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2001 DIGILAW 830 (KAR)

Betco Enterprises v. Pradhan Perfumers

2001-11-09

K.SREEDHAR RAO

body2001
JUDEMENT K. Sreedhar Rao, J.—The name of lyrical Saint Sri Annamayya who lived in 16th Century in Andhra Pradesh a proponent of metaphysical philosophy through the devotional songs in praise of Sri Lord Venkateshwara has become a subject matter of controversy for mundane materialistic right of trade mark. 2. For convenient reference, the ranking and description of the parties is described in the manner done in the suit. 3. The appellant in Regular First Appeal No. 106 of 2001 is the Plaintiff in O.S. No. 3025 of 1998 filed a suit seeking permanent injunction against the Respondent-Defendant in this appeal from wrongfully manufacturing or selling or dealing with the goods under the trade mark "Annamayya" Agarabathi Two-in-one with or without the motion picture still of Akkineni Nagarjuna, a film actor and also seek mandatory injunction directing the Defendant to deliver the infringing lables, cartons, blocks etc. deceptively carrying on the trade mark of the Plaintiff. The Respondent in the appeal is the Defendant. 4. The Plaintiff is a registered firm under the name and style M/s. Betco Enterprises doing the business in manufacturing and sale of Agarabathis (scented sticks) and in the course of business, the Plaintiff has marketed several brands of Agarabathis with different trade marks. The "Annamayya" brand is one such produce marketed by the Plaintiff since 1993 with wide publicity in visual and print media. The packing cover of Annamayya Agarabathis display the name "Annamayya" in Telugu, Tamil, English, Hindi language carrying on the picture of Lord Venkateshwara and of Saint Annamayya on the one side. It is said that the Plaintiff since the year 1993 cultivated the market for the Annamayya brand of Agarabathi in the States of Andhra Pradesh, Karnataka and Tamil Nadu and in the year 1996 the Plaintiff entered into an agreement with a film producer v. Doreswamy Raju and with his permission the film still picture of Akkineni Nagarjuna (a Telugu film actor who had played the role of Annamayya in a Telugu film) was added on the packing cover as result of which the sales of the product picked up quite fast and by the time of filing of the suit, the annual turnover of the product was around 1 crore 13 lakhs and odd. It is said that Defendant also started marketing their agarabathis under the name "Acharya Annamayya deceptively similar to the trade mark of the Plaintiff by plagiarizing the phonetical word and the pictorial lable marks of the Plaintiff, therefore filed the suit restraining the Defendant from passing off his products deceptively. 5. The Defendant contested the suit denying the infringement of the trade mark and contends that the visual appearance of the Defendant product is distinct both phonetically and pictorially. It is contended that the Annamayya agarabathis had no distinct popularity in the market until the products came to be sold with the picture still of Akkineni Nagarjuna on the packing cover. Every bit and piece of the contentions of the Plaintiff is stoutly denied by the Defendant. 6. The trial Court on the consideration of the oral and documentary evidence partially decreed the suit injuncting the Defendant from marketing its product with the motion picture still of Akkineni Nagarjuna. However held that the Defendant is entitled to use the word "Acharya Annamayya" for its product. Being aggrieved by the judgment and decree, the Plaintiff has filed this appeal. 7. The Defendant has filed a counter appeal in Regular First Appeal No. 175 of 2001 for the decree granted against him. Hence, both the appeals are heard together for passing the common order. 8. Interestingly and enlightening arguments were canvassed by the Counsel for both the parties relying on plethora of citations dealing with the fascinating development of the law on the subject including the latest pronouncements of the Supreme Court laying down the authoritative to precedent on the concept of the passing off action and the infringement of trade mark. I find it is not very necessary that all the citations relied on by the Counsel needs to be referred in detail. However to the extent relevant and germane for consideration, the principles of law laid down are considered and discussed. 9. The trial Court on the disputed facts and materials takes a view that the word "Annamayya" is a generic name and the prefix Acharya to the word "Annamayya" makes it dissimilar phonetically by word and style as such not an objectionable act to constitute the passing off. However finds that user of the picture still of Akkineni Nagarjuna on the packing covers of the product of the Defendant held to be objectionable tantamounts to passing off. However finds that user of the picture still of Akkineni Nagarjuna on the packing covers of the product of the Defendant held to be objectionable tantamounts to passing off. Accordingly, after such an order it is said that the Defendant has amended his version of the lable on the cartons removing the picture stills of Akkineni Nagarjuna by replacing with the picture of an anonymous in a saintly get up. 10. The Counsel for the appellant strenuously contended that the view of the trial Court that the word "Annamayya" is a generic name and cannot be a subject matter of trade mark is untenable by relying on the ruling of the Madras High Court in The Andhra Perfumery Works Joint Family Concerns Vs. Krupakula Suryanarayanaiah and Ors. AIR 1969 SC 126 wherein the concept of publici juris and the right of trade mark over legendary name like Lord Ganesha was under judicial scrutiny. In the said case dispute was raised that device of Lord Ganesha and the use of the word Ganesha to the agarabathi product was untenable and cannot be a subject matter of trade mark. The Madras High Court with reference to the plethora of citations of the Supreme Court and of the English Courts held that the any word or name could as well acquire the legal status of a trade mark in relation to the nature of product and its proprietor and the user and further observed that trade mark would become publici juris when allowed to be used by others without demur and if such user becomes so wide and universal the trade mark loses its distinct character and legal incidences and thus become publici juris. In the said case, while hearing the objections, the Registrar of trade marks received the affidavits of several Respondents regarding the user of word Ganesha for their products and also perused the books of account. The Registrar on scrutiny found that the opposing Respondents failed to furnish clear and categorical accounts relating to their product and there was no document to indicate the extent and volume of the sales of their product with the trade mark Ganesha. It was also found that there was no material to show that the opposing Respondents had made any advertisements of their products. In the absence of such evidence, the registration of the trade mark was granted. It was also found that there was no material to show that the opposing Respondents had made any advertisements of their products. In the absence of such evidence, the registration of the trade mark was granted. The said aspects were also taken note of by the Madras High Court and finally affirmed the registration of trade mark with the following observations in para 28 of the judgment. 28. Before leaving these appeals, we may refer to one argument, that the word "Ganesh" applies to the Lord Ganesha who is the deity of auspicious commencement of all undertakings in Hinduism, and hence, that it would be wrong to create a monopoly in respect of such at term, for one particular proprietor. But it was never pretended that the word "Ganesha" cannot become distinctive for Respondent firm's Agarabathis, or that it is not registrable. We need only observe, without proceeding further into this aspect and leaving the issue quite open, that there are several other names of the deity (Vigneswara, Vinayaka etc.) which could not be appropriately used by persons, desiring to associate their goods with the favour of the deity, if the Mark and device, which are thus invented, do not otherwise infringe any prior registered device under the Trade Mark Law. "From the ratio laid down in the judgment it is clear that any word including a noun or the names of any God or Goddess also become the subject matter of trade mark provided it acquired distinctive commercial properties to serve to identify the product and its manufacturer in relation to the common user. The Counsel for the appellant also relied on the ruling of this Court in Mangalore R.K. Beedies Vs. Mohammed Hanif ILR 1994 Kar 2393. In the later portion of para 18, it is held thus: There is admittedly a clear gap of four years between the time of Plaintiff commencing the marketing of goods with their respective trade mark and name. No particular period of user can be mentioned as a minimum period for giving a cause of action in a passing off action except to say that the period should be sufficient to create an awareness in the minds of the public that the goods marketed with the trade name and mark of the Plaintiff were that of the Plaintiff. No particular period of user can be mentioned as a minimum period for giving a cause of action in a passing off action except to say that the period should be sufficient to create an awareness in the minds of the public that the goods marketed with the trade name and mark of the Plaintiff were that of the Plaintiff. Having regard to the nature of product, areas where they are marketed and the section of society using the goods, we can safely conclude that a period of four years is sufficient to establish the link between the Plaintiff and their trade mark ad name, in the minds of the public. To contend that there is no minimum period as such prescribed in law even though it may be a shorter period when there is substantial evidence to show that awareness of the product has been created in the minds of the people, it is sufficient to acquire the legal character of trade mark. The Counsel also relied on the ruling of this Court in Sushil Vasudev Vs. Kwality Frozen Foods Pvt. Ltd., ILR (1993) KAR 1222 wherein in para 16 it is held thus: It is well settled that where the Plaintiff's trade mark is not registered at the relevant point of time of user, it is the prior use which would determine the rights claimed by contesting parties. Thus the Plaintiff has to show (prima facie establish for grant of interim injunction) user of the mark prior in point of time to the impugned user by the Defendant. The registration of the said mark or similar mark prior in point of time to user by the Plaintiff is irrelevant, in an action for passing off and the mere presence of the mark in the Register maintained by the Trade Mark Registry does not prove its user by the person in whose name the mark is registered, and is irrelevant for the purpose of deciding the application for injunction. The Counsel also relied on the ruling of the Bombay High Court in Consolidated Foods Corporation Vs. Brandon and Company Private Ltd., AIR 1965 Bom 35 . In the portion of para 27 it is held thus: I, therefore, agree with the learned Advocate General that all that the Trade Marks Act has done is to facilitate the mode of proof. Brandon and Company Private Ltd., AIR 1965 Bom 35 . In the portion of para 27 it is held thus: I, therefore, agree with the learned Advocate General that all that the Trade Marks Act has done is to facilitate the mode of proof. Instead of compelling the holder of a trade mark in every case to prove his proprietary right before he could ask the Court to grant him an injunction, the Trade Marks Act provides a procedure whereby registering his trade mark the owner gets certain facilities in the mode of proving his title. For instance, under Section 23 of the Trade Marks Act registration is to be prima facie evidence of the validity of the trade mark. This was precisely the view which was expressed by Lord Justice Romer in (1905) I KB 592 to which I have already referred in the earlier part of the judgment. To summarise, therefore, trader acquires a right of property in a distinctive mark merely by using it upon or in connection with his goods irrespective of the length of such user and the extent of his trade. The trader who adopts such a mark is entitled to protection directly the article having assumed a vendible character is launched upon the market. As between two competitors who are each desirous of adopting such a mark "it is, to use familiar language, entirely a question of who gets there first: (Gaw Kan Lye v. Saw Kyone Saing AIR 1939 Rang 343 . Registration under the statute does not confer any new right to the mark claimed or any greater right than what already existed at common law and at equity without registration. It does, however, facilitate a remedy which may be enforced and obtained throughout the State and it established the record of facts affecting the right to the mark. Registration itself does not create a trade mark. The trade mark exists independently of the registration which merely affords further protection under the Statute. Common law rights are left wholly unaffected. Priority in adoption and use of a trade mark is superior to priority in registration. Relying on the said observation contended that this Court has approved the view that the prior use alone is a decisive test to confer trade mark right. The Counsel for the appellant relied on the ruling of the Supreme Court in Cadela Health Care Limited Vs. Relying on the said observation contended that this Court has approved the view that the prior use alone is a decisive test to confer trade mark right. The Counsel for the appellant relied on the ruling of the Supreme Court in Cadela Health Care Limited Vs. Cadila Pharmaceuticals Limited, AIR 2001 SCW 1411 wherein the relevant tests and guidelines are relied on thus: 35. Broadly stated in an action for passing off on the basis of unregistered trade mark generally for deciding the question of deceptive similarity the following factors to be considered: a) The nature of the marks i.e. whether the marks are word marks or label marks or composite marks, i.e. both words and label works. b) The degree of resembleness between the marks, phonetically similar and hence similar in idea. c) The nature of the goods in respect of which they are used as trade marks. d) The similarity in the nature, character and performance of the goods of the rival traders. e) The class of purchasers who are likely to buy the goods bearing the marks they require, on their education and intelligence and a degree of care they are likely to exercise in purchasing and/or using the goods. f) The mode of purchasing the goods or placing orders for the goods and g) Any other surrounding circumstances which may be relevant in the extent of dissimilarity between the competing marks. Weightage to be given to each of the aforesaid factors depends upon facts of each case and the same weightage cannot be given to each factor in every case. In the said case, it is also held that the ratio of the Supreme Court in Dyechem's case AIR 2000 SCW 2172 popularly call 'picnic case, is over ruled rejecting the test of dissimilarities as a criteria. 11. The Counsel for the Respondents relied on the decisions referred to by the appellant, however on facts made an attempt to distinguish that the label mark used by the Respondent do not constitute an infringement and they are distinct. The relevant excerpts of the treatise of Kerley on Law of Trade Marks and Trade Names in his treatise 13th Edition are cited to bring home the point that the prior user alone cannot be a decisive and a predominant factor to confer legal status of a trade mark. The relevant excerpts of the treatise of Kerley on Law of Trade Marks and Trade Names in his treatise 13th Edition are cited to bring home the point that the prior user alone cannot be a decisive and a predominant factor to confer legal status of a trade mark. The said observations are extracted hereunder are at page 185 paras 7.117 and 7.118. Primary and Secondary marks: Potentially, this is a problem which faces any trader who claims that there is more than one badge of origin for his product or service. The trader has a primary mark which the public sees as a badge of origin. However, the trader wishes to establish a secondary mark as an additional badge of origin. Whether he succeeds obviously depends on the facts. The potential problem is avoided if, for example, the secondary mark has an inherent distinctive character of its own, particularly if such a mark joins a group of other secondary marks on a range of products all sold under a recognised house mark. However, the problem facts any trader who adopts as his secondary mark a descriptive or laudatory word, some feature of the goods or their get up which is seen as decorative or, worse, functional. The problem inherent in the mark itself is then compounded by being used in conjunction with a distinctive mark. Here, the trader faces a dilemma. He does not want to remove his primary distinctive mark from the product altogether, for fear that the public would then be unable to identify the origin of the product. On the other hand, he must reduce the public's reliance on the primary mark and attempt to increase recognition and hence reliance on the secondary mark or feature of the product. This exercise is very difficult to do on the product itself, but is much easier to achieve in advertising where a campaign emphasises the secondary mark to the public. In time, the advertising may even drop the primary mark, indicating a degree of confidence on the part of the trader in the ability of his secondary mark to distinguish. 12. In the book the learned Author at page 188 makes the following observations. Mere evidence of use: 7.24 There has been a tendency for applicants seeking to demonstrate distinctiveness acquired through use, to rely on financial evidence of turnover and advertising expenditure. 12. In the book the learned Author at page 188 makes the following observations. Mere evidence of use: 7.24 There has been a tendency for applicants seeking to demonstrate distinctiveness acquired through use, to rely on financial evidence of turnover and advertising expenditure. This tenancy may have been encouraged by the standard form of evidence of use which has been part of the Registry Work Manual for some years. The apparent concentration on turn over and advertising expenditure may obscure the fact that what is required is evidence of distinctiveness and not evidence of use. This type of financial evidence is a necessary part of any attempt to prove acquired distinctiveness, but it cannot do the job by itself. As Jacob J. has said: Mere evidence of use of a highly descriptive or laudatory word will not suffice, without more, to prove that it is distinctive of one particular trader is taken by the public as a badge of origin. This is all the more so when the use has been accompanied by what is undoubtedly a distinctive and well-recognised trade mark". British Sugar (1996) R.P.C. 281 and, later in the same judgment: I have already described the evidence used to support the original registration. It was really no more than evidence of use. Now it is all too easy to be beguiled by such evidence. There is an unspoken and illogical assumption that "use equals distinctiveness". The illogicality can be seen from an example: no matter how much use a manufacturer made of the word "soap" as a purported trade mark for soap the word would not be distinctive of his goods: 7.125 To similar effect, Morritt L.J. in Bach Flower Remedies: First, use of a mark does to prove that the mark is distinctive. Increased use, of itself, does not do so either. The use and increased use must be in a distinctive sense to have any materiality. (2000) RPC 513 . This is the point. It is necessary to combine evidence of the scale of use provided by financial information with evidence that the use has been so as to distinguish on the product, in relation to the service, in advertising or promotion. Sometimes the way in which the mark is presented to the public indicates whether the owner really trusts the mark to function as a trade mark. 13. Sometimes the way in which the mark is presented to the public indicates whether the owner really trusts the mark to function as a trade mark. 13. In the instant case, the contention of the Plaintiff that there are two essential features of his trade mark consisting of word Annamayya with the phonetic value coupled with pictorial device of Akkineni Nagarjuna in the role of Acharya Annamayya. This perhaps indicates the unregistered composite trade mark with the words Annamayya having phonetical value and the label marks with the picture of subsequently added suggesting legal incidences of primary and secondary trade mark. 14. After carefully going through the pleadings and the evidence, two distinct claims are made by the Plaintiff. Firstly it is contended that since the year 1993, the Plaintiff-appellant is using the word Annamayya to his agarabathi product and he has also made an application for registration of the trade mark which is pending. The market sales of the product and the accounts relating to product are also produced. Of course in the year 1994-95, the total sale turn over was Rs. 37,972/-, 1995-96 the total sale turn over was Rs. 3,20,609/-, for the year 1996-97 the total turn over was Rs. 6,04,306/- and for the year 1997-98 it was Rs. 1,13,44,903/-. This is obviously after the addition of the motion picture still of Akkineni Nagarjuna on the cartons of the product since the year 1996. 15. The Plaintiff has examined himself and a witness and marked in evidence several documents to show the period of use of the word Annamayya since 1993 of his agarabathi product. The evidence further disclose that there was not much of sales of his product in the market till he adopted the pictorial device Akkineni Nagarjuna since November/December, 1996. Thereafter, there has been zooming sales and for sales promotion it is said at the time of release of the film several advertising methods were adopted by distributing free agarabathis in many theatres where the motion picture Annamayya was released. Posters, pocket calendars, dangles etc., were offered in advertisements. Besides publicity by balloons, cloth bags, key chains, purses, table clocks, wall clocks were brought about for distribution in the market for sales promotion. 16. Posters, pocket calendars, dangles etc., were offered in advertisements. Besides publicity by balloons, cloth bags, key chains, purses, table clocks, wall clocks were brought about for distribution in the market for sales promotion. 16. It is the case of the Plaintiff that even before the release of the film on 22.5.1997, pictorial device of film actor with the saintly get up of Annamayya was used as a part of their trade mark and agreement of memo of understanding was entered into with the film producer on 31.12.1997. The terms of document also shows that prior to this memo of understanding, the Plaintiff was already using the picture stills of Akkineni Nagarjuna on the carton of his product. Substantial documentary evidence is produced by the Plaintiff to show the efforts made by him to capture the market from December, 1996 onwards taking advantage of the foreseeable popularity of the film Annamayya and the popularity of the actor who played the lead role in the film. From the material produce, there is no gain say that the there was massive endeavour coupled with substantial advertisement to gain popularity of the product with the common consumer. 17. On the contrary, the evidence of the Defendant discloses that he started manufacturing and marketing his agarabathi product since July, 1997 with the word Acharya Annamayya and also he used the pictorial device of Akkineni Nagarjuna, but subsequent to the orders in Miscellaneous First Appeal, the pictorial device of Akkineni Nagarjuna has been dropped replaced by the pictorial device of some anonymous person in saintly get up, however continued to use the word Acharya Annamayya for the product. 18. On going through the law, the view taken by the trial Court that the word Annamayya is name of a person and a generic name and cannot be subject matter of trade mark, does not appear to be correct. The name of any person including the names of legendary Gods could be a subject matter of trade mark provided it is to be shown that the said word or name has acquired the sufficient distinctiveness in the minds of the people in relation to the proprietor and the product. The name of any person including the names of legendary Gods could be a subject matter of trade mark provided it is to be shown that the said word or name has acquired the sufficient distinctiveness in the minds of the people in relation to the proprietor and the product. In the present case, the evidence placed by the Plaintiff clearly establishes that by his commercial endeavours has cultivated the market for his product by the trade mark that the word Annamayya with phonetical value and as well with the picture still of the film actor on the labels. The evidence is placed to show that since the year 1993, the market is cultivated. However the volume of sales were marginal but none the less from the year November/December, 1996, the Plaintiff did make intensive efforts to promote the sales of his product by wide and greater advertisement techniques as a result of which there has been a vertical growth in the sale also. With a different of six months thereafter, the Defendants started marketing the product by using the word Acharya Annamayya. Annamayya is the personal name of a saint popularly perceived and known by his personal name. The prefix Acharya is only a word of reverence and would mean a teacher or a Guru. From the common man's stand point, it cannot be said that by using the prefix Acharya there would be a total distinction in the understanding and perception. On the other hand, the distinction what ever that creates by the word Acharya as a prefix makes only an illusory distinction with only an apparent dissimilarity but not a substantial dissimilarity from the stand point of a common consumer. It is in the usual habit of the people to take only the popular personal name of Annamayya and any prefix or suffix to the name cannot efface the substantial effects of similarity prominent in the very name of Annamayya. 19. The Plaintiff has shown that by his oral and documentary evidence he has created a sufficient good will and popularity to his product by using the word Annamayya as trade mark carrying phonetical value and subsequently added the picture still of film actor to the label along with the phonetical word Annamayya. No doubt, the Plaintiff has shown the prior use of the trade mark for promoting the sales of the product. No doubt, the Plaintiff has shown the prior use of the trade mark for promoting the sales of the product. The contention of the Counsel for Plaintiff that the prior use is only a decisive test to confer unregistered right of a trade mark does not appear to be a tenable contention. Although the decision of this Court in Sushil Vasudev Vs. Kwality Frozen Foods Pvt. Ltd., ILR (1993) KAR 1222 is cited, but however, I find the said ratio is impliedly overruled by the Division Bench of this Court in Mangalore Beedi's case in ILR 1994 Kar 2393 wherein it is held that there was no minimum period although prescribed in law even it may be a shorter period but however it all depends upon the evidence placed to show the awareness of the product created in the minds of the people which in otherwords mean that it is not merely the test of the prior use as a sole determinative factor. It is also necessary to establish that there has been an awareness about the product in the minds of the people which again depend upon the various circumstances like the volume of sales, the goodwill, the cultivation of market, the same view is expressed by the learned Author Kerley in his treatise which is referred to supra. 20. In the present case on the analysis of the oral and documentary evidence placed by the Plaintiff not merely establishes the prior use but also shows the assudious endeavours in creating the market popularity to the product from November/December, 1996. Six months thereafter, after such intensive sales publicity, the Defendant tried to market the goods with word Acharya Annamayya. Therefore in view of the findings and the ratio laid down by the Division Bench of this Court in Mangalore Beedi's case, six months period, I think is sufficient time for creating awareness in the minds of the people about the product and there is objective demonstration of the hike in the volume of the sales promotion and the turnover. 21. 21. Therefore from the material placed on record, unhesitatingly it can be held that the Plaintiff has acquired unregistered trade mark rights over the word Annamayya and as well with the composite trade mark containing the word Annamayya is a primary trade mark with which the Plaintiff started marketing his product and by using the secondary trade mark by using the picture of film actor which has added greater value in sales promotion. Therefore any attempt on the part of the Defendant either to plagerise the composite trade mark or phonetical part of it or pictorial part of it in any manner is an offensive action constituting passing off. Therefore merely by amending the trade mark by giving up the picture still of film actor is not suffice and the threat and vulnerability of passing off still continues by user of word Annamayya with the given prefix. 22. Under the circumstances, I find that the judgment of the trial Court to the extent rejecting the claim of the Plaintiff against the Defendant from using the word Annamayya without any prefix is untenable. Accordingly, the suit of the Plaintiff sought for is to be decreed. Accordingly, the appeal filed by the Plaintiff in Regular First Appeal No. 106 of 2001 is allowed and the appeal filed by the Defendant in Regular First Appeal No. 175 of 2001 is dismissed.