India: Delhi HC On Domain Name And Anti-Injunction Suit

A. FACTS

In the present case, HT Media Ltd. (hereinafter the "Plaintiff No. 1") is engaged in the business of print media, radio, internet, etc. and is one of the foremost media houses in India with its leading English publication 'Hindustan Times'. Plaintiff No. 2 is a Subsidiary of Plaintiff No.1 and is also engaged in the business of print media with its Hindi leading publication 'Hindustan'. Plaintiff Nos. 1 and 2 belong to 'Hindustan Times' Group.

Plaintiff is a registered proprietor of the trademarks 'Hindustan' and 'Hindustan Times' in India and enjoys both statutory rights under the Trade Marks Act, 1999 (hereinafter "the Act") as well as rights under the common law, arising from goodwill and reputation with respect to the Trademarks.

The Plaintiff submits that the trademarks have been continuously and uninterruptedly used by the Plaintiffs and its Group/Subsidiaries, since 1920s and 1930s, respectively and form an essential and dominant part of the corporate name of the 'Hindustan Times' Group.

It was further submitted that Brainlink International Inc. (hereinafter "the Defendant No.1") is a New York based Corporation and claims to be engaged in the business of providing IT related support services to its customers. As per the website of Defendant No. 1 (www.brainlink.com), Defendant No. 2 is the co-founder of Defendant No.1 and key person in the decision-making activities of Defendant No.1. Also the Defendant No.1 is the registrant/owner of the Domain name www.hindustan.com.

Additionally it was submitted that the Defendants are infringing and cybersquatting, in violation of the Plaintiffs' Trademark rights in their Marks 'Hindustan' and 'Hindustan Times'. In view thereof, the Plaintiffs had issued a cease and desist Notice dated 24.12.2019 to the Defendants to acquire the Domain name but the Defendants quoted an exorbitant amount of US $ 3 million in the reply dated 14.02.2020 to sell the Domain name. When the Plaintiffs responded on 02.03.2020 with a counter offer, the Defendants clandestinely filed a Declaratory Suit for non-infringement against the Plaintiffs in the United States District Court for the Eastern District of New York, around 09.03.2020.

It is imperative to note that the Defendants had launched the website to provide 'daily news content relating to Indian - American interests, stock-market reports from India and America and interactive polls daily on Indian - American issues'. Furthermore, the Defendants have no use for the Domain name other than to profit from squatting on the same.

The Defendants had acquired the impugned domain name in the year 1996 in bad faith to ride upon the goodwill and reputation of the Plaintiffs' publications. Thus, use by the Defendants, without any authorisation/license/consent from the Plaintiffs amounts to Trademark infringement under Section 29 of the Act and passive holding of the Domain name amounts to Passing Off and unfair competition of the Plaintiffs' Trademarks.

Therefore, the Plaintiffs approached the Hon'ble Delhi High Court to restrain the proceedings of a Foreign Court by an anti-suit injunction as Defendants are amenable to the personal jurisdiction of this Court and are further willing to sell the domain name to the Plaintiffs.

B. ISSUES FOR CONSIDERATION

1. Whether the High Court in the present case has the jurisdiction to restrain the proceedings of a Foreign Court by an anti-suit injunction?

2. Whether the Plaintiff is entitled to permanent injunction against the Defendants from instituting or filing any other suit/applications/proceedings in any Court of Law in relation to the impugned Domain name or any issue which forms the subject matter of the present Suit.

C. DISCUSSIONS AND FINDINGS

With regard to issue in hand, the Court relied on Modi Entertainment Network & Another v. W.S.G. Cricket Pte. Ltd., (2003) 4 SCC 341 wherein principles have been laid down in case of grant of anti-injunction suit as under:

"31.) ....... 24. From the above discussion, the following principles emerge:

(1) In exercising discretion to grant an anti-suit injunction the court must be satisfied of the following aspects:

(a) the defendant, against whom injunction is sought, is amenable to the personal jurisdiction of the court;

(b) if the injunction is declined, the ends of justice will be defeated and injustice will be perpetuated; and

(c) the principle of comity - respect for the court in which the commencement or continuance of action/proceeding is sought to be restrained - must be borne in mind.

(2) In a case where more forums than one are available, the court in exercise of its discretion to grant anti-suit injunction will examine as to which is the appropriate forum (forum conveniens) having regard to the convenience of the parties and may grant anti-suit injunction in regard to proceedings which are oppressive or vexatious or in a forum non-conveniens.

............

(7) The burden of establishing that the forum of choice is a forum non-conveniens or the proceedings therein are oppressive or vexatious would be on the party so contending to aver and prove the same.

On perusal of the decision of the Supreme Court, the Court had to examine whether the Defendant was amenable to personal jurisdiction of the Court, whether injustice would be caused to the Plaintiff if the injunction was refused and which would be the Forum Conveniens, in case there were more than one Forum available to the Plaintiff.

In view thereof, the Court observed:

"33.) In the case of India TV, Independent News Service Pvt. Ltd. v. India Broadcast Live LLC & Ors., 2007 SCC OnLine Del 960, the Court was examining a similar issue regarding Passing Off a Domain name by a foreign Defendant and stayed the proceedings instituted by the Defendants before the Arizona District Court on the ground that the damage to the Plaintiff's goodwill and reputation would be in India, as the Plaintiff's News Channel was broadcasted for Indian audiences....."

"34.) The Court further observed that usually there are three tests which are repeatedly employed by the Courts to make the determination and which are:

(a) defendant purposefully availed himself of acting in the Forum State or causing a consequence in the Forum State;

(b) cause of action must arise from the defendants activities there;

(c) the acts of the defendant or consequences caused by the defendant must have a substantial enough connection with the forum to make exercise of jurisdiction over the defendant reasonable."

Therefore, the Court held that it is evident from the complaint filed by the Defendant in USA, that the Defendant had not used the Domain name www.hindustan.com since 2000. Thus, it is crystal clear that the sole motive of the Defendants for getting the impugned domain name registered was only to exploit the goodwill of the Plaintiff and set a classic example of cybersquatting.

The Court further observed that:

"39.) ..... Mere passive holding of the Domain name, without any use, evinces bad faith of the Defendants under Clause 4 of the Uniform Dispute Resolution Policy (UDRP), as held in the case of Mr. Arun Jaitley (supra), relevant para of which reads as under:

"40. In the present case, as I have already come to the conclusion that the name ARUN JAITLEY is a well-known name, the use of the same without any reason by the defendants as a Domain name and keeping in possession the said Domain without sufficient cause is violative of the ICANN policy and can be safely held to be a bad faith registration."

Thus, the Court emphasized bad faith on the part of the Defendants when the Plaintiffs approached the Defendants to buy the domain name and exorbitant price was quoted against such offer. Further, the Court stressed on the conduct of the Defendants in quoting an exorbitant amount to sell the impugned Domain name to a Trademark owner or to a third party, is evidence of bad faith, as also held by this Court in Acqua Minerals Ltd. v. Pramod Borse and Anr.

In light of the facts in question, the Court opined that allowing access to the Defendant's website will lead to erosion of the reputation and goodwill of the Plaintiff and weaken the value and strength of their trademarks.

Further, the Court held that a substantial and integral part of the cause of action in terms of Section 20(c) of Code of Civil Procedure, 1908 had arisen well within the jurisdiction of the Court and looking at the case as set out by the Plaintiff, it prima facie also had personal jurisdiction over the Defendants.

Thus, on the aforementioned, the Court concluded that the suit before the Easter District New York is vexatious and oppressive as the Plaintiffs had never asserted trademark rights in United States. Further, due to bad faith and ill conduct of the Defendants, Plaintiffs goodwill will be spoiled globally.

Therefore, the Court held that the Plaintiffs have made out a prima facie case for grant of an anti-injunction suit and restrained the Defendants from proceedings further before the US District Court or any other Court of Law or Authority with regard to the subject matter of the present suit until the next date of hearing i.e. 29.05.2020.

D. ANALYSIS

The Court, in the present case, had appropriately restrained the Suit filed by the Defendant before the Eastern District of New York on the ground of being vexatious and oppressive. Further the Court rightly considered that Domain name is akin to a Trademark.

In the present case, the Court emphasized that though the website of the Defendants may have been passive for a long time but there is every possibility that the users who may not be familiar with the exact web address of the Plaintiffs' Websites or even otherwise, accidentally, may enter into the address toolbar of their Internet Browser, the URL www.hindustan.com and will automatically be taken to the Website of the Defendants and would be confused into thinking that the plaintiffs have taken down their Websites.

In today's world of competition, internet users would automatically be diverted by search engines to websites with identical or similar names, which can be accessed far easily. This would lead to erosion of the reputation and goodwill of the Plaintiffs and weakening of the value and strength of their Trademarks, amounting to dilution and certainly loss of business.

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