Trademark Infringement and Passing Off.
Introduction
The Trademark Act of 1999, both in letter and in nature, stipulates that whilst it promotes free trading in any manner and seeks to promote and not to impede rivalry, it also guarantees that no one, in particular a merchant, is justified in destroying or endangering another’s company through theft, bribery, trickery or deceptive tactics of some type.
Registration of a trademark under the Trade Marks Act of 1999 grants legislative rights and a minor violation of the trademark can lead to a lawsuit for violation. However, even unregistered trademarks are still protected as the Act itself specifies that an injunction to revoke the redress is open to unregistered trademarks.
Passing Off
Passing off action is founded on the theory of common law. The damages specified in the suit for passing off shall be “unliquidated damages”. The law against passing off is based on the idea that, “a man may not sell his own goods under the pretence that they are the goods of another man.”
In a passing off action, the focus in the adoption and usage of the trade mark is higher. Passing off is not specified in the Trademark Act of 1999. It is referred to in Sections 27(2), 134(1)(c) and 135 of the Act. Section 27(2) states that the freedom to recourse against any person for passing off as property or compensation of another person shall not be impaired by the provisions of the Act. Section 134(1)(c) applies to the authority of the courts to prosecute cases for sale arising out of the use of any trademark. Section 135 points out the options necessary for the transition arising from the use of a trademark.
Passing off cases are frequently cases of “deliberate and wilful misappropriation, but it is well founded that deception is not a required element of the right of action, and the absence of intention to misappropriate is not a defence in an action for passing off, while proof of fraudulent intent can objectively allow the plaintiff to determine the possibility of misappropriation.”
The rule of passing off shall apply where there is a possibility of misunderstanding between the markings and the symbol or where there is a possibility of ambiguity of identification by the illegal use of identical markings or the illegal use of these marks.
Characteristics of Passing Off action
The following features can be attributed to the action of passing off:
· Evidence of criminal intent is not required: It is not necessary for the complainant to create wrongdoing on the part of the defendant in the event of a passing off proceeding. Although issuing an injunction against the defendants using the trademark ‘Horlioks’, the High Court of Delhi ruled that “the use of the offending symbol by the defendants was meant to mimic the claimant’s trademark and it seems to be a brazen and obvious effort on the part of the defendants to copy the brand of the complainant with a view to mislead unwary purchasers and abuse and celebrate their affection in order to carry on their products as those of the complainant. The legislation does not authorize someone to carry on business in such a manner as to convince consumers to think that the items belonging to someone else are his or her own. If there is a risk of misunderstanding in the company, an injunction will be issued even though the defendant had adopted the name innocently.”
· Passing off is not limited to commodities: Passing off properly is not limited to the selling of merchandise. Passing off also prevents the defendant from selling under a specific name even if the defendant merchant may not sell the goods. Hence, after a name has been established, the recognition and owner of a particular trade or produce or company may receive the assistance of the Court to limit the usage of that name by others.
· The plaintiff and defendant do not need to be in the same area: In passing off action, it is irrelevant whether the appellant and the defendant trade in the same area or deal in separate goods. Remedies in the form of an injunction were issued in favour of the plaintiff on the grounds of an action of passing away even though the plaintiff and the defendant were dealing in separate goods entirely.
Infringement of a Trademark
Section 27(1) of the Trademarks Act, 1999 states that an individual is entitled to bring civil action to avoid or seek damages arising from infringement of a licensed trademark. Infringement happens when someone else uses a trademark that is identical or deceptively similar to a registered trademark for equivalent or related products or services to create doubt in the public mind. The power to bring an infringement case against the defendant was granted by Section 28 of the Trademarks Act, 1999. Section 28 of the Act states that the registration of a trademark grants the holders of the licensed trademark the sole right to use the trademark in relation to the products and services on which the trademark is licensed and to seek exemption from misuse of the trademark.
The following are the circumstances in which the actions represented infringement of the trademark:
· Usage of reconditioned articles or second goods: The use of the applicant’s label on reconditioned goods can constitute violation even though it is explained that the goods are not original but are reconditioned.
· Marks used along with the mark of others: Use of the applicant’s image, along with the name of the complainant, even though it is prominently placed, constitutes an infringement.
· Marks with foreign prestige which have been used illegally: In the case of a trademark which has gained international recognition, an action for its defence against illegal usage would be taken even though the owner of the trademark has no commercial operation in India.
Difference between Passing-Off and Infringement
In the case Durga Dutt Sharma v. N.P. Laboratories, the Hon’ble Supreme Court found the distinction between the two- infringement and passing off. It was held that “an action for passing off is a common remedy, in essence an action for deceit, that is to say, the passing off by a person of his own goods as that of another, but that is not the essence of an action for infringement. An action for infringement is a statutory remedy granted to the registered owner of the registered trademark in order to justify the exclusive right of the trademark.”
· Conceptual Difference:
a) The infringement action is a statutory right. It depends on the legitimacy of the certificate and is subject to certain limitations set down in the Act. On the other hand, the identification of a trademark is not applicable in the case of a passing off action. It is based on the properties of goodwill gained through the use of the trademark.
b) The owner of an unregistered trademark or trademark which is not used by another cannot sue for infringement of the trademark. His only solution is to bring a passing off action.
· Procedural Difference:
a) In the infringement case, if it was a humorous copy, the fact that it was distinctive was not important in the infringement case, although it may have had significance in the passing off action.
b) If the passing off identity of the action or the resemblance of the symbols is not adequate, there must always be a probability of ambiguity. However, in the case of infringement, if the markings are equal or equivalent, no further proof is necessary.
Combined action for infringement and passing off
Where a trademark is licensed, the applicant may pair his action for transfer where the applicant has used his trademark and is willing to create goodwill and prestige in relation to his company. This means greater protection of the trademark.
Conclusion
Thus, it can be seen from the above topic that the defence of trademarks is important not only from a market point of view, but also for the defence of customers against infringement and coercion. However, it is better if the simultaneous violation and passing case were taken in one suit. As stated in the preamble to the Trademarks Act, 1999, the statute provides for stronger enforcement of trademarks. This Act expressly acknowledges the common law solution which thus forbids all licensed and unregistered trademarks from being misused.
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