Bombay High Court
Medley Pharmaceuticals Ltd vs Twilight Mercantiles Ltd. And Another on 7 July, 2014
Equivalent citations: AIR 2015 (NOC) 45 (BOM.), 2014 (5) ABR 436
Author: G. S. Patel
Bench: G.S. Patel
NMS-657-08.DOC
Shephali
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
NOTICE OF MOTION NO. 657 OF 2008
IN
SUIT NO. 451 OF 2008
Medley Pharmaceuticals Ltd. ...Plaintiffs
Versus
Twilight Mercantiles Ltd. and another.
ig ...Defendants
Mr. Ashish Kamath a/w Puja Kshirsagar i/b M/s. Bharat Shah &
Co., for the Plaintiffs.
Mr. Shekhar Jagtap, for the Defendants.
CORAM: G.S. PATEL, J
JUDGMENT RESERVED ON: 11th June 2014
JUDGMENT PRONOUNCED ON: 7th July 2014
JUDGMENT:
1. The Plaintiffs are the proprietors of three registered trade marks, "O2", "OTWO" and "O2H" used on pharmaceutical and medicinal products. In the suit, they allege infringement of these marks by the Defendants who, according to the Plaintiffs, are using rival marks "O1B" and "O1B PLUS". The Plaintiffs also allege that the Defendants are passing off their products as those of the Plaintiffs. In the present Notice of Motion, the Plaintiffs seek interim reliefs restraining the Defendants from manufacturing, 1 of 29 ::: Downloaded on - 08/07/2014 23:50:24 ::: NMS-657-08.DOC selling, advertising or exhibiting for sale any pharmaceutical and medicinal preparations under any mark that that infringes the Plaintiffs' registered trade marks.
2. The Plaintiffs and the 1st Defendant are both manufacturers of medicinal and pharmaceutical products. The Plaintiffs are a reputed enterprise of some considerable standing. The 2nd Defendant is an entity that manufactures medicinal preparations for the 1st Defendant.
3. The Defendants have not appeared. I have, nonetheless, considered their defence as set up in the affidavit in reply. I have also, with the assistance of Mr. Kamath, learned counsel for the Plaintiffs, considered the relevant authorities. For the reasons that follow, I have been unable to find any substance in the Defendants' reply to this Notice of Motion. I have found the Defendants' marks to be of deceptive and confusing similarity to those of the Plaintiffs.
I have also found that the Defendants adopted the infringing marks with knowledge and notice of the registration of the Plaintiffs' marks.
4. The Plaintiffs' case is that for the last several years they have been using several distinctive trade marks on, and in connection with, their own different pharmaceutical and medicinal preparations. The Plaintiffs have devised and adopted distinctive marks to distinguish their goods from those of others as also to clearly distinguish between the Plaintiffs' own products inter se. In early 2002, the Plaintiffs conceived and adopted the distinctive trade marks "O2", "OTWO" and "O2H" for use in relation to 2 of 29 ::: Downloaded on - 08/07/2014 23:50:24 ::: NMS-657-08.DOC certain specific pharmaceutical and medicinal preparations. The Plaintiffs applied for registration of these trade marks under The Trade and Merchandise Marks Act, 1958. On 12th April 2002, the Plaintiffs applied for and obtained registration of the trade mark "OTWO" under registration No. 1094796 in Class 5 of the 4th Schedule to the Trade and Merchandise Marks Rules, 1959 in respect of medicinal and pharmaceutical preparations with effect from 12th April 2002. A copy of the registration certificate is on record. The registration subsists and is valid today.
5. The phonetic equivalent of the trade mark "OTWO" is "O2". On 23rd October 2003, the Plaintiffs also applied for registration of this trade mark and obtain registration under No. 1245730 in Class 5 of the IVth Schedule to the Trade Mark Rules, also in respect of pharmaceutical and medicinal preparations. Even prior to that registration, the Plaintiffs had been using the mark "O2" since about June 2002. The subsequent registration is valid and subsisting. A third application was granted on 1st December 2004 for the trade mark "O2H" under the registration No. 1323143 in the same class and the same schedule of the rules. That registration is also valid and subsisting.
6. The Plaintiffs outsourced the manufacture of certain medicinal preparations, namely, ofloxacin and ornidazole tablets, to its licensee, one Vapi Care Pharma Private Limited, under the name "O2". Vapi Care has been manufacturing these products since 2002. The Plaintiffs' products are now sold both in tablet and suspension form under the trade mark "O2" since June 2002 and under the trade mark "O2H" since March 2004. The Plaintiffs' 3 of 29 ::: Downloaded on - 08/07/2014 23:50:24 ::: NMS-657-08.DOC use and marketing of these preparations under these two trade marks has been open, continuous and extensive for over five years.
Specimen cartons of these products are produced before the Court.
7. According to Mr. Kamath, the superior quality of the Plaintiffs' products, a result of the Plaintiffs' expertise and high standards, under these two trade marks has resulted in the Plaintiffs acquiring a reputation for reliability and quality, and much goodwill within the trade and with the public. The Plaintiffs' trade marks have come to be exclusively associated with their products and preparations. The Plaintiffs' business has grown. Mr. Kamath points out that there has been a steady increase in the Plaintiffs' sales of their products under these marks. In the five-year period from June 2002 to December 2007, the Plaintiffs' sales were in excess of nearly Rs.58 crores. Mr. Kamath invites attention to the certificates issued by the Chartered Accountants to establish year-
wise sales figures. He also points out that the Plaintiffs have spent a huge amount of over Rs.11 crores only on advertisements and sales promotions of preparations bearing these marks.
8. Copies of certificates in respect of three trade marks in question are Exhibits "A", "A1" and "A2" to the plaint. The products under these marks are all Schedule 'H' drugs. The Plaintiffs' claim that among doctors, chemists, stockists and the public, these marks have become distinctive of the Plaintiffs' products and the Plaintiffs have thus valuable proprietary rights in all three marks in relation to pharmaceutical and medicinal preparations. The Plaintiffs are, therefore, Mr. Kamath submits, justified in claiming an exclusive entitlement to the use of these 4 of 29 ::: Downloaded on - 08/07/2014 23:50:24 ::: NMS-657-08.DOC marks to the exclusion of other manufactures and/or doctors in pharmaceutical and medicinal preparations.
9. Sometime in November 2004, the Plaintiffs came to learn that the Defendants were manufacturing and selling certain pharmaceutical and medicinal preparations under a rival trade mark "O2B". Phonetically, visually and structurally, this mark is, Mr. Kamath submits, and in my view with considerable justification, almost identical to the Plaintiffs three registered trade marks "O2", "OTWO" and "O2H". The Defendants' mark was deceptively and confusingly similar to the Plaintiffs'. Indeed, the 2004 competing trade mark merely substituted one consonant, 'B', for another consonant, 'H'. Confronted with this, the Plaintiffs filed Suit No. 553 of 2005 against these very Defendants in this Court. Ad-interim reliefs were granted on 28th March 2005, and the Defendants were enjoined not to use the trade mark "O2B" or any mark similar to it so as to infringe the Plaintiffs' registered trade marks. The Defendants were also restrained from passing off their preparations as those of the Plaintiffs or as being in any way connected with the Plaintiffs' preparations. This ad-interim order was confirmed on 21st April 2006.
10. Less than a year later, the Plaintiffs learned that the Defendants had, when faced with these orders of injunction, switched over to using another trade mark also in respect of pharmaceutical and medicinal preparations, namely "O1B PLUS". An argument has been taken in the affidavit in reply that this new competing trade mark is part of a "series of marks". I will consider this defence presently. At this stage, it is sufficient to note that the 5 of 29 ::: Downloaded on - 08/07/2014 23:50:24 ::: NMS-657-08.DOC suggestion seems to be that the competing trade mark that is the subject matter of this suit, i.e., "O1B PLUS" is an "evolution" of the earlier mark that was the subject matter of the Suit No. 553 of 2005. Mr. Kamath submits, and once again with complete justification, that this trade mark "O1B PLUS" is phonetically, visually and structurally indistinguishable for all intents and purposes from the Plaintiffs' trade mark. Certainly, the similarity is both deceptive and confusing. Both sets of medicinal preparations have very similar ingredients. The spectrum of ailments they seek to address is the same. When, for instance, telephonic orders are placed for these products, confusion is inevitable, and it matters not whether such a request is made within the trade, by a medical practitioner, or by an individual. Mr. Kamath's submission is that there is not only an infringement of the Plaintiffs' marks but that there is absolutely no manner of doubt that the Defendants, having once been restrained, are now trying by another method to continue to pass off their preparations as those of the Plaintiffs.
11. On 8th February 2007, the Plaintiffs sent a cease and desist notice to the Defendants. A holding reply was received on 22nd February 2007 from the 1st Defendant's Advocates stating that they would revert after instructions. There was, however, no further response from the Plaintiffs or their Advocates. A final notice was sent by the Plaintiffs' Advocates on 14th November 2007.
12. The present Notice of Motion was moved on 29th February 2008. At that stage both parties agreed that the Notice of Motion itself should be taken up for final hearing. There is an affidavit in 6 of 29 ::: Downloaded on - 08/07/2014 23:50:24 ::: NMS-657-08.DOC reply filed by the 1st Defendant. Although this Notice of Motion has been listed at Sr. No. 201 on the final hearing lists well in advance, and there is also a separate notice to the effect that interim applications for final hearing will be taken up every Wednesday and Thursday in the afternoon session, the Defendants remain unrepresented.
13. Despite the Defendants' absence, I have carefully considered the contentions raised in the affidavit in reply. There seem to be four principal defences. The first of these is that the Plaintiffs have acquiesced in the use of their trade mark "O1B" by the Defendants. I presume this to mean that the Plaintiffs have not taken any assertive steps to restrain the Defendants from using this offending mark. It is well established that in a matter such as this acquiescence does not merely mean prior knowledge or even a lack of previous action. The person against whom this allegation is made must be shown to actually have acquiesced for a continuous period of five years in the use of the rival registered trade mark (Section 33 of the Trade Marks Act, 1999), i.e., affirmatively encouraged the defendant to worsen his position. This is hardly the case here. The Plaintiffs took all necessary steps to protect the trade marks when the Defendants first attempted to infringe the Plaintiffs' marks and to pass off their products as those of the Plaintiffs. The Plaintiffs obtained a restraining order. The Defendants promptly altered their marks, but only to one that continued to be and, in my view, still is, an infringement of the Plaintiffs' mark and certainly constitutes passing off. There is, therefore, no substance to the first claim of the Defendants.
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14. The second submission is that 1st Defendant has a well established business and a large turnover, and employs several persons. This is no defence at all to an action in infringement and passing off. Indeed the defence is a complete non sequitur. Infringement and passing of cannot be permitted merely because the person who infringes and passes off another's goods as his own happens to have a large turnover.
15. The third submission is set out in paragraph 11 of the affidavit in reply. Here, the 1st Defendant explains how it conceived of the conflicting marks. According to the 1st Defendant, sometime in July 2003, the 2nd Defendant (which has since amalgamated with the 1st Defendant) decided to manufacture a medicinal and pharmaceutical preparation containing Ofloxacin and Ornidazole and Lactobacillus as its active ingredients. According to the Defendants, the trade mark "O1B" is a combination of the letter 'O' from Ofloxacin and letter 'B' from Lactobacillus. That is unconvincing, especially as to the deployment of the letter B. The Defendants' claim also to have another trade mark "O2B", conceived in a similar manner. At this stage, a portion of what has been set out by the Defendants in paragraph 11 is worth be producing, not least because far from supporting the Defendants' case, it is actually destructive of it.
"11. ... I say that Defendant No. 2 requested their Trade Marks Attorneys to conduct a search of the same. In a search report dated 15th July 2003, two trademarks viz OB and O-200 Tab came to be found closest to the proposed mark. Thereafter, an application for registration was made. In a search report issued by the Registry dated 4th October 2003 it was stated that two 8 of 29 ::: Downloaded on - 08/07/2014 23:50:24 ::: NMS-657-08.DOC marks namely O2 and O2FRESH are pending for registration with the Trade Marks Registry. I crave leave to refer to and rely upon the said Reports, when produced. I say that Defendant No. 2 continued with its marked and product development study of the said preparation in June/ July 2004 and eventually made an application in September 2003 for registration of the trademarks O1B and O2B in Class 5 in respect of medicinal and pharmaceutical pre-acceptance. The applications for registration of the trademarks O1B and O2B are dated 23 September 2003. The application for O1B and O2B are numbered as 1238809 and 1238810 respectively. Hereto annexed and marked EXHIBITS 'B' and 'C' are copies of the said applications. I say that Defendant No. 2 then licensed the trademarks O1B and O2B to Defendant No. 1. In or about 2003, Defendant No. 1 make an application to the Food & Drug Administration, Maharashtra (Thane) (FDA) to formulate the said preparation under the trademarks O1B which permission has been granted by the FDA in or about August 2003 and for O2B in or abut April 2004."
16. To begin with, the explanation for the coining of these two marks is not persuasive, given their phonetic, visual and structural proximity to the marks of the Plaintiffs. Secondly, on the Defendants' own showing, the search commissioned by them threw up, inter-alia, the Plaintiffs' registered mark "O2". Despite, therefore, having knowledge of the pre-existence and prior registration of the Plaintiffs' registration mark "O2", the Defendants nonetheless proceeded with their adoption of the infringing marks "O1B" and "O2B". As I have noted earlier the Defendants use of the mark "O2B" has already been restrained by a separate order of this Court.
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17. The fourth submission in the affidavit in reply is one that, in my view, actually serves only to destroy what little remains of the defence. In paragraph 1 apart from claiming an honest and bona fide conception and adoption of the rival marks, the Defendants now claimed to have coined the trade mark "O3B", contending that the trade marks "O1B", "O2B" and "O3B"are part of "a series of trade marks". There is a common class of products to which all three marks are sought to be applied. There is a common idea underlying all three marks. What the Defendants have overlooked, to their peril, is that an injunction and restraint against any one mark of an admitted "series of marks", must necessarily extend to all others.
18. Justifying the use of the competing marks, the Defendants have in Exhibits 2 and 3 to the affidavit in reply produced certificates of sales for products under the trade marks "O1B200"
and "O1B400" for the year 2003-2004 and for the product "O2B"
for the period ending 31st December 2004. In view of the injunction granted by this Court against the Defendants in respect the mark "O2B" and which order has attained finality, I have declined to take into consideration the sales of that product. The sales of the products under the "O1B" mark are meagre.
19. One of the other defences suggested in the affidavit in reply is that the word 'O' is common to the trade for several different pharmaceutical and medicinal products. I am unable to find anything in the affidavit in reply that substantiates this contention. It is for the Defendants to specifically demonstrate that other marks use the word 'O' in a similar fashion and are also freely available.
10 of 29 ::: Downloaded on - 08/07/2014 23:50:24 ::: NMS-657-08.DOC That is not been done. It is not sufficient to show that a get up is different when the phonetic and structural similarity is so close that is apt to lead to confusion in the mind of, in the words of the Supreme Court, a man of "average intelligence and imperfect recollection".1
20. Despite the Defendants' absence at the hearing of this Notice of Motion, it is necessary to consider whether the defences raised in the affidavit in reply can be said to have any basis in law.
Principally: what are the tests in any infringement action and a passing off action? Where the trade dress differs, is another standard to be applied? Does the fact that the competing products are Scheduled 'H' drugs of restricted availability, sold by chemists only on a doctor's prescription, make a difference or require a different standard to be adopted? What must the party alleging acquiescence prove?
21. Mr. Kamath first placed the leading decision of the Supreme Court in Cadila Health Care Ltd. vs. Cadila Pharmaceuticals Ltd. 2 The Supreme Court was, in that case as in the present one, concerned with rival pharmaceutical companies manufacturing various pharmaceutical products. The Supreme Court considered the past case law on the subject in the context of both an infringement action and a passing off action. It is specifically cited the classic decision of the Supreme Court in Amritdhara Pharmacy v. Satya Deo Gupta.3 Quoting the decision of Parker, J in Re 1 Corn Products Refining Co v Shangrila Food Products Ltd, AIR 1960 SC
142. 2 AIR 2001 SC 1952 3 AIR 1963 SC 449 11 of 29 ::: Downloaded on - 08/07/2014 23:50:24 ::: NMS-657-08.DOC Pianotist Co.'s. Application4 on the question of passing off, the Amritdhara Court said:
"You must take the two words. You must judge them, both by their look and by their sound. You must consider the goods to which they are to be applied. You must consider the nature and kind of customer who would be likely to buy those goods. In fact you must consider all the surrounding circumstances; and you must further consider what is likely to happen if each of those trade marks is used in a normal way as a trade mark for the goods of the respective owners of the marks." (p. 777)"
22. It also held that confusion speaks to the state of mind of a customer who, on seeing a mark, thinks that it differs from mark on goods that he has previously bought but doubts whether that impression is perhaps due to his imperfect recollection. Approaching the question from the point of view of a man of average intelligence and imperfect recollection, if the overall structural and phonetic similarity of the rival names is likely to deceive or cause confusion then the Court must intervene. It is not permissible for a Court to presume that such a person, the ordinary layman or a common purchaser, would carefully splice or parse the two rival words, ponder, ruminate or cogitate on the difference, closely examine their provenance and only then make a decision. The Court was also mindful of conditions that obtain in this country and the way in which people speak and pronounce words.
23. The Supreme Court expressly rejected the submission that the principal of phonetic similarity has no application where the 4 (1906) 23 RPC 774 12 of 29 ::: Downloaded on - 08/07/2014 23:50:24 ::: NMS-657-08.DOC trade dress is distinguishable, i.e., where competing marks are presented in different ways. Again, adopting the approach of the perspective of an ordinary man, this distinction was repelled by the Supreme Court.
24. Of particular importance to the present controversy is the pronouncement in Cadila in relation to Schedule 'H' drugs:
"22. It may here be noticed that Schedule "H" drugs are those which can be sold by the chemist only on the prescription of the Doctor but Schedule "L" drugs are not sold across the counter but are sold only to the hospitals and clinics. Nevertheless, it is not un-common that because of lack of competence or otherwise, mistakes can arise specially where the trade marks are deceptively similar. In Blansett Pharmaceuticals Co. v. Carmick Laboratories Inc., 25 USPQ 2nd 1473 (TTAB 1993) it was held as under:
"Confusion and mistake is likely, even for prescription drugs prescribed by doctors and dispensed by pharmacists, where these similar goods are marketed under marks which look alike and sound alike."
23. In the case of Glenwood Laboratories, Inc. v. American Home Products Corp. reported in 173 USPQ 19 (1972) 455 F. Reports 2d, 1384 (1972) the Court of the United State had held that:
"The fact that confusion as to prescription drugs could produce harm a contrast to confusion with respect to non-medicinal products as an additional consideration of the Board as is evident from that portion of the opinion in which the Board stated...."
13 of 29 ::: Downloaded on - 08/07/2014 23:50:24 ::: NMS-657-08.DOC The products of the parties are medicinal and applicant's products is contraindicated for the disease for which opposer's products is indicated. It is apparent that confusion or mistake in filling a prescription for either product could produce harmful effects. Under such circumstances, it is necessary for obvious reasons, to avoid confusion or mistake in the dispensing of the pharmaceuticals."
The board's view that a higher standard be applied to medicinal products finds support in previous decisions of this Court, Cilifton v. Plough 341, F. 2d 934, 936, 52, CCPA 1045, 1047 (1965) ("It is necessary for obvious reasons, to avoid confusion in the dispensing of pharmaceuticals") Campbell Products, Inc. V. John Wyeth and Bro. Inc., 143 F. 2d 977, 979, 31 CCPA 1217 (1944) it seems to us that where ethical goods are sold and careless use is dangerous, greater care should be taken in the use of registration of trade marks to assure that no harmful confusion results").
24. In the case of R.J. Strasenburgh Co. v. Kenwood Laboratories, Inc. reported in (1955) 106 USPQ 379 as noted in the decision of Morgenstem Chemical Company's case (supra), it had been held that:
"Physicians are not immune from confusion or mistake. Further more it is common knowledge that many prescriptions are telephoned to the pharmacists and others are handwritten, and frequently handwriting is not unmistakably legible. These facts enhance the chances of confusion or mistake by the pharmacists in filling the prescription if the marks appear too much 14 of 29 ::: Downloaded on - 08/07/2014 23:50:24 ::: NMS-657-08.DOC alike when handwritten or sound too much alike when pronounced."
25. The drugs have a marked difference in the compositions with completely different side effects, the test should be applied strictly as the possibility of harm resulting from any kind of confusion by the consumer can have unpleasant if not disastrous results. The Courts need to be particularly vigilant where the defendant's drug, of which passing of is alleged, is meant for curing the same ailment as the plaintiff's medicine but the compositions are different. The confusion is more likely in such cases and the incorrect intake of medicine may even result in loss of life or other serious health problems. In this regard, reference may usefully be made to the case of Glenwood Laboratories, Inc. v. American Home Products Corp., 172 USPQ 19 (1972) 455 F. Reports 2d, 1384 (1972) where it was held as under:
"The products of the parties are medicinal and applicant's products is contraindicated for the disease for which opposer's product is indicated. It is apparent that confusion or mistake in filling a prescription for either product could produce harmful effects. Under such circumstances, it is necessary for obvious reasons, to avoid confusion or mistake in dispensing of the pharmaceuticals."
26. It was further submitted on behalf of the appellant that although the possibility of confusion in a drug being sold across the counter may be higher, the fact that a drug is sold under prescription or only to physicians cannot by itself be considered a sufficient protection against confusion. The physicians and pharmacists are trained people yet they are not infallible and in 15 of 29 ::: Downloaded on - 08/07/2014 23:50:24 ::: NMS-657-08.DOC medicines, there can be no provisions for mistake since even a possibility of mistake may prove to be fatal.
27. As far as present case is concerned, although both the drugs are sold under prescription but this fact alone is not sufficient to prevent confusion which is otherwise likely to occur. In view of the varying infrastructure for supervision of physicians and pharmacists of medical profession in our country due to linguistic, urban, semi-urban and rural divide across the country and with high degree of possibility of even accidental negligence, strict measures to prevent any confusion arising from similarity of marks among medicines are required to be taken."
25. Indeed, as the Supreme Court said in Cadila, there is a supervening public interest that supports a lower threshold of proof to establish confusing similarity where the trade marks in question are being applied to medicinal products.
"Drugs are poisons, not sweets. Confusion between medicinal products may, therefore, be life threatening, not merely inconvenient. Noting the frailty of human nature and the pressures placed by society on doctors, there should be as many clear indicators as possible to distinguish two medicinal products from each other. It is not uncommon that in hospitals, drugs can be requested verbally and/or under critical/pressure situations. Many patients may be elderly, infirm or illiterate. They may not be in a position to differentiate between the medicine prescribed and bought which is ultimately handed over to them."
26. In short, in a passing off action, an immediate and perhaps determinative test is where the misrepresentation made by the 16 of 29 ::: Downloaded on - 08/07/2014 23:50:24 ::: NMS-657-08.DOC defendant is such as is apt to cause an ordinary customer to confuse one product for the other due to the similarity of marks and other surrounding factors. In paragraph 35, the Supreme Court in Cadila enunciated seven tests to be applied in a passing of action. Though these were formulated in the context of an unregistered trade mark, generally these factors must be considered while deciding every application against a rival mark of deceptive and confusing similarity.
"35. Broadly stated in an action for passing off on the basis of unregistered trade mark generally for deciding the question of deceptive similarly the following factors to be considered:
a) The nature of the marks i.e. whether the marks are word marks or label marks or composite marks, i.e. both words and label works.
b) The degree of resembleness between the marks, phonetically similar and hence similar in idea.
c) The nature of the goods in respect of which they are used as trade marks.
d) The similarity in the nature, character and performance of the goods of the rival traders.
e) The class of purchasers who are likely to buy the goods bearing the marks they require, on their education and intelligence and a degree of care they are likely to exercise in purchasing and/or using the goods.
f) The mode of purchasing the goods or
placing orders for the goods and
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g) Any other surrounding circumstances
which may be relevant in the extent of dis-
similarity between the competing marks.
Weightage to be given to each of the aforesaid factors depends upon facts of each case and the same weightage cannot be given to each factor in every case."
27. This is an authoritative statement of law as regards actions and claims in passing off. On the question of the likelihood of deception or confusion, the findings of the Supreme Court in Kaviraj Pandit Durga Dutt Sharma vs. Navratna Pharmaceuticals Laboratories5 continue to hold the field. In paragraph 28, the Supreme Court held:
"28. When once the use by the defendant of the mark which is claimed to infringe the plaintiffs mark is shown to be "in the course of trade, the question whether there has been an infringement is to be decided by comparison of the two marks. Where the two marks are identical no further questions arise; for then the infringement is made out. When the two marks are not identical, the, plaintiff would have to establish that the mark used by the defendant so nearly resembles the plaintiff's registered trade mark as is likely to deceive or cause confusion and in relation to goods in respect of which it is registered (Vide Section 21). A point has sometimes been raised as to whether the words "or cause confusion" introduce any element which is not already covered by the words "likely to deceive" and it has sometimes been answered by saying that it is merely an extension of the earlier test and does not add very materially to the concept indicated by the earlier words "likely to deceive". But this apart, as the question 5 AIR 1965 SC 980 18 of 29 ::: Downloaded on - 08/07/2014 23:50:24 ::: NMS-657-08.DOC arises in an action for infringement the onus would be on the plaintiff to establish that the trade mark used by the defendant in the course of trade in the goods in respect of which his mark is registered, is deceptively similar.
This has necessarily to be ascertained by a comparison of the two marks -- the degree of resemblance which is necessary to exist to cause deception not being capable of definition by laying down objective standards. The persons who would be deceived are, of course, the purchasers of the goods and it is the likelihood of their being deceived that is the subject of consideration. The resemblance may be phonetic, visual or in the basic idea represented by the plaintiffs mark. The purpose of the comparison is for determining whether the essential features of the plaintiff's trade mark are to be found in that used by the defendant. The identification of the essential features of the mark is in essence a question of fact and depends on the judgment of the Court based on the evidence led before it as regards the usage of the trade. It should, however, be borne in mind that the object of the enquiry in ultimate analysis is whether the mark used by the defendant as a whole is deceptively similar to that of the registered mark of the plaintiff."
28. If we apply these two tests to the present case, there is no manner of doubt that the Plaintiffs have made out a case both in infringement and in passing off. The marks "O1B" and "O2B" are much too proximate in visual, phonetic and structural similarity to the plaintiffs' marks "OTWO", "O2" and "O2H". In the mind of the common man, there is bound to be confusion as to the origins of products sold under these marks. Any person, even a chemist or a doctor, might easily confuse the two and conclude that perhaps both are manufactured by the same company. It is equally possible that any person might conclude that both are similar preparations 19 of 29 ::: Downloaded on - 08/07/2014 23:50:24 ::: NMS-657-08.DOC or with slight variations in their formulation or are later generation products. Thus, seen juxtaposed, there is undoubtedly a deceptive similarity of such a nature as is bound to result in confusion.
29. The defence that the Defendants' marks are part of a series of marks does not, as I have noted earlier noted assist them in any way. This too is a matter that has been decided by the Supreme Court, as Mr. Kamath points out, in Corn Products Refining Co. vs. Shangrila Food Products Ltd.6 In such a case it makes no difference whether the rival marks are registered or unregistered. If the marks in the 'series' have a common feature or a common syllable, but are owned by different persons, this will assist an applicant for a mark containing the common feature. But before an applicant can successfully register such a mark, he must prove that those marks had acquired a reputation by user in the market. In Corn Products again, the Supreme Court set out the tests for determining the likelihood of deception or causing confusion, and testing the similarity between the rival marks. The marks have to be considered has a whole. There need not be an absolute identity of the competing marks. Where the products are so connected as to make confusion or deception likely in view of similarity, the use of the competing mark will be restrained by a Court.
30. I must also note the decision of a Division Bench of this Court in a case concerning the present plaintiffs themselves, viz., Medley Laboratories (P) Ltd. vs. Alkem Laboratories Ltd. 7 Here again, the test applied was of "deceptive similarity", i.e., the likelihood of 6 AIR 1960 SC 142 7 2002 (25) PTC 592 (Bom)(DB) 20 of 29 ::: Downloaded on - 08/07/2014 23:50:24 ::: NMS-657-08.DOC deception or causing confusion. This, too, was in the contest of medicinal preparations. Our Division Bench noted, following Cadila, that in such cases Court must take special care given that confusion made have possibly catastrophic consequences. It rejected the argument that there was no likelihood of confusion only because the drugs in question were prescription drugs.
31. The observations of a learned Single Judge of this Court 8 in Wyeth Holdings Corporation & Anr. vs. Burnet Pharmaceuticals (Pvt.) Ltd.9 are of special importance as they also deal with medicinal preparations. Dr. Chandrachud, J. reviewed the case law on the subject, including Amritdhara, Cadila and other decisions. He then said:
"14A. As a matter of principle, it would be inappropriate for the Court to apply a stricter standard only to a particular class of medicinal preparations. If the Court were to do this, it would have to make artificial distinctions from case to case based on whether or not the Court considers that a confusion arising out of the medicinal product in issue may or may not have disastrous effects on health and life. Such an approach is impermissible. An ostensibly innocuous medicinal preparation taken for an affliction which is not life threatening may yet result in a serious danger to life and health, where the drug is not manufactured under correct conditions. A consumer who desires to obtain a medicine even for an ordinary ailment is entitled to be sure that the drug that he purchases is of an assured character and quality. A manufacturer builds up a reputation for quality and standards assiduously over a 8 Dr. D. Y. Chandrachud, J., as he then was 9 2008 (36) PTC 478 21 of 29 ::: Downloaded on - 08/07/2014 23:50:24 ::: NMS-657-08.DOC length of time and an established mark assures to the consumer that the medicine which he has purchased is of a requisite quality that is associated with the mark. A less than strict standard cannot be applied on the hypothesis that the ailment which the drug is intended to treat is not life threatening, nor for that matter can the application of a lower standard be justified merely on the ground that the composition of the Plaintiff's product is the same as that of the Defendant and the confusion caused by mistaking one for the other would not result in a danger to health. Undoubtedly, where the competing drugs are meant to cure the same ailment but the compositions are different, mistaking one for the other may result in deleterious consequences. But, merely because the two competing marks are used for drugs with the same composition that would not justify applying a lower standard of scrutiny. For, even in such a case, the public interest lies in protecting the consumer against an unwary purchase of a deceptively similar product. The consumer must be protected against a reasonable possibility of confusion arising out of a deceptively similar mark. The attempt, therefore, to read down Cadila is impermissible.
17. In considering the question of deceptive similarity, the two marks have to be considered as a whole. The structure of the mark visually and phonetically must be borne in mind. The image which the Court must have is that of the quintessential common man. When the Judge looks at phonetics, the sound which accompanies the pronunciation of the mark is the sound of the mark to an ordinary purchaser bereft of the niceties of language. Structurally and phonetically FOLV falls within that perilous zone where approximation to the mark of the Plaintiffs is close enough to be deceptively similar. It is to my mind, no answer to state that the Plaintiffs intend that the VITE in their mark is to be so pronounced as to 22 of 29 ::: Downloaded on - 08/07/2014 23:50:24 ::: NMS-657-08.DOC rhyme with 'white' while the Defendant intends that the "V" in their mark has to be so pronounced as to rhyme with the 'V' in 'victory' and to then make a distinction between VITE and the V. The ordinary customer goes to a small shop of a Chemist and to him the distinction between FOLVITE on the one hand and FOL-V on the other is so thin as to almost be lacking in significance. It may well be that the manner in which the mark of the Plaintiffs is written in Devnagari may make the VITE in the mark resemble 'white'. But every customer in a multi lingual country such as India is not conversant with that script. An average consumer who asks for FOLVITE would fail to gauge the distinction when he is given a strip of tablets of FOLV and that is what matters on the question of deceptive similarity."
32. There is also the question of delay. Although the Defendants allege acquiescence, the real case alleged in the affidavit in reply is delay on the part of the Plaintiffs. As Mr. Kamath points out, there is no legal basis to this submission. The question is not even res-
integra. It has been finally decided by the Supreme Court in Midas Hygiene Industries P. Ltd. & Anr. vs. Sudhir Bhatia & Ors. 10 in these words:
4. The Respondents filed an Appeal which has been disposed of by the impugned judgment. The Division Bench in spite of noting the factors which have been set out by the learned Single Judge, has vacated the injunction merely on the ground that there was delay and latches in filing the suit. It has held that such delay and latches disentitled grant of injunction. The respondents were merely directed to file regular accounts of their sales in Court.10
2004 (28) PTC 121 (SC); (2004) 3 SCC 90 23 of 29 ::: Downloaded on - 08/07/2014 23:50:24 ::: NMS-657-08.DOC
5. The law on the subject is well settled. In cases of infringement either of Trade Mark or of Copyright normally an injunction must follow. Mere delay in bringing action is not sufficient to defeat grant of injunction in such cases. The grant of injunction also becomes necessary if it prima facie appears that the adoption of the Mark was itself dishonest.
33. Similarly on the issue of delay, the Delhi High Court in Hindustan Pencils (P) Ltd. vs. India Stationery Products Co. & Anr. 11 has also held that delay by itself is not a sufficient defence to such an action especially where the use by the defendants is fraudulent.
In the present case, the Defendants were already once restrained in another action by separate order of this Court. They were then trying to use the mark "O2B" and "O2BPLUS". The Court issued an injunction. Faced with that, they immediately replaced the number 2 with the number 1 at least for one mark. In Hindustan Pencils, the Delhi High Court considered the question of acquiescence and held that, in law, the question arises where the proprietor of a mark, being aware of his rights, and being aware that the infringer may be ignorant of them, does some affirmative act to encourage the infringer's misapprehension so that the infringer worsens his position and acts to his detriment. A mere failure to sue without a positive act of encouragement is no defence and is no acquiescence. A defendant who infringes the plaintiffs' mark with knowledge of that mark can hardly be heard to complain if he is later sued upon it. A defendant who begins an infringement without searching the trade marks register is in no better a position. One who does take a search, finds the plaintiffs' mark and nonetheless continues his act of infringement is, however, certainly much worse 11 AIR 1990 Delhi 19 24 of 29 ::: Downloaded on - 08/07/2014 23:50:24 ::: NMS-657-08.DOC off. Certainly he cannot allege acquiescence. That door is closed to him.
34. Indeed, I would venture to suggest that some species of estoppel, an estoppel by conduct, would apply to such a defendant and would completely defenestrate the acquiescence defence. Prior knowledge of the plaintiffs' mark, if admitted or proved, is a complete answer to a defence of acquiescence on the part of the plaintiff. This is precisely the case here. By their own explicit admission, noted earlier, the Defendants took a search. This showed the Plaintiffs' mark. They nonetheless went ahead and began the illicit use of the rival, competing, confusing, deceptive and similar mark. The admission based on the search apart, the Defendants also had knowledge of the Plaintiffs' mark in another way: they had been subjected to a previous injunction. The defence of acquiescence is unavailable to the Defendants.
35. The question of delay simpliciter and whether the plaintiff should be denied relief only on that ground has also been decided. Mr. Kamath relies on a decision of a learned Single Judge of this Court in Charak Pharma Pvt Ltd v Glenmark Pharmaceuticals Ltd.12 This was a decision that contained a comprehensive review of the law, including precedents on infringement and passing of. All the authorities that I have referred to and several others in addition were fully considered. There, as in this case, a submission was made that not having obtained ad-interim relief, no interim relief ought to be granted after the lapse of seven years. Kathawala, J. held that in an infringement action, where acquiescence is not 12 2014 (57) PTC 538 (Bom); 2014 (2) All MR 732 25 of 29 ::: Downloaded on - 08/07/2014 23:50:24 ::: NMS-657-08.DOC established following well settled principles (as discussed earlier), mere delay is never a defence. He said:
"28. ... It is true that the Notice of Motion is taken up for final hearing after six years but the Plaintiff cannot be denied relief merely because the interim relief application could not be heard earlier. A similar argument was raised by the Defendant in another case of Sami Khatib & Anr. vs. Vadila Pharmaceuticals Ltd. in Notice of Motion No. 599 of 2006 in Suit No. 568 of 2006 and considered by this Court. In paragraph 46 of its decision, this Court observed as under:
"46. I am in agreement with Mr. Kamdar that the delay in this case is not fatal. First of all, the delay caused on account of pendency of this notice of motion from the date of the ad-interim order is not within the control of the Plaintiffs. The motion could not be heard early on account of the exigencies of work. That, by itself, will not give any right to the Defendants to contend that their user has been continuing. Such pendency does not confer any right to urge that there is delay and laches"."
36. A similar view was taken eighteen years ago by another learned Single Judge of our Court 13 in Anglo-French Drugs & Industries Ltd. vs. Eisen Pharmaceutical Company Pvt. Ltd.14 He said, although in the context of an ad-interim application:
13S.N. Variava, J., as he then was 14 Unreported decision in Notice of Motion No.112 of 1997 in Suit No.4450 of 1996 on an ad-interim application, decided on 19th December 1996.
26 of 29 ::: Downloaded on - 08/07/2014 23:50:24 ::: NMS-657-08.DOC "15. There can be no dispute with the propositions of law. However now, sad as it is, the reality is that notices of motion do not reach hearing for years. If therefore at the ad-interim stage itself the Court is even prima facie satisfied that the marks are deceptively similar and that the adoption is dishonest, not to grant relief would amount to encouraging dishonest parties to use laws delays. If an injunction were to be refused defendants would continue to use the deceptively similar mark and the loss caused to plaintiffs would be irreparable. Also defendants have only disclosed figures showing sales from 1995. This inspite of plaintiffs calling upon them to show figures of earlier sales. No figures of advertisement costs are shown. In my view, this is a fit case where ad interim relief must be granted."
To my mind, these observations apply equally, if not with greater force, to an application for interim relief. No plaintiff should be denied an interim relief to which he is entitled in law and equity merely on account of the vagaries of litigation and delays in our judicial system, the latter often of the defendants' contrivance. No defendant ought to be permitted to leverage such delays. The imperative of speedy disposal of cases does not lend itself to an arbitrage of time.
37. There is absolutely no manner of doubt that the Defendants' adoption of the rival trade mark O1B and its variants is dishonest and fraudulent, and far from bona fide. It is an attempt to pass off the Defendants' goods as those of the Plaintiffs, to hijack the plaintiffs' reputation and goodwill and to piggyback on the Plaintiffs' reputation, goodwill and commercial success. There can 27 of 29 ::: Downloaded on - 08/07/2014 23:50:24 ::: NMS-657-08.DOC be no doubting the confusing and deceptive similarity between the Plaintiffs' marks and those of the Defendants.
38. In the result, the motion succeeds. There will be an order in terms of prayer clauses (a) and (b) of the motion, which read as follows:
(a) That pending the hearing and final disposal of the suit, the Defendants, their directors, servants, dealers, distributors, agents and stockists be restrained by an order and injunction of this Hon'ble Court from manufacturing, selling, exhibiting for sale and advertising pharmaceutical and medicinal preparation under the trade mark "O1B" and or "O1B PLUS" and /or any other mark similar thereto, so as to infringe the Plaintiffs' registered trade marks Nos. 1094796 and 1245730 as well as the trade mark covered by Application No. 1323143 when registered;
(b) that pending the hearing and final disposal of the suit, the Defendants, their directors, servants, dealers, distributors, agents and stockists be restrained by an order and injunction of this Hon'ble Court from manufacturing, selling, exhibiting for sale and advertising pharmaceutical and medicinal preparation under the trade mark "O1B" and or "O1B PLUS" and /or any other mark similar to the Plaintiffs' trade marks "O2", "OTWO" and /or "O2H" so as to pass off their pharmaceutical and medicinal preparation as and for the pharmaceutical and medicinal preparation of the Plaintiffs or in some way connected with the Plaintiffs or in any other manner whatsoever."
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39. List the suit for marking of the plaintiffs' documents on 24th July 2014. Plaintiff shall, by that date, file and serve a copy of the affidavit in lieu of examination-in-chief of the plaintiffs' witness, affidavit of documents and a compilation duly indexed and paginated.
(G. S. PATEL, J.) 29 of 29 ::: Downloaded on - 08/07/2014 23:50:24 :::