Indian Courts have predominantly applied the test, termed as the ‘Classical Trinity factors’ as set out in the landmark House of Lords decision in Reckitt & Colman Products Ltd v Borden Inc. [1990] 1 All ER 873, to determine whether a defendant was passing off his goods as that of the plaintiff’s. The test requires the assessment of the following factors namely, (i) goodwill owned by a claimant (plaintiff); (ii) misrepresentation by the defendant; and (iii) likelihood of damage to that goodwill.
In a recent decision of Torrent Pharmaceuticals Ltd. v. Wockhardt Ltd. & Anr. [See end Note i], pertaining to a trademark infringement and passing off suit; the Single Judge of the Bombay High Court was faced with assessing the importance of one of the ‘Classical Trinity factors”, that is the ‘likelihood of misrepresentation’. Since the marks of both parties were registered, the Single Judge restricted the adjudication to only the action of passing off. The specific issue before the Single Judge was where similarity between the competing marks is not disputed, should likelihood of misrepresentation be presumed such as to result in a restraint order in favour of the plaintiff.
The Single Judge analysed the importance of said factor in the context that passing off is an action in deceit, and held that for a restraint order to be issued in a passing off action, there must be some material on record to show actionable misrepresentation by a defendant in attempting to parade his goods as that of the plaintiff. The Single Judge further held that the misrepresentation must be as to source, provenance or origin of the goods or services. Most importantly the Single Judge clarified that a distinction is to be made between ‘likelihood of misrepresentation’, ‘likelihood of confusion’ and ‘likelihood of damage’ and held that “Confusion is not always deception, but the purpose of deception is to confuse and confound”. In applying the above principles to the facts of the instant case, the Single Judge held that the plaintiff failed to establish the “Classical Trinity factors” and specifically held that the plaintiff failed to show any prima facie misrepresentation and accordingly refrained from issuing an interim injunction in favour of the plaintiff.
Brief facts and contentions of the parties:
Torrent Pharmaceuticals Ltd. (Torrent/Plaintiff) instituted a suit for trademark infringement and passing off relying upon its registered marks “CHYMORAL” and “CHYMORAL FORTE”, against Wockhardt Ltd. (Wockhardt/Defendant) and another, alleging that the use of their registered mark, “CHYMTRAL FORTE” amounted to passing off of the plaintiff’s registered marks. The marks of both parties are used in respect of pharmaceutical compositions comprising proteolytic enzymes, trypsin and chymotrypsin as active ingredients and functioning as anti-inflammatory, anti-exudative (for swelling or oedema reduction), mycolytic (breaking down bronchial secretions) and quickened wound healing.
Torrent asserted that its mark was registered in India as far back as 1962 and that it discovered Wockhardt’s virtually identical mark to that of its own and that it was used in respect of the same pharmaceutical composition as that of its own, only in June 2016 and accordingly alleged that there exists likelihood on consumers mistaking Wockhardt’s product as one by Torrent, thereby resulting in passing off. Torrent also relied upon the Supreme Court decision in Cadila Health Care Ltd. v. Cadila Pharmaceuticals Ltd. (2001) 5 SCC 73 to assert that in matters pertaining to pharmaceuticals, a higher degree of caution comes into play and that a commonplace consumer would be confused on seeing Wockhardt’s product. Wockhardt, on the other hand asserted that it applied for registration of the mark “CHYMTRAL FORTE” on 5th March, 2009, on a ‘proposed to be used basis’ which proceeded to registration on 9th February, 2011. In the light of the same, Wockahrdt alleged that the products of both parties have co-existed in the market for a length of time and that Torrent, despite knowledge of Wockhardt’s product did not take any action. Wockhardt also argued that there is nothing on record to show that Wockhardt at any time attempted to dupe, deceive or delude anyone into believing that products bearing the mark “CHYMTRAL FORTE” was a Torrent product.
Decision of the court:
The Single Judge firstly took into consideration the following important factual details. The Single Judge noted that Wockhardt launched “CHYMTRAL FORTE” in 2009 and that its sales for said product rose from about Rs. 27 lakhs in 2009 to Rs. 3.82 crores in 2016. The Single Judge also noted that Wockhardt’s application for registration of the mark “CHYMTRAL FORTE” was advertised in the Trade Marks Journal No. 1441 on 1st June, 2010 and importantly the Single Judge noted that there was no opposition to said mark till its registration on 9th February, 2011. The Single Judge also took into consideration the fact that following an oral demand to withdraw its product by Torrent in June, 2016; Wockhardt filed and served caveats in High Courts of different jurisdictions under Section 148-A of the Code of Civil Procedure, 1908, which expired in October, 2016, but Torrent instituted the instant suit only on 30th January, 2017. Based on the above facts, the Single Judge observed that it was difficult to accept that Torrent was made aware of Wockhardt’s product only in June, 2016 and noted that this was enough to deny the Plaintiff interim relief.
Secondly, on the assessment of the factor of ‘likelihood of misrepresentation’, the Single Judge concurred with Wockhardt’s submissions that while confusion may be assumed, deceit or deception may not. The Single Judge held that a plaintiff must show false representation, albeit unintentional, to the public that leads it to believe that the goods or services of the defendant are those of the plaintiff. The Single Judge also cautioned that while similarity tests used for infringement analysis have a role to play, they are not always necessarily determinative in passing off analysis. The Single Judge thus held that Torrent failed to show any prima facie misrepresentation by Wockhardt.
Thirdly, the Single Judge analysed as to whether Torrent established goodwill and reputation in its registered marks. In this regard, the Single Judge explained that the it is not enough for a plaintiff to only show volumes and sales, but emphasized that the plaintiff must prove goodwill and reputation of the kind that results in the association of the product with its source or maker. The Single Judge stressed that this is the essence of the first of the “Classical trinity factors’, namely ‘goodwill owned by a claimant’. Applying the above principle to the facts of the instant case, the Single Judge observed that Torrent only adduced statements of sales, invoices, promotional materials etc. and held that Torrent failed to establish the necessary linkage or association in the public mind between the product and its maker such that there is a one-ness, a unity between the product and its source. The Single Judge thus held that Torrent failed to establish goodwill and reputation in its registered marks.
Fourthly, the Single Judge noted that in the light of Wockhardt’s trademark registration in 2011 and its caveat petitions in 2016, Torrent’s conduct in instituting the instant suit on 30th January, 2017 was one amounting to acquiescence in the form of silent assent. In this regard, the Single Judge clarified that while delay is not acquiescence, prolonged inaction coupled with the knowledge of invasion of a right amount to acquiescence.
Fifthly, the Single Judge considered the parties’ submissions on the issue that matters pertaining to pharmaceuticals require a higher degree of caution. In this regard, the Single Judge observed that the higher degree of caution as proposed by the Supreme Court in the decision of Cadila was rendered with a view to avoid public injury and specifically in cases where competing marks were for drugs to cure the same ailment, albeit with different compositions and therefore mistaking one for the other could be dangerous. With respect to the instant case, the Single Judge, by relying upon the reasoning in Schering Corporation & Anr. v. United Biotech (P) Ltd. & Anr. (2010 (7) MhLJ 611; held that there was no dispute that the competing marks were directed to the same pharmaceutical composition and thus held there would be no threat of public injury if one was mistaken for the other.
Finally, the Single Judge held that Torrent failed to fulfil the conditions for grant of an interim injunction, that it failed to establish a prima facie case, failed to establish that the balance of convenience lies in its favour and also failed to establish that irreparable harm and injury would be caused to Torrent if the interim injunction is not granted in its favour.
Analysis
The instant decision of the Single Judge of the Bombay High Court provides a holistic view of the requirements to establish a case of passing off and focusses on the burden of proof upon the plaintiff to fulfil the ‘Classical Trinity factors’ for a favourable interim injunction. Most importantly, the instant decision clarifies two important aspects in passing off matters, first, that merely establishing similarity between competing marks will not automatically satisfy the criteria of establishing ‘likelihood of misrepresentation’ and second, that to prove reputation merely filing documents evidencing sale, such as invoices and brochures before the Court, will not suffice and to prove “goodwill and reputation” it will be important to associate the product with its source or maker.
[The author is Senior Associate, IPR Practice, Lakshmikumaran & Sridharan, Delhi]