Why Well-Known Marks Need That Extra Protection

Why Well-Known Marks Need That Extra ProtectionA well-known trade mark deserves protection against unauthorised use across all categories of goods and services. It flows from its exalted reputation, and its unauthorised use has the potential to cause confusion and deception to mislead the public and members of trade. An unscrupulous entity may also misuse a well-known trade mark to defraud the public and obtain an undue commercial advantage.

In a recent case decided on January 19, 2024, by the Delhi High Court, protection against misuse of a well-known trademark was awarded to the plaintiff, namely, Infiniti Retail Limited, the proprietor of the well-known and registered trademark CROMA. As the defendants, M/s Croma-Share & Ors., did not appear before the court despite being summoned, the matter was heard ex-parte. It was the case of the plaintiff that they owned trademark registrations for the marks CROMA, , INFINITI RETAIL,  and their formatives. The plaintiff offered a wide range of electronics, consumer products, household and kitchen appliances, mobile phones, computers, audio and video products, cameras, grooming and wellness products, etc., at more than 260 stores spread across India as well as through their website www.croma.com. The plaintiff’s goods and services were first launched in 2006 and garnered significant goodwill. Its mark CROMA / , a coined term, had been declared a “well-known trademark” by the Trade Marks Registry on February 24, 2020. In November 2022, after receiving several complaints, the plaintiff discovered that the defendants were operating the websites “www.croma-share.com”, “www.croma-2.com”, “www.croma-1.com”, and www.croma-3.com with the modus operandi to defraud people by taking money under the pretext of recruiting them for part-time jobs with “CROMA”/ the plaintiff company. The job description required the recruitees to shop online to help increase sales in return for a commission along with a refund of the principal amount. The process was divided into different levels, requiring the recruitees to pay increasing amounts of money for each subsequent level, from Rs. 180/- to Rs. 42,000/-. When the recruitees asked the defendants for proof of authenticity, the defendants supplied false and fabricated employee IDs, corporate registration in Belize, communications bearing the plaintiff company’s letterheads purportedly signed by the plaintiff’s CEO, etc. The court, on December 5, 2022, while issuing summons, passed an ex-parte ad-interim injunction restraining the defendants from infringing the plaintiff’s CROMA marks through instances such as misuse of the trademark or registering corporate names, domain names, including the impugned websites viz. www.croma-share.com, www.croma-2.com, www.croma-1.com and www.croma-3.com or listings on social media and e-commerce websites.

The court observed that the impugned websites depicted the plaintiff’s CROMA mark and solicited personal information and money from the consumers/recruitees. As the domain names fully incorporated the plaintiff’s CROMA mark, the unsuspecting public was deceived into believing they were securing a lucrative job offer at the plaintiff’s company, thereby falling prey to the defendants’ ploy. The court noted that the likelihood of confusion was evident and that the defendants’ activities amounted to infringement and passing off of the plaintiff’s CROMA marks. The court also acknowledged the submissions of the plaintiff that since the impugned websites also emulated the terms and conditions of use, privacy policy, etc. displayed on the plaintiff’s website www.croma.com, it amounted to infringement of the plaintiff’s copyright vested therein. The court held and observed that since the plaintiff had a high standing in the market and its CROMA mark also enjoyed a well-known status, the impugned activities of the defendants were causing irreparable loss to the goodwill and reputation of the plaintiff. Thus, the plaintiff was entitled to a permanent injunction as sought. The court also ordered that the impugned websites be permanently blocked and the UPI IDs and mobile numbers of the defendants, as mentioned in the plaint, be permanently suspended and disabled.

Trademarks are part of the unique identity of proprietors and their products and services, and they should be protected. Building a reputation that the courts will protect takes much time, resources, and investment. The courts’ protection for well-known trademarks will encourage their proprietors to expand their business activities and safeguard against misuse and fraud.

Authors: Manisha Singh and Dheeraj Kapoor

First Published by: Mondaq here