Concepts in Trademark Law

Introduction

Trademark is a word, phrase or unique symbol which is used by an individual, business organisation or other legal entity to distinctively identify the ownership or brand of their products and services to customers so that its easy to differentiate such product or services. The trademark is represented with an encircled R as ® symbol, both represents Trademark and Service Mark.

Under the Trademark Act of India, the term “mark” is defines to include a device, brand, heading, label, ticket, name, signature, word, letter, numeral, shape of goods, packaging, a combination of colors, logo etc. The prior use of the trademark is not a prerequisite for filing application for registration even if the intention of the user was bonafide, for the same if one wants to file the application, it can be denoted as “proposed to be used basis”.

The Trademarks Act 1999 is the legislation that protects the trademarks. This act lays down the rules and regulations dealing with registration,protection, penalties against infringement regarding Trademarks. Trademarks are mainly the given status of intellectual property across the globe.

Registration of Trademark

The registration of trademark is valid for ten years and is renewable for a subsequent period of ten years. Non-renewal Trademarks leads to the expiry of the registration. However the same can be restored at the will of the applicant.

Registration may be refused on the following grounds: 

• ‘Marks’, which are descriptive in nature, in relation to the applicant’s goods or services, or a part or feature of the same, may also be denied registration.
• ‘Marks’ comprising of geographic terms or common surnames may also be refused.
• ‘Marks’ may be refused for other relevant reasons as well.

Renewal of Trademark Registration:

After the initial registration of trademark, it can be renewed further for 10 years. Unlike the rights granted in the case of Patents, Copyrights or Industrial designs, the Trademark rights can last indefinitely, if the owner of a Trademark continues or wishes to use the ‘mark’. However, if a registered trademark is not renewed after the period of ten years, it is liable to be removed from the register of Trademarks, maintained by the Registrar.

Trademark Infringement

Trademark infringement is the unauthorised usage of a mark that is identical or resembles the registered trademark. The word similarity here means which looks alike that can create confusion within the public and cause misrepresentation.

The most common cases of  infringement mainly arise out of similarity of brand names or logos or good and services that causes false impression and confusion among the public. To prove the  Infringement, the intention to cause false impression and confusion among people are a ground.

Section 29 and 30 deals of  Act deals with provisions that protect the trademark in case of infringement. There are various types of Infringementsas follows:

1. Direct infringement –the conditions for the breach of trademark due to the following:

1. It is accessed by unauthorised by person – violation of trademark occurs when an unauthorised person accessesor utilises the trademark without the permission or agreement with the owner
2. Identical or Deceptively Similar –usageof identical or similar logos, products, services, intending to create confusion among people
3. Registered trademark – the act extends protection only to Trademarks registered with Trademark Registry of India. Tort law is used where injury or damage is caused to the goodwill associated with the activities for infringement by another person or group of persons
4. Class of Goods and Services – the unauthorised use of the ‘mark’ can be used for propagation of goods.

1. Indirect infringement –the conditions by which breach of trademark arising out of the following reasons:

1. Vicarious Liability –Accordingto section 114, if a company commits any offence leading to the derivation of financial gains knowingly carries out infringement and controls the activities, where every person in the company becomes equally responsible
2. Contributory infringement – here the infringement is when a person, materially contributes to direct infringement and induce the Principal Infringer to commit such act of infringement

Section 30 of Trademark Actlists down the limits on the effect of registered trademark on infringement and enumerates those acts which do not amount to infringement. These moves are used as defence suits of infringement.

1. Using the mark to indicate the kind, quality and quantity etc.
2. Implied content use
3. Use mark outside the scope of registration
4. Use of registered trademark in relation to accessories and parts
5. Use of the two registered trademarks that are similar to each other

Therefore, infringement of trademark is done under the following conditions:

1. The allegedly infringing ‘mark’ must be either identical or similar trademark
2. The goods and services in relation to which the allegedly infringing ‘mark’ used must be specifically covered by the Trademark registration
3. The use must be in such a manner to render being used as a trademark
4. It should be used in course of trade

Potential causes of action for Infringement

1. Confusion
2. Dilution

State laws are enacted that lists down the cause of action under State Unfair Competition Law:

1. Passing off:  it is a system of rights derived from UK common law. This provides protection to unregistrered goods and services , and it has changed through the course of time  firstly it was goods and services which later got converted to professions and non- trading activities.This could create confusion and misrepresentation among customers.   There are three basic elements to constitute for passing off, that are commonly called as ‘ Classical Trinity’  are Reputation, Misrepresentation and Damage to goodwill. The issue of passing off arise when misrepresentation is carried out and causes actual damage to the business or goodwill of another trader.
2. Contributory passing off – thisoccurs when the defendant assists or induces another to pass off the products as the plaintiff’s product
3. Reverse passing off – this occurs when the defendant tries to pass off the plaintiff’s products as their own.
4. Misappropriation: this is highly unstable, but this source of additional Trademark related claims.

Passing off was initially introduced for misrepresentation of goods of another. Later this was extended to services, later this was extended even to professional or non-trading activities too. At present, it is applied to all sorts of unfair trade and competition practices impacting the goodwill of  another business, person and group of people.

Exception in Trademark Infringement

There are circumstances when someone other than the Trademark owner may use it in consideration of “fair use” which does not violate or infringe the rights of  owner. The jurisdiction throughout the world applies and consider this as an exception. Generally, the use of other person trademark is allowed, which does not infringe a Trademark right is “fair use”. There are two ways of fair use :

1. Descriptive use
2. Nominative use

While using a geographical name relating to the owner business location, even if that is similar its fair usage. The user is permitted to use descriptive indications concerning the kind, quality, intended purpose, value of the good, geographical indication, time of production of the good and services.

Who has right to sue for Infringement? 

The Registered Proprietor, his heirs and the Registered User can sue for infringement rights. An assignee of a Registered Trademark can also sue for infringement.The user of an unregistered trademark from instituting an infringement action. However, if the ‘mark’ in question is popular India, the user of such a Trademark is not without recourse and may seek a remedy by means of a passing off action. The purpose of this tort is to protect commercial goodwill.

Persons liable to be sued

If an infringement action is occurs, the person who becomes liable to be sued are:-

1. The agent of an infringer
2. The infringer himself
3. In several cases the master responsible for his servant’s act of infringement
4.  The directors and promoters of a limited company, if they have personally committed or directed the infringing acts

Time Limitation to File Suit

As per the existingprovisions of Limitation Act, 1963 the period of limitation for filing suit for infringement is three years from the date of infringement. Where the infringement is a continuing one, a new cause of action would arise every infringement that occurs.

Remedies for Infringement

The owner of the Registered Trademark can commence legal proceedings against the infringer stating the unfair business practices. Two types of remedies are available to the owner of the trademark against the unauthorised use of ‘mark’ by the third party. The Trademarks Act protects the trademark with civil and criminal remedies. Civil proceedings can be initiated by the Trademark owner before the District Court in those jurisdictionswhere the owner resides.

Civil Remedies for Trademark Infringement are available under following heads:

1. In form of Injunction:

The action of an injunction is referred as stopping one person from doing particular activity or task through the judicial process. With respect to trademark infringement, it is restraining a person from unauthorised use of the trademark. Through a temporary or permanent stay, the Court grants protection to the trademark owner.

1. In form of Damages:

Damages refer to the recovery of loss faced by the trademark owner through the trademark infringement. The monetary value of financial loss or brand impairment is recovered under this head. The amount of damages will be granted by the court after considering the actual and anticipated loss of owner due to infringement.

The damages in Trademark law as a relief has increasingly assumed importance and the main aim of the damages is to monetarily compensate.

1. Custody of infringing materials:

This remedy suggests that the Court may ask the infringer to deliver all the goods or products that are labelled with the brand name. Here, the Court may direct the authorities to withhold the related materials accounts and destruct all such goods. Where the trademark relates to services, i.e. a Service Mark is infringed; the order may be passed to stop the provision of the services immediately by the infringer.

In case of infringement/passing off , the criminal complaint can also be filed and noted under the Trade Marks Act, 1999 which states the registered owner of the trademark has a chance to file the FIR through police on the infringer.

Relief Granted 

The court allows to file any suit of infringement or for passing off incorporates permanent and interim directive, the interim relief in the suit may incorporate request for:

1. 1. arrangement of neighbourhood magistrate
   2. accounts books
   3. readiness of stock
   4. permanent injunction
   5. temporary injunction
   6. cost of legal proceeding.

This limits the infringer from discarding or managing the advantages.

Criminal remedies: If there is any activity involving criminal nature for encroachment of enlisted trademark, the offense is culpable with detainment for a term of 6 months under section 103 of Trademarks act 1999, that may even stretch up to 3 years with a fine ranging from 50000 to 200000.

Jurisdiction for a Suit of Trademark Infringement

Section 134 of the  Act provides provisions forthe jurisdiction of suit to commence the proceedings filing of suit for infringement. The trademark owner can institute the infringement suit before District Court. The appropriate District Court falling within the local limits of jurisdiction of the person instituting the suit, i.e. the owner of Trademark or the Assignee, where resides or carry on the business activities.

Defences available in an Trademark Infringement action

When an infringement action has been initiated against the defendant, he may set up any following defences, depending upon the circumstances of case and applicability of relevant defence to his case; That,

• • The plaintiff is not entitled to sue, as he has no title or proprietorship

• The use of trademark is not infringement or it is protected by the provisions of Section 30, which lists out the Acts which do not constitute infringement.

Conclusion

Increased globalisation of Trade, World Trade Organisation enacted TRIPS agreementto lay down the minimum standards for the Intellectual Property (IP) rights among member nations. India, being a member country, understood the need of protecting the rights of IP and the importance of brand names, trade names, marks etc, Trademarks Act 1999 was introduced in line with TRIPS. In India, judiciary has been not only been proactive in protecting various IP rights including copyrights, trademarks etc also efficient provisions were given for enforcement of these rights. There were many landmark cases leading to protection of Domain, Trade names and Marks in Indian judicial history.  India, by following not only a codified law, but also under the common law principles has taken effective measures to curb the violations of infringements against Trademarks.