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Radico Khaitan Limited vs Carlsberg India Private Limited


Radico Khaitan Limited vs Carlsberg India Private Limited, Judgment delivered on 16 September, 2011

THE HIGH COURT OF DELHI AT NEW DELHI

Judgment delivered on: 16.09.2011 I.A. No. 8122/2011 in CS(OS) 1216/2011

RADICO KHAITAN LIMITED ….. Plaintiff Through: Mr. Neeraj Kishan Kaul, Sr. Adv. with Mr. Vivek Dholakia, Mr. Deepak & Ms. Navpreet Kaur, Advs.

versus

CARLSBERG INDIA PRIVATE LIMITED ….. Defendant Through: Dr. Abhishek Manu Singhvi, Sr. Adv., Mr. Rajiv Nayar, Sr. Adv. Mr. Sandeep Sethi, Sr. Adv. with Mr. Peeyoosh

Kalra & Mr. Kamal Sharma, Mr. C.A.

Brijesh & Ms. V. Mohini, Advs.

CORAM:-

HON?BLE MR JUSTICE MANMOHAN SINGH

1. Whether Reporters of local papers may be allowed to see the judgment? Yes

2. To be referred to the Reporter or not? Yes

3. Whether the judgment should be reported in Digest? Yes MANMOHAN SINGH, J.

1. By this order I shall dispose of the plaintiff’s interim application being I.A. No. 8122/2011 under Order XXXIX, Rules 1 & 2 read with Section 151 CPC. The plaintiff has filed the present suit for permanent injunction to restrain infringement, passing off, dilution and damages under Sections 29, 56 and 135 of the Trade Marks Act, 1999. CS(OS) No.1216/2011 Page No.1 of 81

2. CASE OF THE PLAINTIFF

(a) The plaint states that the plaintiff has been continuously and extensively carrying on an established and reputed business in respect of manufacture and sale of alcoholic beverages in India, as well as numerous countries across the world directly by itself and through its affiliates, subsidiaries, licensees, etc. The plaintiff manufactures a host of products including juices of various kinds, drinking water, liquor, such as, Extra Neutral Alcohol (ENA), Industrial Alcohol (Rectified Spirit), Indian made Foreign Liquor (IMFL), Country Liquor and Cane Juice Spirit. Besides, the plaintiff has a tie-up with 22 bottling units all over the country for bottling of IMFL under their popular brands. (b) It is stated that the plaintiff commands a major presence in the beverage industry and in connection with its business, it owns and uses many trademarks which have acquired an enviable reputation and goodwill. The well known brands of the plaintiff include CONTESSA RUM, SPECIAL APPOINTMENT, MASTIH, MASTI GOLD, OFFICER’S CLUB, AFTER DARK, EAGLES DARE apart from the family of 8 PM marks.

(c) The plaintiff adopted the mark 8 PM in the year 1997 in relation to whisky and has been extensively using the same since 1999. As a matter of fact, the Plaintiff sold a record one million cases of the 8 CS(OS) No.1216/2011 Page No.2 of 81 PM whisky in the first year alone of its launch, which was recorded in the Limca Book of Records.

(d) The Plaintiff is the Registered Proprietor of the 8 PM/8PM family of marks not only in India but also in other jurisdictions. The mark 8 PM is registered in India in class 32 and 33 and other classes details of which are given as under:

REGISTRATION IN INDIA

Trademark Number Class Status 8 PM 783398 33 Registered and valid till 24.12.2017

8 PM 978842 32 Registered and valid till 24.12.2020

8 PM Bermuda 1202398 33 Registered and valid XXX till 29.05.2013 8 PM Royale 1332504 25 Registered and valid (Label) till 17.01.2015 8 PM Royale 1332505 41 Registered and valid (Royale) till 17.01.2015 8 PM Excellency 1333994 33 Registered and valid Brandy till 24.01.2015 8 PM Bermuda 1333995 33 Registered and valid White Original till 24.01.2015 CS(OS) No.1216/2011 Page No.3 of 81 FOREIGN REGISTRATION

Country Trademark Registration No. Class Status Morocco 8 PM 89305 33 Registered Bermuda 01.12.2003

XXX Original

Caribbean

Rum

Nepal 8 PM 21483 33 Registered Bermuda 12.04.2004

XXX Original

Caribbean

Rum

Morocco 8 PM Royale 91040 33 Registered Smooth

Indian whisky

Blended With

Scotch

Nepal 8 PM Royale 21748 33 Registered Smooth

Indian

Whisky

Blended with

Scotch

Morocco 8 PM Special 92019 33 Registered rare Blend of 24.05.2004

Indian whisky

& Scotch

ZANZIB 8 PM Rare 80/99 43 Whisky 09.03.1999

AR Blended With Registered Scotch

Nepal 8 PM Rare 15368/07 33 Registered whisky 08.06.2000

Blended with

Scotch

CS(OS) No.1216/2011 Page No.4 of 81 Canada 8 PM 696618 Registered Bermuda 17.09.2007

(e) The Plaintiff is also using the trademark 8 PM for its other products like 8 PM Bermuda XXX Rum (2003), 8PM ROYALE (label) (2003), 8 PM EXCELLENCY Brandy (2005), 8 PM BERMUDA WHITE ORIGINAL CARIBBEAN RUM (2005).

(f) The Plaintiff enjoys substantial turnover from the sale of its 8 PM/8 PM range of products. The modified details of the same are mentioned in the affidavit of Mr. Satish Chandra Pandey dated 05.07.2011 the said figures are:-

Financial Year Sales Turnover Rs.

(in Million)

2006-2007 2565.9

2007-2008 2325.7

2008-2009 2136.4

2009-2010 2325

2010-2011 2452.1

CS(OS) No.1216/2011 Page No.5 of 81

3. CASE AGAINST THE DEFENDANT AS PER THE PLAINTIFF

(i) The defendant is engaged in manufacturing and marketing of alcoholic beverages more specifically beers. The Defendant has been using the brand PALONE/OKACIM PALONE in relation to its strong beers overseas. The brand was launched by the defendant in India in the year 2007 but it was not clicked in the Indian Market. Therefore, the Defendant in Feb, 2011 launched PALONE 8 (alleged to be a super strong beer) in India, numeral 8 being used in a prominent fashion and in fact as a primary mark.

(ii) The impugned mark/numeral 8 is being used by the Defendant as a primary mark despite PALONE/OKACIM PALONE, admittedly, being the Defendant’s main brand. The Defendant has also applied for the registration of the PALONE 8 label on 07.02.2011 with the user claim of 23.01.2011. Also, the website of the parent company of the Defendant www.carlsberggroup.com lists PALONE 8 as on of its main brands.

(iii) Being in the same trade and being well aware of the reputation of the Plaintiff’s 8 PM/ 8 P.M family of marks, the conduct of the Defendant in adopting and using the impugned mark/numeral 8 in respect of same goods and that too in same font and colour with mala fide intention which is also corroborated by the fact that the Defendant is also using a slogan ?8 KA DUM? similar to that of the Plaintiff’s well known CS(OS) No.1216/2011 Page No.6 of 81 campaign ?AATH KE THAATH?. The Defendant is also using the expression ?ROYALS? deliberately as ROYALE is part of the of the Plaintiff’s ?8 P.M? family of marks.

4. In view of the abovementioned facts, it is alleged that the conduct of the Defendant is in violation of Plaintiff’s statutory and common law rights, therefore, the Defendant be restrained from using the Numeral 8 in relation to their products.

5. DEFENDANT?S CASE

(a) The defendant states that it is a company incorporated under the Companies Act, 1956 having its registered office at Delhi. Defendant’s parent company, Carlsberg A/S, Denmark, including its subsidiaries and affiliates is one of the leading brewery groups in the world including beers and other beverage brands which are sold in more than 150 countries.

(b) In India they have launched CARLSBERG, TUBORG, OKOCIM PALONE and variants thereof. In the year 2006, Carlsberg Group decided to enter India and incorporated South Asia Breweries Private Limited on May 3, 2006. Later on, the said company changed its name to Carlsberg India Pvt. Limited (Defendant herein) with effect from February 23, 2009.

(c) By the end of year 2009, Defendant has been using three brand names viz. CARLSBERG in =Super Premium Mild’; TUBORG in CS(OS) No.1216/2011 Page No.7 of 81 =Premium Mild’; and OKOCIM PALONE in =Premium Strong Beer’ (6.5% ABV – Alcohol by Volume).

(d) The brand OKOCIM PALONE is being used internationally since the year 2005 and in India since the year 2007. OKOCIM PALONE label is registered as a trade mark in India since the year 2007. Considering that there is a high demand for strong beer in the Indian market, the Carlsberg Group through Defendant, in January 2011, launched a stronger variant of its well-established brand OKOCIM PALONE under PALONE 8 label having Alcohol By Volume (ABV) of approximately 8%.

(e) It was for the first time that a beer comprising approximately 8% Alcohol By Volume was launched in India. =PALONE 8′ traces its roots to the earlier brands OKOCIM PALONE as well as BALTIKA 8, GRIMBERGEN GOLD 8 and DRAGON 8. Defendant filed an application for registration of the marks =PALONE 8 label’, =PALONE 8 DUMDAR MELA’, and =8 KA DUM’ with the Trade Marks Registry. Defendant applied for registration of PALONE 8 label under No.2096009.The product under the PALONE 8 label also became a great success.

(f) The gross sales revenue of the same from January 2011 to April 2011 is in the region of Rs. 262.2 million (26.2 crore). CS(OS) No.1216/2011 Page No.8 of 81

6. The entire case of the plaintiff in nut-shell is that the use of the numeral =8′ by the defendant in relation to one of its products which is beer under the mark PALONE infringes and violates the statutory and common law rights of the plaintiff in its well known and registered mark =8 PM, numeral 8 being its essential, distinguishing and identifying feature.

7. Learned Senior counsel for the plaintiff Mr. Neeraj Kishan Kaul has made his submissions which can be enumerated as under: a) Firstly, learned counsel for the plaintiff argued that the present case is a case involving the infringement of the trade mark wherein the trade mark 8 PM is registered with the plaintiff is 8pm in class 33 in respect of whisky and class 32 in respect of the juices of various kinds, drinking water and other allied goods. b) Mr. Kaul submits that the Trademarks Act, 1999 provides for the registration and protection of numerals as trademarks. The definition of the mark under Section 2 (m) of the Trade Marks Act, 1999 expressly covers numerals. Courts have consistently upheld rights in numeral marks and have also passed the orders to restrain from time to time in infringement cases holding the misusers of the numeral mark liable. Learned senior counsel has referred the following decisions in support of his first submission: CS(OS) No.1216/2011 Page No.9 of 81 (i) Shaw Wallace & Co. v. Superior Industries Ltd. 2003 27 PTC 63 – Para 1, 5, 12, 14, 15-20, 27 (Marks Involved: Haywards 5000/Superior 5000) (ii) Jagan Nath Prem Nah v. Bhartiya Dhoop Karyalaya AIR 1975 Del 149 – Para 2, 8, 17-19

(Marks Involved: Kasturi 555/ Anand Durbar 555) (iii) M/s Vrajlal Manilal v. Adarsh Bidi Co. 1995 1 Arb. L.R 471-Para 2, 7, 10-12

(Marks Involved: 22/122)

(iv) Kamal Trading v. Gillette UK Limited

1988 1 (7′ O Clock)

c) It is submitted by Mr. Kaul that it is a classic case of infringement of trademark wherein the Plaintiff is the Registered Proprietor of the 8 PM in India but also in other countries of the world. The details of registration are given in Para 4 of the plaint. Section 28 of the Trade Mark Act, 1999 gives the registered proprietor the exclusive right to use of the registered mark and the use of an ?identical? or ?deceptively similar? mark by another without any permission/authority amounts to infringement of the registered mark under Section 29 of the Act.

d) The registration of the plaintiffs’ trademarks is not challenged by the defendant or any third party, thus it is a valid registration within the meaning of Section 32 of the Act and the court has to take the prima facie view of the validity of the mark at this stage. e) In support of his submission on the question of infringement, he has relied upon the following decisions: The defendants’ usage of CS(OS) No.1216/2011 Page No.10 of 81 the mark 8 as a trade mark without being a registered proprietor is a clear invasion upon plaintiff’s rights.

i. Kaviraj Pandit Durga Dutt Sharma v. Navaratna Pharmaceutical Laboratories AIR1965SC980 – at 989- 990 page wherein it was held that:

“The action for infringement is a statutory

remedy conferred on the registered proprietor of a registered trade mark for the vindication of the exclusive right to the use of the trade mark in relation to those goods”

“if the essential features of the trade mark of the plaintiff have been adopted by the

defendant, the fact that the get-up, packing and other writing or marks on the goods or on the packets in which he offers his goods for sale show marked differences, or indicate

clearly a trade origin different from that of the registered proprietor of the make would be

immaterial”

ii. In the case of American Home Products v. Mac Laboratories AIR 1986 SC 137 in Para 36 it was held as under:

“When a person gets his trade mark

registered, he acquires valuable rights by

reason of such registration. Registration of his trade mark give him the exclusive right to the use of the trade mark in connection with the goods in respect of which it is registered and if there is any invasion of this right by any other person using a mark which is the same or

deceptively similar to his trade mark, he can protect his trade mark by an action for

infringement in which he can obtain

injunction….”

iii. In the case of National Bell Co. v. Metal Goods Mfg. Co. AIR 1971 SC 898 at page 903 it was held as under: CS(OS) No.1216/2011 Page No.11 of 81 “On registration of a trade mark the

registered proprietor gets under Section 28 the exclusive right to the use of such trade marks in relation to the goods in respect of which the trade mark is registered and to obtain relief in respect of any infringement of such trade

mark.”

f) Mr. Kaul has referred the two images of the products used by the parties in the present case in order to show that the defendant has taken the essential and dominate feature of the main 8 without any valid justification.

PLAINTIFF DEFENDANT

g) Learned counsel for the plaintiff argued that the mark 8PM of the plaintiff is registered in respect of whisky which is well known and famous mark and the use of the mark by the defendant is in respect of beers which are the goods of the same description CS(OS) No.1216/2011 Page No.12 of 81 within the meaning of Section 29 (1), (2) and (4) of the Trade Mark Act, 1999.

h) Thus, the infringement of the present trade mark 8PM of the plaintiff is in respect of the same or similar goods and therefore the said infringement is bound to cause confusion and deception in the market as to the source of the goods.

8. By relying the said observations of the Apex Court, learned counsel has explained that there is no doubt that the courts must respect the registration and the valuable rights of the plaintiff in the form of registration must be given due credence in the form of interim injunction and third party use of the same mark becomes irrelevant and injunction must follow in the present case.

9. On the aspect of an action of passing off, Mr. Kaul submits that the defendant has deliberately and intentionally adopted and used the essential feature of the mark i.e. numeral 8 in order to take the advantage of the goodwill and reputation gained by the plaintiff in relation to its business as two sets of products i.e. whisky and beers are allied and cognate goods which are purchased by the same set of customers and sold by the same shopkeepers. Both set of goods are placed side by side at the selling counter and served to the consumer at the same time. CS(OS) No.1216/2011 Page No.13 of 81

10. Mr. Kaul has thus concluded the arguments by stating that the present case is a straightforward case of infringement of the registered trade mark rights of the plaintiff and the prima facie case is in the favour of the plaintiff as the defendant by misusing the numeral mark 8 has slavishly copied or imitated the mark of the plaintiff. The balance of convenience also falls in favour of the plaintiff as the defendant is the recent entrant in the market. The plaintiff will suffer irreparable loss in the event of rejection of injunction. Therefore, this court should grant ad interim injunction restraining the defendants from infringing the plaintiff mark 8PM.

11. Per contra, learned Senior Counsel Dr. A.M. Singhvi, appearing on behalf of the defendants has made his submissions which can be crystallized in the following terms.

(i) Dr. A.M. Singhvi in his first submission states that the plaintiff is only engaged in the business of manufacturing and marketing of =Whisky, Rum’ (Class 33) under the brand 8 PM and is not at all in the business of =beer’ which falls in Class 32. The plaintiff has no registration for the brand 8 PM for =beer’. Plaintiff has got registered the mark 8 PM in Class 32 but only in respect of mineral water and not beer etc. in Class 33. Thus, no case of infringement is made out as the plaintiff’s trademark is 8 PM in relation to Whisky and Rum etc. and numeral 8 is admittedly not identical with the mark of the plaintiff 8 PM CS(OS) No.1216/2011 Page No.14 of 81 Therefore, the test of passing off would apply while comparing the two marks in question.

(ii) The defendant’s brand BALTIKA 8 is being used in Russia since the year 2001 and is registered in the USA in Class 32 in respect of =beer’ with user claimed since October 2007. The defendant is not using the mark 8 PM all alone. It is being used along with international brand of the defendant who is engaged in the business of beers. (iii) That the defendant has obtained excise registrations for its PALONE 8 label in 24 States of the country. The said product was first launched in January 2011 in Maharashtra. Defendant’s affiliate/s has/have been using the numeral 8 along with/as a part of famous international brands such as BALTIKA 8, GRIMBERGEN GOLD 8, DRAGON 8. The instant Suit was filed on May 16, 2011. On the said date, defendant did not even had an excise approval in Delhi to sell beer under PALONE 8 label. Therefore, the contention of Plaintiff that the products of Defendant under PALONE 8 label are available within the jurisdiction of Delhi is false, misleading and absurd. (iv) That the plaintiff is not entitled to the exclusive proprietory rights over the numeral mark ?8? due to following reasons: ? Plaintiff has not obtained any separate registration for =8′ or =P.M.’ per se nor has filed any application for registration of =8′ per se. In order to buttress his submission, learned senior CS(OS) No.1216/2011 Page No.15 of 81 counsel has read section 17 of the Trade Marks Act which provides for the part of the trade mark and nature of rights available in the case of part of the trade mark. It is contended by the learned senior counsel for the defendant that the Plaintiff is seeking to assail Defendant’s use of =8′ as a part of the PALONE 8 label on the basis of its alleged registration =8 PM’

? Plaintiff’s mark 8 PM is descriptive. It attributes 8 PM to the preferred recreation time of the evening when everyone desires to unwind. It is argued that the registrar was conscious of the fact that the mark of the plaintiff is inherently non-distinctive, the Registrar (under the Trade Marks and Merchandise Act, 1958 which has now been repealed) granted registration to Plaintiff for its trade marks 8 PM in Part B of the Register which are comparatively weaker trade marks and the court can question the same. As the mark 8 PM is descriptive and non-distinctive, it does not entitle Plaintiff to claim exclusive rights over the numeral 8 to the exclusion of others.

12. After reliance, as mentioned above, it is stated by Dr. Singhvi that the numeral =8′ is publici juris and common to the trade therefore, question of any exclusivity in respect thereof to the Plaintiff alone does CS(OS) No.1216/2011 Page No.16 of 81 not arise. As it has been mentioned in Narayanan’s Law of Trade Marks and Passing Off 6th Edition @ page 180 para 8.63 that “Numeral though come within the scope of the definition of a mark, they are and cannot be prima facie considered distinctive or capable of distinguishing as they are descriptive of the number of articles…”. He argues that the trademark consisting of a single number will always be considered as lacking distinctive character unless presented with distinctive stylization. Single numbers which have little or no stylization will normally be open to objection because they are often used in trade to indicate model or catalogue reference.

13. In view of the abovementioned facts and documents referred, Dr. Singhvi says that the plaintiff has failed to make out any case of infringement of trademarks and passing off. In substance, the following reasons are given:

(i) Plaintiff has no registration for the numeral =8′ per se and no registration in respect of beer. It is common to the trade. The defendant is not using the numeral 8 per se

(ii) The goods viz. beers and whisky are totally different; and belong to different segments as class of consumers is different; it is impossible for one to buy whisky for beer or vice-versa; even illiterate consumers will not be confused. (iii) The labels/packaging/bottles of 8 PM whisky and PALONE 8 beer are totally different.

CS(OS) No.1216/2011 Page No.17 of 81 Therefore, there has been no confusion and

deception.

(iv) Defendant’s use of =8′ is indicative of the kind, quantity and characteristics of the product in question. The Alcohol By Volume in

Defendant’s product is approximately 8%.

Thus the use of the numeral =8′ by Defendant is a bona fide description of the character of its goods.

(v) Plaintiff’s whisky is priced at approximately INR 300 whereas Defendant’s beer bearing the label PALONE 8 is priced at INR 65. The

plaintiffs sale of products and 8 PM is lower than defendant’s sale.

14. As regards the objection of the plaintiff about the Defendant’s use of slogan 8 KA DUM and the expression ROYALS on the basis of its erstwhile campaign AATH KE THAATH and the expression ROYALE. No relief has been claimed in the Suit in respect of the same thus the injunction does not arise. About the mark Royal used by the defendant is concerned it is stated that though no relief is sought in the plaint but even the plaintiff’s application of 8 PM Royale has been opposed by the third party. It is stated that the Plaintiff has neither any interest in =beer’ nor has any registration in respect of =beer’ in Class 32 for its mark 8 PM.

15. Thus, it is alleged that the plaintiff has not been able to make out a prima facie case of infringement for the grant of injunction. This is more so when there are several players in the whisky trade using 8 numeral but the plaintiff has chosen to sue the defendant only who is CS(OS) No.1216/2011 Page No.18 of 81 dealing in respect of the beers, therefore, no case is made out by the plaintiff for infringement rather in view of the peculiar facts of the present case, the plaintiff has not met its case under Section 29(4) as the plaintiff has not been able to show that the main 8 PM has well known status which seems unfeasible in view of several players in the market using the expression or numeral 8 in respect of whisky itself who have more business than the plaintiff and their user of the mark 8 numeral is prior to the use of the plaintiff.

16. Learned Senior Counsel Dr. Singhvi has vociferously argued that the use of the numerals are quite common in the liquor industry as demonstrated from the above listed drinks emanating from well known brands. It is further argued that the numeral mark is per se non distinctive.

Learned Senior Counsel submitted that it is difficult to ascribe distinctiveness to the numeral unless very high degree of distinctive character is shown. Furthermore, the said distinctiveness has to be seen from case to case basis and the plaintiff in the present case has been miserably failed to show any such distinctiveness with respect to numeral 8 per se in respect of whisky even due to the prevalent trade practice and thus the plaintiff is clearly disentitle to any such protection.

17. The next submission of the learned Senior Counsel is that the plaintiff has approached this court after inordinate delay of 5 CS(OS) No.1216/2011 Page No.19 of 81 months after attaining the knowledge about the defendant’s products under the mark PALONE 8. This has been explained by the plaintiff by stating that Plaintiff’s knowledge of the Defendant/its product dates back to January 2011 when Defendant launched its product under PALONE 8 label in Maharashtra. Defendant’s label was published on the Notice Board of the Excise Department, Mumbai for 15 days in January, 2011 for objections, if any. Further, Plaintiff filed objections to the application filed by Defendant with the Excise Office, Hyderabad for approval of PALONE 8 label in February 2011, which was granted in favour of the Defendant.

18. Lastly, Dr. Singhvi, learned senior counsel has argued that the plaintiffs claim of passing off is also not made out due to following reasons:

a) Defendant’s products under PALONE 8 label are not so far available in Delhi.

b) Defendant is using PALONE 8 label comprising its flagship brand PALONE whereas Plaintiff’s mark is 8 PM

c) 8 PM does not command goodwill/reputation. d) There has been no misrepresentation on the part of Defendant. e) The source of origin of the product bearing the PALONE 8 label is clearly discernible.

CS(OS) No.1216/2011 Page No.20 of 81 f) The goods viz. beers and whisky are totally different; and belong to different segments.

g) The labels/packaging/bottles of 8 PM whisky and PALONE 8 beer are totally different.

h) The Defendant’s bottle is specially designed wherein its name is clearly embossed on the bottle.

i) Class of consumers is different; it is impossible for one to buy whisky for beer or vice-versa; even illiterate consumers will not be confused. [Please see Khoday Distilleries Limited Vs. Scotch Whisky Association].

j) Plaintiff’s whisky is priced at approximately INR 300 whereas Defendant’s beer bearing the label PALONE 8 is priced at INR

65. [Please see White Horse Distillers Limited Vs. The Upper Doab Sugar Mills Limited].

k) 8 KA DUM and AATH KE THAATH cannot be mistaken for each other. In any case 8 KA DUM is a slogan used on the product of the Defendant to indicate the strength i.e. 8% Alcohol By Volume, whereas the campaign AATH KE THAATH was in respect of music CDs of the Plaintiff which is no longer in use. Therefore, it is argued by the defendant that in view of all abovementioned factors the defendant cannot pass off its goods as that of goods of the plaintiff.

CS(OS) No.1216/2011 Page No.21 of 81

19. I have gone through the pleadings, application, reply and documents filed therewith and also the submissions made by the parties at the Bar. Before dealing with the submissions of the parties, I deem it appropriate to discuss the law on the subject on the question of infringement of trade mark.

INFRINGEMENT

20. The law relating to infringement of a registered trademark has been envisaged u/S 29 of the Trade Marks Act, 1999 and exclusive rights granted by virtue of registration under Section 28 which reads as under:-

“29. Infringement of registered trade marks – “Infringement of registered trade marks.-

(1) A registered trade mark is infringed by a person who, not being a registered proprietor or a person using by way of permitted use, uses in the course of trade, a mark which is identical with, or deceptively similar to, the trade mark in relation to goods or services in respect of which the trade mark is registered and in such manner as to render the use of the mark likely to be taken as being used as a trade mark.

(2) A registered trade mark is infringed by a person who, not being a registered proprietor or a person using by way of permitted use, uses in the course of trade, a mark which because of- (a) its identity with the registered trade mark and the similarity of the goods or services covered by such registered trade mark; or (b) its similarity to the registered trade mark and the identity or CS(OS) No.1216/2011 Page No.22 of 81 similarity of the goods or services covered by such registered trade mark; or

(c) its identity with the registered trade mark and the identity of the goods or services covered by such registered trade mark, is likely to cause confusion on the part of the public, or which is likely to have an association with the registered trade mark. (3) In any case falling under clause (c) of sub- section (2), the court shall presume that it is likely to cause confusion on the part of the public.

(4) A registered trade mark is infringed by a person who, not being a registered proprietor or a person using by way of permitted use, uses in the course of trade, a mark which-

(a) is identical with or similar to the registered trade mark; and (b) is used in relation to goods or services which are not similar to those for which the trade mark is registered; and (c) the registered trade mark has a reputation in India and the use of the mark without due cause takes unfair advantage of or is detrimental to, the distinctive character or repute of the registered trade mark. ……?

?28. Rights conferred by registration –

(1) Subject to the other provisions of this Act, the registration of a trade mark shall, if valid, give to the registered proprietor of the trade mark the exclusive right to the use of the trade mark in relation to the goods or services in respect of which the trade mark is registered and to obtain relief in respect of infringement of the trade mark in the manner provided by this Act. (2) The exclusive right to the use of a trade mark given under sub-section (1) shall be subject to any conditions and limitations to which the registration is subject.

(3) Where two or more persons are registered proprietors of trade marks, which are identical with or nearly resemble each CS(OS) No.1216/2011 Page No.23 of 81 other, the exclusive right to the use of any of those trade marks shall not (except so far as their respective rights are subject to any conditions or limitations entered on the register) be deemed to have been acquired by any one of those person as against any other of those persons merely by registration of the trade marks but each of those persons has otherwise the same rights as against other persons (not being registered users using by way of permitted use) as he would have if he were the sole registered proprietor.? By mere reading of these provisions, it is clear that a registered trademark is infringed by a person who not being a registered proprietor, uses in the course of trade a mark which is identical or deceptively similar in relation to the goods or services which are identical or similar to that in respect of which the trademark is registered without the permission of the trademark owner.

21. So far as infringement qua different goods is concerned, separate enactment of Section 29(4) makes it clear that the strict rigors are prescribed as against the ordinary case of similar goods wherein a registered proprietor has to establish that the registered trademark has reputation in India and is of such a nature wherein the use of the mark by the other side without due cause would tantamount to taking unfair advantage or detrimental to the distinctive character or repute of a trademark.

22. A reading of Section 29(4) of the Act would reveal that the said protection qua different goods is earmarked by the Legislature for the trademarks which are either highly reputed or well known or famous CS(OS) No.1216/2011 Page No.24 of 81 trademarks and enjoy either high level of distinctiveness or the marks which are inherently distinctive in nature or has become distinctive due to their repute; the use of which will cause detrimental to the distinctive character and repute of the trademark only when the ingredients of Section 29(4) are satisfied conjunctively which is sub sections (a), (b) and (c) the infringement qua Section 29(4) in relation to different goods is attracted.

23. Let me also examine the provisions relating to the limitations of infringement of a trademark. For the purposes of present case, Section 30(1) is relevant extract of the provision which is reproduced herein after:-

Section 30

(1) Nothing in section 29 shall be construed as preventing the use of a registered trade mark by any person for the purposes of identifying goods or services as those of the proprietor provided the use-

(a) is in accordance with honest practices in industrial or commercial matters, and

(b) is not such as to take unfair advantage of or be detrimental to the distinctive character or repute of the trade mark.

24. A careful reading of Section 30(1) would reveal that the said Section provides that nothing in Section 29 shall be construed as preventing the use of a registered trademark by any person for the purposes of identifying the goods or services as those of the proprietor CS(OS) No.1216/2011 Page No.25 of 81 provided that the use is in accordance with honest practices in industrial or commercial matters. The said section is enacted within two parts which is section 30(1) (a) and (b). In-between the two sub clauses the word used is =and? which means that both the conditions prescribed are to be satisfied conjunctively which means that the user of any trademark for the purposes of identifying the goods or services as those of the proprietor shall not be construed as infringement if the use is in accordance with honest practices in the industrial/commercial matters at the first place and is also not amounting to taking unfair advantage or detrimental to the character or repute of the trademark.

25. Now, the question arises that what can be termed as the honest practices in commercial or industrial matters as used in the sub clause (a). The said honest practices in Industrial or commercial matters can be interpreted either way as the honesty can be subjective terms inasmuch as what maybe honest in the eyes of one person may not be honest in the eyes of another. Therefore, in order to rule out the subjectivity in the expression ?honest practices in industry or commercial matters?, the Courts have developed the doctrine of objectivity rather than the subjectivity while applying the test of honest practices in the industry and commercial matters.

26. By interpreting honest practices as those which are satisfying the objective standards in Aktiebolaget Volvo V. Heritage (Leicester) CS(OS) No.1216/2011 Page No.26 of 81 Ltd cited as 2000 FSR 253, the Chancery Division has said ” It appears to be now well settled that the test of honesty for the purposes of the proviso is one that has to be judged by an objective standard and in my judgment the appropriate question to be asked in relation to the test in the present case is whether a reasonable motor service provider would think the use complained of in the present case to be honest, or, rather, in accordance with honest practices in that business (see Cable & Wireless PLC & Anr. V. British Telecommunications PLC). The Court further held that the application of the proviso namely “the use in accordance with honest practices in industrial or commercial matters” involves “looking at the particular use complained of as being an infringement of the relevant trademark and determining whether a reasonable person in the trade concerned, that is to say, in this case the trade of motor car service provider, knowing all the relevant facts that the defendant knew would think it an honest use of a trade mark concerned – that is to say, honest use in the commercial activity in which such a trader is involved. That, in my judgment, must involve considering all the circumstances surrounding the use complained of and the context in which that use was made.”

27. From the above, it is clear that the honest practices in commercial/industrial matters have to be seen from the two standpoints of objectivity. First is the standpoint of a reasonable person in the trade CS(OS) No.1216/2011 Page No.27 of 81 whether he will think that the said use is in the honest way after knowing fully well about the trade and secondly from the perspective of the practices prevalent in the industry, which means that what the other persons/proprietors are doing in the same industry and if there is an established practice in the industry to use such expression in the particular manner, then it would not be unfair to call that practice as honest.

28. The second test is relevant due to the express wordings of the Section 30 (1) (a) which are honest practices in industrial or commercial matters. Once the said provision provides for such honest practices in the industrial or commercial matters as an exception to an infringement, then the said practice in the trade becomes relevant for the purposes of examining any case where the infringement is alleged by the proprietor.

29. Thus, the standards of determining what is honest and what is not would be much dependent upon the practice and the manner of usage of that expression which is prevalent in the market. After all that is what is called objective standards rather than subjective use which may vary from one person to another.

30. From the above discussion, another thing is clear that it is always not necessary to infer that trade practice is honest solely because the manner of use of the expression is in descriptive sense and not in a CS(OS) No.1216/2011 Page No.28 of 81 prominent fashion. The converse may be true also in some cases. There are certain industries wherein special emphasis has to be given to the said expression upon the product or an ingredient of the product so as to catch the customers or attract the consumer rather than using it as a small word on the label. Just like in liquor industry wherein one has to prominently display as to how old that liquor is by mentioning the number of years or the volume of content of alcohol.

31. Thus, the decisive test for examining the honest practice in industrial practice is not prominence or non-prominence of the said expression which may though be relevant but much will be dependent upon the manner of use of the said expression as warranted in the said industry which will set out the limit for what can be the honest and what can be dishonest.

32. The propositions which are emerging from the abovementioned discussions are as under:-

a) That Section 30 acts as an exception to Section 29 which provides for infringement of trademark;

b) Section 30(1) safeguards the use of the trademark by anyone other than the registered proprietor if the use of the said trademark is in accordance with the honest practices in the industrial or commercial matters and is not such as to take CS(OS) No.1216/2011 Page No.29 of 81 unfair advantage of or be detrimental to the distinctive character or repute of the trade mark.

c) Honest practices in the industry/ industrial or commercial matters have to be examined objectively and not subjectively for which it can be tested on two-fold basis:- i) Reasonable man having knowledge in the trade. ii) Practice prevalent in the respective industry.

33. Let me now proceed to discuss the law relating to numeral trademarks. Section 2(1)(m) of the Trade Marks Act, 1999 defines the expression =mark’ which is reproduced herein below:- Section 2(1)(m)

“mark” includes a device, brand, heading, label, ticket, name, signature, word, letter, numeral, shape of goods, packaging or combination of colours or any combination thereof.”

34. On bare perusal of the said definition, it becomes clear that the said definition is an inclusive definition which includes numeral. Mark also includes numerals which shows and denotes that the said numeral can perform the function of a trademark. Although numeral has been included in the definition of mark but it has to be examined as to whether a single-numeral 8 in the facts and circumstances of the present case can be protected while comparing the two marks of the parties, i.e. 8 PM and PALONE 8 and the two sets of goods are whisky and beer. Likewise, Dr. Venkateswaran on Trademarks and Passing CS(OS) No.1216/2011 Page No.30 of 81 off (5th Edition 2010) also observes about the numeral trademarks as under:-

“Mark? is defined to include letters and numerals – See Section 2(1)(m). However, they notoriously lack inherent distinctiveness on account of common and natural practice of firms and persons to use their initials on goods, letter paper and so forth, or to use them as symbols indicative of quality or of other characteristics. Whether a letter or numeral mark can be registered prima facie will therefore depend upon whether it is devoid of any distinctive character. Letters and numerals also presented with additional features or which are intertwined, conjoined etc. and which have a trade mark character will be accepted.”(Emphasis Supplied”

?For example, numbers, letters which may be used in trade for bona fide description will entail objections under Section 9(1) (c ) are:-

? The date of production of goods/ provision of services (e.g. 2001, 2002)

? Size, eg XL for clothes, 1600 for cars, 34R for clothing, 185/65 for tyres.

? Quantity 20, 200 for cigarettes.

? Dates for printed matter eg 1066 for history books, 1996 for wines, 2003 for anything.

? Telephone codes eg 022, 011, 033 etc.

? The time of provision of service, eg 8 to 10 ? The power of goods eg 115 (BHP) for engines or cars. ? Speed, eg 386, 486, 586, 686, & 166, 266 for computers. CS(OS) No.1216/2011 Page No.31 of 81 ? Strength eg, “8.5% for lager.”(Emphasis Supplied) The reliance of the above referenced excerpts from the authority would show and reveal that even it is recognized in the field of the trade marks that there are certain numerals which are considered to be of non distinctive character and also having some connection with the trade. Numeral 8 is one of those numerals which are earmarked as one which has some connection and relevance in the field of beer as mentioned above. Further, it also clarifies the position in the law that the numeral trade marks which are intertwined with other features can succeed for registration. But then it is to be looked into that the monopoly can be accorded to the numeral per se or the mark in totality.

35. The said argument that the numeral 8 is common to the trade and also has some relevance with the alcohol trade also gains strength when the defendants stand is examined wherein the defendants have shown number of major players /traders in the alcohol trade to be using the numeral 8 on their labels. Dr. Singhvi, learned Senior counsel has relied upon the entries on the registers worldwide as well as in India and also the labels of the current use of several alcoholic drinks so as to demonstrate that the numeral 8 is common to the trade. The said entries and the pictorial representation thereof of the same are reproduced hereinafter:

CS(OS) No.1216/2011 Page No.32 of 81 Signature 8, a whisky, was

recently launched by United

Spirits Limited.

BACARDI 8 RUM – a variant

of well-known BACARDI brand

was launched in the year 2000.

CS(OS) No.1216/2011 Page No.33 of 81 CELLAR NO. 8 is a well known

Californian Red Wine. The same

is being sold since 1881.

BLACK DOG 8 whisky, a

premium scotch whisky brand, is

being sold in India by United

CS(OS) No.1216/2011 Page No.34 of 81 Spirits Ltd. since the year 2006.

V8 VEGETABLE JUICE – V8

is a well-known Vegetable juice

brand. V8 was launched in 1933

and have been available in India

since at least the year 2005. ?A

few cocktail drinks use V8, most

famously the “bloody eight” or

“eight ball”, which is a Bloody

Mary with V8 instead

of tomato juice?.

36. By citing the detailed analysis of aforementioned brands of alcoholic drinks available in the market, the learned Senior counsel for the defendant sought to urge that the plaintiff’s grievance is nothing but a frivolous one and it does not survive in view of the market trend demonstrated above, and it reveals that there are not merely entries on CS(OS) No.1216/2011 Page No.35 of 81 the register which reveal ?8? as one of the features of the registration but rather there is substantive actual user by the third parties.

37. For ease of reference, reproduced hereinbelow is a list of few =8′ and/or =8′ formative marks in Classes 32 and 33. The list is illustrative and not exhaustive :

LIST OF

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