2006 (8) TMI 528 - SC - Companies Law

Concept of trade mark - Interpretation of the provisions of the Trade and Merchandise Marks Act 1958 - trademark Ramdev - Infringement of rights trade name and logo - Application for injunction - Principles of family settlement - MOU - LACHES AND ACQUIESCENCE - Whether there is as a result of misrepresentation a real likelihood of confusion or deception of the public and consequent damage to the plaintiff? HELD THAT - We are of the opinion that in this case this Court would be justified to interfere with the said findings. We are however not oblivious of the damages which may have to be suffered by respondents herein in the event the suit of the appellant is to be ultimately dismissed. We intend to protect the same also. Thus we would take into consideration the terms of the injunction granted by the Trial Judge that the respondents were entitled to sell their products in the name of M/s. Ram Dev Masala only from the seven outlets. The modification made by the High Court has already been noticed by us. We in view of our findings aforementioned direct (i) The respondents be restrained from using the trade mark including the trade name Ramdev Masala in any of their products. (ii) They may however carry on their business in any other name insofar as manufacturing of spices is concerned. (iii) The appellant shall as and when demands are made supply spices produced by it for retail sale thereof to seven outlets belonging to respondents on usual terms and in respect of such articles on the labels/pouches on the reverse thereof the following shall be mentioned in the minimum permissible size in terms of the provisions of Weights and Measures Act and Prevention of Food Adulteration Act This product is manufactured and marketed by M/s. Ramdev Masala (Arvindbhai Group) (Or M/s. Ramdev Exports Arvindbhai Group) having no relationship whatsoever with Ramdev Food Products Pvt. Ltd. (iv) The appellant shall deposit a sum of Rs. 50 lakhs before the Trial Court or furnish a bank guarantee for the said sum by way of security. (v) Despite pending applications for rectification before the Registrar of Trade Marks the final hearing of Civil Suit No. 828 of 2000 shall be expedited and the learned Trial Judge is hereby directed to complete the hearing as expeditiously as possible preferably within a period of six months from the date of communication of this order.

Summary

1. ISSUES PRESENTED and CONSIDERED

The core legal questions considered in this judgment include:

• Whether the appellant has exclusive rights to the use of the trademark 'Ramdev' under the Trade and Merchandise Marks Act, 1958.
• Whether the respondents' use of the trademark 'Ramdev' constitutes infringement and passing off.
• The legal implications of the Memorandum of Understanding (MOU) on the rights of the parties concerning the trademark.
• The applicability and interpretation of Sections 15 and 17 of the 1958 Act concerning the registration of parts of a trademark.
• Whether the respondents can claim concurrent use of the trademark under Section 29 of the 1958 Act.
• The impact of the Prevention of Food Adulteration Act and Standards of Weights and Measures Act on the use of the trademark.
• The role of acquiescence and estoppel in the context of the appellant's claims.

2. ISSUE-WISE DETAILED ANALYSIS

Exclusive Rights to the Trademark 'Ramdev'

The legal framework involves the Trade and Merchandise Marks Act, 1958, which provides that the registration of a trademark gives the proprietor exclusive rights to use the mark. The Court interpreted that the appellant, as the registered proprietor, has statutory rights to the trademark 'Ramdev'. The evidence showed that the appellant registered the trademark and had acquired goodwill and reputation in the market.

The Court found that the respondents' use of the trademark 'Ramdev' in their business activities was likely to cause confusion among consumers, thus infringing the appellant's rights. The Court rejected the respondents' claim of concurrent use, emphasizing that the appellant's rights were absolute under the 1958 Act.

Interpretation of the MOU

The MOU was treated as a family settlement aimed at resolving disputes among the parties. The Court analyzed the MOU's terms, noting that it allowed the respondents to carry on retail business in seven outlets but did not permit them to manufacture spices under the 'Ramdev' name. The Court emphasized that the MOU must be interpreted in light of the law, and any ambiguity should be resolved in a manner consistent with legal principles.

The Court concluded that the MOU did not grant the respondents the right to use the trademark 'Ramdev' beyond the specified retail outlets, and any manufacturing under that name constituted infringement.

Sections 15 and 17 of the 1958 Act

Section 15 allows for the registration of parts of a trademark separately, while Section 17 deals with disclaimers in trademarks. The Court found that the appellant's trademark, which included the name 'Ramdev', was registered as a whole, granting exclusive rights to the appellant. The Court rejected the respondents' argument that the appellant could not claim exclusive rights to the name 'Ramdev' apart from the label.

Concurrent Use and Infringement

The respondents argued for concurrent use under Section 29, claiming their use was bona fide. However, the Court held that the respondents' use of 'Ramdev' was likely to deceive consumers, constituting infringement. The Court emphasized that the statutory rights conferred by registration are absolute and not subject to claims of concurrent use without proper authorization.

Impact of Other Statutory Provisions

The Court addressed the respondents' reliance on the Prevention of Food Adulteration Act and Standards of Weights and Measures Act, which require manufacturers to display their names on products. The Court held that these provisions do not confer rights to use a trademark in a manner that infringes on registered rights.

Acquiescence and Estoppel

The respondents argued that the appellant had acquiesced to their use of the trademark. The Court found no evidence of acquiescence or estoppel, noting that the appellant had consistently objected to the respondents' use and had taken legal action to protect its rights.

3. SIGNIFICANT HOLDINGS

The Court's significant holdings include:

• The appellant has exclusive rights to the trademark 'Ramdev', and the respondents' use constitutes infringement.
• The MOU does not grant the respondents the right to manufacture under the 'Ramdev' name, limiting their use to retail sales in specified outlets.
• The respondents' defense of concurrent use and reliance on statutory provisions like the Prevention of Food Adulteration Act does not override the appellant's registered rights.
• The principles of acquiescence and estoppel do not apply as the appellant actively sought to protect its trademark rights.

The Court concluded by issuing an injunction restraining the respondents from using the trademark 'Ramdev' in their manufacturing activities, while allowing them to continue retail sales in the specified outlets under certain conditions. The Court also ordered the appellant to supply products for retail sale in those outlets, with clear labeling to prevent consumer confusion.