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TMI Blog2017 (12) TMI 1886X X X X Extracts X X X X X X X X Extracts X X X X ..... ts of the multiple trade marks of the Plaintiff ('TOYOTA', 'TOYOTA INNOVA' and 'TOYOTA DEVICE MARKS'); the conditional injunction Order dated 10.08.2000; the violation thereof; all have been urged by Shri Chidambaram to contend that the aforesaid facts are strong evidence of dishonest intention on the part of the Defendants to defraud the Plaintiff to derive undue benefit from the goodwill and reputation of the trade mark of which the Plaintiff is the first user. Territoriality principle - Universality doctrine in trademark law - HELD THAT:- To give effect to the territoriality principle, the courts must necessarily have to determine if there has been a spill over of the reputation and goodwill of the mark used by the claimant who has brought the passing off action. In the course of such determination it may be necessary to seek and ascertain the existence of not necessarily a real market but the presence of the claimant through its mark within a particular territorial jurisdiction in a more subtle form which can best be manifested by the following illustrations, though they arise from decisions of Courts which may not be final in that particular jurisdictio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the Indian market so as to vest in the Plaintiff the necessary attributes of the right of a prior user so as to successfully maintain an action of passing off even against the registered owner. In any event the core of the controversy between the parties is really one of appreciation of the evidence of the parties; an exercise that this Court would not undoubtedly repeat unless the view taken by the previous forum is wholly and palpably unacceptable which does not appear to be so in the present premises. If goodwill or reputation in the particular jurisdiction (in India) is not established by the Plaintiff, no other issue really would need any further examination to determine the extent of the Plaintiff's right in the action of passing off that it had brought against the Defendants in the Delhi High Court. Consequently, even if we are to disagree with the view of the Division Bench of the High Court in accepting the Defendant's version of the origin of the mark 'Prius', the eventual conclusion of the Division Bench will, nonetheless, have to be sustained. It is deemed proper to affirm the order(s) of the Appellate Bench of the High Court and dismiss the appeals f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rent countries as early as the year 1990 (in Japan) and eventually in other jurisdictions all over the globe. So far as India is concerned, however, the car was released in the year 2009 and until that point of time the Plaintiff had not obtained registration of the mark 'Prius' in the Indian jurisdiction. However, the car was displayed in the car shows in Delhi and Bangalore held in the year 2009 and it was formally launched in India in the year 2010. The Plaintiff claimed that various advertisements and news reports about 'Prius' and publications in car magazines in India and across the globe has made 'Prius' a well known trade mark within the meaning of the said expression Under Section 2(1)(zg) of the Trade Marks Act, 1999 (hereinafter referred to as 'the Act'). According to the Plaintiff, in the year 2009, it discovered that the Defendants not only had got the mark 'Prius' registered way back in the year 2002-2003 for all types of auto parts and accessories but that they had also been using the said trade mark in carrying out their trade in such auto parts and accessories. The Plaintiff, therefore, approached the Trade Mark Registry for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... India to identify and recognize or associate the Defendants' registered trade mark 'Prius with any of the products of the Plaintiff. In fact, in the written statement filed, the Defendants claimed that as they were the first in India to manufacture add-on chrome plated accessories, they had conceptualized their attempt as 'pehela prayas' (Hindi word meaning first attempt). It was on that basis that they had adopted the name 'Prius' and got the same registered in the year 2002 as 'PRIUS' (Registration No. 1086682 dated 13.03.2002) and 'PRIUS-The name you can trust' (Registration No. 1163594 dated 2.1.2003). 6. The learned trial Judge of the High Court by Order dated 22.12.2009 granted ex-parte ad-interim injunction restraining the Defendants from using the registered trade marks of the Plaintiff i.e. 'TOYOTA', 'TOYOTA INNOVA' and 'TOYOTA DEVICE' and the mark 'Prius' in respect of auto accessories manufactured by the Defendants. This order was vacated on 19.03.2010 on the basis of an application filed by the Defendants. Aggrieved, the Plaintiff had filed an appeal before the Division Bench of the High Court and b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 'Prius' is concerned having permeated to the Indian jurisdiction, it was held that the Plaintiff was entitled to an injunction against the Defendants restraining them from passing off the said mark. Punitive damages quantified as Rupees ten lakhs was also awarded in favour of the Plaintiff. 9. Both sides appealed against the aforesaid order of the learned Single Judge. While the appeal of the Plaintiff was with regard to the quantum of the damages awarded, the appeal filed by the Defendants was in respect of the order of injunction granted against them. However, in the course of hearing of the appeal filed by the Defendants, the grievance with regard to the conditional use of the trade marks 'TOYOTA', 'TOYOTA INNOVA' and 'TOYOTA DEVICE' (in terms of the interim Order dated 10.08.2010) was not persisted with and the sole grievance expressed was in respect to the permanent injunction granted by the learned trial Judge with regard to the use of the name 'Prius'. 10. The Division Bench of the High Court by the impugned judgment dated 23.12.2016, on grounds and reasons, that will be noticed in the course of deliberations and discussions that follo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... equently, it was held that the physical presence of the car in India at a later point of time was immaterial. In fact, the learned trial Judge went on to hold that the mark 'Prius had satisfied the definition of a well-known trade mark Under Section 2(1)(zg) read with Section 11(6) 11(9) of the Act. Relying on the decision of this Court in S. Syed Mohideen v. P. Sulochana Bai 2016 (2) SCC 683, the learned trial Judge took the view that if the Plaintiff could successfully prove that its case was covered by passing off the registered trade mark of the Defendants would not remain protected under the Act. Proceeding further, the learned trial Judge took the view that the Plaintiff was the prior user/adopter of the mark 'Prius', though it may not have been such prior user so far as the Indian market is concerned. In this regard, the learned trial Judge relied on the decision of this Court in N.R. Dongre v. Whirlpool Corporation 1996 (5) SCC 714 wherein this Court had approved the views of the Delhi High Court holding that wide advertisement of a trade mark without the existence of the goods in the local market can well be considered as use of the trade mark in the said local ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s with regard to spread of the transborder reputation of the mark 'Prius' had not been correctly arrived at by the learned trial Judge as facts and materials beyond the relevant point of time i.e. first date of use (April, 2001) of the mark by the Defendants in India was taken into consideration. The Division Bench of the High Court while holding that the launching of the car 'Prius' in the year 1997 was widely reported and advertised, however, held that such publication in the print media was not ground breaking and in fact in the issue of Economic Times dated 27.03.1997 and 15.12.1997, small news items with regard to the launching of the product in Japan had been published, which could not have impacted the Indian public at large. Relying on one of its own judgments in the case of Trans Tyres India Pvt. Ltd. v. Double Coin Holdings Ltd. and Anr. 2012 SCC Online Delhi 596 the Division Bench of the High Court took the view that the Universality Doctrine (which posits that a mark signifies the same source all over the world) has not been accepted by courts. Modern day trade; globalization have brought in multi-channel modes of sale of goods in the market and therefor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rial Judge also took the view that the word 'Prius' is publici juris and that the explanation given by the Defendants for adopting the said word as their trade mark is logical and acceptable. It is on the aforesaid broad basis the decree passed by the learned trial Judge was reversed by the Division Bench of the High Court. 16. The arguments advanced on behalf of the rival parties may now be noticed. 17. Shri P. Chidambaram, learned senior Counsel, who had argued the case of the Appellant before us, submitted that recognition and reputation of a trade mark is not contingent upon the actual sale of goods in India bearing the mark in question. Advertisement and promotion of the mark through different forms of media is sufficient to establish reputation and goodwill within a particular geographical area, i.e., India. It is urged that in the present case the car Prius was widely publicized and advertised in leading newspapers and magazines with wide circulation all over the world since the year 1997. It is also urged that to establish goodwill and reputation it is not necessary that the mark should be recognized by every member of the public and it would be sufficient if person ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... utation of the Defendants in the mark in question. Shri Chidambaram has also struck an issue with regard to the trade mark 'Prius' being publici juris. It is urged that the said finding has been arrived at without there being an issue before the Court and without any evidence being led on the point. 19. In reply, Shri Sai Krishna, learned Counsel for the Respondents/Defendants has submitted that as a manufacturer of spare parts, the Defendants are entitled to inform the consumer the name of the specific vehicles for which the particular spare part is suitable and useful. This is precisely what has been done and nothing more. Such action on the part of the Defendants is protected Under Section 30 of the Act. It is urged that the conduct of the Plaintiff in belatedly moving the Registry of Trade Mark for registration and that too on a proposed to be used basis and the amendment to the said prayer made, after filing of the suit, are crucial circumstances for determination of the Plaintiff's claim. On the other hand, the mark was adopted by the Defendants in the year 2001 and registration thereof was obtained in the year 2002-2003 whereas this mark was adopted by the Plaint ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... een urged to contend that the claim of the Plaintiff has been rightly rejected by the Division Bench of the High Court. 21. At the very outset, certain principles that govern the law of passing off may be usefully noticed. Such principles, in fact, have been considered by this Court in its decision in S. Syed Mohideen (supra), though in a somewhat different context, i.e., the right of a registered owner of a particular mark to bring an action for passing off against another registered owner of an identical or largely similar trade mark. In S. Syed Mohideen (supra), this Court on a collective reading of the provisions of the Act held that the action for passing off which is premised on the rights of prior user generating a goodwill shall be unaffected by any registration provided under the Act, which proposition actually stood approved in an earlier decision of this Court in N.R. Dongre (supra). The trinity test laid down in Reckitt and Colman Ltd. (supra) was reiterated by this Court in S. Syed Mohideen (supra) by holding that to prove and establish an action of passing off, three ingredients are required to be proved by the Plaintiff, i.e., his goodwill, misrepresentation and dama ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ught out for a large sum. On the other hand, a Rule of law dealing with this situation has to avoid the opposite scenario of bona fide domestic traders finding themselves open to litigation at the suit of unknown or barely-known claimants from almost anywhere in the world. Some of the more radical proposals for changing the law to assist foreign claimants ignore the need for this balancing exercise, without which the opportunities for abuse are simply increased, and further uncertainty created. 24. The view of the courts in U.K. can be found in the decision of the U.K. Supreme Court in Starbucks v. British Sky Broadcasting 2015 UK SC 31 wherein Lord Neuberger observed as follows: As to what amounts to a sufficient business to amount to goodwill, it seems clear that mere reputation is not enough...The claimant must show that it has a significant goodwill, in the form of customers, in the jurisdiction, but it is not necessary that the claimant actually has an establishment or office in this country. In order to establish goodwill, the claimant must have customers within the jurisdiction, as opposed to people in the jurisdiction who happen to be customers elsewhere. Thus, where the cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ular territorial jurisdiction in a more subtle form which can best be manifested by the following illustrations, though they arise from decisions of Courts which may not be final in that particular jurisdiction. 30. In SA Anciens Etablissements Panhard et Levassor v. Panhard Levassor Motor Co. 1901 2 Ch. 513, the Plaintiffs were French car manufacturers who had consciously decided to not launch their cars in England (apprehending patent infringement). Nevertheless, some individuals had got them imported to England. It was seen that England was one of the Plaintiff's markets and thus, in this case, permanent injunction was granted. Similarly in Grant v. Levitt 1901 18 RPC 361, a Liverpool business concern trading as the Globe Furnishing Company, obtained an injunction against the use of the same name in Dublin as it was observed that advertisements by the Plaintiff had reached Ireland and there were Irish customers. C A Modes v. C A (Waterford) 1976 I.R. 198 (Irish), was a case where the Plaintiffs operated a chain of clothes stores throughout the U.K. and even in Northern Ireland but not in the Republic of Ireland where the Defendants were trading. The Court held that, a very s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be defeated by imposing such a requirement. In such a situation, likelihood of confusion would be a surer and better test of proving an action of passing off by the Defendants. Such a test would also be consistent with commercial and business morality which the law of passing off seeks to achieve. In the last resort, therefore, it is preponderance of probabilities that must be left to judge the claim. 32. The next exercise would now be the application of the above principles to the facts of the present case for determination of the correctness of either of the views arrived at in the two-tier adjudication performed by the High Court of Delhi. Indeed, the trade mark 'Prius' had undoubtedly acquired a great deal of goodwill in several other jurisdictions in the world and that too much earlier to the use and registration of the same by the Defendants in India. But if the territoriality principle is to govern the matter, and we have already held it should, there must be adequate evidence to show that the Plaintiff had acquired a substantial goodwill for its car under the brand name 'Prius' in the Indian market also. The car itself was introduced in the Indian market ..... X X X X Extracts X X X X X X X X Extracts X X X X
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