The Delhi High Court in its judgment dated August 16, 2023, embarked on a comprehensive examination of the trademark dispute involving Sun Pharma Laboratories Ltd. and Finecure Pharmaceuticals. The critical issue under scrutiny was whether the defendants' use of the trademark "PANTOPACID" constituted an infringement of the plaintiff's registered trademark "PANTOCID". The judgment not only explored the trademark's infringement aspect but also delved deeply into the legality of the plaintiff's registration. The court's decision explained multifaceted aspects of trademark law, including the nuanced relationship between validity and infringement, along with the issue of suppression, concealment, and misrepresentation.
Issue of Infringement
Regarding the issue of infringement, the court identified two key questions:
- Does the defendants' "PANTOPACID" mark infringe the plaintiff's "PANTOCID" mark?
- If infringement is established, is the plaintiff entitled to interlocutory injunctive relief against the defendant?
Validity of Trademark Registration
The court examined the relationship between Sections 28(1) and 29 of the Trade Marks Act. It emphasized that the entitlement to relief against infringement is conditioned upon the validity of the registered trademark. While Section 29 focuses on infringement, Section 28(1) requires a valid registration for claiming relief against infringement. The court clarified that the existence of a valid registration is essential for both the right to claim exclusivity and the right to obtain relief against infringement.
The court acknowledged that trademark registration is prima facie evidence of its validity, as outlined in Section 31(1) of the Trade Marks Act. However, this presumption is not absolute; it merely indicates that the registration is prima facie valid and shifts the burden to the opposing party to present evidence to the contrary. The plaintiff, at the interlocutory stage, is tasked with establishing a prima facie case, benefiting from the presumption of validity. If the defendant seeks to undermine this presumption, a more robust case is required to shift the initial benefit.
In the case, a formidable challenge emerged as the plaintiff's registration of "PANTOCID" faced scrutiny under Section 11 of the Trade Marks Act. The defendant argued that the plaintiff's mark cannot stand due to the existence of the earlier registered "PANTOCID" mark by a third party Takeda. Section 11(1)(a) specifically bars registration if there exists a likelihood of confusion from identity with an earlier trademark.
The plaintiff attempted to invoke the 'special circumstances' clause under Section 12 to rescue their registration. However, the court asserted that this clause, usually a remedy for certain exceptional cases, does not apply in the plaintiff's scenario.
The court delved into the concept of "honest concurrent use" and emphasized that it must be pleaded and proven. Further, the "special circumstances" provision is not unbridled and is circumscribed by Section 11(4) which mandates consent from the earlier mark's proprietor. The plaintiff's reliance on a past order and affidavits to validate the registration failed to sway the court's analysis.
Prima Facie Case for Infringement
The court analysed whether "PANTOPACID" infringed the plaintiff's "PANTOCID" mark based on Section 29(2)(b) of the Trade Marks Act. It found that the cumulative conditions for infringement were satisfied, including phonetic similarity, similarity of goods, and likelihood of confusion or association. The court dismissed arguments related to potential differences in distribution channels, as they did not eliminate the likelihood of confusion.
The Confluence of Validity and Infringement
The case clarifies that while the issue of validity is not directly relevant in the context of infringement under Section 29, it becomes crucial when seeking relief under Section 28(1) against proven infringement. In other words, a plaintiff's successful demonstration of infringement is insufficient on its own; the registration's validity is a precondition to securing relief against the infringement.
The court's analysis underscores the necessity for the plaintiff to respond effectively if the defendant mounts a substantive challenge to the registration's validity. Successfully defending the validity of the registration is paramount to obtaining relief, even in the presence of proven infringement.
Effect of Prefix "PANTO" and "Special Circumstances"
The court addressed the impact of the common prefix "PANTO" on the plaintiff's exclusivity claim. It explained that while the prefix might not be individually registered, deceptive similarity persisted when considering the whole marks.
Suppression and Concealment
The court noted issues of concealment and suppression by the plaintiff. It pointed out the plaintiff's failure to disclose Takeda's earlier application for the same mark and the plaintiff's own opposition to the defendants' application for registration. The court held that such behaviour disentitled the plaintiff to injunctive relief.
Conclusion
The court concluded that the plaintiff had not established its entitlement to relief against infringement by the defendants. The application for interlocutory injunction was rejected. Instead, the defendants were directed to maintain accounts of earnings from the use of the "PANTOPACID" mark and submit periodic statements to the court. The court's analysis highlighted the intricate relationship between trademark infringement and validity, asserting that the latter is pivotal to claiming relief against infringement.
However, the judgment appears to remain silent regarding the passing-off action. Although the judgment acknowledges that the plaintiff' did not present any arguments concerning passing off, it is noteworthy that the plaintiff had raised such allegations. The court did indicate its intention to address the passing off issue; nonetheless, no conclusive determinations were reached regarding passing off. Furthermore, the court refrained from deciding how the plaintiff's registration was prima facie illegal, fraudulent, or so shocking to the court's conscience as to deny an injunction. It's essential to note that the court retains the authority to deny granting an injunction based on these grounds; however, establishing such claims necessitates a very high threshold of prima facie proof as held by the Full Bench of the Bombay High Court in the case of Lupin Ltd. v Johnson and Johnson and Shakti Bhog Foods Ltd. v Parle Products Pvt. Ltd. In the present case, the plaintiff's application for registration did succeed on technical grounds after an opposition filed by an earlier proprietor Takeda. Consequently, the judgment did not delve into the aspect of whether the plaintiff's registration could be deemed prima facie illegal and fraudulent.
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