Allowed

M/S Shalina Laboratories Pvt.Ltd. v. Sms Foundations Pvt. Ltd. and Ors. and Asst. Drugs Controller (India) and Ors.

Bombay HC19 Sept 2006NMS/2211/2004

Case brief

AI extract

What is this about?

High Court permitted injunction restraining defendants from manufacturing and marketing pharmaceutical preparations under deceptively similar mark "SUPER APPETITE" and their label, finding prima facie infringement of trade mark, copyright, and passing off.

What did the court decide?

Motion made absolute; injunction against manufacturing, marketing, and exporting of offending goods stayed for two weeks.

M/S Shalina Laboratories Pvt.Ltd. Vs Sms Foundations… — Intellectual Property | Bombay HC (2006)

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vss

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 IN THE HIGH COURT OF JUDICATURE AT BOMBAY
 ORDINARY ORIGINAL CIVIL JURISDICTION

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NOTICE OF MOTION NO.2211 OF 2004
 IN

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 SUIT NO.2233 OF 2004

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 M/s.Shalina Laboratories Pvt. Ltd. ... Plaintiffs

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 V/s.

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 M/s.SMS Formulations Pvt. Ltd. & Ors. ... Defendants

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And

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 Assistant Drugs Controller
 (India) & Ors. ... Respondents

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 Mr.Ravi Kadam with Mr.Himanshu W. Kane, Mr.Ashiksh
 Kamat and Mr.Rahul Kadam for Plaintiffs

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 Mr.Janak Dwarkadas with Mr.V.R. Dhond for Defendant
 Nos.1 to 3

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 Mr.Dilip Rai for Defendant No.4

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 CORAM: SMT.NISHITA MHATRE,J.

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 DATED: SEPTEMBER 19, 2006

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P.C.:

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 . The present Motion has been taken out by the

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 Plaintiffs for an injunction against the defendants from
 manufacturing, marketing, exporting, etc. its medicinal
 or pharmaceutical preparations with the trade mark
 "SUPER APPETITE". According to the plaintiffs the mark
 is identical or deceptively similar to their registered
 trade mark, "SUPER APETI". The plaintiffs have claimed
 that the Defendants have infringed their registered
 trade mark and copyright in the artistic work of their
 label. The plaintiffs have also claimed an injunction
 contending that the Defendants, by using the label

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 : 2 :

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 "SUPER APETITE", are passing off their goods as those of
 the plaintiffs.

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 2. The plaintiffs’ case is that in 1984, they
 started manufacturing, marketing and exporting
 pharmaceutical medicinal products. In 1993, they
 adopted the trade mark "APPETITE" for their
 pharmaceutical preparations consisting of the drug
 "Cyproheptadine Hydrochloride". The Plaintiffs obtained
 a loan license to manufacture the drug on 11.6.1993. In
 February 1994, they adopted and used a new trade mark
 "SUPER APETI". They then obtained a loan license to
 manufacture a syrup under the mark "SUPER APETI". They
 also started manufacturing tablets with the same mark by
 obtaining another loan license. The Plaintiffs applied
 for registration of their trade mark "SUPER APETI" (word
 per se) on 25.9.1997. This mark was registered on
 12.8.2003 for medicinal pharmaceutical and veterinary
 preparations in class V, claiming a user since
 14.11.1994. A suit was filed by the plaintiffs against
 Rajan Enterprises & others for infringement of their

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 trade mark "SUPER APETI" and copyright in the label as
 well as passing off being Suit No.3481 of 2001. Interim
 and ad-interim orders have been obtained by the
 plaintiffs in that suit. The respondents herein have
 been restrained from exporting the offending medicinal
 preparations. The plaintiffs contend that they learnt
 that some unknown parties in Gujarat had commenced
 manufacturing identical pharmaceutical preparations in

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 : 3 :

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 cartons using a deceptively similar trade mark.
 According to the plaintiffs, the get-up, lay-out and
 placement of all the essential features on the
 carton/label were identical and therefore, they filed a
 criminal complaint before the Judicial Magistrate,
 Sanand, Gujarat on 11.7.2003. Certain orders were
 passed by the Court on that criminal complaint. The
 Sanand Police raided the factory premises of Defendant
 No.4 herein and learnt that the goods bearing the mark
 and label "SUPER APPETITE" were being manufactured by
 Defendant No.4 for Defendant Nos.1 and 2. The
 plaintiffs were granted registration of the copyright in
 their artistic work of their label "SUPER APETI" on
 19.8.2003. A report was accordingly submitted to the
 Judicial Magistrate, Sanand. When the plaintiffs learnt
 that the Defendant Nos.1 to 3 were likely to export
 pharmaceutical preparations bearing the mark and label
 "SUPER APPETITE" they filed a complaint with the Deputy
 Commissioner of Police (Enforcement), Mumbai under
 section 115 of the Trade and Merchandise Act, 1999
 complaining of the infringement and passing off of its
 trade mark and copyright in the mark "SUPER APETI". The
 Plaintiffs were informed by the defendants that
 Defendant No.2 was the proprietor of the trade mark

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 "SUPER APPETITE" and that an application for
 registration of the same was pending.

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 3. The plaintiffs, therefore, contend that by
 adopting a similar or deceptively mark and label, the

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 defendants have infringed the plaintiffs’ registered
 trade mark and copyright in the artistic work of their
 label as well as have indulged in passing off of their
 own goods as those of the plaintiffs.

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 4. I will first deal with the case of infringement
 of the registered trade mark which the Plaintiffs seek
 to make out.

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 5. The learned Counsel appearing for the Plaintiffs
 contends that the plaintiffs have been manufacturing and
 selling their goods under the word mark "SUPER APETI"
 from 1994. The Plaintiffs’ goods are being exported and
 have no market in India. Similarly, the defendants’
 goods are also being marketed abroad in the same
 territory. The learned Counsel submits that the mark
 "SUPER APETI" must be taken as a whole when determining
 whether there is an infringement of the plaintiffs’
 trade mark. He submits that although there is a
 disclaimer for the word mark "SUPER", when seen as a
 whole, the two marks are obviously deceptively similar.
 He submits that the plaintiffs have established that
 their mark has been infringed under section 29(2)(b) of
 the Trade Marks Act. The learned Counsel further
 submits that the plaintiffs have been "using" the mark
 as understood under the Trade Marks Act and therefore,
 there is an obvious case of infringement of their
 registered trade mark by the defendants.

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 : 5 :

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 In support of these contentions, the learned Counsel
 relies on the judgments in: Parle Products (P) Ltd.
v/s. J.P. & Co., Mysore, AIR 9172 SC 1359; Living
Media India Ltd. v/s. Jitendra V. Jain, 2002(25) PTC
61 (Del); Madhubhan Holiday Inn v/s. Holiday Inn Inv.,
2002(25) PTC 308 (Del) (DB); Asian Paints (I) Ltd.
v/s. Jaikishan Paints & Allied Products, 2002(6) Bom
C.R. 1; Pidilite Industries v/s. S.M. Associates,
2003(5) BCR 295; Poddar Tyres Ltd. v/s. Bedrock Sales
Corporation Ltd., AIR 1993 BOM 237; Biochem

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Pharmaceutical Industries v/s.Biochem Synergy Limited,
1998 PTC (18); M/s.Maxheal Pharmaceuticals (India) &
Anr. v/s. Shalina Laboratories Pvt. Ltd. & Ors.,
Appeal No.88 of 2005 in Notice of Motion No.2638 of 2004
in Suit No.2663 of 2004; Glaxo Operations UK Limited &
Anr. v/s. Samrat Pharmaceuticals, 1984 PTC 66;
Director of Rationing & Distribution v/s. The
Corporation of Calcutta & Ors., AIR 1960 SC 1355;
Burroughs Wellcome (India) Ltd. v/s. Uni-Sole Pvt.
Ltd., 1998(3) Bom. CR 481 and Kamal Trading Co., Bombay
& Ors. v/s. Gillette UK Limited, Middle Sex, England,
1988 PTC 1. The learned Counsel also relied on Extract
of Law of Trade Marks and Passing Off (Sixth Edition) by

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P. Narayanan and The Extract of the Trade and
Merchandise Marks Act, 1958 (Third Edition) by R.K.
Abichandani.

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 6. The learned Counsel for the Defendants, on the
 other hand, submits that there can be no infringement of

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 the plaintiffs’ mark as the plaintiffs are using the
 word mark "SUPER APETI" by misspelling the original
 words. He points out that there is a disclaimer for the
 word "SUPER". The word "APETI" has been coined from the
 French word "Appetit" which was the original mark
 adopted by the plaintiffs in 1993. He submits that the
 word mark "SUPER APETI" which has been registered is a
 descriptive word and, therefore, the plaintiffs can
 claim no infringement. He submits that section 30(2)(a)
 and (b) provides for instances wherein a trade mark,
 though registered, is not infringed. According to the
 learned Counsel, there is no use of the word "SUPER
 APETI" in India by the plaintiffs since admittedly they
 export all their goods. Therefore, there can be no
 infringement of their mark. He also points out that the
 Defendants have received a letter from the Registrar of
 Trade Marks informing them that the mark "SUPER
 APPETITE" is not registerable since it is descriptive in
 nature.

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 7. The learned Counsel relies on various
 commentaries to point out what could constitute
 infringement of a trade mark. While referring to the
 commentary of Shavaksha on The Trade and Merchandise

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Marks Act 1958, the learned Counsel submits that if a
 word is descriptive in a particular language, it must be
 considered on the same footing as an ordinary
 descriptive word. If a foreign word is of such a nature
 i.e., it is ordinarily used in a particular language

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 from which the word emanates the mark would be difficult
 to register.

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 8. The question, therefore, is whether the
 plaintiffs’ word mark "SUPER APETI" has been infringed.
 Undoubtedly, the mark has been registered on 25.9.1997.
 The instances of infringement of a trade mark has been
 described in section 29 of the Trade Marks Act. Section
 29(2)(b) of the Trade Marks Act which was pressed into
 service by the learned Counsel for the Plaintiffs reads
 thus:

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 29(2)(a) ...

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 (b) its similarity to the registered trade
 mark and the identity or similarity of the
 goods or services covered by such
 registered trade mark; or

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 (c) ...

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 is likely to cause confusion on the part of the
 public, or which is likely to have an
 association with the registered trade mark.

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 9. The use of a registered trade mark has been
 defined in subsection (6) of section 29 thus:

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 (6) For the purposes of this section, a person

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 uses a registered mark, if in particular, he-

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 (a) affixes it to goods or the packaging
 thereof;

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 (b) offers or exposes goods for sale, puts them
 on the market, or stocks them for those purposes
 under the registered trade mark, or offers or
 supplies services under the registered trade
 mark;

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 (c) imports or exports goods under the mark; or

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 (d) uses the registered trade mark on business

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 papers or in advertising.

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 10. In the present case, there is no dispute that
 both the plaintiffs and the defendants cater to the
 customers abroad. They are exporting the goods under
 their respective marks. The manufacturing and packaging
 of the goods takes place in India. The registered mark
 of the plaintiffs is affixed on their goods in India,
 before being exported. The two marks "SUPER APETI" &

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 "SUPER APPETITE", in my view, are similar and the
 plaintiffs’ mark "SUPER APETI" has prima facie been
 infringed by the Defendants.

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 11. The submission of the learned Counsel for the

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 Defendants is that there is no infringement in view of
 the provisions of section 30(2) (a) and (b) which read
 as under:

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 30(2) A registered trade mark is not infringed
 where - (a) the use in relation to goods or
 services indicates the kind, quality, quantity,
 intended purpose, value, geographical origin,
 the time or production of goods or of rendering
 of services or other characteristics of goods or
 services;

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 (b) a trade mark is registered subject to any
 conditions or limitations, the use of the trade
 mark in any manner in relation to goods to be
 sold or otherwise traded in, in any place, or in
 relation to goods to be exported to any market
 or in relation to services for use or available
 or acceptance in any place or country outside
 India or in any other circumstances, to which,
 having regard to those conditions or
 limitations, the registration does not extend;

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 12. The submission of the learned Counsel that the

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 registration of the mark would not extend to the market
 which the plaintiffs and the defendants cater to cannot
 be accepted. Section 56 reads thus:

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 56. Use of trade mark for export trade and use
 when form of trade connection changes. - (1)
 The application in India and any other act done
 in India in relation to goods to be so exported
 or services so rendered outside India which, if
 done in relation to goods to be sold or services
 provided or otherwise traded in within India
 would constitute use of a trade mark therein,
 shall be deemed to constitute use of the trade
 mark in relation to those goods or services for
 any purpose for which such use is material under
 this Act or any other law.

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 (2) The use of a registered trade mark in
 relation to goods or services between which and
 the person using the mark any form of connection
 in the course of trade subsists shall not be
 deemed to be likely to cause deception or
 confusion on the ground only that the mark has
 been or is used in relation to goods or services
 between form of connection in the course of
 trade subsisted or subsists.

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 13. On considering the aforesaid provisions of law
 it appears that the application in India of a trade mark

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 to goods to be exported from India, shall be deemed to
 constitute the use of the trade mark in relation to
 those goods or services for any purpose which use is
 material under this Act or any other Act. As aforesaid,
 the marks of both the plaintiffs and the defendants are
 being "used" in India and the products are being
 exported. The provisions of section 30(2) (a) and (b)
 would not aid the defendants in any manner. There is
 therefore in my opinion, a prima facie case made out by
 the plaintiffs and the defendants of infringement of
 their registered trade mark.

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 14. The next question to be considered is whether
 the Defendants have infringed the copyright of the
 plaintiffs in the artistic work of their label. The
 plaintiffs have annexed an affidavit of one Sandesh
 Pawar to the plaint wherein he has averred that he had
 created the label for the plaintiffs and that the
 artwork is owned by the plaintiffs. The defendants
 contend that the label which they use is dissimilar to
 the artistic work in the label used by the plaintiffs.
 They contend that they have obtained a registration
 certificate under section 45(1) of the Copyright Act
 from the Registrar of Copyrights, New Delhi for the
 artistic work of their label taken as a whole. The
 copyright registration is in respect of the label "Super
 Appetite Cyproheptadine Hydrochloride Tablets BP with
 the device of fruits". The registration certificate has
 been issued on 7.3.2005. The Defendants therefore,

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 contend that since they have a registered copyright in
 their label, there is no question of infringing the
 copyright in the plaintiffs’ label. It is submitted
 that their label would not have been registered if there
 was any similarity between the two labels.

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 15. According to the learned Counsel, when the
 defendants are the owners of the copyright in the
 artistic work of their label, there is no question of
 infringement of the plaintiffs’ copyright. The
 affidavit filed by Defendant No.3 on 13.4.2006 describes
 the points of difference between the plaintiffs’ label
 and that of the defendants. The defendants claim that
 the colour scheme, lay-out, arrangement of articles and
 the get-up of both the labels is different. Hence,
 there could not be any infringement of the copyright in
 the artistic work. According to the defendants,
 enquiries made with the trade mark registry have
 revealed that the plaintiffs’ application for
 registration of the label under No.1208191 made on
 20.6.2003 and another made on 13.8.2003 are pending.
 The defendants contend that these applications were
 considered by the Registrar before issuing the copyright
 registration in favour of the defendants’ artistic work
 in their label. Section 51(a)(i) provides that the
 copyright in an artistic work is deemed to be infringed
 when a person, without a license granted by the owner of
 the copyright or Registrar of Copyrights, does anything
 which the owner of the copyright is exclusively entitled

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 to it.

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 As held in Asian Paints (supra) copyright in an artwork
 subsists the moment it is created. The registration of
 the copyright under the Copyright Act is optional. If
 the plaintiff who claims infringement of his copyright
 is able to establish that his artistic work was created
 earlier in point of time than that of the Defendant,
 mere registration of the work by the Defendant cannot
 defeat the plaintiff’s claim. It is no doubt true that
 in this case the registration of the plaintiffs’ label
 is pending. However, the affidavit of the person who
 improved the artistic work of the label being used by
 the Plaintiffs indicates that he was commissioned by the
 plaintiffs for this work in October, 1996. The
 registration certificate in respect of the Defendants’
 work has been obtained in 2005. Therefore, the
 plaintiffs’ label has been created earlier in point of
 time. The similarity between the two labels is
 striking. In my opinion, the plaintiffs have
 established, prima facie, that their copyright in the
 artistic work of their label has been infringed.

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 16. This takes me to consider whether the plaintiffs
 have established their case of passing off.

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 17. A bare perusal of the two cartons in my view,
 indicate that the defendants’ label is deceptively
 similar to that of the plaintiffs. The affidavit of

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 Defendant No.3 points out the dissimilarities of the two
 labels. In my opinion, the essential features of the
 cartons are similar or deceptively similar. Both the
 cartons bear a picture of various fruit. The Defendants
 contend that besides the picture of fruit the
 plaintiffs’ carton bears the picture of meat, fish and a
 milk bottle on one side of the carton whereas the
 defendants’ carton has a picture of several fruit on
 both sides of the carton. This in my view, is not a
 material difference. Contending that the offending
 carton depicts the pictures of fruits other than those
 found on the plaintiffs’ carton, besides other articles
 of food is only nit-picking. The general appearance of
 both the cartons is that fruit are displayed
 prominently. Although the cartons are of different
 colours, a person with an imperfect recollection would
 easily mistake one for the other. Both the cartons bear
 a red band on which the name of the product is inscribed
 in white. It is a well settled proposition of law that
 while considering whether the two labels are similar for
 the purposes of action in passing off, one has to bear
 in mind the general appearance and the imperfect memory
 of the gullible customer. The detailed differences are
 not what is required to be considered when deciding
 whether there is a similarity or a deceptive similarity
 between the two labels as held in the case of Cadila
Health Care Limited (supra) In an action for passing
 off, the essential features of the two products must be
 ascertained and if there is a deceptive similarity

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 between the two products, an action for passing off
 would lie.

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 18. However, although there is a similarity between
 the two labels, it would be necessary to consider
 whether the plaintiffs have established that they have
 the goodwill and reputation in the market for their
 product "SUPER APETI". It is only when the plaintiffs
 are able to establish this, that they would be entitled
 to maintain an action for passing off against the
 defendants.

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 19. The fundamental requirement in an action for
 passing off is that the plaintiffs should be able to
 establish that it has a reputation in the country where
 it exists. In a commentary by Christopher Wadlow on the

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Law of Passing Off (Unfair Competition by

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Misrepresentation), Third Edition 2004, the essential

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 elements of passing off have been recognised as a
 misrepresentation causing damage to the business or
 goodwill of the claimants. An action for passing off is
 a remedy available to a person for protecting the
 goodwill the claimant has in a distinctive sign, mark,
 name or get up. Therefore, it must be established that
 a claimant has goodwill in the jurisdiction where the
 action has been filed. The author has also pointed out
 the distinction between the goodwill and reputation.

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 20. So as to establish the goodwill of the

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 plaintiffs in the market the plaintiffs have produced on
 record their sales figures. These indicate, prima
 facie, that the plaintiffs have a substantial hold over
 the market and that the sales figures have been
 increasing over a period of time. Obviously therefore,
 the reputation of the plaintiffs in the market has
 increased.

¶90

 21. Besides this, there is evidence on record which
 prima facie indicates that the plaintiffs’ product was
 in the market prior to that of the defendants. The
 plaintiffs have also taken action against various other
 companies/persons for passing off their respective goods
 as those of the plaintiffs. Prima facie, therefore, it
 would appear that the plaintiffs have established that
 they have built up a goodwill over a period of time
 which would necessarily lead to the inference that the
 defendants have been passing off their products as those
 of the plaintiffs. The plaintiffs have also established
 that they are prior users and therefore are entitled to
 the injunctions prayed for.

¶91

 22. Both these products are pharmaceutical and
 medicinal preparations. The Supreme Court in the case
 of Cadila Health Care Ltd. v/s. Cadila Pharmaceuticals
Ltd., AIR 2001 SC 1952 has held that while dealing with
 the pharmaceutical and medicinal preparations, a
 stricter view must be taken by the Courts when
 considering an action for passing off. The Supreme

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 Court has held that the class of purchasers who are
 likely to buy the goods bearing the marks must be kept
 in mind, having regard to their education and
 intelligence and a degree of care that they are likely
 to exercise in purchasing and/or using the goods. These
 products are not meant for trade in India and are meant
 for trade overseas. It is submitted on behalf of the
 Defendants that customers of average intelligence buying
 the product overseas would certainly be able to discern
 the differences between the two labels, given the
 education of those customers. In my opinion, this
 submission on behalf of the defendants is untenable as
 there is a "user" of the product in this country and
 therefore, the action of passing off must be considered
 having regard to the conditions in India. A customer
 with an imperfect recollection would certainly not be
 able to discern the differences between the two cartons.
 Although the drug contained in the tablets is the same,
 in my opinion, the defendants are prima facie, guilty of
 passing off their products as those of the plaintiffs.

¶94

 23. An action for passing off is a common law right
 which is available to a plaintiff whether or not he is
 entitled to a declaration that there is an infringement
 of his trade mark or copyright in the artistic work of
 his label.

¶95

 24. Reliance is placed by the learned Counsel for
 the Defendants on the case of M/s.Smithkline Beecham

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Plc. & Ors. v/s. M/s.Hindustan Lever Limited & Ors.,
2000 PTC 83 to contend that there is no material on
 record to show any goodwill for the product in the
 country where the goods are exported nor is there any
 use of the products in India. The Apex Court in this
 case considered the question of infringement of a
 registered design and of passing off. It has held that
 where no international advertisement is published in
 India or when there is no evidence of an advertisemen
 being published in India or an invoice to show that
 there is any goodwill for the product in this country,
 goodwill or reputation cannot be presumed. Nor can it
 be presumed that any transborder reputation exists with
 the Company. The documents annexed to the plaint
 sufficiently show that the product have been
 manufactured and marketed in countries other than India.
 Invoices of the product are also been placed on record.
 Therefore, the plaintiffs have shown sufficiently that
 the defendants have indulged in passing off their goods
 as those of the plaintiffs.

¶98

 25. In my opinion, prima facie, the plaintiffs have
 established prima facie that there is a case of passing
 off made out against the defendants. The plaintiffs
 would therefore, be entitled to the reliefs claimed.
 Hence, the Motion is made absolute in terms of prayer
 clauses (a) to (f).

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 26. On the application made by Mr.Dhond, this order

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¶101

 is stayed for a period of two weeks from today.

M/S Shalina Laboratories Pvt.Ltd. v. Sms Foundations Pvt. Ltd. and Ors. and Asst. Drugs Controller (India) and Ors.

Case brief

What is this about?

What did the court decide?

M/S Shalina Laboratories Pvt.Ltd. v. Sms Foundations Pvt. Ltd. and Ors. and Asst. Drugs Controller (India) and Ors.

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Cases cited

Statutes considered

Parties & counsel

Coram

Case details

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