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TRANSBORDER REPUTATION OF TRADEMARKS

AUTHOR: - PRABHANSHU

3rd YEAR, CHANAKYA NATIONAL LAW UNIVERSITY, PATNA

INTRODUCTION

Trademarks are concerned with brand identity - they can be distinctive words, marks or other features, the purpose of which is to establish, in the mind of the customer, a link between the particular products or services and the company. Protection is afforded to a trade or service mark in India even if the products bearing the said mark are neither manufactured, marketed nor sold, or services under the said mark are not offered in India, provided the said mark has acquired substantial reputation in foreign trade. Take, for instance, the Harley-Davidson motorcycles. It is a well known and reputed motorcycle brand of US which has not been launched in India. In other words we can say that it is not doing trade with India. Now the question arises can any Indian company launch a new brand motorcycle with the mark of Harley-Davidson. Well, it can claim that since Harley-Davidson is not trading in India, so it can start and launch a new bike with the brand name Harley-Davidson. Can such thing happen, which would be clear cut violation of trademarks and result to unfair trade practices also? Here comes the concept of Trans – Border Reputation of Trademarks.

HOW LAW REGARDING TRANSBORDER REPUTATION ORIGINATED

The Division Bench while dismissing the defendants' appeal, in the N.R. Dongre v. Whirlpool Corpn  case stated that “From the aforesaid facts including the extensive advertisements of the goods of the first respondent & its trade mark 'WHIRLPOOL' and the legal position adumberated hitherto we are prima facie of the opinion that the trade mark 'WHIRLPOOL' has acquired reputation and goodwill in this country and the same has become associated in the minds of the public or potential buyers with the goods of the first respondent. Even advertisement of trade mark without existence of goods in the market is also to be considered as use of the trade mark. It is also not necessary however that the association of the plaintiff's marks with his goods should be known all over the country or to every person in the area where it is known best[1]. Besides the facts prima facie demonstrate that the first respondent was prior user of the trade mark 'WHIRLPOOL' as it was using the same since 1941, while the appellants themselves claim the adoption thereof from 1886. Thus, we see no reason to differ with the finding of the learned Single Judge that the first respondent acquired transporter reputation in respect of the trade mark 'WHIRLPOOL' and has a right to protect the invasion thereof. It has also been held that there is no plausible explanation offered by the defendants for recently adopting the mark 'WHIRLPOOL' when business in washing machines was being carried out earlier in other names, which at this stage, is supportive of the plea of unfair trading activity in an attempt to obtain economic benefit of the reputation established by the plaintiff whose name is associated with the mark 'WHIRLPOOL'. The plaintiffs' conduct in opposing the defendants' application for registration as soon as it was notified and persisting in the opposition by filing an appeal against the Registrar's order and then an application for rectification of the entry in the register on grant of the certificate and also filing the suit without delay is referred by the trial court as sufficient to suggest that there was no abandonment of the mark, acquiescence or laches by the plaintiffs. The judgement of the Whirlpool case is regarded as the landmark judgement in the field of the Transborder reputation of trademarks and called for wide-ranging review of the 1958 Trademarks Act. Recognizing the need for comprehensive changes in the existing law, the Indian Parliament replaced the 1958 Act by passing a new Act, the Trade Marks Act 1999.

LAWS REGARDING TRANSBORDER REPUTATION OF TRADEMARKS

Even when the goods are manufactured outside the Country, the foreign manufacturer or the importer can rely on the trade mark on the goods provided, they are in a position to establish the reputation in this Country in the trade mark and having a place of business in the country, is not at all essential for the manufacturer or importer of foreign goods. It is for the firm to establish an adequate good-will in the business which could be said to suffer damage by reason of the activity of the other firm. The firm must also establish that it has a business reputation in this Country which they are entitled to protect. It would not be sufficient even a mere knowledge of the make of the petitioner in the Country without any business activity. The petitioner cannot also take advantage of simple advertisement in India in order to prove that it is the user of a trade mark in this Country[2].

As it has been factually found by the appellate Board that the transborder reputation can be established only by letting in evidence before the Registrar of Trade Marks that the mark is so well-known or familiar in India and most of the general public are fully aware of such mark connecting the petitioner, the contention could be accepted. For the same reason, the appellate Board has not applied the judgement of the Apex Court relied upon by the petitioner in N.R. Dongre v. Whirlpool Corpn[3]. When there is a specific finding that the petitioner had totally failed to produce any evidence with regard to the commercial publicity either in the magazines or otherwise the appellant mark in India, the contention relating to transborder reputation should be negatived. The knowledge and awareness of a trade mark in respect of the goods of a trader is not necessarily restricted only to the people of the country where such goods are freely available but the knowledge and awareness of the same reaches even the shores of those countries where the goods have not been marketed. When a product is launched and hits the market in one country, the cognizance of the same is also taken by the people in countries almost at the same time by getting acquainted with it through advertisements in newspapers, magazines, television, video films, cinema etc. even though there may not be availability of the product in those countries because of import restrictions or other factors. In today's world it cannot be said that a product and the trade mark under which it is sold abroad, does not have a reputation or goodwill in countries where it is not available. The knowledge and awareness of it and its critical evaluation and appraisal travels beyond the confines of the geographical area in which it is sold. This has been made possible by development of communication systems which transmit and disseminate the information as soon as it is sent or beamed from one place to another. Satellite Television is a major contributor of the information explosion. Dissemination of knowledge of a trade mark in respect of a product through advertisement in media amounts to use of the trade mark whether or not the advertisement is coupled with the actual existence of the product in the market[4].

TRANSBORDER REPUTATION OF TRADEMARKS V. PASSING OFF

Passing-off is said to be a species of unfair trade competition or of actionable unfair trading by which one person, through deception, attempts to obtain an economic benefit of the reputation which another has established for himself in a particular trade or business. The action is regarded as an action for deceit. The tort of passing-off involves a misrepresentation made by the trader to his prospective customers calculated to injure, as a reasonably foreseeable consequence, the business or goodwill of another which actually or probably, causes damages to the business or good of the other trader.

The concept and principle on which passing off action is grounded is that a man is not to sell his own goods under the pretence that they are the goods of another man. A trader needs protection of his right of prior user of a trade mark as the benefit of the name and reputation earned by him cannot be taken advantage of by another trader by copying the mark and getting it registered before he could get the same registered in his favour. We see no reason why a registered owner of a trade mark should be allowed to deceive purchasers into the belief that they are getting the goods of another while they would be buying the goods of the former which they never intended to do. In an action for passing off if should not matter whether misrepresentation or deception has proceeded from a registered or an unregistered user of a trade mark. He cannot represent his own goods as the goods of some body else.

No one can be permitted to trade by deceiving or misleading the purchasers or to unauthorized divert to itself the reputation and goodwill of others.

The reputation of any trademark travels trans-border to India as well through commercial publicity made in magazines which are available in or brought in India. These magazines do have a circulation in the higher and upper middle Income Indian society.

A trans-border reputation indicating that any goods marketed with the use of any particular  mark  gives the impression of it being a goods marketed by the plaintiffs; and the same type of goods  manufactured, sold and advertised by the defendants give that impression resulting in confusing the intending buyers with the impression.

REMEDIES AVAILABLE FOR TRANSBORDER REPUTATION INFRINGEMENT

Trans-border reputation can be established only by letting in evidence before the Registrar of Trade Marks that the mark is so well-known or familiar in India and most of the general public is fully aware of such mark connecting the trade mark. Passing off is a species of unfair trade competition by which one person seeks to profit from the reputation of another in a particular trade or business. A passing off action is a direct subject matter of the law of tort or common law of right, i.e. case law. The Trade and Merchandise Marks Act, 1958 does not define passing off, but only provides the rules of procedure and the remedies available. Under Section 27(2) of the Copyright Act an action for passing off against registered user of trade mark is maintainable at the instance of a prior user of the same, similar or identical mark. Since such a remedy is available against the registered user of a trade mark, an interim injunction restraining him to use the mark can also be granted to make the remedy effective.

The protection afforded to unregistered marks is also extended to foreign marks, which have a reputation in India on the basis of extensive advertisements and publicity. The transborder reputation of a trader could enable him to obtain injunction in the courts of a country in which he is not trading. Indian courts, too, recognize the existence of transborder reputation and grant injunction in cases where one tries to derive economic benefit from the reputation established in a particular trade by another[5]. The Division Bench of the Delhi High Court in Rob Mathys India Pvt. Ltd  V. Synthes Ag Chur[6] considered the scope of trans border reputation or spill over reputation and held that the same cannot be accepted a the sole criteria for protecting a registered or unregistered trade mark.

No doubt the Courts in India have protected the transborder or spill over of international reputation of trade marks of overseas companies in various cases and would continue to do so. It also does not require any, emphasis that rapidly grown international trade makes it imperative that intellectual property are properly rights are properly recognized and managed in different countries of the globe. The Court frowns upon any attempt by one proprietor or appropriates the mark of another proprietor although that proprietor is a foreign proprietor and the mark has only been used by him in a foreign country. However, these principles are to be applied keeping in view the salient aspects of each case[7].

CONCLUSION

If any organization is using the registered trademark of another company without permission, that means it is not only committing a crime but also causing damage to the business of the company and damaging the brand name of that company. The organization might be using others trademark to use its market reputation and market stake to enhance its own business without extra efforts. Trademark is the identification mark of any company or organization. A customer relates any trademark with the quality of products and reputation of the company that is using it. It is a distinctive name, word, phrase, symbol, logo, design, image, or a combination of these elements that identifies a product, service or firm that has been legally registered as the property of the firm. Trademarks grant the owner the right to prevent competitors from using similar marks in selling or advertising. So there is a need for more perfect legislation in regard of the protection of Transboundary Reputations of the trademarks.


[1] Faulder & Co. Ltd. v. O & G. Rushton, (1903) 20 RPC 477.

[2] World Wide Brands Inc V. The Assistant Registrar of Trade Marks MIPR 2009 (2) 310

[3] N.R. Dongre v. Whirlpool Corpn.(1996)5SCC714

[4] Cited in the case of, V and S Vin Spirit AB  V. Kullu Valley Mineral Water Co. 2005(30)PTC47(Del)

[5] Mars Incorporated v. Chanda Softy Ice Cream and Others, AIR 2001 Madras 237

[6] Rob Mathys India Pvt. Ltd  V. Synthes Ag Chur 1997 (17) PTC 669 (DB)

[7] The Gillette Company v. A.K. Stationery,2001 PTC 513 (Del)


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