International Coffee and Tea, LLC v. Sanjay L. Mansukhani
2008-07-07
HIMA KOHLI
body2008
DigiLaw.ai
JUDGMENT Hima Kohli, J. 1. The plaintiff has instituted the present suit for permanent injunction, restraining passing off, damages, delivery up etc. Despite service being effected on the defendant, none entered appearance. Accordingly, vide order dated 3.9.2007, the defendant was directed to be proceeded ex parte. Matter is placed in Court after the plaintiff has led ex parte evidence by way of affidavit. 2. It is the case of the plaintiff that the plaintiff is incorportated under the laws of the State of Delaware and has its address for business at California, USA. The suit is instituted by the constituted attorney of the plaintiff, who is authorized to sign and verify the pleadings and institute the present suit. The letter of authority issued in favour of the constituted attorney, Mr. Anand Banerjee, the deponent of the affidavit by way of evidence, is enclosed with the affidavit and marked as EX.PW-1/1. The power of attorney dated 11.7.2007, authorizing Mr. Anand Banerjee to institute the present suit is placed on the record and marked as EXPW-1/2. 3. It is deposed on behalf of the plaintiff that it is the owner of the trademark, THE COFFEE BEAN & THE TEA LEAF. The plaintiff owns, operates and/or has franchised 423 stores worldwide under the name `THE COFFEE BEAN & THE TEA LEAF in 15 countries. The plaintiff has a website at www.coffeebean.com which receives approximately 8.3 million hits per month from around the world. Relevant extracts of the plaintiffs website are marked and exhibited as Ex PW-1/3. The list of the various international locations where the plaintiffs stores are operating is marked as Ex.PW-1/4. The trademarks registered in favour of the plaintiff worldwide including those registered at Canada and US are marked as Ex-PW-1/5, PW-1/5A, PW-1/6 and PW-1/6A. 4. The plaintiff claims to be the prior user of the mark, `THE COFFEE BEAN & THE TEA LEAF since the year 1963 and states that its trans-border reputation has spilled into India. It is stated that the plaintiff has recently, during the pendency of the present proceedings launched its store in India through its outlet at Select City Walk Mall, Saket, New Delhi.
It is stated that the plaintiff has recently, during the pendency of the present proceedings launched its store in India through its outlet at Select City Walk Mall, Saket, New Delhi. Online articles as to the launch of the aforesaid store are marked as Ex.PW-1/7A-C. With reference to India, the plaintiff has made the two trademark applications dated 19.3.1998, (marked as Ex.PW-1/10- PW-1/10A) in Class 30, namely, in the category of `Coffee, tea, cocoa and other goods. 5. Counsel for the plaintiff submits that the present suit instituted by the plaintiff is a Quia Timet suit, which was necessitated on account of the fact that the defendant who is based in Bangalore, obtained a registration which is identical to that of the plaintiffs trademark `THE COFFEE BEAN & THE TEA LEAF, as per extract of the Trademark journal dated 17.1.2005, marked as Ex.PW-1/8. She submits that it is pertinent to note that though the defendant has claimed to be the user of the said trademark since 16.10.2003, and claims to run a restaurant in the State of Karnataka, but in real, no business is being carried out by the defendant under this mark. 6. It is stated that the plaintiff learnt for the first time about the defendants adoption of the impugned trademark in or around the month of May, 2004 when a trademark search on its part disclosed a pending application in Class 42 in the name of the defendant. Thereafter, the plaintiff carried out investigations, which disclosed that the defendant no longer resided in India and had shifted to Philippines, but no address of the defendant could be found, nor did the investigation reveal existence of any business under the impugned name. Counsel for the plaintiff submits that the fact that the defendant did not enter appearance in the present suit despite being served with a notice, and was ultimately directed to be proceeded against ex-parte vide order dated 3.9.2007, reaffirms the stand of the plaintiff that the defendant is not carrying out any business under the impugned trademark. 7. Counsel for the plaintiff submits that the plaintiff had filed an application for rectification against the registration granted to the defendant for the impugned trademark on 22.9.2006, (Ex.PW-1/9), which is pending disposal.
7. Counsel for the plaintiff submits that the plaintiff had filed an application for rectification against the registration granted to the defendant for the impugned trademark on 22.9.2006, (Ex.PW-1/9), which is pending disposal. She submits that though it is understood that the defendant had shifted to Philippines and there is no sign found of any business being conducted under the impugned trademark, the present Quia Timet suit was necessitated in view of the subsistence of the impugned trademark in favour of the defendant with the Trademark Registry, which the plaintiff apprehends the defendant may potentially use, transfer or assign at any stage to any third party or competitor or rival with an interest in a similar business as that of the plaintiff, thus damaging the interest of the plaintiff. 8. Counsel for the plaintiff reiterates that taking into consideration the proprietary rights of the plaintiff in the trademark based on a prior adoption, use and registration worldwide and pending prior trademark applications in Class 30 in India, which constitute constructive notice to the defendant, the adoption of the impugned mark by the defendant is not bonafide. She stresses that holding of the aforesaid registration for the impugned mark by the defendant is a potential threat to the expansion of plaintiffs business in India and amounts to misuse of its trademark which shall cause irreparable loss and injury to the plaintiffs business, goodwill and reputation. 9. Counsel for the plaintiff relies on a judgment of this Court in the case entitled, Mars Incorporated v. Kumar Krishna Mukherjee reported at 2003 (26) PTC 60 (Delhi). She submits that the aforesaid suit was also a Quia Timet action, where the plaintiff approached the Court when it found that the defendant therein had incorporated a company under the name and style of Mars Foods Private Ltd., though he had neither commenced the manufacturing nor the sale of goods. The plaintiff therein was the proprietor of the trademark, MARS, registered in its favour in India and in several other countries world over and was in the business of chocolate, confectionery and other food items in India. 10.
The plaintiff therein was the proprietor of the trademark, MARS, registered in its favour in India and in several other countries world over and was in the business of chocolate, confectionery and other food items in India. 10. Counsel for the plaintiff draws the attention of this Court to paras 16 and 17 of the aforesaid judgment to establish that there is no requirement of actual damage to be caused or likelihood of damage because of confusion or mistake and that injunctive relief may be obtained even before the defendant opens its business. Also that one does not have to await the actual injury to obtain preventive relief, for the purpose of instituting a Quia Timet" suit. Paras16 and 17 of the judgment are reproduced herein below for ready reference: Para 16- Quia Timet is actually a Latin word which means "because he fears or apprehends". In legal terminology it has been defined in Osbornes Concise Law Dictionary (London : Sweet and Maxwell, 8th edn. 1993, Bone and Rutherford) as an action by which a person may obtain an injunction to prevent or restrain some threatened act being done which, if done, would cause him substantial damage, and for which money would be no adequate or sufficient remedy. Para - 17-I am of the view that as in the case of infringement of registered trademark or passing off action, the intention and object of infringer is mainly to trade or cash upon widespread and invaluable goodwill and reputation established over the years at huge cost by the plaintiff and in the process there occurs a dilution of the trade mark if goods manufactured and sold by infringer happen to be of poor quality, the underline intention of a person who proposes to adopt either same or deceptively or confusingly similar trademark or even the Corporate name is to encash and become unjustly rich by trading upon the goodwill and reputation of the plaintiff. 11. In the aforesaid judgment reference is made to two other judgments on the Quia Timet action, entitled as Direct Line Group Ltd. and Ors. v. Direct Line Estate Agency Ltd. and Ors. reported at Chancery Division 374 and Marks and Spencer Plc. v. One in a Million Ltd and Ors. reported at (1998) FSR 265. 12.
11. In the aforesaid judgment reference is made to two other judgments on the Quia Timet action, entitled as Direct Line Group Ltd. and Ors. v. Direct Line Estate Agency Ltd. and Ors. reported at Chancery Division 374 and Marks and Spencer Plc. v. One in a Million Ltd and Ors. reported at (1998) FSR 265. 12. In the present case, taking into consideration the deposition on the record and documents filed with the deposition and duly exhibited, the plaintiff has been able to establish that the registration of the impugned trademark `THE COFFEE BEAN & THE TEA LEAF by the defendant is not bonafide. As per the plaintiff, the defendant has not only stopped running a restaurant under the impugned trademark in Karnataka but has also left the shores of India. The plaintiff is justified in its apprehension that by holding on to the wrongful registration for the impugned mark, the defendant poses a potential threat to the plaintiffs business and interest which is entitled to be protected by such a Quia Timet action as the present suit. 13. It is too much of a co-incidence that the defendant applied for registration of the impugned name which was coined by the plaintiff way back in the year 1963 when the plaintiff started its business. Admittedly, the defendant has not infringed the trademark of the plaintiff in relation to any goods in respect of which the plaintiffs trademark is registered, nor has the defendant attempted to pass off his goods as that of the plaintiff. Instead, the defendant has adopted the trademark of the plaintiff under Class 42 namely services that cannot be classified in other classes. Thereafter, he is stated to have even discontinued the business of running a restaurant as per the averments made in the plaint and deposition on behalf of the plaintiff. It appears that the sole intention of the defendant in getting the trademark in question registered in his favour is to thrive upon the goodwill and reputation of the plaintiff and encash the same to the detriment of the plaintiff. 14. The aforesaid imminent threat has become more real during the pendency of the present proceedings in view of the submission made on behalf of the plaintiff that in the meantime, the plaintiff has already entered the Indian market by launching its store in Delhi in the month of March, 2008.
14. The aforesaid imminent threat has become more real during the pendency of the present proceedings in view of the submission made on behalf of the plaintiff that in the meantime, the plaintiff has already entered the Indian market by launching its store in Delhi in the month of March, 2008. Merely because the defendant is no longer using the impugned trademark or has left this country and shifted to Philippines, would not in itself and be sufficient to defeat the present suit or hold that the threat expressed and apprehended by the plaintiff is not real or tangible for the reason that the registration of the impugned trademark remains on the records of the Trademark Registry in favour of the defendant. Thus, the sword of Democlese continues to hang over the head of the plaintiff. As a result, the present Quia Timet suit instituted by the plaintiff is held to be bonafide. The injury apprehended by the plaintiff and the threat extended by the defendant by registering the impugned trademark in his favour is sufficient to invoke the jurisdiction of this Court for seeking the relief as prayed for in the plaint so as to nullify any threat faced by the plaintiff although no actual injury or damage has yet been caused to the plaintiff. In this context, it is relevant to refer to para 29 of the judgment in the case of Mars Incorporated (supra), which is reproduced herein below: Para 29 - The only tests for injunctive relief in Quia Timet Action are:- (i) Whether it is likely to cause confusion or to deceive the purchasers as to source or origin of the trademark or the goods to be sold in future under the said mark irrespective of the fact whether goods intended to be sold are competitive goods or not; (ii) Whether the intention to use the infringed trademark is to trade or cash upon the reputation and goodwill of the plaintiff earned over the years through extensive advertisement and huge expenses; (iii) Whether there is likelihood of real or tangible damage or injury to the plaintiff or reasonable probability if the same would take place.
In other words whether use of the trademark by the defendant is likely to be associated with the plaintiffs trademark of business;(iii) Whether the hardship suffered by the plaintiff would be greater than that of the defendants if injunction is not granted against the defendants. 15. Measured by the aforesaid yardstick laid down for claiming injunctive relief in a Quia Timet action, the plaintiff has been able to establish that it has been in the business of owning and operating franchise stores worldwide for the past 45 years under the impugned trademark `THE COFFEE BEAN & THE TEA LEAF, which is a distinctive trademark and a unique collocation of words, making the said trademark of the plaintiff highly memorable in the minds of the public. The plaintiff had also established that it has a presence by way of 423 stores worldwide in different countries and the plaintiff has also pending applications pending for registration in India. Thus the plaintiff has established that it has earned a goodwill over the past several years and any attempt on the part of the defendant to use the impugned trademark is likely to be associated with the plaintiffs business. That apart, the plaintiff has entered into the Indian market by opening its store for its product through its launch held as recently as in March, 2008. The plaintiff also enjoys international goodwill and has acquired an international reputation through its advertisements worldwide including those on the web. 16. The adoption of the very same trademark by the defendant shows his malafide intention to misrepresent to the public at large and create confusion in mind of the public that either the defendant is associated with the plaintiff, or is authorized by the plaintiff to use the said mark. Likelihood of the defendant selling the mark to a rival party so as to encash the goodwill of the plaintiff can also not be ruled out. In the aforesaid circumstances, the present suit is decreed in favour of the plaintiff by holding that the defendant, his agents, officers and assigns are restrained from using, advertising, offering for sale or directly/indirectly dealing in beverages, coffee, tea or restaurants and related services under the trademark `THE COFFEE BEAN & THE TEA LEAF and any other mark deceptively similar to the aforesaid trademark so as to pass off his services and goods as those of the plaintiff. 17.
17. Insofar as the claim of the plaintiff for damages to the tune of Rs. 20,00,700.00 against the defendant is concerned, it is deposed on behalf of the plaintiff that the plaintiff apprehends potential harm from the defendant to its goodwill and reputation and thus the plaintiff is entitled to claim the aforesaid amount as damages. But in absence of any relevant material to substantiate actual damages suffered by the plaintiff and if so, the basis of quantifying the damages at Rs. 20,00,700.00 and particularly, in view of the plaintiffs own averment that since the institution of the present suit, it has not found the defendant running any restaurant in Karnataka under the impugned trademark, or doing any other business of such a nature as to damage the goodwill and reputation of the plaintiff, more so when the defendant is stated to have left this country now, it is not a fit case for grant of any damages in favour of the plaintiff and against the defendant. 18. Accordingly, a decree is passed limited to the extent mentioned in para 16 above. The suit and all pending applications are disposed of. Decree sheet be drawn accordingly.