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Likelihood of Confusion in Trademark Identification: Law Awaits Clarity?

Likelihood of Confusion in Trademark Identification: Law Awaits Clarity?

Bench comprising Justices L. Nageswara Rao, B.R. Gavai and B.V. Nagarathna of the Hon’ble Supreme Court, in Renaissance Hotel Holdings Inc. Vs B. Vijaya Sai, 2022 SCC OnLine SC 61, elucidated the scope of Sections 29 & 30 of the Trademarks Act, 1999, wherein it observed that, in an action for infringement, when the trade mark of the Defendant is identical to the registered trade mark of the Plaintiff and when the goods or services of the Defendant are identical to the goods or services covered by registered trade mark, the Court shall presume that it is likely to cause confusion within the general public.

The two key points addressed in this particular observation are—

  • The resemblance/likeness between the trademarks used by the aggrieved party and the infringer.
  • The similarity/homogeneity of the products or services sold by both the parties.

In such cases, the normal course of action to be adopted by the Court would be to issue an injunction as soon as it is proved that the Defendant is or had been improperly using the trademark of the Plaintiff.

A suit was filed by the Appellant Plaintiff claiming a decree of permanent injunction to restrain the Defendants from using the trade mark “SAI RENAISSANCE” or any other trade mark identical with their trade mark “RENAISSANCE”. The Trial Court had partly decreed the suit by restraining the Defendants from using the aforementioned trademark or any other trade mark which incorporates the plaintiff’s trade mark “RENAISSANCE” or is deceptively similar thereto. The High Court, allowing the Defendant’s appeal, observed that there was no infringement of trade mark, and set aside the judgment of the Trial Court. This made the Plaintiff approach the Apex Court.

In July 2018, a similar issue was raised before the Delhi High Court, in a dispute between two pharmaceutical companies— Mankind Pharma Limited and Mercykind Pharmaceutical Private Limited [(2018) 253 DLT 39]. The Plaintiff was manufacturing and selling its products by using “KIND” as a suffix or prefix. A Single Bench comprising Justice Rajiv Sahai Endlaw adjudicated on the injunction application filed by Mankind, wherein its primary contention was that, by using “Mercykind” as its company name, the Defendant infringed the registered trademarks having “KIND” as suffix or prefix in the products sold by Mankind Ltd, and therefore were seeking to restrain the Defendant from using the name, “Mercykind”. However, the Court noted that Mercykind Ltd was not using “KIND” as a suffix or prefix in any of its products; it was shown only as the name of manufacturer. This contention was rejected by the Court noting that none of the products of the defendant were sold under the label ‘Mercykind’ and that Mercykind was not used as a “trade mark”

Justice Endlaw stated that mere affixation of the name as manufacturer or marketeer of the drugs/medicines would not qualify as a use thereof as a trade mark, even under Section 29(6) of the Act”, said Justice Endlaw. It was noted that infringement by use of “trade name” as opposed to “trade mark” was exclusively covered under Section 29(5) and in order to sustain infringement action by use of “trade mark” under sub-sections(1) to (4) of Section 29, the Plaintiff need only show that the impugned trade mark was “identical or deceptively similar” to the registered trademark. However, that test would not suffice for claim of infringement by use of “trade name”.

What this decision essentially laid down was that a case of infringement could have been sustained under Section 29(5), if the Defendants had used “Mankind” as part of their name or any other registered trade mark of the Plaintiff. Merely because “Mercykind” may be deceptively similar to “Mankind” or any other registered trade mark of the Plaintiff with “Kind” as prefix or suffix, it would not amount to infringement under Section 29(5).

The quandary that we face is whether the Supreme Court fundamentally overturned the Delhi High Court’s 2018 verdict with the Renaissance judgment. The primary factor at play in this dispute was a prima facie resemblance between the names “Renaissance” & “Sai Renaissance”, which is somewhat, if not entirely similar to “Mankind” & “Mercykind”. A generic word, in apparent terms, though incapable of causing confusion among the general public, has the potential to give rise to complexities if it is associated with multiple products or services of the similar nature. When the similarity of the name of two products or services is taken into account, the evidence of actual confusion, when analysed, should be impressive to an extent that the consumer is barely able to distinguish between the two or not at all.

It is still possible for two different businesses to have similar names or marks. However, the real question is determined by the potential for the confusion of consumers. If two similar marks are used in different industries that are located in different markets, confusion is unlikely. On the other hand, if two businesses that are using similar marks are operating in markets that overlap, priority will be an issue.

This brings us to the second, but equally important factor at play, which is the fact that both the aggrieved party and the infringer were in similar businesses where the latter was using a deceptively similar trademark in relation to or upon printed matter, periodicals, books, instructional and teaching material, stationery, manuals, magazines and office requisites, and for hotel, restaurant, catering, bar and cocktail lounge services, provision of facilities for meetings, conferences and exhibitions and reservation services for hotel accommodations amounting to infringement of the Appellant-Plaintiff’s registered trademark.

The guiding principle of trademarks is to avoid consumer confusion. When the consumer purchases a product bearing a mark or a particular type of name, they purchase an ‘experience envelope’ symbolically depicted and/or represented through that mark or name, which helps to construct its identity. Courts look at several factors, including whether or not consumers are likely to be confused by two businesses that operate in the same industry.

On careful appraisal of both the judgments of the Delhi High Court and the Supreme Court, one can’t help but notice that it unfortunately boils down to the degree of confusion likely to ensue from the resemblance of the names or marks, as it is indicative, to a major extent, the measure of public inconvenience. Two similar products from Mankind and Mercykind cannot cause confusion within prudent members of the public for the use of the suffix “kind” in the trade name. It does not prima facie indicate or implicate any notable similarity as the word “kind” is not being used in any way, as a means to distinguish their products or give them a separate identity. Had that been the case, it would probably have made a fit case of trademark infringement. The Supreme Court, on the other hand, dealt with a case where “Renaissance” and “Sai Renaissance”, though distinguishable per se, was likely to cause confusion within the public. The “deceptive similarity” factor could not be ignored as it has the potential to indicate a sort of affiliation or association, since both were involved in businesses of a similar nature.

To adopt a proper textual and contextual interpretation, it becomes important to read the aforementioned judgments with reference to the language as has been used by the Legislature, particularly in Sections 29(5) and 29(9) of the Trademarks Act, 1999. The word “kind” was not being used as a distinctive element, specifically with respect to the trade name of Mercykind Pharmaceutical Private Limited, whereas the word “Renaissance”, in a sense, owing to the international presence and reputation of the aggrieved party, was a distinctive element with regard to its brand image. Hence, the Apex Court allowed their appeal as it was a fit case of infringement of trademark.

So, what conclusion did we arrive at? Did the law get stricter? Does it open the floodgates to hundreds of such infringement suits? It is important to understand why a mark is likely to cause marketplace confusion. Likelihood of confusion’ is the gold standard by which infringement is measured across almost every region although, of course, specific phraseology may vary. Many regions have different tests that they apply to assess likelihood of confusion with set factors to measure. These factors can vary on the basis of the facts applicable to a particular case at hand and so factors applicable to one’s region and circumstances assume primal importance. Nonetheless, some general principles apply. It really depends on the nature of the industry, the individual market characteristics, the target customers/ clients, honesty of concurrent use and the strength of the trademark of the company or organization which started using it first. “Strength” in this context, is defined as advertised more frequently, more unique, and less diluted. Consumers associate the trademarks, trade dresses etc. with the goodwill of the brand. Organizations should ideally be aware of similar marks and/or names and whether the use of these marks or names constitutes or is likely to constitute infringement of trademark.

About Author

Parag Chaturvedi

Parag Chaturvedi, working as a Senior Associate with S. Jalan & Co., is a B.A. LLB graduate from Department of Law from University of Calcutta having graduated in the year of 2014. His primary area of practice involves Commercial Arbitration involving major infrastructural projects and constitutional matters, currently practices in the field of Arbitration focusing on infrastructural projects before the High Court, Tribunals and quasi judicial tribunals.

Shruti Tibrewal

Shruti Tibrewal is an Associate Advocate with S. Jalan and Co., having passed out in the year 2020 from Amity University, Kolkata. Her area of practice majorly includes Real Estate transactional documentation, due diligence, drafting and research in the legal area.