Trade mark registration test becomes 'stricter'

Lex Orbis
Manisha Singh Nair
[email protected]

With the increasing awareness of the importance of trade marks and the allied benefits of having a strong reputation, the number of trade mark infringement disputes is on the rise. For stronger intellectual property protection, the rights holder has to ensure that his mark is not diluted so as to avail maximum protection.

In a recent case, Gulfic Ltd. & Another v Clinique Laboratories Llc & Anr 2010 (43) PTC 788(Del.) (DB), the Delhi High Court was confronted with the task of ascertaining infringement of two registered marks. While the Single Judge Court upheld infringement on the basis of sales figures, the Division Bench reversed the judgment and held that there was no infringement due to the fact that both of the products catered to the needs of different classes of people. Keeping aside the larger question of whether the test was good or bad, the immediate impact of the judgment implies that marks can be diluted to a certain extent even if it amounts to deception of a consumer with average intelligence and imperfect recollection.

The factual matrix of the case is as follows: Clinique Laboratories Llc. & Anr was the registered proprietor of the trade mark CLINIQUE since 1981 for cosmetics, lotions and oils. It was also owners of CLINIQUE WATER THERAPY, CLINIQUE MOISTURE SURGE and CLINIQUE SKIN SUPPLIES FOR MEN from 1992. In 2006, Clinique Laboratories Llc & Anr learnt that Gulfic Ltd. & Anr had registered mark 'SKINCLINIQ' and label 'STRETCH NIL'. With CLINIQUE being the most distinguishing feature of its trade mark, it was its grievance that the act of Gulfic Ltd amounted to infringement of the trade mark CLINIQUE. Clinique Laboratories also alleged intention in using the identical mark since it had enjoyed a worldwide reputation since 1968 and a strong goodwill in India since 2007.

The Single Judge held that since both of the parties were engaged in identical businesses, there was a likelihood of consumer deception and thus of one enjoying the benefit of goodwill of the other. Therefore, the balance of convenience tilted in favour of Clinique Laboratories and the injunction was warranted. The reasons articulated were that the distinction between the marks wase only with respect to 'Q' and 'QUE', which were so phonetically similar that it could result in confusion among the public. Perusal of the sales figures also suggested that Gulfic had enjoyed a considerable increase in sales. Thus, prima facie violation of Section 29(2) had been made out. Regarding the applicability of Section 9(2)(a), which assumes validity upon registration, it was stated that such a defence cannot stand when the registration itself is invalid as per Sections 11(1) and (2).

Aggrieved by the order of the Single Judge, Gulfic went in appeal before a larger bench. The applicability of Section 124(1)(ii) regarding staying of the matter pending disposal of rectification application was not pressed in the appeal since Gulfic itself had not claimed the defence available for registered marks in Section 30(2)(e). Thus, the only issue that went in appeal was the issue of infringement of trade mark. Gulfic argued that the marks were neither identical nor deceptively similar and also that its use was with respect to different products. It highlighted the price differential in the products, stating that they were meant to meet the needs of different classes of people, while also pointing out that the style, manner, writing, trade dress et al were different from that of Clinique Laboratories.

Reiterating the well-established trade mark principles of infringement, the following principles were arrived at:

“(i) The test of deceptive similarity in the case of infringement is the same as in a passing off action, where the marks are not identical;

(ii) The question has to be approached from the point of view of a man with average intelligence and imperfect recollection;

(iii) In comparing the marks, it is the overall structural and phonetic similarity of the two marks that is to be seen and not by splitting them into their component parts and to consider the etymological meaning thereof;

(iv) The trade mark is the whole thing – the whole word has to be considered; and

(v) In comparing the two marks, it is also to be seen whether they both convey the same idea (test of commonness of the idea between the two marks).”

Accordingly, the court held that there was no infringement as the products are dissimilar and in no way cause consumer deception. This is because there was no overall structural or phonetic similarity between the marks, and they were not meant for the same class of people.

Consequently, we can see that courts in trade mark disputes on infringement are adopting a stricter approach. Although the fact of confusion in the minds of the average man with imperfect recollection still holds good, similarity also means in terms of word taken as a whole. In addition, evidence relating to the class of consumers has now some significance.