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2000 DIGILAW 547 (MAD)

Messrs Allied Business Solutions Private Limited v. Messrs Avan-Tec Medical Systems Private Limited and Another

2000-06-09

M.KARPAGAVINAYAGAM

body2000
Judgment :- The Judgment was delivered by : M/s. Allied Business Solutions Private Limited, T. Nagar, Chennai, the plaintiff herein has filed a suit in C.S. No. 141 of 2000 against M/s. Avan-Tec Medical Systems (P) Limited, Chepauk, Chennai, the first defendant and Mr. M. Achudhan, Managing Director of the Company, the second defendant, seeking for permanent injunction from infringement of the copyright and trademark "MEDIVIEW" and restraining them from passing off and also for other directions. Pending disposal of the above suit, the applicant/plaintiff has filed three applications, O.A. No. 186 of 2000 seeking for interim injunction in respect of the infringement of the copyright, O.A. No. 187 of 2000 in respect of the trademark and O.A. No. 188 of 2000 in regard to the passing off the said mark, namely, "MEDIVIEW". Out of these three applications, this Court by the order dated 8-3-2000 after hearing the counsel for the applicant/plaintiff and the caveators, the defendants, granted interim injunction only in O.A. No. 188 of 2000 restraining them from passing off their software programmes by using the trademark "MEDIVIEW" and ordered notice in other applications. Thereafter, the counsel for the respondents/defendants filed a common counter in all these applications requesting for the disposal of the same on various grounds. For disposal of these interim applications, the counsel for the parties, on the strength of the various documents filed in their respective typed sets and also by placing reliance on the various decisions of this Court as well as the Apex Court, would argue at length. The case of the plaintiff/applicant in brief is as follows :- "(a) The plaintiff is one of the professional software developers. They have also developed a computer software programme for use in sophisticated medical diagnostic instruments. The plaintiff invested huge amounts for developing this software program. It had adopted a distinctive brand name "MEDIVIEW" for the said software and marketing the same under the said trademark "MEDIVIEW". In the course of time, it has become highly popular in the medical field. Various famous hospitals have installed the said software on being satisfied about its effectiveness. Thus, the plaintiff is the absolute owner of the copyright "MEDIVIEW" with a distinctive trademark, which has acquired high distinctiveness by virtue of its extensive publicity. In the course of time, it has become highly popular in the medical field. Various famous hospitals have installed the said software on being satisfied about its effectiveness. Thus, the plaintiff is the absolute owner of the copyright "MEDIVIEW" with a distinctive trademark, which has acquired high distinctiveness by virtue of its extensive publicity. They have filed application before the Registrar of the Copyrights, New Delhi and also for registration of the trademark under the Trade and Merchandise Marks Act.(b) The second defendant, the Managing Director of the first defendant approached the plaintiff for marketing the above said software program "MEDIVIEW". Ultimately, both of them had entered into an arrangement to market the software program "MEDIVIEW" and the terms, which were agreed upon were reduced into writing in the minutes prepared in a meeting at the office of the plaintiff on 1-9-1999. Under this arrangement, as agreed between the parties, the plaintiff would develop the software and the defendants would market the same, and the plaintiff would be the exclusive proprietor of the copyright and the defendants would place orders for the purchase of the "MEDIVIEW" software with the plaintiff on making advance payments and thereafter, the plaintiff would supply the package in CDs along with HASP KEY as per the price stipulated. Accordingly, the plaintiff supplied "MEDIVIEW" packages on receipt of the orders booked on various dates. On receipt of the cheque for Rs. 25, 000/- on 28-12-1999 on placement of the orders by the defendants, the plaintiff supplied one "MEDIVIEW" software package, the price of which is Rs. 20, 000/-, after adjusting the balance of Rs. 5, 000/- towards the arrears, But the "MEDIVIEW" software package sent through registered post was returned with an endorsement 'refused'. Then, on coming to know that the defendants are attempting to pirate the plaintiff's software package software "MEDIVIEW" and market the same as that of their software, the plaintiff sent a letter on 7-2-2000 cancelling the earlier arrangements and calling upon the defendants to return to the plaintiff the materials entrusted to them. But, this letter also was sent back as 'refused'. But, this letter also was sent back as 'refused'. Furthermore, since the defendants continued to market the pirated versions of the "MEDIVIEW" software packages by adopting the plaintiffs trademark "MEDIVIEW", the plaintiff was constrained to file this suit to stop the infringement of the trademark, copyright and passing off." The case of the defendants/respondents could be summarised as follows :- "(a) The brand name "MEDIVIEW" was derived by the defendants from a German Company, viz., VEPRO Computer System, from whom the first defendant was importing software "Medimage". The defendant selected the trademark "MEDIVIEW" because it has similar features of the "Medimage". The first defendant engaged an artist to design a unique brand name distinctive trademark "MEDIVIEW". The defendants' software is related to medical science. Therefore, the applicant/plaintiff has no right or claim or ownership over the copyright of the 'MEDIVIEW". The software is own idea and special skills and own product of the defendants. As such, the defendants are the absolute owners of the copyright and the package. (b) The defendants have started the software in 1998 itself when they imported "Medimage" software from Germany. The applicant had not adopted the brand name "MEDIVIEW", whereas it is this respondent who adopted the distinctive brand name "MEDIVIEW". The applicant has only programmed the software with the technical know how and knowledge and ideas of the respondents/defendants. The applicant was only a programmer to do job work and collect charges for the work done from the respondents. The respondents designed distinctively the brand name "MEDIVIEW" in line with the "Medimage". As a matter of fact, the respondents/defendants filed an application for registration of the brand name of this trademark on 16-12-1999 and paid necessary charges, whereas the applicant/plaintiff filed necessary application only in January, 2000. (c) The document dated 1-9-1999, the minutes in which the alleged arrangements were made is not admissible in evidence, as the same is not signed. The respondents have not booked any order with the applicant and the amount has been given by the respondents/defendants to the applicant/plaintiff only on the request of the plaintiff in order distribute salary to its programmers. Therefore, the respondents alone are the absolute owners of the trademark "MEDIVIEW", as the trademark "MEDIVIEW" is their own intellectual property. The respondents have not booked any order with the applicant and the amount has been given by the respondents/defendants to the applicant/plaintiff only on the request of the plaintiff in order distribute salary to its programmers. Therefore, the respondents alone are the absolute owners of the trademark "MEDIVIEW", as the trademark "MEDIVIEW" is their own intellectual property. They are not only the owners of the trademark "MEDIVIEW", but also they are now programming the same by appointing qualified programmers in their own company. Under those circumstances, the applicant has no right to stop their business, since they cannot have any authority to claim the trade made, which actually belongs to the defendants. Hence, the applications have to be dismissed. "The point for consideration is, whether the applicant/plaintiff would be entitled to the interim relief sought for in these three applications. The learned counsel for the applicant would cite the following authorities :- (i) Hanfstaengl v. W. H. Smith and Sons 1905 (1) Ch(D) 519; (ii) Donoghue v. Allied Newspapers, Limited, 1938 (1) Ch 106; (iii) Johnson v. George Newnes, Limited, 1894 (3) Ch 663; (iv) Blackwook and Sons v. Parasuraman, 1959 AIR(Madras) 410; (v) M.C. Production v. A. Sundaresan, 1976 AIR(Madras) 22. The learned counsel for the respondents would cite the following authorities :- (i) Ruston and Hornby Ltd. v. Z. Engineering Co., (ii) Century Traders v. Roshan Lal Duggar and Co., 1978 AIR(Delhi) 250; (iii) Prem Singh v. M/s. Ceeam Auto Industries; (iv) Kirloskar Proprietary v. Kirloskar Dimensions. The following are the principles laid down by various Courts in the above decisions :- (A) The action for infringement is a statutory right. In an action for infringement where the defendant's trademark is identical with the plaintiff's mark, the Court need not enquire whether the infringement is such as is likely to deceive or cause confusion. But where the alleged infringement consists of using not the exact mark on the Register, but something similar to it, the test of infringement is the same as in an action for passing off. In other words, the test as to likelihood of confusion or deception arising from similarity of marks is the same both in infringement and passing off actions. In other words, the test as to likelihood of confusion or deception arising from similarity of marks is the same both in infringement and passing off actions. (B) In an action for passing off in order to succeed in getting an interim injunction the plaintiff has to establish user of the mark prior in point of time than the impugned user by the defendants. The registration of the mark or similar mark or filing of an application for registration of the same prior in point of time to user by the parties is irrelevant in an action for passing off.(C) For the purpose of claiming such proprietorship of a mark, it is not necessary that the mark should have been used for considerable length of time. As a matter of fact, a single actual use with intent to continue such use confers a right to such mark as a trademark. (D) The mere presence of the mark in the Registrar does not prove its user at all. It is possible that the mark may have been registered but not used. It is not permissible to draw any inference as to the user to the presence of mark in the Regiser. (E) In order to succeed in an infringement of copyright, or passing off action, a party has to show that he is originator in the sense that the concept emanated from him, and further that the given design or get up or style has become distinctive of his goods to the extent that the trading public associates his goods exclusively with the given design or get up. The moment this is established even prime facie, the Courts have stopped the opposite party, shown to have adopted by imitation or other deceptive means, the design or get up of the first party, from continuing with the mischief, because that is treated to be a rank instance of dishonesty by the second party. (F) In a case where the first party himself is shown to have adopted a trademark or copyright of a third party, then Courts shall resolutely decline to step in aid of this party because honesty of action is the crux of the matter. (F) In a case where the first party himself is shown to have adopted a trademark or copyright of a third party, then Courts shall resolutely decline to step in aid of this party because honesty of action is the crux of the matter. Court's protection is extended only on the principle that damage to a party who has acquired a goodwill or reputation in certain trademark or design or trading style marketing his goods, should not be allowed to be effected by the dishonest user of the same by another. If this first party himself is shown to be guilty of identically wrongful conduct, then it cannot seek indulgence of the Court, particularly at the initial stage, without even going to trial.(G) In order to consider the balance of convenience and the damage, it is necessary to take note of the facts relating to acquiescence, delay and that of confusion that may be created in the minds of the public in order to ascertain the damage that may be caused to the plaintiff. (H) The question of infringement of the copyright depends on the degree of resemblance. It must be solved by taking each of the works to be compared as a whole or determining whether there is no merely a similarity or resemblance in some leading feature or in certain of the details, but whether, keeping in view the idea and general effect created by the original, there is such a degree of similarity as would lead one to say that the alleged infringement is a copy or reproduction of the original or the design - having adopted its essential features and substance. (I) There is no copyright in an idea, or in ideas. A person may have a brilliant idea for a story, or for a picture, or for a play, and one which appears to him to be original; but if he communicates that idea to an author or an artist or a playwright, the production which is the result of the communication of the idea to the author or the artist or the playwright is the copyright of the person who has clothed the idea in form, whether by means of a picture, a play, or a book, and the owner of the idea has no rights in that product. (J) The author of a contribution to a periodical has not parted with his copyright to the proprietor of the said journal. Therefore, his right to sue for infringement would not be taken away, unless it is proved that not only he paid for his services, but also his work had been composed on the terms that the copyright should belong to the proprietor of the journal. In other words, the author is the proprietor unless he has assigned the entire copyright to the proprietor of the journal.(K) An infringement of copyright is in the nature of an invasion of a right to property. Therefore, the intention of the infringer is immaterial provided there is infringement. (L) A reading of the entire provisions of the Copyright Act, 1957 would reveal that there is no indication in any of the provisions of the Act, read individually or as a whole, to suggest that registration is a condition precedent to subsistence of copyright or acquisition of ownership thereof or release for infraction of copyright. In the light of the above well laid principles, if a careful scrutiny is made to the present facts of the case taking into consideration the documents relied upon by the parties and the respective submissions made by the counsel for rival parties, there cannot be any hesitation for this Court to conclude that the plaintiff/applicant has made out a prima facie case for the entitlement of the relief of interim injunction in all these three applications pending disposal of the suit. The reasons are as follows. According to the plaintiff/applicant, they developed software for specific use in medical diagnostic instruments at huge cost and adopted the trademark "MEDIVIEW". They entered into an understanding with the defendants for marketing the software programme "MEDIVIEW" through the minutes of the meeting held at the plaintiff's office on 1-9-1999. However, the defendants are claiming right over the trademark and copyright by stating that they adopted the trade "MEDIVIEW", since the trademark "MEDIVIEW" was derived by them from German Company, viz. VEPRO Computer System from whom the first defendant was importing software "Medimage" and the applicant/plaintiff was only engaged as a job contractor for developing the computer programme and consequently, the plaintiff has only programmed the software with technical know-how and knowledge and ideas of the defendants.In order to substantiate their contention, the plaintiff filed several document. VEPRO Computer System from whom the first defendant was importing software "Medimage" and the applicant/plaintiff was only engaged as a job contractor for developing the computer programme and consequently, the plaintiff has only programmed the software with technical know-how and knowledge and ideas of the defendants.In order to substantiate their contention, the plaintiff filed several document. As per the document, namely, minutes of the meeting prepared on 1-9-1999, the plaintiff and the defendants have agreed for various terms. As per the said understanding, it was agreed between the plaintiff and the defendants that the plaintiff would develop the software "MEDIVIEW" and the same would be marketed through the defendants. It is also specifically agreed that the plaintiff would be the owner of all the proprietary rights in the said product "MEDIVIEW" and whenever the defendants place an order for supply of "MEDIVIEW" software, the price shall be paid to the plaintiff in advance. It is also understood through the minutes that the price fixed to be paid by the defendants to the plaintiff was arrived at Rs. 20, 000/- per "MEDIVIEW" software package. With reference to this document, though it is not specifically denied stating that there is no such arrangement at all, but it is merely stated in the counter that the said document dated 1-9-1999 is not admissible in evidence, as the same is unsigned. But, it is admitted that it is only a nature of proposal. However, it is stated that the said proposal was not agreed by the defendants. This contention on the part of the defendants is quite unfortunate. The document dated 3-9-1999 would clearly show that the minutes dated 1-9-1999 have been conveyed to the defendants. After this arrangement was over, on 12-10-1999 the plaintiff wrote a letter to the defendants enclosing 4 Nos. Hasps Keys for Demo purposes. That part, the letter dated 15-10-1999 from the defendants to the plaintiff acknowledging the Demo Hasps. This letter also confirms the understanding between the parties that there shall be differences in the future for black and white and colour scanners.Moreover, the orders placed by the defendants through the letters dated 1-11-1999 and 11-11-1999; the letter dated 17-11-1999 from the plaintiff to the defendants asking for advance payment against the order dated 11-11-1999; the letter dated 27-11-1999 sent by the plaintiff to the defendants for supplying the software "MEDIVIEW" to Dr. Suresh; the letter dated 29-11-1999 from the plaintiff to the defendants; the letter dated 30-11-1999 sent by the defendants to the plaintiff confirming the receipt of 6 Nos. "MEDIVIEW" packages; the letter dated 6-12-1999 from the plaintiff to the defendants confirming the modified terms of the agreement relating to payment for the prices of the packages; the letters dated 8-12-1999 and 20-12-1999 by the defendants placing orders with the plaintiff for supply of "MEDIVIEW" package and Delivery Note dated 23-12-1999 for the supply of "MEDIVIEW", all would clearly show that the terms of the arrangement mentioned in the minutes drafted on 1-9-1999 at the Office of the plaintiff have been acted upon by both the parties without any dispute. On the other hand, there is no document produced by the defendants to indicate that the terms of the arrangement as mentioned in the minutes dated 1-9-1999 were only proposals, but they were not agreed upon or acted upon. As noted above, the case of the defendants is that they derived the brand name "MEDIVIEW" from a German Company from whom the first defendant was importing software "MEDIVIEW" and they selected the trademark "MEDIVIEW" because it has similar features of the "Medimage", which is also one of the software imported by these defendants. This submission is quite misleading. There is nothing to indicate that the "MEDIVIEW" has got similar features of the "Medimage". The documents filed by the defendants would show that a certificate has been issued by the German Company to the first defendant that it has been qualified as an authorised Med Image distributor. The documents filed by the defendants dated 8-6-1998, 10-6-1998, 17-6-1998, 17-11-1998, 25-1-1998 and 7-6-1999, all would relate to the purchase orders for the supply of" Med Image and not "Medimage".It cannot be debated that the defendants placed purchase orders for the supply of "MEDIVIEW" with the plaintiff from 1-11-1999 till 20-12-1999. The various orders placed by the defendants with the plaintiff on various dates would clearly show that they placed orders for the supply of "MEDIVIEW" from the plaintiff. Therefore, it is preposterous to contend that the first defendant engaged an artist to design a unique brand name distinctive trademark, with specific colours on the words "MEDIVIEW". The various orders placed by the defendants with the plaintiff on various dates would clearly show that they placed orders for the supply of "MEDIVIEW" from the plaintiff. Therefore, it is preposterous to contend that the first defendant engaged an artist to design a unique brand name distinctive trademark, with specific colours on the words "MEDIVIEW". It is quite clear that under the garb of the certificate issued by the German Company qualifying the first defendant a distributor for the Med Image, the defendants have not only infringed the copyright and trademark of the plaintiff but also tried to mislead this Court in order to see that the plaintiff would not get interim relief which they are entitled. There is yet another aspect of the matter. On 19-1-2000, the plaintiff filed an application for registration of the trademark "MEDIVIEW" under No. 898768. On 4-2-2000 the plaintiff filed an application for registration of the copyright. On the other hand, the defendants have filed some documents to show that they have filed an application before the Trademark Registry for registration of the trademark "MEDIVIEW" on 16-12-1999. The document No. 5 filed in the additional typed set by the defendants is the copy of the application dated 25-11-1999 made to the Trademark Registry for registration of the trade "MEDIVIEW". In this application, it has been specifically stated that the trademark "MEDIVIEW" has been used only from 18-11-1999. If it is so, the contention raised in the counter that the applicant/plaintiff had only programmed the software with technical know-how and knowledge of the defendants and collected the charges for the piece, is nothing but tissue of falsehood. According to the defendants in the counter, the word 'order' used in the relevant records must be taken to mean in a different context in the sense that it is only advance for the charges and it cannot be taken to mean that it is a purchase order. If this is true, they ought to have mentioned in the application for registration dated 25-11-1999 that they have been using the trademark even from 1-1-1999 on which the date, the minutes of understanding was drafted or at least from 15-10-1999 when the second defendant confirms the understanding between the parties in regard to the trademark "MEDIVIEW". But unfortunately, the defendants mentioned in the application for registration as if they have been using from 18-11-1999. But unfortunately, the defendants mentioned in the application for registration as if they have been using from 18-11-1999. Thus, it is clear that even after applications dated 25-11-1999 and 16-12-1999 before the Trademark Registry, the defendants placed orders on 20-12-1999 for the supply of 3 "MEDIVIEW" with the plaintiff. These things would show that the defendants have not only failed to prove their case but also have not come out with clean hands.Apart from the above documents, the document filed by the plaintiff dated 7-2-2000 is also an important one. This is the letter sent by the plaintiff to the defendants informing them that the marketing arrangement with the first defendant for marketing "MEDIVIEW" package stands cancelled and demanding to hand over 4 Nos. "MEDIVIEW" given for Demo purposes. Both the registered post cover and certificate of posting cover have been returned on 9-12-2000 with an endorsement 'refused'. There is no reason given by the defendants as to why these letters have been sent back by making the endorsement 'refused'. The reason is obvious. Even while placing orders, the defendants wanted to infringe the trademark and copyright of the plaintiff by filing application before the Trademark Registry in November and December 1999 and began to advertise in the Newspapers that they are the authors of "MEDIVIEW" software programme. Under those circumstances, in the absence of any document filed by the defendants to show that the trademark "MEDIVIEW" has been used by the defendants even prior to the use of the trademark by the plaintiff, the defendants have no authority to use the trademark or copyright and to pass off the goods, especially when the plaintiff has been using "MEDIVIEW", in the light of the documents which would reveal that the applicant/plaintiff after developing the subject computer programme has adopted a distinctive trademark "MEDIVIEW" combining the two words 'Medical' and 'View' taking into consideration of the application of the software in ultra sound scanners, colour Doppler, etc. Besides holding that the defendants have placed purchase orders with the plaintiff endorsing that he is the author and owner of the trademark and copyright of "MEDIVIEW" with distinctive mark, it shall be held that the contention that the brand name "MEDIVIEW" has been derived by the defendants from "Medimage" from German Company from whom the first defendant was importing software programme, is totally to be rejected, inasmuch as "MEDIVIEW" is entirely different from the word "Medimage". It shall also be noticed that actually it is not "Medimage", but the German company has qualified the first defendant to be the distributor for the "Med Image" and not for "Medimage".In view of the above discussion, none of the contentions urged by the counsel for the defendants would deserve any consideration and the same are liable to be rejected. Consequently, as stated above, this Court is inclined to hold that the plaintiff through documents has established a prima facie case and the balance of convenience in its favour to grant interim injunction. In the result, all the three applications are allowed.