Delhi District Court
Additional District Judge (Central) 12 vs Rain Forest Cafe on 29 August, 2011
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IN THE COURT OF SHRI MAN MOHAN SHARMA,
ADDITIONAL DISTRICT JUDGE (CENTRAL) 12,
TIS HAZARI COURTS, DELHI.
T M no.: 118/2011
Unique case ID no. : 02401C5034632004
Rainforest CAFÉ, Inc.
1510 West Loop South
Houston, TX.770279525 (USA)
(Formerly at:
720 South 5th Street, Hopkins
MN55343 (USA) ..........Plaintiff
Versus
1. Rain Forest Cafe
A133, Arjun Nagar
KotlaMubarakpur
Bhisham Pitama Marg
New Delhi110003
2. Mr. Gaurav Sachdeva,
C/o A133, Arjun Nagar
KotlaMubarakpur
Bhisham Pitama Marg
New Delhi110003
3. Mr. O.P. Sachdeva,
C/o A133, Arjun Nagar
KotlaMubarakpur
TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 1 of 43
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Bhisham Pitama Marg
New Delhi110003 .........Defendants
Date of institution : 12.01.2000
Date of reserving judgment : 16.08.2011
Date of pronouncement : 29.08.2011
JUDGMENT
1 In the instant suit the plaintiff has been seeking the relief(s) of permanent injunction, rendition of accounts and damages against the defendants under section 27 and 105 of the Trade & Merchandise Marks Act, 1958 and section 55 of the Copyright Act, 1957.
PLEADINGS 2 Briefly stated, the facts as propounded by the plaintiff are:
(a) The plaintiff is a publicly held company having its head office at 1510 West Loop South, Houston, TX.770279505, United States of America (formerly 720 South 5th Street, Hopkins, Minnesota 55343, United States of America). Mr. Steven L. Scheinthal is the Vice President and Secretary of the plaintiff and duly authorized to sign and verify the plaint and to institute TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 2 of 43 3 and prosecute the suit on its behalf.
(b) The defendant no. 1 is a restaurant under the name Rainforest CAFÉ at A133, Arjun Nagar (K.M. Pur), Bhisham Pitama Marg, New Delhi110003 and defendants nos. 2 and 3 are the partners involved in the management of defendant no.1.
(c) The plaintiff is the exclusive owner of the well known RAINFOREST CAFÉ restaurant chain which operates a combination of restaurant/retail stores throughout the United States and internationally, since 1994, the plaintiff has been continuously using the registered marks/name RAINFOREST CAFÉ & RAINFOREST CAFÉ logo and the tagline "A WILD PLACE TO SHOP AND EAT" in connection with its themed restaurant/retail facilities. Plaintiff has used the registered trade marks RAINFOREST CAFE and the RAINFOREST CAFÉ logo (which is a combination mark consisting of the words RAINFOREST CAFÉ and the representation of various animals of the rain forest arranged in a particular manner) in various versions; TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 3 of 43 4
(d) RAINFOREST CAFÉ restaurant concept was conceived by Stephen Schussler, Senior Vice President of Development of the Plaintiff. The plaintiff was the first in the world to conceptualize, coin and use the trademark 'RAINFOREST CAFÉ' in 1994 visàvis restaurantcum retail business. The concept of RAINFOREST CAFÉ restaurant involves animation, retail and live animals in a restaurant arena and is promoted by a simulated tropical forest environment that includes a variety of live tropical birds, exotic fish in a large custom designed aquariums, animated artificial animals, sculpted banyan trees that create a canopy of foliage. Every RAINFOREST CAFÉ represented and controlled by the plaintiff has a retail area with merchandise ranging from apparel, home accessories, jewelry, bath products, books, cookie jars, food, children's items etc. All these products carry the registered RAINFOREST CAFÉ name and logo.
(e) The first RAINFOREST CAFÉ restaurant was opened at the Mall of America, in Minneapolis, Minnesota, United States of America in 1994. Since TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 4 of 43 5 then, the plaintiff has experienced rapid growth and phenomenal success, both in the U.S.A and internationally. As exclusive proprietor of the RAINFOREST CAFÉ name and logo in its versions, the plaintiff has secured about 70 registrations in various countries of the world and has over 100 pending applications for the same. In addition to the aforesaid registration/applications, the plaintiff has secured U.S. copyright registration of its RAINFOREST CAFÉ logo marks.
(f) The plaintiff has grown from strength to strength since its inception 1996. Plaintiff has narrated the growth trajectory in para 4 (iv) of its plaint. The plaintiff owes its success to multilayered system of quality control mechanisms and supervision.
(g). The plaintiff has secured about 70 registrations in various countries in the world. Plaintiff has also secured U. S. copyright registration of its RAINFOREST CAFÉ logo marks. In India, the plaintiff has made applications for the RAINFOREST CAFÉ name and logo in class 16 TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 5 of 43 6 and 25 corresponding to the various goods sold by the plaintiff in the retail area of its outlets which are aptly described as 'RAINFOREST CAFÉ, A WILD PLACE TO SHOP AND EAT'. The plaintiff has not made any application for the restaurant services in India since the existing Trade and Merchandise Marks Act, 1958 does not provide for registration of service marks.
(h). The plaintiff has made substantial investments in the advertisement and promotion of its business under the trade name/trading style RAINFOREST CAFÉ. It is also advertised through electronic media. It has also been featured in leading newspaper reports and magazine articles. It has also been the recipient of numerous awards and honours.
(i). The plaintiff has been zealously guarding its trade mark/trade name and has actively initiated actions against passing off/infringement as narrated in para 4 (xii) of its plaint.
(j). The plaintiff's RAINFOREST CAFÉ enjoys spillover reputation and goodwill in India as narrated in TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 6 of 43 7 para 4(xiii) of the plaint.
(k). 'RAINFOREST CAFÉ' is not a natural or generally used combination of words but is unique and distinctive. The tag line 'A Wild Place to Shop and Eat' is also unique and distinctive to the plaintiff. Since 1994, the trade mark and logo have grown from strength to strength and have become distinctive of and exclusively identified with the plaintiff's restaurant business alone. It has its significant transborder reputation in India.
(l). The plaintiff came to know in the first week of November 1999 about the presence of defendant no. 1 in the name and style of RAINFOREST CAFÉ at Kotla Timber Market, Opposite Defence Colony. From inquiries it transpired that the restaurant was operating at A133, Arjun Nagar, KotlaMubarakpur, Bhisham Pitama Marg, New Delhi110003; started operation in October 1999; defendant nos. 2 and 3 are at the helm of its affairs. In December 1999 the plaintiff came to know of the said restaurant's colour advertisements by leaflets which was inserted in leading Delhi newspapers and it also TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 7 of 43 8 transpired that the defendant was vigorously advertising the impugned mark RAINFOREST CAFÉ by way of posters. Various other publicity/promotion material like menu cards, bill boards etc. came to the knowledge of the plaintiff and it was found to be falsely representing as registered owner of the trade mark RAINFOREST CAFÉ. On inspection of the records of Trade Mark Registry the representation was found to be false.
(m). The use by the defendants of the identical mark RAINFOREST CAFÉ is perpetuated by malafide intention to trade upon the reputation and goodwill of the plaintiff and to gain wrongfully at its expense. The dishonest intention is writ large as the defendants have adopted the tagline 'A WILD PLACE TO EAT' (in contrast to the Plaintiff's mark RAINFOREST CAFÉ with the tagline "A WILD PLACE TO SHOP AND EAT"). In the similar vein the representation of various animals in the logo of defendant is obviously with ulterior motives.
(n). The defendants are wellaware of the fame and TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 8 of 43 9 reputation of the plaintiff in respect of the mark RAINFOREST CAFÉ, logo and tagline and their use of such mark and its associated features is in bad faith. This is likely to cause confusion and deception to public of nexus or association of the defendants with plaintiff.
(o). The acts of the defendants in adopting and using the impugned mark RAINFOREST CAFÉ with the tag line "A Wild Place to Eat" constitute misrepresentation amounting to passingoff. This has caused damage to plaintiff's reputation and goodwill. The integrity and goodwill of the plaintiff's mark is at stake. The defendants have been making wrongful profit at the cost and expense of the plaintiff. The plaintiff's copyrights are also at stake. The use by the defendants of the RAINFOREST CAFÉ logo constitutes infringement of the plaintiff's copyright.
(p). The plaintiff has claimed various reliefs against the defendants.
3 Summons of the suit was sent to the defendants and the defendants put their appearance and put a contest to the suit by filing TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 9 of 43 10 their written statement of defence.
4 Written statement filed by the defendant opposed the claim of the plaintiff. On merits, in sum and substance, the defendants denied the material averments of the plaint, particularly on which the plaintiff had propounded its cause of action. As elucidatory facts, the defendant no. 1 pressed the following pleas in service:
(a). The plaintiff's mark is unregistered, thus suit is barred under section 27 of the Trade and Merchandise Marks Act, 1958. The plaintiff has made a categorical admission that it has not even filed any application for registration in India.
(b). No claim of passing off is made out as there is no allegation that any customer has visited the defendant's restaurant under the belief of being licensed by or having association with the plaintiff.
(c). The plaintiff has failed to show any cause of action against the defendants. The defendants are using the trade mark RAIN FOREST CAFÉ as thematic representation of a feel of dining in the environment of rain forests of North East India.TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 10 of 43
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(d). The logos of the plaintiff and defendant are entirely different. The plaintiff has no copyright; copyright cannot be claimed in ideas and themes; no copyright has been violated.
(e). The suit is bad for misjoinder and nonjoinder of parties. Defendant no. 3 is not a necessary party. Mr. Gautam Sachdeva, being a partner of the defendant no. 2 has not been made a party.
(f). The suit has not been filed by a duly authorized and competent person. The suit has not been properly valued;
appropriate court fee has not been paid; and; the suit is fraudulent.
(g). Denying the material averments of plaint in the above terms and propounding that the plaintiff has no cause of action, the defendants have prayed for dismissal of the suit with costs.
5. Replication to the written statement of defendants was filed by the plaintiff wherein the averments made in the written statement have been denied and the contents of the plaint have been reiterated and re affirmed by the plaintiff.
TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 11 of 4312
ISSUES
6. Vide order dated 25.10.2002, on the pleadings of the parties, the following issues were framed:
1. Whether the plaintiff has the transborder reputation in respect of trademarks RAINFOREST CAFÉ and RAINFOREST CAFÉ logo for the reasons set out in para 4 of the plaint? OPP
2. Whether the acts of the defendants in adopting and using the impugned mark RAINFOREST CAFÉ with the tagline "A Wild Place to Eat" constitute misrepresentation amounting to passingoff? OPP
3. Whether the plaintiff has suffered any damage to its reputation and goodwill and, if so, the quantum thereof? OPP
4. Whether the use by the defendants of the RAINFOREST CAFÉ logo constitutes infringement of the plaintiff's copyright? OPP
5. Whether the defendant's RAINFOREST logo does not constitute an infringing copy under TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 12 of 43 13 the copyright Act, 1957 for the reasons stated in para 5 of the written statement? OPP
6. Whether the suit filed is barred under Section 27 of the Trade & Merchandise Marks Act, 1958 for the reasons stated in para 1 of the preliminary objections of written statement? OPP
7. Relief.
7. In its evidence the plaintiff has filed affidavit of Mr. Steven L. Scheinthal as PW1. In the minutes of proceedings dated 18.03.2009 ld. counsel for the plaintiff relied upon Glaxosmithkline Pharma ceuticals Ltd. vs. Theodar Laboratories Pvt. Ltd. 2006 (32) PTC 629 (Del.) to submit that in exparte proceedings personal appearance of the witness may be dispensed with. The submission and consequent prayer was allowed by my Ld. Predecessor vide the order of even date. Subsequently on 04.08.2011 Sh. S. Ashish Kanta Singh, an attor ney of Mr. Steven L. Scheinthal, proved the signatures of Mr. Steven L. Scheinthal on his affidavits in evidence. Sh. S. Ashish Kanta Singh was duly identified by Shri Prashant Gupta.
8. Vide minutes of proceedings dated 08.03.2006 the defendants were proceeded as exparte. An application filed by the defendants for TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 13 of 43 14 setting the order by which they were proceeded as exparte was dis missed vide order dated 15.11.2006. However there was appearance on behalf of defendant on various dates subsequent to and the pro ceedings on their part were joined. Thereafter an application under Or der 6 Rule 17 of Code of Civil Procedure for amendment of plaint was allowed by my Ld. Predecessor vide order dated 04.08.2008, subject to terms as to deposit of costs of Rs. 15,000/ in Prime Minister Relief Fund. The subsequent minutes of proceedings do not show any com pliance on the part of the plaintiff of the condition attached to the or der dated 04.08.2008. Therefore the plaint stands as originally filed on record sans the amendments proposed and allowed with a condition.
9. No evidence has been led by the defendants.
10. Final arguments have been addressed by Sh. Vivek Dhokalia, Ld. Counsel for the plaintiff. Written arguments have also been filed on behalf of the plaintiff. Despite an opportunity afforded to the de fendants vide minutes of proceedings dated 16.08.2011 to file their written submission, the same has not been availed.
11. It has submitted by Sh. Vivek Dhokalia, Ld. Counsel on behalf of the plaintiff that the plaintiff was the first in the world to conceptualize, coin and use the trademark 'RAINFOREST CAFÉ' in TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 14 of 43 15 1994 visàvis restaurantcumretail business. 'RAINFOREST CAFÉ' is not a natural or generally used combination of words but is unique and distinctive. The tag line 'A Wild Place to Shop and Eat' is also unique and distinctive to the plaintiff. 'RAINFOREST CAFÉ' constitutes the distinguishing part of the plaintiff's corporate name as well as trademark.
12. Unique theme and strict quality control had made 'RAINFOREST CAFÉ' highly popular. It's chain of outlets has seen rapid expansion within USA and across the globe. It has significant presence in highly popular and visible international tourist destinations. The sales have seen exponential growth, thanks to the goodwill enjoyed by the mark. The expenditure on advertisements has been substantial in print and electronic media. The mark has been acclaimed in various articles in journals and magazines of international repute like Newsweek, Fortune, Forbes and Bon Appetit. Many laurels and industry awards have been conferred upon it.
13. The plaintiff has prior rights based on Common Law. The mark enjoys the status of Well Known Mark in its category of business. Albeit, the plaintiff has no presence in India, it has the legal right to protect the integrity of its mark in view of the transborder reputation. TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 15 of 43 16
14. The plaintiff's mark and logo to be wellknown mark (falling within the definition under Section 2(zg) of the Trademarks Act, 1999 since the mark has been used extensively, promoted and advertised the services under the said mark through print and advertisement media. Wellknown mark is also premised upon numerous registrations subsisting in the plaintiffs' favor in various classes in various countries across the globe. The mark enjoys a transborder reputation. The defendant has violated the rights of plaintiff as regards the trade mark and copyright. They are liable to account for the same.
15. No other point has been argued or urged.
APPRECIATION OF EVIDENCE, FINDINGS & REASONS
16. Evidence of the plaintiff's witnesses goes unrebutted and unchal lenged as the defendants though initially joined the proceedings over a number of hearings after they were proceeded as exparte but did not rebut the evidence of plaintiff in any way. In view of the above evi dence of PW, plaintiff has been able to establish a case of passing off and infringement of copyright by the defendants.
17. In its evidence the plaintiff has referred to the tendering of the following documents in support of its case:
TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 16 of 4317
(i). Copy of board of resolution in favour of PW1 is marked as Ex.PW1/1;
(ii). Copy of another board resolution in favour of PW1 is marked as PW1/2;
(iii). Complete range of RAINFOREEST CAFE name logo in its various versions is marked as Ex.PW1/3;
(iv). A list of some of the souvenir/promotional RAINFOR EST logo items which the plaintiff sells in its RAINFOREST CAFE restaurant is marked as Ex.PW1/4;
(v). One TShirt is marked as Ex.PW1/5;
(vi). One plate is marked as PW1/6;
(viii). One decorative magnet is marked as Ex.PW1/7;
(viii). Three paper handbags are collectively marked as Ex.P W1/8:
(ix). Promotional cards with date are collectively marked as Ex.PW1/9;
(x). Two children colouring books are collectively marked as Ex.PW1/10;
(xi). Promotional cards without date are collectively marked as Ex.PW1/11;TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 17 of 43
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(xii). Corporate announcements and brochures covers are col lectively marked as Ex.PW1/12;
(xiii). Original photographs along with their negatives and orig inal postcards of some of the restaurant facades and interiors, both in USA and international locations, which emphasize the simulated rain forest restaurant retail environment, are collec tively marked as Ex.PW1/13;
(xiv). A complete list of plaintiff's U.S. and international loca tions along with plaintiff's manuals/books are collectively marked as Ex.PW1/14;
(xv). Original annual reports of the plaintiff for the period 19951998 are collectively marked as Ex.PW1/15; (xvi). A list of the countries where the plaintiff has registrations for its RAINFOREST CAFE name and logo in its various in various classes is marked as Ex.PW1/16, certified copies of a registration certificates obtained in the United Kingdom, Cana da, Australia, saudi Araba, Singapore and Indonesia are collec tively marked as Ex. Pw1/17;
TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 18 of 43 19 (xvii). A list of he countries where the plaintiff has pending ap plications for its RAINFOREST CAFE name and logo in its various versions is marked as Ex.PW1/18;
(xviii). Certified copies of the copyright registration secured by the plaintiff are collectively marked as Ex.PW1/19; (xix). Legal proceeding certificates of Indian Registration nos.758677, 814867 and 1239850 for the RAINFOREST CAFE logo are collectively marked as Ex.PW1/20; (xx). Original representative advertisements appeared in news papers and magazines, namely: (a) Chicago Tribune dated 11.03.1997 at page no. 8 is marked as Ex.PW1/21, (b) Daily Herald dated 12.03.1997 at page no. 4 is marked as Ex.PW1/22,
(c) Pioneer Press dated 20.03.1997 at page no. B13 is marked as Ex.PW1/23, (d) Advertisement of Rainforest on the cover page of AC Today of the Courier Post summer 2004 A south jersey's Newspaper at page no. 5TAB and 26 TAB is marked as Ex.PW1/24, Newspaper cutting of the Asian Wall Street Journal dated 30.11.1999 at page no. 4 listing places to eat in Asia which features Rainforest Cafe in Hong Kong is marked as Ex.PW1/25, (f) Advertisement and Articles in the magazine TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 19 of 43 20 "Architecture and Urbanism" concerning plaintiff's recently opened restaurant in Hong Kong is marked s Ex.PW1/26, (xxi). Three video tapes are collectively marked as Ex.PW1/27, (xxii). Fortune magazine dated 27.05.1996 at page no. 95102 is marked as Ex.Pw1/28, Newsweek dated 11.09.1995 at page no.
72 is marked as Ex.PW1/29, BonAppetit of March 1996 at page no. 32 is marked as Ex.PW1/30, article in TIME dated 22nd July 1996 at page no. 56 is marked as Ex. PW1/31; (xxiii). Advertisement of Rainforest in the magazine "OC Fami ly" of April 2004 at page no. 140 is marked as Ex.PW1/32; (xxiv). Annual report 2001 of Lamdary's Restaurants, Inc, which features an article on Rainforest Cafe is marked as Ex.P W1/33, article features in Restaurant Forum of Greater Orlando is marked as Ex.PW1/34, conference brochure for leisure prop erty in Europe industry Forum, September21.22, 1998 is marked as Ex.PW1/35, article on Rainforest on Disney's 25th Anniversary Guide in marked as Ex.PW1/36, Beyond the parks A Disney brochure is marked as Ex.PW1/37, Food Industry News, October 1998 at page no. 37 is marked as Ex.PW1/38, Inhouse listing for awards in Rainforest cafe's manual is TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 20 of 43 21 marked as Ex.PW1/39, true and correct copies of the relevant orders and other material are collectively marked as Ex.PW1/40, Newsletter of Shanghai Patent and Trade Marks Law Office of October, 1999 is marked as Ex.PW1/41, a few downloaded pages from the said website is marked as Ex.PW1/42, copies of some letters are collectively marked as Ex.PW1/43;
(xxv). A true and correct copy of the newspaper advertisement is marked as Ex.PW1/44, photographs and negatives thereof of the bill board outside the defendant's outlet at the said location is marked as Ex.Pw1/45, photographs and negatives thereof of the interiors of the defendant's outlet are collectively marked as Ex.Pw1/46 and three original Menu Cards are marked as Ex. PW1/47.
18. I have considered the submissions and the material on record.
My findings on the various issues are as under:
Issue no. 1:Whether the plaintiff has the transborder reputation in respect of trademarks RAINFOREST CAFÉ and RAINFOREST CAFÉ logo for the reasons set out in para 4 of the plaint?
TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 21 of 43 22
19. It is the admitted case of the plaintiff that it has no business presence in India. The plaintiff has banked upon the transborder reputation on account of its presence in various countries including USA and coupled with the fact that its eating/sales/business joints have been visited by various Indian tourists to the international destination. The plaintiff has proved various magazines like Newsweek, Fortune, Forbes and Bon Appetit on record where it has been featured in various articles and reports. It has also proved various advertisements in many magazines of international circulation and repute. It's trade mark is registered in various countries. These aspects of plaintiff's evidence have gone unchallenged. No evidence to the contrary has been led by the defendants. Thus it is established on record that the plaintiff's mark RAINFOREST CAFÉ has a global presence.
20. In Milment Oftho Industries v. Allergan Inc. AIR 2004 SUPREME COURT 3355 it has been held "....It must also be remembered that now a days goods are widely advertised in newspapers, periodicals, magazines and other media which is available in the country. This results in a product acquiring a worldwide reputation. Thus, if a mark in respect of a drug is TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 22 of 43 23 associated with the Respondents worldwide it would lead to an anomalous situation if an identical mark in respect of a similar drug is allowed to be sold in India. However, one note of caution must be expressed. Multinational Corporations, who have no intention of coming to India or introducing their product in India should not be allowed to throttle an Indian Company by not permitting it to sell a product in India, if the Indian Company has genuinely adopted the mark and developed the product and is first in the market. Thus the ultimate test should be who is first in the market.
9. In the present case, the marks are the same. They are in respect of pharmaceutical products. The mere fact that the Respondents have not been using the mark in India would be irrelevant if they were first in the world market. The Division Bench had relied upon material which prima facie shows that the Respondents product was advertised before the Appellants entered the field. On the basis of that material the Division Bench has concluded that the Respondents were first to adopt the mark. If that be so then no fault can be found with the conclusion drawn by the Division Bench."
21. In N. R. Dongre vs. Whirlpool Corporation 1996 PTC (16) 476, a judgment of the Division Bench of the Hon'ble High Court of Delhi, it has held that notwithstanding the fact that a product is not sold in a particular country its reputation transcends the physical TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 23 of 43 24 boundaries of geographical regions on account of development of communication system contributing to information explosion.
22. In Jolen Inc. vs. Doctor &Company 2002(25) PTC 29 (Del) it has been held by the Hon'ble High Court of Delhi that 'merely because a party has no business in the foreshores of a particular country does not mean that that it has no right to protect the integrity of its reputation or goodwill of its name or trade mark.'
23. Thus on the basis of material on record on the touchstone of pronouncements of law, the fact that the plaintiff has the transborder reputation in respect of trademarks RAINFOREST CAFÉ and RAINFOREST CAFÉ logo for the reasons set out in para 4 of the plaint is established. The finding on this issue is therefore returned in favour of the plaintiff and against the defendants. Issue no. 2. Whether the acts of the defendants in adopting and using the impugned mark RAINFOREST CAFÉ with the tagline "A Wild Place to Eat" constitute misrepresentation amounting to passingoff?
24. As per the evidence on record, the plaintiff visàvis the defendants has been the pioneer to coin, adopt and use the trade mark trade mark RAINFOREST CAFÉ logo and the tagline "A WILD TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 24 of 43 25 PLACE TO SHOP AND EAT" coupled with a depiction of various animals of the rain forest arranged in a particular manner. This complete arrangement is the trade dress. This trade dress registers in the mind of the consumer and he is able to form a picture of broad features of the mark in his mind, though he may not know or may not be able to recall the fine features.
25. The word mark RAINFOREST CAFÉ is not an invented word. It has its existence in dictionary. If we look at the hierarchy of marks from weak to strong in the spectrum of distinctiveness the following lineage appears: GENERIC>DESCRIPTIVE >SURNAME>SUGGESTIVE >ARBITRARY>INVENTED
26. Arbitrary marks comprise those words, symbols or pictures etc. which are in common linguistic use but which, when used with the goods or service in issue, neither suggest nor describe any ingredients, quality or characteristic of those goods or services. Thus 'Apple' for computers; 'Arrow' for shirts; 'Teacher' for liquor are all arbitrary marks. These words of dictionary have no connection with the TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 25 of 43 26 ingredients, quality or characteristic of those goods. Thus they have in the course of trade have become distinctive of the goods they represent from a particular proprietor or source. They have thus in the course of use have become source identifier.
27. On this yardstick, the mark RAINFOREST CAFÉ, being an arbitrary mark, and on account of its use has been a source identifier for the plaintiff's provision of services and its distinctiveness.
28. A trade mark is in fact a pseudo intellectual property. This is for the reason that a trade mark is not respected for its artistic quality, for its design or some novelty in it. It's raison d'etre is its ability to distinguish the goods and services of its proprietor, as flowing from that particular person. Thus it is a pointer or a source identifier for goods and services. While other IPRs have a limited life span of monopoly of its proprietor and thereafter they pass into the public domain, it is just the other way round for a trademark. The trade mark remains the monopolistic property of its proprietor perpetually provided its registration is kept alive (if registered) or if unregistered it is used in connection with goods and service continuously. A trade mark is thus a repository of goodwill of its proprietor. With the passage of time there is value addition in the trade mark TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 26 of 43 27 commensurate with the reputation and goodwill of the business. Thus trade mark and goodwill are more or less synonyms of each other.
29. Now the question arises as to what is 'infringement' and what constitutes 'passing off'. A fine distinction has been drawn between what are the salient distinguishing features of an action for passing off visàvis an action for infringement in Kaviraj Pandit Durga Dutt Sharma v. Navaratna Pharmaceutical Laboratories AIR 1965 SUPREME COURT 980 as held under:
"...While an action for passing off is a Common Law remedy being in substance an action for deceit, that is, a passing off by a person of his own goods as those of another, that is not the gist of an action for infringement. The action for infringement is a statutory remedy conferred on the registered proprietor of a registered, trade mark for the vindication of "the exclusive right to the use of the trade mark in relation to those goods"
(Vide S. 21 of the Act). The use by the defendant of the trade mark of the plaintiff is not essential in an action for passing off, but is the sine qua non in the case of an action for infringement. No doubt, where the evidence in respect of passing off consists merely of the colourable use of a registered trade mark, the essential features of both the actions might coincide in the sense that what would be a colourable imitation of a trade mark in a passing off action would also be such in an action for TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 27 of 43 28 infringement of the same trade mark. But there the correspondence between the two ceases. In an action for infringement, the plaintiff must, no doubt, make out that the use of the defendant's mark is likely to deceive, but where the similarity between the plaintiff's and the defendant's mark is so close either visually, phonetically or otherwise and the court reaches the conclusion that there is in imitation, no further evidence is required to establish that the plaintiff's rights are violated. Expressed in another way, if the essential features of the trade mark of the plaintiff have been adopted by the defendant, the fact that the getup, packing and other writing or marks on the goods or on the packets in which he offers his goods for sale show marked differences, or indicate clearly a trade origin different from that of the registered proprietor of the mark would be immaterial; whereas in the case of passing off, the defendant may escape liability if he can show that the added matter is sufficient to distinguish his goods from those of the plaintiff.
29. When once the use by the defendant of the mark which is claimed to infringe the plaintiff's 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 TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 28 of 43 29 in relation to goods in respect of which it is registered (Vide S. 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 some times 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 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 plaintiff's 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 TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 29 of 43 30 analysis is whether the mark used by the defendant as a whole is deceptively similar to that of the registered mark of the plaintiff."
30. In Ruston and Hornby Ltd. v. Zamindara Engineering Co. AIR 1970 SUPREME COURT 1649 it has been held "In an action for infringement where the defendant's trade mark is identical with the plaintiff's mark, the Court will not enquire whether the infringement is such as is likely to deceive or cause confusion. But where the alleged infringement consists of using not the exact mark on the Register, but something similar to it, the test of infringement is the same as in an action for passing off. In other words, the test as to likelihood of confusion or deception arising from similarity of marks is the same both in infringement and passingoff actions."
31. A mark has to be seen as a whole. A term though not a term of law but a term contemporary in business milieu is the term 'TRADE DRESS' which describes the total image of a product & may include its size, shape, colour or texture. An example of this is the waited bottle of CocaCola. In this context, in the instant case the trade mark RAINFOREST CAFÉ logo and the tagline "A WILD PLACE TO SHOP AND EAT" coupled with a depiction of various animals of the rain forest arranged in a particular manner is the trade dress which TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 30 of 43 31 registers in the mind of the consumer.
32. In Parle Products (P) Ltd. v. J. P. and Co., Mysore AIR 1972 SUPREME COURT 1359 it has been held:
'In order to come to the conclusion whether one mark is deceptively similar to another, the broad and essential features of the two are to be considered. They should not be placed side by side to find out if there are any differences in the design and if so, whether they are of such character as to prevent one design from being mistaken for the other. It would be enough if the impugned mark bears such an overall similarity to the registered mark as would be likely to mislead a person usually dealing with one to accept the other if offered to him. It is of no use to note on how many points there is similarity and in how many others there is absence of it."
33. Thus the yardstick is based on the reality test--as a consumer in the market. If he is likely to be deceived or taken for a ride, then there is deceptive similarity. Thus, these are the broad features of a particular mark, its general or overall impression that is the relevant consideration. These are the broad features and not the meticulous TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 31 of 43 32 details that remain in the mind of the consumer. There is also the factor of imperfect recollection at play. Thus side by side comparison of two marks is not the true test. The numerical count of similarities or dissimilarities is also immaterial.
34. In the instant case the use by the defendants of the identical word mark RAINFOREST CAFÉ (RAIN FOREST CAFÉ); adoption of the tagline 'A WILD PLACE TO EAT' (in contrast to the Plaintiff tagline "A WILD PLACE TO SHOP AND EAT"); the décor and position of the different animal (though the animals are different but they give primarily the similar resemblance as those of the plaintiff's collectively) creates the same impression as that of the plaintiff's mark. The overall getup and aura of the mark of the defendants visà vis the mark of the plaintiff is so similar that an ordinary person is likely to be deceived taking the mark of the defendant as that of the plaintiff and possibility of association cannot be ruled out by a consumer of ordinary prudence and imperfect recollection.
35. In passing off action it is not the actual deception that is material. It is the likelihood of deception that is material. It is riding on the goodwill of someone else by creating a deception. It is making expense at the cost of other. It is passing one's own goods or service TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 32 of 43 33 as if they come from some other source.
36. 'Thou shall not steal', says the Bible. This applies to trade marks and trade names.
37. Rights and liabilities are two sides of the same coin. A person is well within his right to sell his goods or render services using any trade name for the purpose as long as he does not cause injury to other person by deceptive or wrongful use of that person's trade mark or trade name.
38. It is not permissible under the law for any other person to start selling goods or rendering services either using the same name or dishonestly imitating the trade mark of another person as to cause injury to that person and unjustifiably enrich himself at the cost of that person who had already been using that name and had acquired a certain reputation with the passage of time and on account of the quality of the goods sold or services rendered by him.
39. Any attempt on the part of a person to enrich upon the goodwill generated by any other person needs to be curbed by the court whenever approached by the aggrieved party in this regard. Even if the person using or imitating the trade mark or goodwill of another person is yet to commence his business activities his dishonest TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 33 of 43 34 intention to make use of the mark and name of the other party will be obvious from the very use or imitation of the mark and goodwill of the other person and, therefore, it should not be a defence to say that there has so far been no use of the offending corporate name or mark.
40. In view of the material on record the use of the similar trade mark RAIN FOREST CAFÉ and its tag line with pictorial representation of birds in the form and manner as used by the defendants is amounting to passing off.
41. Thus the finding on this issue is returned in favour of the plaintiff and against the defendants.
Issue no. 4 & 5. Whether the use by the defendants of the RAINFOREST CAFÉ logo constitutes infringement of the plaintiff's copyright, and, Whether the defendant's RAINFOREST logo does not constitute an infringing copy under the copyright Act, 1957 for the reasons stated in para 5 of the written statement?
42. There is no copyright in an idea. Copyright does not protect ideas or concepts. It protects the expression, not the idea. It is also not concerned with the originality of ideas, but only with the originality of expression. It does not prevent accidental independent creation of an TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 34 of 43 35 identical or similar work.
43. Copyright in a work is considered as infringed only if a substantial part is made use of unauthorizedly. What is 'substantial' varies from case to case. More often than not, it is a matter of quality rather than quantity. For example, if a lyricist copy a very catching phrase from another lyricist's song, there is likely to be infringement even if that phrase is very short. The leading case on this aspect is R. G. Anand vs. Delux Films AIR 1978 SUPREME COURT 1613.
44. Registration of copy right is not the sinequanon to qualify for infringement action.
45. The plaintiff has claimed its logo to be artistic work. Section 2
(c) of the Copyright Act, 1957 defines as "artistic work" to mean "(i) a painting, a sculpture, a drawing (including a dia gram, map, chart or plan), an engraving or a photograph, whether or not any such work possesses artistic quality;
(ii) a work of architecture; and
(iii) any other work of artistic craftsmanship."
46. The rights of a copyright owner have been listed in section 14 of the Copyright Act, 1957 as under:
TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 35 of 43 36
"For the purposes of this Act, "copyright" means the ex clusive right subject to the provisions of this Act, to do or authorise the doing of any of the following acts in respect of a work or any substantial part thereof, namely,
(a) in the case of a literary, dramatic or musical work, not being a computer programme,
(i) to reproduce the work in any material form including the storing of it in any medium by electronic means;
(ii) to issue copies of the work to the public not being copies already in circulation;
(iii) to perform the work in public, or communicate it to the public;
(iv) to make any cinematograph film or sound recording in respect of the work;
(v) to make any translation of the work;
(vi) to make any adaptation of the work;
(vii) to do, in relation to a translation or an adaptation of the work, any of the acts specified in relation to the work in subclauses (i) to (vi);
(b) in the case of a computer programme,
(i) to do any of the acts specified in clause (a);
(ii) to sell or give on commercial rental or offer for sale or for commercial rental any copy of the computer pro gramme:TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 36 of 43
37
PROVIDED that such commercial rental does not apply in respect of computer programmes where the pro gramme itself is not the essential object of the rental.
(c) in the case of an artistic work,
(i) to reproduce the work in any material form including depiction in three dimensions of a two dimensional work or in two dimensions of a three dimensional work;
(ii) to communicate the work to the public;
(iii) to issue copies of the work to the public not being copies already in circulation;
(iv) to include the work in any cinematograph film;
(v) to make any adaptation of the work;
(vi) to do in relation to an adaptation of the work any of the acts specified in relation to the work in subclauses (i) to (iv);
(d) in the case of a cinematograph film,
(i) to make a copy of the film, including a photograph of any image forming part thereof;
(ii) to sell or give on hire or offer for sale or hire, any copy of the film, regardless of whether such copy has been sold or given on hire on earlier occasions;
(iii) to communicate the film to the public;
(e) in the case of a sound recording TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 37 of 43 38
(i) to make any other sound recording embodying it;
(ii) to sell or give on hire, or offer for sale or hire, any copy of the sound recording regardless of whether such copy has been sold or given on hire on earlier occasions;
(iii) to communicate the sound recording to the public.
Explanation: For the purposes of this section, a copy which has been sold once shall be deemed to be a copy already in circulation."
47. In the case in the décor and position of the different animals/leaves, though the animals are different but they give primari ly the similar resemblance as those of the plaintiff's artistic work tak en as a whole, creates the same impression as that of the plaintiff artistic work. The overall getup and aura of the work of the defen dants visàvis the artistic work of the plaintiff is so similar that an or dinary person is likely to be taken for a ride. The design of the defen dants is substantial reproduction of the plaintiff's work and it has the potency of mischief and is a violation of the plaintiff's mark. The artistic work of the plaintiff is coined in the year 1994 is still valid un der section 22 of the Copyright Act, 1957. The plaintiff is entitled to protection in view of section 40 read with section 51 of the Copyright Act, 1957.
TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 38 of 43 39
48. From the material on record the use by the defendants of the RAINFOREST CAFÉ logo constitutes infringement of the plaintiff's copyright. The defence propounded by the defendants in para 5 of the written statement is only moonshine as there its work is substantial reproduction of the plaintiff's artistic work.
49. Therefore finding on issue nos. 4 and 5 is returned against the de fendants and in favour of the petitioner.
Issue no. 6: Whether the suit filed is barred under Section 27 of the Trade & Merchandise Marks Act, 1958 for the reasons stated in para 1 of the preliminary objections of written statement?
50. Section 27 of the Trade & Merchandise Marks, 1958 reads as under:
"27 No action for infringement of unregistered trade mark: (1) No person shall be entitled to institute any proceeding to prevent, or to recover damages for, the in fringement of an unregistered trade mark. (2) Nothing in this Act shall be deemed to affect rights of action against any person for passing off goods as the goods of another person or the remedies in respect there of."
TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 39 of 43 40
51. The above section of the Act is selfspeaking of the matter con tained therein. The difference between infringement and passing off has been discussed on the touchstone of the settled law. To avoid pro lixity, the same is not being discussed here again.
52. Passing of a common law remedy. It is a tort. In view of the un challenged and unrebutted testimony of the plaintiff there is ample evidence of the defendants passing off their services as that of or hav ing association with the plaintiff. The plaintiff has been successful in proving his case of passing off. The plaintiff's mark, as deceptively used by the defendants, in the context of restaurant services is an act of passing of.
53. The Trade & Merchandise Marks, 1958 did not recognize service marks. They were given a statutory recognition under the Trade Marks Act, 1999, which came into force on 15.09.2003.
54. Notwithstanding the fact that the Trade & Merchandise Marks, 1958 did not recognize the infringement of service marks, the passing off remedy under the Common law had always been available.
55. Therefore, I do not see any bar of section 27 of the Trade & Merchandise Marks, 1958 attracted in the facts and circumstances of TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 40 of 43 41 the present case.
56. The finding on this issue is returned against the defendant and in favour of the plaintiff.
RELIEF
57. In view of my finding on the above issues the plaintiff is entitled to the reliefs claimed. As regards the relief of rendition of accounts, I am of the view that as the defendants have used the plaintiff's mark, logo and artistic design for quite some time but the exercise of rendition of very complex in view of the number of transactions involved; categorization/bifurcation of transactions into different slots where the plaintiff's goodwill has been abused and where it has not been abused being a stumbling block; cumbersome calculations involved; the case being very old and a host of other factors which all cannot be illustrated here, the remedy of rendition of accounts may not be appropriate. On the contrary, it may involve such costs and expense to parties which is avoidable. In my view, instead of rendition of accounts lumpsum and consolidated damages can be awarded.
58. I, therefore, after considering the material on record and findings on the issues, grant the following reliefs to the plaintiff: TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 41 of 43 42
(i). A decree of permanent injunction restraining the defendants, their agents, representatives, assigns, officers, partners, servants, administrators etc. from using the mark RAINFOREST CAFÉ, its logo and tagline either in whole or in part etc. in any manner deceptively similar or nearly resembling the plaintiff's trade mark in any way in connection with the restaurant or similar business in any manner as to pass off their services as that of the plaintiff's services.
(ii). A decree of permanent injunction restraining the defendants, their agents, representatives, assigns, officers, partners, servants, administrators etc. from using the mark RAINFOREST CAFÉ, its logo/artistic work either in whole or in part etc. in any manner substantially similar or nearly resembling the plaintiff's RAINFOREST CAFÉ its logo/artistic work in any way in connection with the restaurant or similar business in any manner as to infringe the Copyright of the plaintiff in the said artistic work.
(iii). A decree for a sum of Rs. 5,00,000/ (Rupees Five Lakhs Only) as token consolidated damages to the plaintiff payable by the defendants jointly and severally in lieu of a decree for rendition of accounts.
(iv). A decree for orders of delivery of infringing and other TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 42 of 43 43 incriminating material like publicity/promotional material, crockery & Cutlery, stationery items, letter heads/printed material, packing material, upholstery etc. by the defendants, their agents representatives, assigns, officers, partners, servants, administrators etc. to the plaintiff for destruction.
(v). The plaintiff is awarded costs of this suit, which I quantify at Rs. 50,000/ (Rupees Fifty Thousand Only) consolidated.
59. The plaintiff shall pay the court fee for damages awarded and after payment of court fee, decree sheet be drawn accordingly.
60. After necessary compliance, the file be consigned to the Record Room.
Announced in the Open Court On this 29th day of August 2011 (MAN MOHAN SHARMA) ADJ (Central)12, Delhi TM 118/2011 Rainforest Café Inc. vs. Rainforest Café & Ors. Page 43 of 43