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Infringement action can be maintained despite long delay in trademark use - International Report

Infringement action can be maintained despite long delay in trademark use

Lakshmikumaran & Sridharan - India

Rahul Beruar
Sarita Rout

06 Aug 2014
Infringement action can be maintained despite long delay in trademark use
Lakshmikumaran & Sridharan - India
Rahul Beruar , Sarita Rout
 
06 Aug 2014

In a recent order the Delhi High Court dealt with a dispute involving deceptively similar trademarks used in relation to pharmaceutical products. In Wockhardt Ltd v Remed Healthcare Pvt Ltd (April 25 2014) a single-judge bench issued an injunction in favour of the plaintiff.

Background
Pharmaceutical giant Wockhardt Ltd owns the registered trademark MERICOBAL used in relation to pharmaceuticals and other products in Class 5. Wockhardt instituted infringement proceedings under the Trademarks Act 1999 against Remed Healthcare Pvt Ltd and another for adopting and using an identical MERICOBAL trademark in relation to similar products.

Decision
The court rejected Remed's argument that there was no likelihood of confusion as it was using only the trademark MERICOBAL in relation to its products, compared to Wockhardt's use of the trademark MERICOBAL alognside the suffix 'Viva'. Further, having rejected the defendant's arguments in regard to non-use, the court observed that Wockhardt had satisfied the three criteria for grant of an injunction:

  • There was a prima facie case;
  • The balance of convenience rested in favour of the plaintiff; and
  • There was a likelihood of irreparable injury would be caused to the plaintiff.

Therefore, the court granted a temporary injunction against Remed, restraining it from using Wockhardt's MERICOBAL trademark or any other deceptively similar mark and from selling, advertising or marketing any goods using the mark.

Delay in using trademark after registration does not frustrate trademark rights
Wockhardt argued that the adoption of the visually and phonetically identical trademark by Remed was likely to cause confusion and deception among both the public and trade. Remed counterargued that although Wockhardt had obtained registration of the MERICOBAL mark in April 2005, it used the mark in relation to its products only from December 2012; thus, Wockhardt's registration should be removed from the Trademarks Register for non-use.

While considering this issue, the court looked at other decisions such as Smithkline Beecham Plc v Sunil Sarmarkar (2012 (132) DRJ 880) and Allergan Inc v INTAS Pharmaceuticals (2013 (53 PTC 36 (Del)), in which the plaintiffs failed to establish any actual use of their trademarks subsequent to registration and therefore their rights in such marks were found to have extinguished.

However, in the case at hand the court was not persuaded by this argument. It relied on the basic principle recognised in the Trademarks Act that a trademark can always be registered on the basis of proposed use, and that there can always be a gap between the dates of registration of the trademark and commencement of use.

The court distinguished the facts of the case at hand from the cases cited above as Wockhardt had been using its trademark since December 2012 (though almost eight years after registration). However, Wockhardt's trademark had not lost out or died, unlike the trademarks in the decisions cited above. Further, the court relied on Sun Pharmaceuticals Industries v Cipla Ltd (2009 (39) PTC 347 (Del)), in which the court observed that use of registered trademark is not a condition for obtaining relief against infringement of the mark. The court also dismissed the defendant's argument that the mark should be removed from the register on account of non-use under Section 47 of the Trademarks Act, and held that a plea of non-use in an infringement suit could not be allowed when no removal proceedings have been initiated before the registrar or the IP Appellate Board under Section 47 of the act. Permitting such a plea would only undermine the value of the trademark registration, which was to be regarded as prima facie evidence of validity.

Therefore, the court rejected Remed's argument that, through delay in use of the mark after registration, Wockhardt had lost its rights to initiate infringement proceedings based on such mark. 

Plea of vested rights when allowed
Another line of argument adopted by Remed was that Wockhardt's use of the mark was subsequent to Remed's use of the allegedly infringing mark, and therefore Remed's vested rights in the mark were protected under Section 34 of the Trademarks Act.

The court found this argument to be misplaced and considered the requirements for allowing a plea of vested rights under Section 34 of the Trademarks Act. It held that the provision is applicable only when the use of identical or similar trademarks by another person is established to be prior to the date of registration or the date of use of the registered trademarks by the registered owner or user, depending on which date is earlier. In the case at hand, Remed's use of the allegedly infringing trademark was in 2006 and thus not prior to the date on which Wockhardt registered the MERICOBAL mark (ie, April 2005). Therefore, the court held that a plea under Section 34 was not available in this case.

Plea of acquiescence
Remed also filed a plea of acquiescence on the grounds that its products under the allegedly infringing trademark had been present on the market since 2006 and Wockhardt, although aware of this, had not objected for almost eight years until the current proceedings. The court, while considering this argument, did not delve into acquiescence per se. Instead, it relied on the observation in Sun Pharmaceuticals that in an injunction application, where a simultaneous claim is filed by a person other than the registered owner by virtue of use of the mark, the balance of convenience is tilted in favour of the registered owner.  

Comment
This decision is particularly relevant in view of the court's finding that a delay in actual use of the registered trademark by the registered owner following registration of the mark does not extinguish the owner's exclusive rights in the registered mark. The registered owner can still successfully bring infringement actions against a third party for adopting and using identical or deceptively similar trademarks, even though it used the registered mark only more than five years after registration.

For further information please contact:

Rahul Beruar
Lakshmikumaran & Sridharan
www.lakshmisri.com
Email: rahul.beruar@lakshmisri.com
Tel: +91 11 4129 9811


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