The Trademarks Law Review: India
The trademark registration and enforcement landscape in India, as far as legal provisions are concerned, is no different from that in other Commonwealth jurisdictions. However, despite the best laws, India has always been criticised for its weak and highly time-consuming enforcement and court procedures. This chapter will attempt to give a brief outline of the laws as they exist and the recent changes in the enforcement procedures on account of legislative changes and attitude of courts, resulting in efficient and timely conclusion of cases. The chapter will also discuss some of the path-breaking precedents handed down by Indian courts, especially in the digital space.
Year in review
The Supreme Court of India, in a path-breaking decision titled Justice K S Puttaswamy v. Union of India,2 ruled that the right to privacy is a basic core fundamental right protected by the Indian Constitution as an intrinsic part of Article 21, which protects the right to life and personal liberty. Enshrined in the right to privacy is also the right to publicity.
The Delhi High Court has recently been engaged with cases involving infringing and counterfeiting activities on the internet and online marketplaces. In Kent RO Systems Ltd v. Amit Kotak,3 the court held that under the provisions of the Act and the Rules, an intermediary is only required to declare to all its users its policy in regard to violation of IP rights of others and advise them not to host any infringing information. The court held that eBay is entitled to be protected under the safe harbour provisions of the Information Technology Act and had complied with the Information Technology (Intermediaries Guidelines) Rules 2011. In an appeal against this decision,4 the appeal court, however, held that the court could not, on a demurrer, accept eBay as an intermediary and the same would have to be established on trial.
In Christian Louboutin SAS v. Nakul Bajaj,5 the court set out the guidelines under which an online marketplace could claim the exemptions available to an 'intermediary' under the Information Technology Act 2000. Similarly, in Amway India Enterprises Pvt Ltd v. 1MG Technologies Pvt Ltd,6 the court held that online marketplaces such as 1MG, Amazon, Flipkart and Snapdeal are not mere passive platforms, but are massive facilitators providing warehousing, logistical support, packaging, delivery services, payment services, collection gateways and suchlike. In an appeal against this decision,7 the division bench of the Delhi High Court set aside the order of the single judge and held that the findings of the single judge ran contrary to the structure and frame of the suits and also held that the single judge had misinterpreted Section 79 of the Information Technology Act.
In another recent case, of Delhivery Pvt Ltd v. Treasure Vase Ventures Pvt Ltd,8 recording the submissions of reliance on the US Supreme Court decision in Booking.com, a single judge of the Delhi High Court formed a prima facie opinion that the mark 'Delhivery' if pronounced in a routine manner shall mean 'delivery' and, being a generic word, cannot be registered as a trademark.
Other than these cases, Indian courts are currently hearing arguments on issues such as use of registered trademarks as keywords or part of key words, a dispute that involves search engines such as Google.
The Trade Marks Act 1999 and the Trade Marks Rules 2017 provide for registration of trade and service marks. The term 'trademark' in India includes service marks. The Companies Act 2013 provides for registration of company names. The Geographical Indications of Goods (Registration and Protection) Act 1999 provides for registration of geographical indications (GIs) of goods.
India is also a member of the World Trade Organization and a signatory to the Agreement on Trade-Related Aspects of Intellectual Property Rights, the Paris Convention for the Protection of Industrial Property and the Madrid Protocol for the International Registration of Marks. India is also a member of the Nairobi Treaty on the Protection of the Olympic Symbol. Additionally, India adopted the Nice Agreement on the International Classification of Goods and Services and the Vienna Classification, established by the Vienna Agreement.
The Registrar of Trade Marks under the Intellectual Property Office (IPO) manages the filing and registration of trademarks. The registrar is empowered to refuse or rectify marks based on absolute or relative grounds, or both. Appeals from its orders can be filed with the Intellectual Property Appellate Board (IPAB).
The GI Registry, also under the IPO, manages the filing and registration of GIs.
Company names can be registered with the Registrar of Companies (ROC). The ROC also has powers to disapprove or rectify names of companies that are identical to or too closely resemble the name by which a company in existence had been previously registered.
Cooperative societies can be registered with the Department of Registrar Co-operative Society.
Domain name registration for .in and .co.in domain names can be undertaken through registrars appointed by the .IN Registry working with the National Internet Exchange of India, both of which, in turn, are under the Ministry of Electronics and Information Technology. The .IN Registry has adopted the Uniform Dispute Resolution Policy and is assisted by a Dispute Resolution Committee to resolve disputes in this regard. It also has powers to appoint arbitrators to address disputes involving registrars and registrants.
Disputes relating to print and television advertising, including comparative advertising, are undertaken by the Advertising Standards Council of India (ASCI), which is an industries body with representation from the industry. The ASCI Code is recognised and enforceable under the Cable Television Networks Rules 1994, which stipulate that 'No advertisement which violates the Code for self-regulation in advertising, as adopted by the Advertising Standards Council of India (ASCI), Mumbai for public exhibition in India, from time to time shall be carried in the cable service'.
Remedies against the manufacture and sale of misbranded drugs and cosmetics can be undertaken through the drug inspectors. Such products are licensed under the office of the Drug Controller, all under the provisions of the Drugs and Cosmetics Act 1940.
iii Substantive law
Registered trade and service marks protected by the Trade Marks Act 1999, registered GIs, unregistered and well-known trademarks protected by common law, can all be protected through the filing of civil suits. Trademark violations also attract criminal liabilities (see Section V.i).
The Trade Marks Register itself can be rectified by filing proceedings with either the Registrar of Trade Marks or the IPAB.
Company names can be enforced either through filing substantive suits in civil courts or through the mechanism provided in the Companies Act 2013, empowering the ROC to rectify names of objectionable companies.
India has been at the forefront of protection of internationally well known trademarks, even if the trademarks are not used in India. The Trade Marks Act stipulates the following criteria for determining whether a trademark is well-known in India:
- the knowledge or recognition in the relevant section of the public, including knowledge in India obtained as a result of promotion;
- the duration, extent and geographical area of any use;
- the duration, extent and geographical area of any promotion, including advertising or publicity and presentation, at fairs or exhibitions;
- the duration and geographical area of any registration of or any application for registration to the extent that they reflect the use or recognition of the trademark; and
- the record of successful enforcement of the rights mark; in particular, the extent to which the trademark has been recognised as a well-known trademark by any court or registrar under that record.
The term 'relevant section of the public' takes into account: (1) the number of actual or potential consumers; (2) the number of persons involved in the channels of distribution; and (3) the business circles dealing with the goods or services to which that trademark applies.
Where a trademark has been determined to be well known in at least one relevant section of the public in India by any court or registrar, that trademark is considered as a well-known trademark for registration. There is no requirement that the trademark is well known to the public at large.
The trademark is neither required to be used nor registered to be declared a well-known trademark. The Registrar maintains a list of declared well-known trademarks in India, which it also publishes.
The Information Technology Act 2000 and the Intermediary Guidelines Rules 2011 enacted under the said Act provide rules and regulations, terms and conditions or user agreements informing users of computer resources not to host, display, upload, modify, publish, transmit, update or share any information that infringes any patent, trademark, copyright or other proprietary rights.
The manufacture and sale of misbranded drugs and cosmetics, which includes adulterated and spurious drugs and cosmetics, can also be enforced through the provisions of the Drugs and Cosmetics Act 1940.
Registration of marks
Registration of trademarks can be undertaken by filing an application with the IPO. The fee for a physical filing is 10,000 rupees. For e-filing, the fee is reduced by 10 per cent. There is a new expedited process for registration for which an additional expedited processing fee of 40,000 rupees is payable. The fee for renewal of a registered trademark is identical to the filing fee (i.e., 10,000 rupees for a physical filing and 9,000 rupees for an e-filing).
Once an application is filed, it is given an exclusive number and a date. Based on the priority of filing it is taken in its turn and examined. The process of examination includes an assessment of inherent registrability and acquired distinctiveness and prior rights. If no objections are found, the trademark is published in the Trade Marks Journal to invite oppositions (see Section III.iii) from members of the public at large. If no objections are filed within four months of the publication, the registration certificate is issued. The registration dates back to the date of the application and is thereafter renewable every 10 years.
There is no requirement for the mark to have been used in India to make it eligible for registration in India. Trademarks can also be registered on a proposed user basis. If, however, use of the trademark is not commenced for a period of five years, it can be a ground for removal of the trademark from the Register of Trade Marks.
i Inherent registrability
The following trademarks are not registrable in India on grounds of inherent registrability:
- those devoid of any distinctive character; that is to say, not capable of distinguishing the goods or services of one person from those of another person;
- those that consist exclusively of marks or indications that may serve in trade to designate the kind, quality, quantity, intended purpose, values, geographical origin or the time of production of the goods or rendering of the service or other characteristics of the goods or service;
- those consisting exclusively of marks or indications that have become customary in the current language or in the bona fide and established practices of the trade;
- those of such nature as to deceive the public or cause confusion;
- those containing or comprising any matter likely to hurt the religious susceptibilities of any class or section of citizens of India;
- those comprising or containing scandalous or obscene matter;
- those whose use is prohibited under the Emblems and Names (Prevention of Improper Use) Act 1950; or
- those consisting exclusively of a shape:
- of goods that results from the nature of the goods themselves;
- of goods that is necessary to obtain a technical result; or
- that gives substantial value to the goods.
In Bata India Ltd v. Chawla Boot House,9 the court held that while generic marks are least distinctive, descriptive marks require secondary meaning to be established before they can be registered. However, suggestive marks and arbitrary and invented marks are all inherently distinctive, not requiring any evidence of secondary meaning.
In the case of descriptive marks, registration can be obtained by producing evidence that, before the date of application for registration, the mark acquired a distinctive character as a result of the use made of it or it was a well-known trademark.
A trademark may be limited wholly or in part to any combination of colours. If a trademark is registered without limitation of colour, it is deemed to be registered for all colours.
ii Prior rights
A trademark can be denied registration if there exists a likelihood of public confusion with an earlier trademark, which includes the likelihood of association with the earlier trademark, and if either of the following relative grounds (based on prior rights) applies:
- the mark is identical to an earlier trademark within a similar goods or services sector; or
- the mark is similar to an earlier trademark within an identical or similar goods or services sector.
A trademark may be denied registration even in a case where it is sought to be registered for goods or services that are not similar to those for which the earlier trademark is registered in the name of a different proprietor or if the earlier trademark is a well-known trademark in India, if 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. An earlier trademark is one that is either registered or used prior to the later trademark.
Similarly, a trademark can be denied registration if its use in India is liable to be prevented by the laws of passing off or copyright.
iii Inter partes proceedings
All trademark applications are published in the Trade Marks Journal to enable members of the public to oppose such registrations within a period of four months. It is also possible to initiate proceedings with the Registrar to initiate rectification or cancellation proceedings against granted registrations. These can also be initiated with the IPAB. While opposition proceedings can be initiated by any member of the public, rectification and cancellation proceedings can only be filed by an aggrieved person (i.e., a person who has some legitimate interest in having the registered mark rectified or removed).
Appeals against the orders of the Registrar can be filed with the IPAB. Orders of the IPAB can be challenged in the Supreme Court of India by way of a special leave petition. It may also be possible to challenge such orders of the IPAB by way or writ petition to a high court.
The district court is considered the court of first instance for trademark disputes. An appeal therefrom lies to the high courts, and, finally, an appeal by way of special leave petition lies with the Supreme Court. There are 29 states in India, divided into 731 districts, with each district having a district judge (DJ) who is the administrative head of the district, and there are additional district judges who have the same judicial powers as the DJ. Additionally, there are 24 high courts in India, all of which have appellate jurisdiction over the district courts and some quasi-judicial bodies or tribunals. Six high courts (of Delhi, Bombay, Madras, Calcutta, Jammu and Kashmir, and Himachal Pradesh) have original jurisdiction and can entertain trademark suits. These suits are filed before a single judge, and a bench of two judges has appellate jurisdiction over the single judge.
The territorial jurisdiction of a court is decided by the residence or place of business of the defendant (the infringer) or the place where the infringement (cause of action) takes place. It is also possible to claim jurisdiction on the basis of a threat in the jurisdiction. Under the Trade Marks Act, it is also possible to confer jurisdiction on courts where the trademark owner resides or carries on business or has its principal place of business. The Supreme Court of India has recently ruled on these issues in the case of IPRS v. Sanjay Dalia.10 Other relevant rulings of the Supreme Court include Dhodha House v. S K Maingi11 and Patel Roadways Ltd v. Prasad Trading Company.12
There have also been rulings of the Delhi High Court (Division Bench) conferring jurisdiction on courts on the basis of interactive websites, which include Banyan Trade Holding v. A Murali Krishan Reddy13 and WWE v. Reshma Collection.14
As far as pecuniary jurisdiction is concerned, claims must be for at least 20 million rupees for a case to be eligible for filing in the Delhi High Court. For the Bombay High Court, it is half this amount. The court fee payable is 1 per cent of the amount claimed.
ii Pre-action conduct
It is advisable to conduct appropriate investigations before commencing actions. This should include, among other things, online and on ground investigations, and searches on the Trade Marks Register and Registrar of Companies. Based on the results, litigation strategies should be devised, which could include obtaining and executing ex parte search and seizure orders, serving the opposite party with cease-and-desist notices, and initiating pre-litigation mediation proceedings15 under the Commercial Courts Act.16
iii Causes of action
Cause of action for a trademark case may be triggered by (1) actual infringing use of the mark, including use on business paper or packaging material; (2) likelihood of passing off; (3) threat of use or passing off; (4) advertising, including online advertising through an interactive website; (5) import or export of infringing goods; (6) infringing use by use in a company or firm name; or (7) adoption of infringing domain name, key words, meta tags, etc.
iv Conduct of proceedings
The recently enacted Commercial Courts Act mandates each state government to constitute commercial courts at district levels. High courts have original civil jurisdiction and are mandated with having commercial divisions within them. Over 250 commercial courts have already been constituted. The Delhi High Court itself has six commercial divisions. Trademark suits relating to registered or unregistered trademarks are considered commercial disputes.
The Commercial Courts Act provides for strict timelines to conclude trademark suits. Some significant enactments are as follows.
- A written statement is required to be filed within 30 days (up to a maximum of 120 days) of the date of service of summons. This period is not extendable.17 The written statement is required to be accompanied by an affidavit of admission and denial of the plaintiff's documents.
- All documents in support of the plaint and the written statement are required to be submitted along with the respective documents.
- Inspection of documents of both parties are liable to be concluded within 30 days of filing of the written statement.
- Within 15 days of inspection, the first case management hearing is liable to be held.
The Commercial Courts Act mandates for trial and arguments to be concluded within six months of conducting the first case management hearing. The judge is required to pronounce a decision within 90 days thereafter.
One important strategy for a speedy trial is to seek appointment of trial including examination and cross-examination of witnesses to be conducted before a court-appointed commissioner. Using this strategy, there are already examples of trials, including complicated patent trials, being concluded in less than six months.
Under the Commercial Courts Act, costs are liable to be imposed on the defaulting party that does not adhere to the timelines. Actual costs are also liable to be granted for fees and expenses of witnesses incurred, legal fees and expenses incurred and any other expenses incurred in connection with the proceedings. There are several precedents of courts awarding actual costs with the unsuccessful party ordered to pay the costs of the successful party. In Merck Sharp and Dohme v. Abhayakumar Deepak,18 the court ordered costs of 8 million rupees. In Koninklijke Philips Electronics NV v. Rajesh Bansal,19 a case of patent infringement, the court ordered an order of injunction and actual costs to the tune of 31.571 million rupees. In Glenmark Pharmaceuticals Ltd v. Curetech Skincare,20 the Bombay High Court granted costs to the tune of 15 million rupees, payable to a relief fund in charity.
In civil proceedings, courts have powers to pass the following orders:
- injunctions against future violations (also ex parte);
- civil search and seizure orders (also ex parte);
- damages or accounts for profits;
- discovery of documents;
- preservation of infringement goods or documents or other evidence; and
- preservation of assets of the defendant (also ex parte).
Other enforcement proceedings
i Criminal enforcement
Trademark violations under the Trade Marks Act 1999 also invite penal consequences that may include imprisonment of up to three years and fines of up to 200,000 rupees.
Under the Act, a police officer of or above the rank of deputy superintendent of police or its equivalent can conduct search and seizure operations against a prospective infringer after obtaining an opinion on the same from the Registrar of Trade Marks. It is also possible to obtain open-ended search and seizure orders from magistrates' courts against known or unknown parties.
The National Intellectual Property Rights (IPR) Policy recognises the need to build the capacity of the enforcement agencies at various levels, including strengthening of IPR cells in state police forces. Since the adoption of the National IPR Policy in 2016, IPR cells have been established in various states' police departments. Some states, such as Telangana and Maharashtra, have also established intellectual property (IP) crime units. IPR enforcement training and capacity-building of police officials is regularly conducted, which includes working from the IPR Enforcement Toolkit for Police, which is a handbook that serves as a ready reckoner for police officials in dealing with IP crimes; in particular, trademark counterfeiting.
Notification 47/2007-Customs (NT), dated 8 May 2007, and Circular No. 41/2007-Customs, dated 29 October 2007, empower customs authorities to interject goods suspected to be counterfeit or pirated at the border. The said rules are applicable on import of goods that infringe IP registered in India. Apart from registration with the appropriate authority for obtaining IP rights, registration with the Customs Department is also necessary for obtaining protection at the border.
Once IP is registered with the customs authorities, seizure of suspected counterfeit goods is carried out suo moto (on its own initiative) by Customs. The IP right holder is also required to furnish the details of the country or person suspected of exporting counterfeit goods to India in order to keep a check on the activities of those persons or consignments from those countries. Even where the IP is not registered with Customs, the clearance of imported goods can be suspended if Customs has prima facie evidence or reasonable grounds to believe that they infringe IP rights. The right holder may then be asked to comply with the filing of notice, among others, within five days of the date of suspension of clearance of goods.
Although India is notorious for what is perceived as inefficient legal and administrative systems with inherent delays, things in the past few years have been very different.
The IPO, itself, has undertaken several measures to cut delays. Comprehensive amendments by way of the Trademark (Amendment) Rules 2017, which were made effective from 6 March 2017, streamline and simplify the trademark procedures. The number of forms has been reduced from 74 to eight. There is now one application form for all types of trademark applications. Emails have been introduced as a mode of service, and hearings can be held through video conferencing. SMS alert facilities have also been introduced. Registration certificates are automatically processed and despatched to designated email IDs, and are also uploaded to the electronic register. Similar processes have been initiated for renewals processes. Allotment of applications for examination has been automated to be examined by seniority of filing.
A 10 per cent concession has been provided for filing applications online, and online filing of trademark applications has increased by more than 80 per cent. To promote filing, there is a 50 per cent concession in the prescribed fee for start-ups, individuals and small enterprises. Procedures that provided for filing extensions of time for submissions of affidavits and evidence have been removed. Adjournment of hearings has been restricted to a maximum of two, with the provision that each adjournment shall not be for more than 30 days.
The website of the IPO is one of the more efficient ones from a global perspective. The entire e-file of applications and prosecution history is available through an easy-to-navigate search mechanism. Documents are uploaded in PDF format and are available publicly. With its online register, along with provisions of the Right to Information Act, it can safely be said that the Indian IPO is perhaps one of the most transparent intellectual property offices in the world. As a result of these changes, registration of trademarks has increased by over 20 per cent, and final disposal of cases by over 90 per cent. Indeed, it is not unusual for registrations to be granted within six to eight months.
On the enforcement front, with the introduction of the Commercial Courts Act, efficiency of handling cases has improved tremendously, reducing timelines significantly. The number of judges at the district level has increased with new, and better, infrastructure.
E-court services have been introduced across courts in India with an enhanced and improved website containing details of all cases filed and their current status.21 There have been several improvements in the working of the site itself, and a mobile app has also been introduced.
In conclusion, it would be safe to say that India recognises the importance of soft assets such as intellectual property and the role that they can play in the development of the economy. Several measures have been and are being taken to smooth the processes, making it more transparent and enhancing the aspect of timeliness and efficiency. There are still constraints on resources, and much still needs to be done; however, the country is moving in the right direction and that, too, at a fairly rapid pace.
1 Chander Mohan Lall is a designated senior advocate at the High Court of Delhi. The information in this chapter was accurate as at November 2020.
2 Writ Petition Civil No. 494 of 2012 (Supreme Court of India – Decision dated 26 September 2018) Citation: 2017(10) SCC 1.
3 2017 (69) Patents & Trade Marks Cases (PTC) 551 (Del) (Delhi High Court Decision dated 18 January 2017).
4 Case No. FAO (OS)(Comm) 95 of 2017 (Delhi High Court Decision dated 1 May 2017).
5 MANU/DE/4019/2018 – Case No. CS (Comm) 344 of 2018 – (Decision dated 2 November 2018).
6 2019 SCC OnLine Del 9061 (Delhi High Court Decision dated 8 July 2019).
7 Amazon Seller Services Pvt Ltd v. Amway India Enterprises Pvt Ltd & Ors (Delhi High Court Decision dated 31 January 2020 in FAO (OS) 133/2019).
8 Delhi High Court decision dated 12 October 2020 in CS (COMM) 217 of 2020.
9 Case No. CS (Comm) 110/2019 (Delhi High Court decision dated 16 April 2019).
10 (2015) 10 Supreme Court Cases (SCC) 161.
11 (2006) 9 SCC 41.
12 1992 All India Reporter 1514.
13 2010 (42) Patents & Trade Marks Cases (PTC) 361 (Del).
14 2014 (60) Patents & Trade Marks Cases (PTC) 452 (Del).
15 This is considered compulsory in all commercial suits with the limited exception of cases where urgent relief is sought.
16 Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act 2015.
17 Unilin Beheer B V v. Balaji Action Buildwell (Case No. CS (Comm) 1683 of 2016 and CC (Comm) 38 of 2018 (Delhi High Court decision dated 9 April 2019)).
18 CONT.CAS (C) 846 of 2018 (decision dated 11 March 2019).
19 CS (Comm) 24 of 2016 (decision dated 12 July 2018).
20 COMIP(L) No. 1063 of 2018 (Bombay High Court order dated 28 August 2018).