the effect of such trademarks would take place since the expiry of the earlier registrations which were prior to the filing of this suit and thus, the suit is maintainable.

Further, on the question of infringement, the Court held that the plaintiff would have to prima facie establish that the marks of the plaintiff and defendants are similar/identical and are used for similar/identical goods so as to create a “likelihood of confusion” amongst the public at large. The Court further explained in detail each component of both the marks to show that the two marks are not deceptively similar and that since there is no likelihood of confusion, the plaintiff cannot assert infringement upon the defendants.

It was also stated that it is a well-settled law that a composite trademark is not to be dissected to determine whether there is any deceptive similarity with the impugned trademark and a comparison has to be by taking the rival marks as a whole. Further, on the aspect of the “dominant feature” in a composite mark, the Court held that the plaintiff also lacks in this regard as the letter “d” itself cannot be given protection and the word “mart” means market in the English language. It was further held that the plaintiff has registrations for d’mart composite marks but has to date not applied for the registration of the word mark “d’mart” knowing that it is a generic word.

Further, the plaintiff was estopped from asserting right on the word “d’mart” as it itself differentiated its mark 1368370b.jpgfrom other d’mart formative marks in its reply to the examination report. Further, the Court also adjudged on the issue of passing off and held that from a bare comparison of the rival marks, prima facie, there is no deceptive similarity and/or likelihood of confusion between the two. Further, it was observed that the revenue figures of both the parties were vastly different and the goods for which the rival marks were used and the price at which they were sold were also completely different. Lastly, the Court decided that the grant of an interim injunction is dependent on the trinity principles i.e., ‘prima facie case established by the plaintiff’, ‘balance of convenience’ and ‘irreparable harm and injury’.

An overall comparison of the facts of the case was made and it was held that the plaintiff failed to establish a prima facie case against the defendants. Moreover, the balance of convenience was also not in favour of the plaintiff for multifarious reasons. Further, while deciding if irreparable harm and injury would be caused to the plaintiff, it was held that since the defendants have expanded their business and have exponential sales figures especially more than the plaintiff in the case, the irreparable harm and injury would be caused to the defendants if an interim injunction is passed against them.

Accordingly, the Court dismissed of the application filed by the plaintiff by restricting the interim relief qua infringement of its trademarks1368370c.jpg , 1368370d.jpgand 1368370b.jpg in classes 14, 21 and 25, respectively. However, the defendants were directed to maintain accounts of sales and file the same on an affidavit once in four months.