The Rule of One Mark, One Source and One Proprietor in Trademark Law

Smriti Yadav, Partner, Khaitan & Co

Shwetank Tripathi, Senior Associate, Khaitan & Co

In the matter of Shree Ganesh Rolling Mills (India) Limited v Jindal Rolling Mill Limited, CS(COMM) 360 of 2016 (Suit), the Learned Single Judge of the Delhi High Court (Court) passed an interim injunction order dated 10 June 2020 (Decision) in a trade mark passing off suit relying on the settled principle of ‘one mark, one source and one proprietor’ and giving pre-eminence to the interest of the consumers who may be misled.

Factual Background

In the year 1996, Shree Ganesh Rolling Mills (India) Limited (Plaintiff), claiming to be the prior adopter and registered proprietor of the trade mark ‘JINDAL’ (said Trade Mark) in respect of goods falling in class 6 (Goods) instituted a suit bearing reference number CS(OS) 979/2006 (Earlier Suit) before the Court for infringement and passing off against Jindal Rolling Mill Limited (Defendant) who was using the marks ‘Y. R. JINDAL’ and ‘JINDAL CO’ in respect of identical/similar goods.

Around that time, the Defendant had initiated a rectification application against the Plaintiff’s registration of the said Trade Mark which came to be dismissed by the Intellectual Property Appellate Board (IPAB) in 2004. Thus, the Plaintiff’s right in the said Trade Mark remained indisputable. The Earlier Suit was abandoned in 2002, as the Plaintiff believed that the Defendant had stopped use of the marks ‘Y. R. JINDAL’ and ‘JINDAL CO’.

In 2015, the Defendant, claiming rights in the said Trade Mark filed a suit before the Hyderabad Civil Court against one of the Plaintiff’s licensees and received an ex-parte ad-interim order. This suit was ultimately settled and disposed of. The Plaintiff claims to have learnt that the Defendant was using the said Trade Mark only at this time. Interestingly, around the same time, the Defendant also instituted a suit against the Plaintiff for infringement and passing off in relation to the said Trade Mark before the Hyderabad Civil Court (Hyderabad Suit). No interim reliefs were granted to the Defendant and the Hyderabad Suit is pending. It is the case of the Plaintiff that it was only from the Hyderabad Suit that the Plaintiff learnt about the Defendant’s alleged  prior user claim of 1972 (this was prior to the Plaintiff’s user claim of 1974) and its various registrations for the same (these were subsequent to the Plaintiff’s registration of the said Trade Mark).

Resultantly, in 2016, the Plaintiff instituted the Suit before the Court for passing off against the Defendant seeking permanent injunction from the use of the said Trade Mark in respect of the Goods and also filed rectifications against the Defendant’s registrations for the said Trade Mark and other marks consisting of the same. The Defendant filed an application under Section 10 of the Code of Civil Procedure 1908 for stay of the Suit on account of pendency of the prior Hyderabad Suit. In the Decision, the Court considered the Plaintiff’s application for interim injunction and the Defendant’s application for stay of proceedings in the Suit.

Rival Contentions

The Plaintiff contended that it adopted the said Trade Mark in 1974 and has been continuously using the same in respect of the Goods either directly or through its licensees. The Plaintiff also relied upon the registrations obtained by it for the said Trade Mark in respect of the Goods. The Plaintiff further inter alia contended that: (a) the Defendant was well-aware of the rights of the Plaintiff in the said Trade Mark in view of the Earlier Suit; (b) the Defendant was a habitual infringer and its claim on the said Trade Mark is not bona fide; and (c) the Defendant was incorporated only in the year 1986 and therefore its user claim of 1972 is false.

The Defendant contended that it was using the said Trade Mark since 1972 through its predecessor-in-interest, and therefore, it is the prior adopter and user of the said Trade Mark. The Defendant further inter alia contended that: (a) the Plaintiff has not furnished any reasons for abandoning the Earlier Suit;  (b) the Plaintiff closed its manufacturing unit in 2003, and thus, it has abandoned its alleged rights in the said Trade Mark; (c) the alleged use of the said Trade Mark by the Plaintiff through its licensees is false as the license agreements relied upon by the Plaintiff are forged and fabricated; (d) the Plaintiff did not oppose the applications filed by the Defendant for registration of the said Trade Mark and other marks consisting of the same; (e) the Defendant  was using the said Trade Mark for 44 years; and (f) the Plaintiff acquiesced to the Defendant’s use of the said Trade Mark, and therefore, the Suit suffers from delay and laches. 

Findings and Decision

The Court, after going through the rival submissions and the voluminous documents produced by the parties, deemed it apposite to not burden the Decision with all the documents and Judgments relied upon by the parties, at the interim stage especially in view of the fact that the Suit cannot be proceeded to trial in view of pendency of the prior Hyderabad Suit.

On merits of the matter, the Court observed that it was difficult to take a prima facie view on the respective claims of either parties. The Court observed that ordinarily when a prima facie case is not found in favour of the Plaintiff, no interim relief is to be granted. However, in the present matter, both the parties were using identical marks for identical goods, and therefore, the rival goods were indistinguishable from each other. Relying on the fundamentals of trade marks laws. The Court observed that the purpose of the law regarding infringement and passing off is not only to protect rights of the proprietors of the marks but also to protect the consumers from being misled and confused.

The Court observed that while the Plaintiff may or may not be the prior user of the said Trade Mark, it was admittedly the prior registrant of the said Trade Mark and the same was a strong indicator in favour of the Plaintiff. The Court also relied upon the pleadings in the Earlier Suit where the Defendant has been claiming rights in the marks ‘Y. R. JINDAL’ and ‘JINDAL CO’ and not the said Trade Mark ‘JINDAL’ per se, and observed that the Defendant has subsequently dropped the prefix/suffix from its mark to make it identical with the Plaintiff’s said Trade Mark.

Thus, relying on the settled principle of ‘one mark, one source and one proprietor’, and for protection of interest of the consumers, the Court injuncted the Defendant from using the said Trade Mark ‘JINDAL’ per se. To strike a balance, the Court allowed the Defendant to use the mark ‘Y. R. JINDAL’. The proceedings in the Suit were thereafter stayed until the disposal of the Hyderabad Suit.

Comment

In a complex factual matrix like the present case, at times it becomes difficult for the Court to take a prima facie view one way or the other. The Court has taken a remarkable step by injuncting a party by giving prominence solely to public interest. The Decision deviates from the commonly used principle of granting interim injunction only when the Plaintiff is able to show a prima facie case in its favour along with balance of convenience and grave and irreparable loss.


Smriti Yadav is a Partner at Khaitan & Co. She can be reached here.

Shwetank Tripathi is a Senior Associate, Khaitan & Co. He can be reached here.


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