Open Access Research Article
TRADEMARK TURMOIL: UNMASKING UNFAIR COMPETITION IN INDIA
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TRADEMARK TURMOIL: UNMASKING UNFAIR
COMPETITION IN INDIA
AUTHORED BY
- NANDAKISHORE A & GOPIKA SASI
(JINDAL
GLOBAL LAW SCHOOL)
Trademarks
play a significant role in the business world because they allow
organisations to differentiate their products or services from those of others
and create brand recognition. The inappropriate use or unauthorised duplication
of trademarks, on the other hand, offers substantial issues and dangers to
businesses. Trademark infringement and dilution are major concerns in India
that necessitate strong legal frameworks and efficient enforcement procedures.[1]
Criteria
for Trademark Protection [2]
The Trade
Marks Act, 1999, and the accompanying rules govern trademark protection in
India. A mark must meet the following conditions to be eligible for trademark
protection:
Distinctiveness:
The mark must be capable of distinguishing the goods or services of one entity
from those of others. It should be distinctive rather than generic or
descriptive of the goods or services it represents. Highly unique marks are
more easily registered and protected.
Non-descriptiveness:
The mark should not directly describe the goods or services, including their
quality, features, or geographical origin. Descriptive marks that acquired
distinctiveness through broad adoption may be protected.
Non-deceptiveness:
The mark shall not deceive or mislead the public about the nature, quality, or
geographical origin of the goods or services.
Non-offensiveness:
The mark should not be insulting to public order, morality, or religious
sensibilities. Marks that are likely to offend religious or cultural
sensibilities may be denied protection.
Not a
common or generic sign: Trademarks that are common in the industry or are
generic words may be refused registration.
Not similar
or identical to existing marks: The mark should not be similar or identical to
any existing registered or well-known marks in the same or connected
industries. It should not mislead or deceive the people.
Capability
to be represented graphically: The mark must be able to be represented
graphically in the form of words, logos, forms, symbols, or a combination of
these components.
Use in
relation to goods or services: The mark should be used, or planned to be used,
in relation to goods or services for the purpose of indicating, or
implying, a commercial relationship between the goods or services.
Trademark
Infringement
When a
third party uses a registered trademark or a confusingly similar mark without
the authorization of the trademark owner, it is considered as a trademark
infringement. This unauthorised use produces consumer confusion or deception
since the infringing goods or services may be wrongly associated with the
legitimate trademark owner. To handle trademark infringement, India has the
Trademarks Act, 1999, which provides trademark owners with statutory protection
and remedies.
In India,
infringement can take many forms. It could include the unauthorised use of a
similar mark on similar goods or services, causing customer confusion.
Infringement can also arise when a deceptively similar mark is employed, producing
confusion due to its resemblance to a well-known mark. The possibility of
confusion is determined by factors such as similarity of marks, trade channels,
nature of goods or services, and consumer perception.[3]
For
businesses, the consequences of trademark infringement can be severe. It
dilutes the distinctiveness and novelty of the original mark, undermining the
trademark owner's reputation and goodwill. This is especially problematic for
well-known trademarks that have gained widespread consumer recognition. When an
unauthorised third party uses a similar mark, the distinctiveness of the
original mark is blurred or its reputation is tarnished.
In India,
dilution is a fundamental part of trademark law. It refers to the unauthorised
use of a similar mark that detracts from a well-known trademark's
distinctiveness or repute. Dilution can occur through blurring, where the
distinctiveness of the mark is diminished by association with unrelated goods
or services, or tarnishment, when the reputation of the mark is tarnished
through affiliation with substandard or disreputable products or services.
The Trademarks Act of 1999 recognises the notion of dilution and offers legal
protection to preserve well-known trademarks' originality and reputation against
dilutive practises.[4]
Enforcing
Trademark Rights on Infringement
When a
trademark owner discovers unauthorised use of their mark, they have
various avenues for enforcing their legal rights and addressing
trademark infringement. The enforcement measures include civil, administrative,
and criminal remedies. The following is an outline of how a trademark owner can
enforce his or her rights: [5]
Civil
Remedies
Interim
Injunction: An interim injunction is a temporary judicial order that prohibits
the infringing party from continuing to make unauthorised use of the trademark
until a final decision is made.
Mareva
Injunction: A Mareva injunction, also known as a freezing order, prohibits
the infringer from disposing of or transferring their assets in an attempt to
avoid potential monetary damages or compensation.
Anton
Piller Order: An Anton Piller order permits the trademark owner to enter the
infringing party's premises to search for and seize evidence of trademark
infringement. This decree prohibits the destruction or removal of essential
evidence.
John Doe
Order: A John Doe order, also known as a "Ashok Kumar" order, enables
the trademark proprietor to pursue legal action against unidentified
infringers. It allows the owner to register a lawsuit without knowing the identities
of the alleged infringers.
Permanent
Injunction: The court grants a permanent injunction after a thorough trial on
the merits. It is a final decree prohibiting the infringer from using the
trademark in question permanently.
Damages or
Profit Accounts: The court may award monetary damages as compensation for the
trademark owner's losses resulting from the infringement. Alternately, the
court may order the infringer to account for any profits derived from the
trademark infringement.
Delivery up
and Destruction: The court may order the infringer to hand over or surrender
the infringing goods, labels, packaging, or other materials associated with the
infringing use. In certain instances, the court may also order the
destruction of such goods or substances.
Criminal
Remedies
Under the
Trade Marks Act in India, trademark infringement is punishable by criminal
penalties. Infractions such as falsifying trademarks, applying trademarks
incorrectly, and using false trade descriptions are listed. In addition to
fines, these offences may result in imprisonment of up to three years. The Act
grants the police the authority to seize infringing goods and make arrests
during searches. Complaints seeking criminal remedies are submitted before the
Magistrate Court, which issues orders directing the police to investigate and
perform searches. The complainant is responsible for locating and providing
evidence of infringers. The complainant must follow up with the police post the
investigations and provide evidence that the seized items are counterfeit.[6]
Administrative
Remedies:
a. Opposition
against a similar mark: Any right holder or third party who believes that a
trademark published in the trademarks journal may lead to public confusion or
deception may oppose the mark within four months of its publication. Both
parties submit evidence to support their claims, and a decision is made
regarding the continuation of the trademark's registration.
b. Rectification
of a registered mark: If an aggrieved party believes that a registered
trademark is incorrectly remaining on the trademarks register owing to non-use,
expiration, or similarity to an earlier mark, they may file for rectification
or annulment of the registration. This procedure enables errors or omissions in
the register to be rectified.
c. Recordal
with Customs: The owners of trademarks can record their marks with
customs authorities to prevent the import or export of goods bearing an
infringed trademark. The Customs Act of 1962 grants the government the
authority to prohibit the import or export of goods in order to defend
intellectual property rights. Customs officers are authorised to inspect
premises, vehicles, and individuals, and seize counterfeit goods if they
have reasonable suspicion that they are contraband.
In the case
of Guccio Gucci v. Intiyaz Sheikh[7],
Guccio Gucci S.P.A, the plaintiff in this case, sought a permanent
injunction against Intiyaz Sheikh for trademark infringement, violation of
copyright, passing off, unfair trade competition, among other claims. Guccio
Gucci advertised its products bearing its registered trademarks and logos via a
variety of media outlets. During a market survey, they discovered that the
defendant was unlawfully manufacturing socks bearing Gucci's protected
"green and red stripes" logo and "Gucci" mark. An ex-parte
ad-interim injunction was initially granted by the court. Despite the
defendant's absence from the proceedings, the court ruled in favour of Guccio
Gucci based on the doctrine of preponderance of probabilities and the evidence
presented, including the report of a local commissioner. As a result, the court
imposed a permanent injunction against the defendant, ordered the return of
infringing products, and awarded costs and damages of 2,00,000/- and
1,66,000/-, respectively.
Unfair
Competition in Trademark Law
In the
context of trademark law, unfair competition refers to practises that violate
the principles of fair business competition and improperly exploit the
reputation, goodwill, or distinctive attributes of a trademark. It refers to
actions taken by competitors or other entities that may cause customer
confusion, deception, or harm, or that may unfairly benefit from the trademark
owner's reputation and investments. Here are some examples of prominent types
of unfair competition in trademark law: [8]
Trademark
Infringement: Unauthorised use of a trademark that is likely to confuse,
deceive, or mislead consumers into believing that the infringing products or
services originate from or are linked with the trademark owner. This includes
employing a similar or identical mark, as well as leveraging the reputation of
a well-known mark.
False
Advertising: Making false or misleading remarks about one's own or a
competitor's products or services in a way that could deceive or confuse
consumers. This can include false statements, exaggerations, or
misrepresentations that may influence consumers' purchasing decisions.
Trade
Secret Misappropriation: Unlawful acquisition, use, or disclosure of another
party's trade secrets, such as confidential business knowledge, formulas,
methods, or customer lists, in order to obtain a competitive advantage.
Domain Name
Cybersquatting: Registering, trafficking, or employing a domain name that is
identical or confusingly similar to a well-known trademark in order to profit
from the reputation or goodwill connected with that mark. Cybersquatters may
seek to sell the domain name to the rightful trademark owner or use it
fraudulently or maliciously.
Passing
Off: Passing off takes place when a person or business misrepresents their
goods or services as those of another, causing consumers to be confused or
deceived. It entails imitating or mimicking another company's well-known
products or services by adopting a similar brand, packaging, or trade dress.
False
Endorsements: Unauthorised use of a trademark to imply a connection,
sponsorship, or endorsement by the trademark owner. This can lead to consumers
believing that a product or service has been endorsed or approved by the
trademark owner when in fact it has not.
In the case
of Starbucks Coffee v. SardarBuksh Coffee[9],
Starbucks, a well-known coffee enterprise, launched a trademark infringement
and passing off action against SardarBuksh Coffee, a local Indian coffee shop.
Starbucks alleged that SardarBuksh's name and logo were misleadingly similar to
their own, causing consumer confusion. The court considered the trademarks'
visual and phonetic similarities, as well as the overall image they
conveyed. It determined that SardarBuksh's name and logo were likely to cause
customer confusion and may be interpreted as an attempt
to capitalize on Starbucks' reputation and goodwill. The court
awarded Starbucks an interim injunction, preventing SardarBuksh from using the
contested name and design. It stated that SardarBuksh's use of a similar name
and logo could dilute Starbucks' trademark's distinctiveness and
jeopardise its economic interests. This case underlines the significance of
safeguarding trademark rights and avoiding unfair competition. It highlights how
the unauthorised use of a similar name or logo, particularly in the same
industry, can give rise to trademark infringement allegations. Courts play an
important role in enforcing trademark rights and protecting well-known brands'
reputation and distinctiveness.
Conclusion
Infringement
and dilution of trademarks pose substantial hurdles to Indian enterprises.
Adherence to trademark protection standards is critical for ensuring legal
recognition and exclusive rights over a mark. Effective enforcement methods,
including civil, criminal, and administrative remedies, are critical in
protecting trademark owners' rights and for deterring infringement.
Furthermore, resolving unfair competition practises is essential for keeping a
level playing field in the marketplace and protecting trademark reputation and
goodwill. India can develop an atmosphere that encourages innovation,
competitiveness, and respect for intellectual property by fostering a strong
legal framework and promoting awareness regarding trademark rights.
[1] Neolexvision Blogs and Diksha
Mehta, ‘Analysis of Grounds of Trademark Infringement’ [2020] Social Science
Research Network.
[2] L Dr.Chandrakanthi and M Natarajam,
‘Trade Marks Protection under Indian Trademark Law: An Assessment’ (2016) 2
Imperial journal of interdisciplinary research.
[3] George Miaoulis and Nancy D’Amato,
‘Consumer Confusion & Trademark Infringement’ (1978) 42 Journal of
Marketing 48.
[4] ‘Trademark Dilution (Intended for a
Non-Legal Audience)’ (International Trademark Association)
[5] Ananya Chaurasiya and others, ‘Laws
Relating to Trade Mark Infringement in India’ [2022] International journal of
health sciences.
[6] The Trademarks Act 1999, s.103
& s.104.
[7] Guccio Gucci SPA v
Intiyaz Sheikh, CS (COMM) NO. 2090/2019.
[8] Rudolf Callmann, ‘Trade-Mark
Infringement and Unfair Competition’ (1949) 14 Law and contemporary problems
185.
[9] Starbucks Corporation v
Sardarbuksh Coffee & Co. & Ors., CS (COMM) 1007/2018.
Article Information
TRADEMARK TURMOIL: UNMASKING UNFAIR COMPETITION IN INDIA
Authors: NANDAKISHORE A, GOPIKA SASI
- Journal IJLRA
- ISSN 2582-6433
- Published 2023/10/24
- Issue 7
About Journal
International Journal for Legal Research and Analysis
- Abbreviation IJLRA
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