KMG International Ltd. v. K. M. G. Industrial Traders Pvt. Ltd.
2007-12-24
PRADEEP NANDRAJOG
body2007
DigiLaw.ai
JUDGMENT : Pradeep Nandrajog, J. K.M.G. International Ltd. (hereinafter referred to as KMGI) and KMG Industrial Traders Private Ltd. (hereinafter referred to as KMGIT) are litigating with each other, KMGIT has scored an initial victory in as much as vide impugned order dated 6.10.2007 it has obtained an interim injunction till suit filed by it against KMGI is disposed of restraining KMGI from using the mark 'KMG' and the logo graphically to be seen on the letter heads, printed and packaging material of the 2 companies. The reasons given by the learned Trial Judge while granting the injunction are set out in paras 9, 10 and 13 of the impugned order. The same are as under : A. KMGIT is the registered holder of the trade mark 'KMG' and the logo in a question since 2003. B. KMGI holds no registration. C. Documents filed by KMGI show use of the mark and the logo for the first time only in the year 2005. D. Even case of KMGI was that it was assigned the right to use the mark and the logo by KMG Milk food in the year 2005. E. KMGIT had a better case not only as the registered proprietor of the mark but even due to prior user. F. Though both companies were at one point of time part of KMG group, KMGI could not show a better title vis-a-vis KMGIT. 2. Case pleaded by KMGIT in the plaint may now be noted. It is pleaded that it was a company registered under the Companies Act and was carrying on business a manufacturer, importer and seller of electrical goods including CFL lamps. That vide registration No. 1174847 dated 13.2.2003 it obtained registration of the trade mark 'KMG' and the logo in question pertaining to goods in class 11 of the T.M. Act, 1999 and thus by virtue of Sections 28 and 29 of the said Act had the exclusive right to the trade mark and the logo. That KMGI had started marketing CFL bulbs using the trade mark and the logo of the Plaintiff in May 2007. Thus infringing its trade mark. 3. In para 14 of the plaint a passing reference was made that till some time back KMGIT and KMGI were working as associates but parted company. 4.
That KMGI had started marketing CFL bulbs using the trade mark and the logo of the Plaintiff in May 2007. Thus infringing its trade mark. 3. In para 14 of the plaint a passing reference was made that till some time back KMGIT and KMGI were working as associates but parted company. 4. It may be noted it the outset that in what manner the 2 companies were associated in the past and what was the nature of the association has not been disclosed in the plaint. 5. It may also be noted that the suit has been instituted under the authorization of one Sushil Goel, The Managing Director of KMGIT and has been filed under the signatures of one Brajendra Singh Gaur, the constituted attorney of KMGIT. 6. The written statement may be noted. 7. KMGI stated that KMG group of companies was founded by Shri Basudev Garg in the year 1976 and the group companies were using the mark 'KMG' and the logo in issue on their letter heads. Reference was made to a publication 'SAR Economist' dated August 2002 where an article gave the history of the businesses founded by Shri Basudev Garg. It was further pleaded that KMG Malik foods Ltd. a group company had obtained registration of the trade mark 'KMG' and the logo under the Copyright Registration Act and in relation to CFL bulbs had permitted KMGI to use the same. It was pleaded that KMGI had been selling the CFL bulbs using the trade mark in dispute as also he logo in dispute since the year 2002. It was further pleaded that KMGI was initially known as Rahul Jee and Company. Name was changed in the year 2001. Similarly, KMGIT was earlier on known as Industrial General Traders and later on got the name changed to KMGIT. It was specifically pleaded that the 'KMG' logo and the mark KMG' belonged to the KMG group companies and was used by all. 8.
Name was changed in the year 2001. Similarly, KMGIT was earlier on known as Industrial General Traders and later on got the name changed to KMGIT. It was specifically pleaded that the 'KMG' logo and the mark KMG' belonged to the KMG group companies and was used by all. 8. Since I propose to set aside the impugned order and remand the matter for fresh adjudication by the Trial Judge in as much as I note that the learned Trial Judge has not even referred to the core area of dispute and has ignored documents filed by both parties I do not intend to write a lengthy order, save and except to note the documents on record and the issue which needed to be focused and considered while deciding the application for grant or denial of interim relief. 9. At the forefront it has to be noted that the SAR Economist Magazine for the month of August, 2002 which was admittedly before the Trial Judge contained an article giving the history of KMG group of companies. The same has not even been noted, much less referred to by the learned Trial Judge. 10. At pages 33 to 36 of the magazine is the article in question. It gives the history of the KMG group of companies. It states that the group companies were founded by Basudev Garg in 1976 with the incorporation of Rahul Jee and Company, Industrial General Traders and B.M. Industries. It records the growth of the group under the leadership of Basudev Garg and notes that new companies were incorporated and name of existing companies was changed. It notes that by the year 2002, 6 companies namely (a) KMG Non Ferrous Metals Pvt. Ltd., (b) KMG Electrical Equipments Pvt. Ltd., (c) KMG Milk food Ltd. (d) KMG Leasing and. Advance Ltd., (e) KMG ATOZ Systems Pvt. Ltd., (f) KMG Solutions India Pvt. Ltd. were formed. It further records that all group companies were marching under the banner of KMG all group of Industries. The Article prominently displays the logo in question qua which claim has been laid in the suit as also the mark 'KMG'. The article suggests that the logo and the mark was used by all group companies marching under the banner of KMG. 11.
The Article prominently displays the logo in question qua which claim has been laid in the suit as also the mark 'KMG'. The article suggests that the logo and the mark was used by all group companies marching under the banner of KMG. 11. Both parties had filed documents relating to the website with the domain name: "kmggroup.com" which was created on 4th April, 2001. The website gives information of all afore-noted six companies marching under the KMG banner. Each web page pertaining to each company prominently displays the logo in dispute and the mark KMG. 12. As in the case of the article in question, learned Trial Judge has nowhere considered the impact of the said common website, the common domain name and the common use of the logo and the mark 'KMG' when the group companies were together. 13. Not only that. When the group companies were together, Sushil Goel had been acting on behalf of KMGI. Letters written under his signatures on the letter head of KMGI evidencing sale of CFL bulbs have not been considered. Further documents under signatures of Sushil Goel submitted to SIEMENS for KMGI to be appointed as a distributor recording that KMGI had been marketing energy saving lamps and was the sole distributor for the Kerala Mineral and Metals Ltd. Since 2003 have been ignored. The said documents evidence sale of CFL bulbs by KMGI in the year 2003-2004 in sum of Rs.9,13,80,000, Rs.1,66,86,000 in the year 2004-2005 and Rs.2,49,67,000 in the year 2005-2006. Further, balance sheet of KMGI filed before the learned Trial Judge of 31.3.2005 showing import of CFL ad T-5 Tubes in sum of Rs.47,72,529 as of 31.3.2004 and in sum of Rs.9,07,695 in the next financial year have also been ignored. Further, bills raised under the signatures of Brajendra Singh Gaur when he was working with KMGI on third parties pertaining to sale of CFL bulbs have also been ignored. 14. Learned Trial Judge has ignored that Mr. Sushil Goel under whose authority the suit was instituted and Mr. Brajendra Gaur who had signed the plaint had, in the past, when the group companies were together, been acting on behalf of KMGI. These acts relate to the year 2003 onwards.
14. Learned Trial Judge has ignored that Mr. Sushil Goel under whose authority the suit was instituted and Mr. Brajendra Gaur who had signed the plaint had, in the past, when the group companies were together, been acting on behalf of KMGI. These acts relate to the year 2003 onwards. The impact of said conduct vis-a-vis the statement in the plaint that KMGIT learnt about the offending activity (as pleaded in para 25 of the plaint) in May 2007 has not been discussed by the learned Trial Judge. 15. The legal question arising out of the plea in the defence that the entire group of companies were using the logo and the mark, namely was it a case where a group of companies jointly owned the mark and the logo? And if yes, the effect thereof has not been considered by the learned Trial Judge. Further, what was the inference to be prima-facie drawn from the documents, briefly noted by me hereinabove, has not even received the slightest attention of the learned Trial Judge. 16. Whether Plaintiff had shown a consistent use of the mark and the logo in relation of CFL bulbs has not been considered by the learned Trial Judge. The legal principle that mere registration of a mark cannot defeat the claim of a prior user has not been even noted, much less considered by the learned Trial Judge. 17. Since the entire approach of the learned Trial Judge is vitiated on account of afore-noted reasons I have 2 Options. Firstly to call for the record of the learned Trial Judge and decide the issue on merits. Or, to require the learned Trial Judge to redecide the matter after taking into consideration the pleadings of the parties and the admitted documents filed by the parties. A focused decision thereafter to be taken conscious of the umbilical cord binding the Plaintiff and the Defendant; their past association and in particular that both were marching under the same banner till the year 2006. 18. The appeal stands disposed of quashing the impugned order dated 6.10.2007. The application for injunction filed by the Plaintiff against the Defendant is restored for fresh decision. 19. Learned trial Judge is directed to re-decide the matter within a month of receipt of the present order. 20. No costs.