Britannia v ITC: the battle for blue

It is globally accepted that protection will be granted for a particular colour or combination of two or more colours only when it acts as a source identifier, and whether it acts as a source identifier depends on the specific circumstances of the case. However, the enforcement of colour marks, including trade dress, is still the subject of heated debate worldwide. The Delhi High Court Division Bench recently shed some light on the enforcement of colour marks in the trade dress passing-off case of Britannia Industries Ltd v ITC Ltd. The case is groundbreaking not only because of the well-reasoned and lucid judgment, but also because the division bench upheld the appeal when the appellate court would normally not be justified in interfering with the order of a single judge.

Facts
ITC Ltd had filed an interlocutory application against Britannia Industries Ltd seeking an injunction to restrain Britannia from passing off its rights in the trade dress of its product, the Sunfeast Farmlite Digestive-All Good biscuit, launched in February 2016. ITC contended that Britannia was using a confusingly and deceptively similar trade dress for its Nutri Choice Digestive Zero biscuit, launched in July 2016.

The single judge granted an interim injunction in favour of ITC, with a disclaimer that Britannia would be allowed to retain the colour yellow and had to substitute only the blue colour in the impugned packaging with any other distinctive colour. Thus, the debate on appeal revolved around the use of blue or its variants in the packaging.   

Decision
The division bench decided the case based only on the first element of a passing-off action (ie, the existence of goodwill) and did not examine the other two elements (misrepresentation and likelihood of damage). The court upheld the appeal and set aside the order passed by the single judge for the following reasons.

Bona fide and honest use by appellant
Although dishonest intention is not necessary to demonstrate a passing-off action, it is a factor which is usually taken into consideration when assessing whether the impugned mark or trade dress has been adopted in good faith. In this case, the court also took into account the bona fide and honest use of the combination of blue and yellow by Britannia.

The three variants of Britannia’s digestive biscuits had the same genre of packaging and design. In addition, since Britannia had used yellow as the primary colour in combination with red and green for its earlier products, its natural evolution into a combination of yellow and blue for the Digestive Zero product was held to have been in good faith. Moreover, the court observed that Britannia was a market leader insofar as biscuits were concerned. Thus, the court noted that Britannia had no intention to ride on ITC’s goodwill.

Lack of inherent distinctiveness in trade dress
The judgment was also clear on the point that it is unnecessary to provide exhaustive evidence of use to establish distinctiveness provided that the get-up is not only novel, but also striking. In the case at hand, the court did not find the combination of yellow and blue to be novel and striking. It also noted that since the colour blue was used in many sugarless or zero sugar products, it could not be held to be inherently distinctive with respect to ITC’s digestive no added sugar biscuits.

Lack of acquired distinctiveness in trade dress
The distinction between reputation and goodwill was discussed in detail in light of several decisions. The well-established principle that there may be reputation and yet no goodwill exists was reiterated. It was inferred that misappropriation of goodwill, rather than reputation, provides a cause of action in common law. The plaintiff must establish that goodwill is attached to the plaintiff's goods and the purchasing public associates the get-up with the particular goods or services offered by the plaintiff.

By applying this principle to the case in hand, the question was not whether ITC’s product had acquired popularity in a short period, but rather whether the get-up – in particular, the yellow and blue colour combination – had become exclusively identifiable with ITC’s product. The criteria for determining whether the combination of yellow and blue had become distinctive to ITC’s biscuit was to check whether a customer immediately recognised yellow and blue packaging as being sourced from ITC.

This issue was answered in the negative. It was held that in such a short period, it could not have been possible for ITC to have acquired distinctiveness in the yellow and blue colour combination. It was observed that although sales worth Rs50 million and various forms of evidence produced by ITC indicated the growing reputation of ITC’s product, they did not indicate that the get-up of the product had come to be identified as a source identifier.

Comment
This decision has made clear that the protection of colours based on inherent distinctiveness is not prevented per se if the colour or combination of colours is novel and striking. However, the judgment did not specify what could be termed novel and striking or what could constitute the exceptional circumstances in which colours could be protected based on inherent distinctiveness. Similarly, the judgment suggested that if, in advertisements, the plaintiff mainly relies on its business name or other word and figurative elements, it would find it hard to establish its claim based on general get-up. However, the judgment did not make clear the kind of evidence that could be produced to demonstrate that a particular colour or a combination of colours has become a badge of origin and has come to be exclusively associated with the claimant. Thus, although the judgment has answered some questions with respect to trade dress, in particular a specific colour combination, further judicial clarification on several unresolved issues is still required.