Keeping your finger on the pulse

Prior to the enactment of the Trademarks Act 1999 on 15th September 2003, no statutory definition of a "well-known" trademark or concept of transborder reputation existed. Therefore, the Indian courts took on the task of developing and expanding the concept of "well-known" trademarks.

One major change brought about by the entry into force of the act was the provision of statutory protection for the types of mark referred to in the act as "well-known". The earliest international provision mandating the protection of well-known trademarks is found in Article 6bis of the Paris Convention for the Protection of Industrial Property (1883). This article requires member states to reject or cancel the registration or prohibit the use of a trademark which is confusingly similar to a well-known mark. Well-known trademarks have also been endorsed by the Agreement on Trade-Related Aspects of Intellectual Property Rights.

Background
The Trade and Merchandise Marks Act 1958 afforded no statutory protection to well-known marks. The Indian courts stepped into the breach and accorded common law protection to well-known trademarks on the grounds that use of a well-known mark is likely to deceive, even in relation to dissimilar goods.

In Daimler Benz Akietgesellschaft v Hybo Hindustan (AIR 94 Del 239) the Delhi High Court held that the mark BENZ, which had been used extensively by the plaintiff in relation to cars, would cause confusion when used by the defendant with respect to undergarments, even though the manufacturers of Mercedes Benz cars neither manufactured nor sold clothes or undergarments. The court observed that “it will be a great perversion of the law relating to trademarks and designs, if a mark of the order of ‘Mercedes Benz’... is humbled by indiscriminate colourable imitation by all or anyone”.

The 1999 act recognises the more modern concept of trademark protection. Although the Indian courts actively protected well-known trademarks, statutory protection was a necessary step as the legislature sought to identify the circumstances in which a trademark could be said to enjoy well-known status and to lay down the scope of protection accorded to such trademarks.

Statutory protection
Section 2(zg) of the act defines a "well-known mark" as follows:

“Well-known trademark, in relation to any goods or services, means a mark which has become so to the substantial segment of the public which uses such goods or receives such services that the use of such mark in relation to other goods or services would be likely to be taken as indicating a connection in the course of trade or rendering of services between those goods or services and a person using the mark in relation to the first-mentioned goods or services.”

In addition to this definition, Section 11(6) lists factors which must be considered by the trademarks registrar when deciding whether a mark is well known. The scheme adopted by the act is broad, providing an inclusive list of factors and empowering the registrar to take into account any other relevant factors. Such factors include: 

• The knowledge or recognition of that trademark in the relevant section of the public, including knowledge in India obtained as a result of promotion of the trademark.
• The duration, extent and geographical scope of any use of that trademark.
• The duration, extent and geographical scope of any promotion of the trademark.

The applicability of the aforementioned provision is well illustrated by the decision in Kabushiki Kaisha Toshiba v Tosiba Appliances (2005 (30) PTC 188 (Reg)), where the court held that TOSHIBA was a world-renowned trademark and had acquired worldwide goodwill and reputation, and as such had become not only well known, but also the plaintiff’s house mark. Ultimately, the registrar considered the following factors in arriving at the conclusion that TOSHIBA was a well-known mark: 

• Toshiba’s record of successfully enforcing its rights. 
• The extensive sales of various goods worldwide under the TOSHIBA trademark.
• The agreements that Kabushiki Kaisha Toshiba had entered into with a number of Indian companies and public undertakings.
• The registrations of the TOSHIBA mark under the Indian trademark laws.
• The presence of Toshiba service centres in a number of Indian cities.
• The international registrations of the TOSHIBA trademark.

Further, Section 11(9) of the act lists certain factors which the registrar regards as preconditions to determine the well-known status of a mark, such as that the trademark have been used in India or that the trademark have been registered or an application for registration have been filed in India. The Trademarks Act 1999 provides protection to well-known trademarks on two levels: 

• Against the registration of any similar marks (Section 11).
• Against infringement (Section 29).

Protection against registration of similar marks
According to Section 11(2) of the act, a trademark which is to be registered for goods or services which are dissimilar to those for which the earlier trademark is registered in the name of a different proprietor shall not be registered if or to the extent that the earlier trademark is a well-known trademark in India and the use of the later mark without due cause would take unfair advantage of or be detrimental to the distinctive character or repute of the earlier trademark.

Although Section 11(9) of the act specifically states that registration of a mark is not a precondition for the registrar to hold that a mark is well known, the protection available under Section 11(2) is applicable only to a well-known mark that is registered in India. Section 11(2) poses a difficulty in that while it does not expressly state that the earlier trademark must be registered, this requirement is implied by use of the words “goods or services which are not similar to those for which the earlier trademark is registered”.

Section 11(2) can also be invoked by the proprietor of a well-known mark in an opposition proceeding instituted against any application or registration of a mark under the act.

Action against misuse of a well-known mark
The statutory protection against third-party misuse of well-known marks is provided under Section 29(4) of the act. This section provides that a registered trademark is infringed if another party uses a mark which is identical or similar to the registered trademark for dissimilar goods or services, provided that the registered trademark has a reputation in India and the use of the mark without due cause would take unfair advantage of or be detrimental to the distinctive character or repute of the registered mark.

Although this provision, which is also referred to as the "dilution" provision, does not expressly mention well-known marks, it affords broad-based protection to trademarks with reputation – and well-known marks have repeatedly been held to be marks with reputation. It remains to be seen whether an Indian court is likely to hold that marks with reputation are the same as well-known marks or whether they require a lower level of proof to that required to prove the well-known nature of a mark. Thus, this provision also protects well-known marks against misuse by third parties in relation to goods or services which are dissimilar to those in respect of which the well-known mark is being used, but only if such use: 

• Takes unfair advantage of the well-known mark.
• Is detrimental to the distinctive nature of the well-known mark.
• Is detrimental to the repute of the well-known mark.

Section 27(2) of the act also preserves the common law right of action against any person for passing off goods or services as those of another person. It would be a more accurate reflection of the Indian law on passing off to state that the courts have not insisted on a common field of activity to find passing off and have extended the applicability of this action to cognate, allied or dissimilar goods and services, provided that an action for passing off against use of the mark for completely dissimilar goods or services has been upheld in cases where the complainant’s mark was held to be well known. Further, in such actions the courts have specifically noted that dilution is a form of harm that is likely to occur to the goodwill associated with a well-known mark. However, in a passing off action based on a well-known mark – just as in any other passing off action – the complainant is still required to show misrepresentation and a passing off action cannot be based solely on dilution. In this sense, the protection conferred under the act is broader than that available to well-known marks in an action for passing off.

In the past, an action for infringement was usually combined with an action for passing off. In such cases the Indian courts found in favour of the plaintiff at the interlocutory stage, generally on the grounds of passing off, and did not venture to interpret the meaning of Section 29(4).

However, recent judgments show a change in this trend, as exemplified in Rolex SA v Alex Jewellery Pvt Ltd (9th April 2009, MANU/DE/0796/2009). In that case the Delhi High Court granted interlocutory relief to the plaintiff upon finding infringement under Section 29(4). The court used Section 11(6) to determine whether the plaintiff’s mark ROLEX (used in relation to watches) was a well-known mark on the basis of evidence provided by the plaintiff, such as: 

• Widespread media advertising since 1947, particularly in the years immediately preceding the suit.
• Registrations obtained for the ROLEX trademark.
• Use for nearly 100 years of the ROLEX trademark around the world.
• Rolex advertisements in Indian magazines, even when import restrictions were in place.
• Registration of the trademark in a large number of countries.
• Successful enforcement of the plaintiff’s rights with respect to the trademark.

On the basis of this evidence, the court held the plaintiff’s ROLEX mark to be a well-known mark and that the use of the mark by the defendant in relation to jewellery constituted infringement of the plaintiff’s rights under Section 29(4) of the act. The ROLEX case best exemplifies the current scenario as regards the protection of well-known marks in India. The registrar and the courts are applying the statutory provisions to their fullest extent in order to afford protection to marks which qualify as well known under the ambit of the act. However, as a precondition to availing of such protection, proprietors are required to establish the well-known nature/repute of their mark by adducing requisite evidence to that effect. In the absence of a straightjacketed formula for what amounts to "requisite evidence", future litigants can rely on judicial precedent as a guide for the same.

This article first appeared in World Trademark Review, published by The IP Media Group (www.worldtrademarkreview.com).