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TMI Blog2009 (9) TMI 1025X X X X Extracts X X X X X X X X Extracts X X X X ..... nt had also filed cross objections to a limited extent. 2. The brief facts of the case as per the appellant are as follows: - a) In 1988, Cadila Chemicals Ltd. an erstwhile company of Cadila Group developed and launched in the market, a product containing Aspartame an artificial sweetener as a low-calorie table-top sweetener, which is as sweet as sugar containing only 2% of its calories. b) The appellant's product containing 'aspartame', a protein derivative, was launched under the brand name/trademark 'Sugar Free' in the year 1988. The product under the trademark 'Sugar Free' was originally coined and adopted as aforesaid by Cadila Chemicals Ltd., predecessors of the appellant. c) In the year 1995, consequent upon the restructuring of the Cadila Group of businesses, the business of Cadila Chemicals Ltd. was transferred and bifurcated between two transferee companies viz.Cadila Healthcare Ltd., i.e., the appellant and Cadila Pharmaceuticals Ltd. with all its property, rights and trademarks, both registered and unregistered, vide a judgment and order dated 2nd May 1997 of the Gujarat High Court passed in Company Petition No.82/1996. d) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed a considerable degree of distinctiveness among the traders and consumers but that is not ipso facto conclusive of an action of passing off which requires that not only there is an acquisition of secondary meaning by trademark or distinctiveness associated with it, but in fact also requiring that the respondent has misrepresented his products as those of the appellant s and caused damage to the distinctiveness associated with the trademark used in relation to the appellant s product. At this interim stage the respondent s goodwill and the typical style and packaging coupled with the well aware customer base which can easily distinguish between the appellant s and the respondent s product and deception is thus, prima facie, ruled out. (d) While there is no perceptible similarity between the two different packaging in terms of colour scheme and get up, sugar free has been written in more prominent form than that of Amul, thus focusing on the word Sugar Free by overshadowing the respondent s trademark Amul. (e) The chances of the consumer, who is the regular purchaser of the appellant s products, being deceived are minimal and such a consumer can easily distinguish between t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bination of two English words. Even assuming that it is not a coined word, even then it is not descriptive of the appellant s product but merely suggestive. The appellant s product which is an artificial sweetener cannot be directly consumed or eaten. Sugar Free would not be apt to describe an item which is not directly consumed but is merely an additive. The appellant has adopted it as a mark for a sugar substitute since 1988, when no products containing artificial sweeteners were manufactured or marketed in India or imported into India, there was absolutely no use of Sugar Free, or any other similar word to describe the products which did not contain sugar. A sugar substitute or artificial Sweetener cannot be described as Sugar Free, even if the meaning free of sugar is given to the ungrammatical phrase Sugar Free , since that which is used as a substitute for sugar in foods or beverages cannot be termed free of sugar and only the foods or beverages so made could be described as free of sugar. Aspartame or Sucralose are artificial sweeteners or sweetening agents which can be used in lieu of sugar. Such chemical compounds cannot be described free of sugar. Sugar Free is theref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n a fair use defense is a defense only against descriptive, not a suggestive, trademark. Suggestive mark is thus protected without any necessity for providing secondary meaning. B) The submission of the respondent that Sugar Free is generic and has no trademark significance is untenable, as this argument apart from being raised for the first time cannot be sustained for the reasons herein below: i) The Sweeteners cannot be divided by creating two classes sugar based and sugar free. The correct criteria for describing the sweeteners would be natural sweeteners and artificial sweeteners. Natural sweeteners are substances like sugar, jaggery, brown sugar etc. Artificial sweeteners are the genus of which Saccharine, Aspartame, Sucralose are species. These artificial sweeteners can never be termed as sugar free sweeteners either colloquially or otherwise. ii) Generic terms are generally nouns and only in very rare cases they can be adjectives. Reliance is placed for the above reasoning on Gilson on Trademarks Edition (2007) and McCarthy on Trade Marks (2007). iii) A generic term would answer the question What are you? (What is this?) If a powder of artificial sweet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch after the appellant had acquired huge reputation and goodwill in respect of its product. Such user clearly is tantamount to passing off. D) The word Sugar Free has become distinctive of the sugar substitute and has acquired a secondary meaning in the sugar substitute (Artificial Sweetener) market namely as the appellant s sugar substitute. The appellant adopted the mark for its sugar substitute in 1988 and has since then been continuously using it exclusively. There was almost no use of Sugar Free in India till 2004. The appellant has also marketed a drink containing Aspartame namely Sugar Free Dlite . The appellant has 74% market share in the sugar substitute market in India. Even a common English word descriptive of the product can become distinctive by a long and continued use and is entitled to similar protection, and that a man has no right to put off his goods for sale as the goods of a rival trader and induce purchasers to believe that the goods which he is selling are manufactured by another entity or are connected in some manner with such other entity. The appellant can take action against anyone who seeks to use their goods in such a manner that it would indica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (2) The respondent knew that appellant is marketing a drink under the trademark Sugar Free Dlite containing sugar substitute and is already in the Food and Beverage market. (3) The manner and size of writing on the packaging clearly indicates use in the trademark sense and not merely to describe the characteristics of the product. If it was only to describe the product characteristics, it could have been used in any other manner. In fact, the packet of Frozen Dessert already contains the following words INDIA S FIRST SPECIALLY CREATED LOW FAT DIABETIC DELIGHT which is sufficient to describe the product and there was absolutely no need to use the word Sugar Free . (4) The Gujarati advertisement translates all other words including the word INDIA S FIRST SPECIALLY CREATED LOW FAT DIABETIC DELIGHT , but SUGAR FREE continues to be stated as such in Gujarati clearly indicating the use of these words in the trade mark sense. (5) The hoardings show the use of Sugar Free also in slogan Sugar Free Guilt Free Worry Free in addition to Sugar Free in large lettering clearly indicating use in trademark sense and not in descriptive sense (7) If the only manner in whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... permitting the respondent to use the mark Sugar Free will lead to passing off, confusion and deception in the following manner: (1) Consumers or at any rate some of them will believe that there is a connection with the appellant or that appellant s product are used in the manufacture of the respondents frozen dessert. It would appear to the consumer or at least to some of them that the product is endorsed, approved or recommended by the appellant thus creating a misrepresentation by connection. (2) The Appellants are already in the Food and Beverage market with a product called Sugar Free Dlite which is a ready to drink beverage. The Appellant s legitimate extensions would be to enter into other Foods and Beverages for Diabetics market like Sugar Free Dlite Jello/Ice-cream/Frozen desserts/Cake mix etc. There could be serious confusion in the market which can cause damage to the reputation of the appellant. If everyone is allowed to use Sugar Free , there will be not only confusion but dilution of the appellant s well established mark. J) The learned Senior Counsel Shri Thakore concluded his arguments by emphasizing that a clear case of passing off arises and the arguments ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a suffix to mean without that to which it is so attached is common to the English language. ii. The combination of the words Sugar and Free is common and used extensively in a wide variety of contexts to indicate a category of food. iii. The claim that sugar free products were available in India only recently, even if correct, is irrelevant to counter the fact that the same is a combination of common English words which was widely used prior to the purported adoption by the appellant, and in any case even a mark which may be used in a descriptive sense is not considered distinctive as per Section 19(b) of the Trade Marks Act, 1999 (hereinafter referred to as the TM Act). iv. The judgment in the case of Baby Dry (supra) is inapplicable since the combination was permitted registration in view of their syntactically unusual juxtaposition which was not a familiar expression in the English language and was a lexical invention. B) The mark is in fact inherently generic and is not entitled to protection since it can never function as a trademark to indicate origin. In the case of Home Solutions Retail ( India ) Limited, reported in 2007 ( 35 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otection by virtue of such registration. In the instant case too, the colour combination of red and white on its own does not identify the source of the product since the red and white colour combination is quite generic in nature and common to toothpaste trade as demonstrated by the various products and their labels relied upon by the defendants. Moreover, there is nothing innovative or distinctive in using the colour, white for writing the word mark COLGATE , since white is a colour commonly used for writing alphabets/numerals on coloured backgrounds. The mark is not suggestive which is defined as indicating certain characteristics of the product that the consumer can ascertain only on reflection, through a reasoning process requiring several steps. In any case the words are so utterly descriptive of the goods concerned as to be totally incapable of distinctiveness. It is also a term which describes an aspect of the product and is an unprotectable generic name. Thus, Sugar Free is a simple word extensively and commonly used, which by its very nature is incapable of losing its primary meaning. D) Assuming that the mark is capable of acquiring distinctiveness, the f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as been drawn between an invented or fancy word used as a name to which the party has no relation, or at least no direct relation to the character or quality of the goods which are to be sold under that name on the one hand and to a totally different principle which must apply in the case of goods which are sold under a merely descriptive name. It was observed as follows: If a person employing a word or term of well-known signification and in ordinary use .is yet able to acquire the right to appropriate a word of term ordinary use in the English language to describe his goods, and to shut others out from the use of this descriptive term, he would really acquire a right much more valuable than either a patent or a trade mark for he and his successors in business would gain the exclusive right, not for a limited time as in the case of patent, but for all time coming, to use the word as applicable to goods which others may be desirous of manufacturing and are entitled to manufacture and sell as much as he is. That being so, it appears to me that the utmost difficulty should be put in the way of any one who seeks to adopt and use exclusively as his own a merely descriptive term. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch words are used, unless the plaintiff shows that the words have acquired a secondary significance, such that it has displaced the primary significance and meaning of the word, the defendants should not be prevented from using similar words which are part of common language. Viewed from that angle, it is clear that the Plaintiffs mark AYUSHAKTI is not to exclusive or so inevitably associated with the Plaintiffs product that the word AYUSH standing alone cannot be used by anyone else. 21. Dr. Tulzapurkar, the learned counsel for the defendants has relied on a decision of the House of Lords reported in The Cellular Clothing Company Limited v. Maxton and Murray, reported in 1899, AC 326, where the following observations are made: If it can be shown that representations to the effect that the goods were manufactured by the plaintiffs be made directly or by implication, by the language used, the plaintiffs would of course be entitled to a remedy. But where the plaintiffs proof shows that the only representation by the defendants consists in the use of a term of terms which aptly and correctly describe the goods offered for sale, as in the present case, it must be a conditions of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der it appropriate to refuse the injunction. (ii) The fact that there could be a number of alternative ways of describing a product is no answer to the criticism of the mark particularly since on the same analogy, the other ways would also be entitled to protection. Reliance was placed on the case of Profit Maker Trade Mark ( 1994 ) RPC 613 wherein it was held as under: - It is just the sort of combination of two common words which others traders might well wish to use. Indeed, the similar expression MONEYMAKER is to be found in the dictionary. The fact that honest traders have a number of alternative ways of describing a product which will make profits is no answer to the criticism of the mark. F) There is no passing off since the use of the mark by the respondent does not amount to a misrepresentation nor is there a likelihood of deception, and damage in view of the reasons given below: (i) The adjective Sugar Free is a true description of the goods of the respondent and conveys the real meaning to the purchasing public. (ii) The mark is not used in the trademark sense of seeking to distinguish the goods of the respondent from similar goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndicative of the source or of the product of the appellant being an ingredient of such goods, and more so since the words are written in a completely different style than that used by the appellant. For such assumed confusion precise copying would be required and the slightest distinction would be sufficient to avoid confusion. In any case mere confusion is insufficient and in the absence of misrepresentation or deception, no action for passing off can be maintained. I) Moreover, the appellant, having adopted such an inherently descriptive word must be prepared to tolerate some degree of confusion even if the same is assumed to occur. Moreover, such a conclusion of the Court would grant a complete monopoly in the words to the appellant since it would be applicable to the entire range of products available throughout the world which bear the mark Sugar Free. The case of Glucovita (AIR 1960 SC 142) relied upon by the appellant was a case where the appellant s mark was registered and the respondent had sought registration of a trademark in respect of goods of the same description, which mark was held to be sufficiently similar so as to be reasonably likely to cause deception and wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... give this Court a good ground for imposing a blanket injunction on the defendant from using the expression 'Sugar Free', especially when the defendant intends to use this expression only in its descriptive sense and not as a trade mark, and even otherwise, when the use of this expression is widespread in relation to foods and beverages. We fully agree with and reaffirm the said finding. 9. We are unable to hold that the appellant s trademark Sugar Free is a coined word; at best it is a combination of two popular English words. The mere fact that the appellant s product cannot be directly consumed or eaten and merely is an additive does not detract from the descriptive nature of the trade mark. Once a common phrase in the English language which directly describes the product is adopted by a business enterprise, such adoption naturally entails the risk that others in the field would also be entitled to use such phrases provided no attempt is made to ride on the band wagon of the appellant s indubitably market leading product Sugar Free . In this connection, merely because the attributes of sugar Free can be described by other phrases cannot detract from the commo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ( a ) is in accordance with honest practices in industrial or commercial matters, and ( b ) is not such as to take unfair advantage of or be detrimental to the distinctive character or repute of the trade mark. (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 of production of goods or of rendering of services or other characteristics of goods or services; ( 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; ( c ) the use by a person of a trade mark- ( i ) in relation to goods connected in the course of trade with the proprietor or a registered user of the trade mark if, as to those goods or a bulk or which they form par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prietor or a registered user of a registered trade mark to interfere with any bona fide use by a person of his own name or that of his place of business, or of the name, or of the name of the place of business, of any of his predecessors in business, or the use by any person of any bona fide description of the character or quality of his goods or services. ( emphasis supplied ) Thus, it is clear that the mark or indication which serves to designate the quality of the goods of the appellant, which indeed the phrase Sugar Free does, would be an absolute ground for refusal of registration of a mark unless it has acquired a distinctive character. The expression can at best be said distinctive qua the artificial sweetener of the appellant and mere starting of the marketing of the drink sugar free D lite cannot give the appellant the right to claim distinctiveness in the expression Sugar Free ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r is known to exist only when added to food and beverages, and its own identity gets merged in the food and beverages to which it is added. Thus, the expression Sugar Free when used in relation to a sweetener may really describe a sweetener in the sense of its generic meaning, and what it connotes is the specific nature and characteristics of the product. 12. In support of the contention of the appellant that even if it is assumed that the mark Sugar Free is descriptive, it nevertheless has attained distinctiveness as it has been associated with the business of the appellant for a considerable period of time and, therefore, any adoption of a similar mark by the respondent establishes dishonest intention of the respondent, the learned Senior Counsel has relied upon the cases of Info Edge ( India ) Pvt . Ltd . , Societe Des Products NESTLE S . A, Essel Packaging and Caterpillar Inc . (supra). In our view, before ascertaining whether the expression Sugar Free has acquired a secondary meaning and assumed distinctiveness what has to be borne in mind is the specialized nature of the appellant s product. Being essentially a sweetener, the popularity of the sug ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e marks are also used and understood in linguistics in their primary sense. For instance, words like Catterpiller , Panther , etc. are famously known for their dual meanings, that is, both in their primary sense as generic words of animals as well as in their secondary sense as well known trade marks.... [See: para 34 of Sugarfree-I] 4) ...Thus, while ascertaining the distinctiveness of a trademark in relation to a product, it is paramount to first identify the range or circumference of the consuming class of such product, and measure the distinctiveness of the trademark only within such range or circumference. [See: para 37 of Sugarfree-I] 5) ...a good reason to assume that the trade mark Sugar Free has acquired a considerable degree of distinctiveness amongst traders and consumers. However, it is to be borne in mind that the acquisition of a secondary meaning by a trade mark or the distinctiveness associated with it are not ipso facto conclusive of an action for passing off.... [See: para 42 of Sugarfree-I] 6) ...There may be a possibility, though less likely, that such consumer may be misled into believing that the plaintiff's product being in the nature of an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ugar Free is in public domain and cannot be appropriated exclusively by the plaintiff. Examples of numerous products, including biscuits, ice-creams, chocolates, candies, mints, pan cakes and waffles, all of which use the expression Sugar Free prominently, have been presented on behalf of the defendant. Even judicial notice can be taken of the fact that the expression Sugar Free is commonly used to denote that a particular food article does not contain sugar and / or has been sweetened by using sugar substitutes / artificial sweeteners. In that sense, the expression Sugar Free is generic. However, in Sugarfree-I, it has been observed that Sugar Free in relation to sweeteners has attained a certain degree of distinctiveness referring to the plaintiff's products. That, of course, is a prima facie conclusion and is subject to the final decision in the suit. However, assuming that conclusion to be valid for the purposes of the present case also, it must be reiterated that the considerable degree of distinctiveness relates only to artificial sweeteners / sugar substitutes and is limited to such products. Sugar Free, prima facie, has not attained any distinctiveness as all ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the respondent cannot be restrained from absolutely using the expression Sugar Free , particularly in the descriptive sense. A mere descriptive usage of the expression Sugar Free by the respondent may thus blunt the edge of claim of distinctiveness by the appellant. However, we make it clear that if any party enters into the domain of artificial sweeteners with the trademark Sugar Free the appellant may have a just cause in seeking restraint. 15. The learned Senior Counsel for the respondent Shri Mihir Joshi has vehemently argued that the size of the font is not inappropriate in the context of trade usage as it merely serves to emphasize the category and unique selling point of the product and prominence of use, by itself, and would not amount to misrepresentation particular in view of the common font styling, which is completely different than that used by the appellant. He thus urged that the learned Single Judge was not justified in imposing the restrictions. In view of the findings recorded in the judgment about the descriptive nature of the phrase Sugar Free , we cannot restrict the use of the expression Sugar Free by the respondents especially as the part of a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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