2001 (3) TMI 928 - SC - Indian Laws

Infringement of trademarks - Held that - Keeping in view the provisions of section 17B of the Drugs and Cosmetics Act, 1940 which inter alia indicates an imitation or resemblance of another drug in a manner likely to deceive being regarded as a spurious drug it is but proper that before granting permission to manufacture a drug under a brand name the authority under that Act is satisfied that there will be no confusion or deception in the market. The authorities should consider requiring such an applicant to submit an official search report from the Trade Mark office pertaining to the trade mark in question which will enable the drug authority to arrive at a correct conclusion. Broadly stated in an action for passing off on the basis of unregistered trade mark generally for deciding the question of deceptive similarity the following factors to be considered (a)The nature of the marks, i.e., whether the marks are word marks or label marks or composite marks, i.e., both words and label works. (b)The degree of resembleness between the marks, phonetically similar and hence similar in idea. (c)The nature of the goods in respect of which they are used as trade marks. (d)The similarity in the nature, character and performance of the goods of the rival traders. (e)The class of purchasers who are likely to buy the goods bearing the marks they require, on their education and intelligence and a degree of care they are likely to exercise in purchasing and/or using the goods. (f)The mode of purchasing the goods or placing orders for the goods, and (g)Any other surrounding circumstances which may be relevant in the extent of dissimilarity between the competing marks. Weightage to be given to each of the aforesaid factors depends upon facts of each case and the same weightage cannot be given to each factor in every case. The Trial Court will now decide the suit keeping in view the observations made in this judgment.

Issues Involved:
1. Injunction against the use of a similar trade mark.
2. Principles of passing off and deceptive similarity.
3. Application of legal principles to medicinal products.
4. Comparison of trade marks.
5. Public interest and consumer protection in the context of medicinal products.
6. Judicial scrutiny and standards for medicinal products.

Detailed Analysis:

1. Injunction Against the Use of a Similar Trade Mark:
The appellant sought an injunction against the respondent for using the trade mark 'Falcitab', alleging it was deceptively similar to its own trade mark 'Falcigo'. The appellant argued that the similarity could lead to confusion among consumers, especially since both drugs were used for treating the same disease, cerebral malaria.

2. Principles of Passing Off and Deceptive Similarity:
The judgment emphasized the principles of passing off, which are based on misrepresentation causing confusion among consumers, thereby injuring the goodwill of the plaintiff. The court referred to the five elements of passing off as stated by Lord Diplock in Erwen Warnink BV v. J. Townend & Sons: misrepresentation, made by a trader, to prospective customers, calculated to injure the business or goodwill, and causing actual damage or likely to do so.

3. Application of Legal Principles to Medicinal Products:
The court highlighted that in cases involving medicinal products, a stricter standard is required due to the potential harm that confusion can cause. The judgment cited various precedents, including Amritdhara Pharmacy v. Satya Deo Gupta and F. Hoffmann-La Roche & Co. Ltd. v. Geoffrey Manner & Co. (P.) Ltd., to underline that the likelihood of confusion must be assessed from the perspective of an average consumer with imperfect recollection.

4. Comparison of Trade Marks:
The judgment discussed the comparison of trade marks in detail, emphasizing that the marks must be considered as a whole, both visually and phonetically. The court referred to previous cases, such as Corn Products Refining Co. v. Shangrila Food Products Ltd. and Kaviraj Pandit Durga Dutt Sharma v. Navaratna Pharmaceutical Laboratories, to illustrate the principles of comparing trade marks for deceptive similarity.

5. Public Interest and Consumer Protection in the Context of Medicinal Products:
The court stressed that public interest requires a higher degree of protection against confusingly similar trade marks in the case of medicinal products. The judgment noted that confusion between medicinal products could have life-threatening consequences, unlike non-medicinal products where the harm might be limited to economic loss.

6. Judicial Scrutiny and Standards for Medicinal Products:
The judgment underscored the need for exacting judicial scrutiny in cases involving medicinal products. It cited American cases, such as American Cynamid Corpn. v. Connaught Laboratories Inc., to support the view that stricter standards are necessary to prevent confusion. The court also highlighted the importance of considering the varying levels of literacy and the linguistic diversity in India when assessing the likelihood of confusion.

Conclusion:
The Supreme Court did not interfere with the lower courts' orders but provided detailed guidelines for the trial court to decide the suit. The judgment emphasized the need for a stricter approach in cases involving medicinal products to prevent any possibility of confusion, which could have serious health implications. The court also suggested that drug authorities should require an official search report from the Trade Mark office before granting permission to manufacture a drug under a brand name to avoid confusion or deception in the market.

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