Madras High Court
Daystar Television Network Pvt Ltd vs Word Of God Fellowship on 2 December, 2011
Author: B. Rajendran
Bench: R. Banumathi, B. Rajendran
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 02-12-2011
Coram
THE HONOURABLE MRS. JUSTICE R. BANUMATHI
and
THE HONOURABLE MR. JUSTICE B. RAJENDRAN
O.S.A. Nos. 300 to 303 of 2011
and
M.P. Nos. 1 and 2 of 2011
Daystar Television Network Pvt Ltd.,
rep. By its Managing Director
Mr. A. Jasper New Prabhu
No.229/1, Royal Park Apartment
Konnur High Road, Ayanavaram
Chennai 600 023 .. Appellant in all the appeals
Versus
1. Word of God Fellowship
Inc.,/d/b/a/Daystar Television Network
No.3901, Highway121, Bedford
Texas 76021, U.S.A.
2. Daystar Broadcasting Network Pvt Ltd
Plot No.77, Balaji Swarnapuri Colony
Behind Donbosco School
Sanjeevreddy Nagar
Hyderabad 560 018 .. Respondents in all the appeals
Appeals filed under Order XXXVI Rule 9 of O.S. Rules read with Clause 15 of the Letters Patent against the Judgment and Decree dated 13.07.2011 passed in O.A. Nos. 439, 440 and 441 of 2011 and Application No. 2821 of 2011 in C.S. No. 340 of 2011 on the file of this Court.
For Appellant : Mr. Arvind P. Datar, Senior Counsel
for M/s. P.V.S. Giridhar & Sai Associates
in all the appeals
For Respondents : Mr. Satish Parasaran
in all the appeals
COMMON JUDGMENT
B. RAJENDRAN, J Aggrieved by the common order dated 13.07.2011 passed by the learned single Judge in O.A. Nos. 439, 440 and 441 of 2011 and Application No. 2821 of 2011 in C.S. No. 340 of 2011, the appellant has come forward with these Original side Appeals.
2. The appellant has filed C.S. No. 340 of 2011 for the following reliefs:-
"(a) A decree of permanent injunction restraining the defendants, their men, agents, representatives, successors or assigns or anyone claiming under them from downlinking, distributing the signals or telecasting Daystar Television Network channel in any place or media in India otherwise than through the plaintiff;
(b) A decree of permanent injunction restraining the defendants, by themselves, their men, agents, representatives, successors or assigns or anyone claiming through or under them from in any manner infringing the plaintiff's registered trademark "DAYSTAR TELEVISION NETWORK" by using the said name in any television programmes, stationery, broadcast, advertisements, websites, propoganda literature or in any other manner or media in India whatsoever;
(c) A decree of permanent injunction restraining the defendants by themselves, their partners/Directors as the case may be, heirs, legal representatives, successors-in-business, assigns, servants, agents, distributors, retailers, stockists or any one claiming through them from in any manner passing off or enabling others to pass off their goods, services and business by use of offending trademark "DAYSTAR TELEVISION NETWORK" as trade name or in any other manner whatsoever;
(d) A decree be ordered to the second defendant to render true and faithful accounts of profits earned by them on account of adoption and use of trademark "DAYSTAR TELEVISION NETWORK" in relation to their services and the plaintiff undertakes to pay the actual court fees after the second defendant renders the accounts;
(e) To direct the first defendant to pay to the plaintiff compensation of a sum of Rs.75,00,000/- (Rupees Seventy Five Lakhs Only) together with interest at 12% per annum from the date of plaint to the date of payment
(f) A decree for costs of the suits
3. Pending suit, the plaintiff/appellant has taken out four applications namely O.A. Nos. 439, 440 and 441 of 2011 and Application No. 2821 of 2011 in C.S. No. 340 of 2011 praying for the following reliefs:-
(i) O.A. No. 439 of 2011 has been filed praying for an ad interim injunction restraining the respondents / defendants, their men, agents, representatives, successors or assigns or anyone claiming under them from downlinking, distributing the signals or telecasting Daystar Television Network channel in any place or media in India otherwise than through the applicant/ plaintiff pending disposal of the above suit.
(ii) O.A. No. 440 of 2011 has been filed praying for an ad interim injunction restraining the respondents/defendants, by themselves, their men, agents, representatives, successors or assigns or anyone claiming through or under them from in any manner infringing the applicant's/plaintiff's registered trademark "Daystar Television Network" by using the said name in any television programmes, stationery, broadcast, advertisements, websites, propoganda literature or in any other manner or media in India whatsoever, pending disposal of the suit
(iii) O.A. No. 441 of 2011 has been filed praying for an ad interim injunction restraining the defendants by themselves, their partners/Directors as the case may be, heirs, legal representatives, successors-in-business, assigns, servants, agents, distributors, retailers, stockists or any one claiming through them from in any manner passing off or enabling others to pass off their goods, services and business by use of offending trademark "Daystar Television Network" as trade name or in any other manner whatsoever, pending disposal of the suit.
4. On 29.04.2011, this Court granted interim injunction in O.A. No. 440 of 2011 as prayed for. Thereafter, the appellant filed Application No. 2821 of 2011 praying to punish the respondents/defendants for disobedience of the order 29.04.2011 in O.A. No. 440 of 2011.
5. All the above applications were taken up together and by a common order dated 13.07.2011, the learned single Judge dismissed all the applications namely O.A. Nos. 439, 440 and 441 of 2011 and Application No. 2821 of 2011 in C.S. No. 340 of 2011.
6. The case of the appellant is as follows:-
(i) The appellant is a company incorporated under the provisions of the Companies Act and the object of the appellant company is to downlink television channel and to carry them to homes and other places in India, to install, maintain and run television networks, to operate as Multi-System Operators and to uplink television programmes. According to the appellant, for the last four years, due to their hardwork in their business, they have earned reputation in India.
(ii) On 01.05.2007, the appellant entered into a marketing and distribution agreement with the first respondent at Chennai whereby the first respondent authorised the appellant to market and distribute their rights relating to Daystar Network Television, USA and to provide Word of God Fellowship (WOGF) Programme throughout the territory of India. The period of agreement was five years, with an option for further renewal. As per the agreement, the appellant has to follow the downlinking guidelines stipulated by the Ministry of Information and Broadcasting, New Delhi. According to the appellant, pursuant to the agreement, they have been marketing and distributing the rights over the Daystar Network Television channels to various MSO's lawfully. The appellant also submitted an application to downlink Daystar Television Network in India to Ministry of Information and Broadcasting, New Delhi and based on the same, a licence/permission dated 15.02.2008 was issued to the appellant to downlink Daystar Television Network in India as a non-news and current affairs TV channel, which was also subsequently renewed on 28.02.2011 for a period of one year upto 14.02.2012. By virtue of the said permission issued under the provisions of Cable Television Network (Regulation) Act, 1955 and the rules framed thereunder, the appellant alone has the right to downlink the said channel and distribute the same throughout India. In other words, the appellant is the registered proprietor of the aforesaid trademark 'Daystar Television Network' in India. Based on such license/permission obtained by the appellant, they have also entered into agreement with various cable system operators of MSO's across India to receive and distribute signals of Daystar Television Network through cable service on a prime brand position in analog frequency and digital set top box through cable network in different States in India. In fact, the efforts taken by the appellant was also videly appreciated by the first respondent herein.
(iii) On 01.12.2010, the appellant received an e-mail whereby the first respondent terminated the agreement entered into between the appellant and demanded the appellant to sign the said agreement and return it to the first respondent. As per the letter of termination, the appellant would cease to have any authority to enter into contract for telecast of programmes of Daystar Television Network. In and by such letter of termination, the appellant was also required to pay to the first respondent a sum of Rs.1.98 crores. According to the appellant, even prior to the letter of termination, the representative of the appellant and the first respondent had a meeting on 13.11.2010 and during the course of such meeting, the first respondent attempted to initiate the process of transferring the telecast rights of the appellant, but the same was declined by the appellant inasmuch as the appellant had the exclusive rights for another five years as per the agreement and the agreement was in force.
(iv) On 30.12.2010, the appellant sent a reply to the first respondent pointing out that the appellant cannot be expected to sign a letter contrary to facts and opposed to their own rights and interest. It was also pointed out that Day Star Television Network has been duly registered as a trade mark in India and is owned by the appellant whose reputation in India has been built up, besides that the appellant is having an exclusive downlinking licence based on the agreement. Therefore, the appellant denied their liability to pay any sum to the first respondent during the currency of the agreement and in fact, the first respondent is liable to compensate the appellant for the loss, hardship, mental agony and injury caused to them, which was quantified at USD 200,000. Even though the first respondent received the reply, there was no response.
(v) The appellant learnt that the defendants have been dealing with third parties and MSO's directly and have been distributing their signals. The programmes are being telecast by down-linking Daystar Television Network not only in breach of the agreement, but in violation of the provisions of Cable Television Networks (Regulation) Act, 1995, particularly Section 3 thereof. The respondents have been by-passing the appellant, who is the only person authorised to distribute the channel in India in view of the licence granted in their favour. Therefore, the action of the respondents is not only illegal but amounts to an offence punishable under Section 16 of the Cable Television Networks (Regulation) Act, 1995. The respondents have also been infringing the registered trademark of the appellant and continuing to use the name Daystar Televisoin Network Channel in television programmes, in publicity materials etc., The goodwill and reputation built by the appellant by their hardwork and persistence effort is sought to be nullified by the respondents and they are taking unfair advantage of the reputation of their trade mark, which is detrimental to their interest. Due to the interference into their business activities by the respondents, the appellant has sustained loss of over Rs.10 lakhs during the year 2009-2010.
7.(i) The applications filed by the appellant were resisted by the respondents by contending that the suit is not maintainable before this Court in view of Section 134 of the Trade Marks Act inasmuch as the registration of the appellant's trade mark at Chennai does not by itself confer any jurisdiction to file the suit before this Court. Further, the trademark of the appellant has not been registered with the Trade Mark Registry at Chennai, but it was registered with the Trade mark authority at Mumbai, hence, the suit is liable to be dismissed in limine.
(ii) The first respondent is a Georgia based non-profit organisation carrying on business under the name and style of Daystar Television Network since 1997. The first respondent was founded by Mr. Marcon Lamb and Mr. Joni Trammeli and set up the first full-power Christian television station in the State of Alabama in 1985. The said television network has over the years gained popularity and Daystar Television Network was officially launched in 1997 with live broadcast. The said television channel was aimed at reaching God's messages to Christians across the United States and as on date the first respondent's television channel is available in 254 countries across the world.
(iii) In 2006, the first respondent identified the appellant for the purpose of forming a company in India to telecast their Daystar Television Network Channel. All requisite funds for the purpose of commencing the telecast of the channel in India was given by the first respondent. In the process, the appellant was required to apply for and obtain necessary license from the Union of India for the purpose of downloading the first respondent's television link and telecasting the same in India. The Ministry of Information and Broadcasting had insisted upon registration of the logo of the first respondent under the Indian Trademarks Act as a condition precedent to issue the license with the certificate of registration of logo from the country of origin and an agreement permitting the appellant to use the said logo in India. Therefore, the first respondent requested the appellant to have the said logo registered in India as required. On 01.05.2007, an agreement was entered into between the first respondent and the appellant on 01.05.2007 for the purpose of telecasting the Daystar Television Network Channel in India. Thereafter, the appellant, with a view to telecast the first respondent's Daystar Television Network Channel, entered into agreement with Asianet Satellite Communication Limited and other networks and commenced the telecast and all expenditure towards the telecast of the channel were borne by the first respondent. In the course of their business, the first respondent felt that huge revenue generated through the telecast of the first respondent's channel was not put to use for the purpose as agreed, but it was misappropriated by the appellant. The first respondent also came to know that huge monies from the first respondent over the years were fabricated and forged by false descriptions. Therefore, the first respondent held meetings with the appellant and in line with the agreement arrived at between the parties, on 01.02.2010, a letter dated 12.04.2011 was sent terminating the agreement dated 01.05.2007 with the appellant and therefore the appellant does not have any right, whatsoever with regard to the first respondent's Daystar Television Network Channel and is disentitled to telecast the same. Since the appellant acted against the interest of the first respondent and the television channel, the first respondent had to find alternative means of telecasting its channel in India and therefore, they have caused the incorporation of the second respondent company on 01.11.2010.
(iv) The appellant, with full knowledge about the first respondent's superior and exclusive right over the Daystar Television Network Channel and the intellectual property rights attached thereto, has filed the suit. The suit averment reveals that in addition to the acts of misappropriation of huge revenue generated through the telecast of Daystar Television Network channel, the appellant has sought to fradulently appropriate the properties of the first respondent, including the first respondent's trademark/logo Daystar Television Network. The appellant is merely a permissive/licensed user of their trade mark for thepurpose of telecasting the television channel in India and does not have an independent right over the said trademark/logo. All reputation and goodwill enjoyed by the trademark Daystar Television Network worldover including in India is relatable to the first respondent alone and no other person, including the appellant, can claim any title or right over the same. The trademark Daystar Television Network is the property of the first respondent and the same was permitted tobe used by the appellant. The entire activity of the appellant from its incorporation is at the instance of the first respondent and by using the funds of the first respondent. The first respondent has till date spent approximately Rs.30 crores for promotion and telecast of its channel in India and millions of US dollar across the World towards promotion of its Daystar Television Network. Apart from entering into agreement with Asianet Satellite Communications Limited, the appellant had entered into agreements with various cable operators/MSO's in India and has been telecasting the channels of the first respondent in India. The charges/fees towards telecast of the first respondent's Daystar Television Network is running to crores of ruppes has been paid by the first respondent. Apart from the payment of charges/fee, the first respondent also supplied the receivers to the cable operators/MSO's through the appellant. While so, the appellant does not enjoy any right over the television channel or the trademark Daystar Television Network.
8. The learned Senior counsel appearing for the appellant would contend that the suit as well as the applications have been filed consequent to the first respondent infringing the trade mark 'Daystar' which is a registered trademark of the Appellant in India. The appellant has been distributing the Daystar Network Television Channel pursuant to an agreement dated 01.05.2007 with the first respondent. The appellant also hold a statutory licence having been issued on 15.02.2008 which was extended up 14.02.2012 under the provisions of the Cable Television Network (Regulations) Act, 1995 to downlink the channel in India and it is an exclusive licence. The appellant has been issued with such exclusive license in view of the TRAI regulations which stipulates that only an Indian company can obtain such a license. The respondents, being a company incorporated in the United States is ineligible to hold such a licence. The appellant had worked hard to promote the network across the Country, but the first respondent simply terminated the agreement by a communication received on 29.04.2011 without any reasonable cause. The agreement came to be cancelled purportedly due to some internal differences in the management in United States due to which Mr. Janice Smith, the former Vice President, who was responsible for entering into the agreement with the appellant had to leave the company following an unchristian scandal. The Federal Communication Commission in United States has launched an investigation into the irregularities committed by the first respondent in the management. Under those circumstances, the attempt of the first respondent to downlink the channels through the second respondent, who does not have a statutory licence, which is mandatory, is clearly violative of the provisions of the Cable TV Regulation Act and the guidelines issued by TRAI. The learned single Judge, without appreciating the above said aspects dismissed the applications filed by the appellant on the ground that the agreement has been terminated by the first respondent. When the appellant holds a statutory licence, the respondents are legally barred from downlinking the channel without a license. The learned Judge also erred in holding that although the first respondent is the registered owner of the Trademark 'Daystar', the first respondent had prior use of the mark, ignoring the established legal position that prior use should be in India and not in abroad as Trade Mark has only the territorial right. Moreover, the learned Judge has conflated the product (Television Programmes) with the Trade Mark ignoring the fact that the Trademark is an independent species of the property. The very character of intellectual property is that it is independent from the product which it represents or indicates.
9. We have heard the learned Senior counsel for the appellant as well as the learned counsel for the respondents.
10. The learned Senior counsel for the appellant would mainly contend that the appellant company was incorporated in India, the trade mark of the appellant company was registered in India and therefore, the appellant is the absolute owner of the company as well as the trade name. While so, the first respondent cannot deal with the trade mark or the business name of the appellant in India and consequently, the permit given to the second respondent by the first respondent, to telecast in India the Daystar Television Channel, is illegal. In fact, the main contention of the learned Senior counsel for the appellant was that period of the agreement entered into between the appellant and the first respondent has not expired and therefore, the first respondent is estopped from unilaterally terminating the agreement. The learned Senior counsel for the appellant goes to the extent of arguing that the agreement with the appellant cannot be terminated by the first respondent as the appellant is the registered owner of the trade mark and so long as the registration continues, the first respondent has no legal right to terminate the contract. As proprietor of the registered trade mark, the appellant has every right to utilise the registered trade name. The learned Senior Counsel for the appellant also contends that the learned single Judge erred in construing the dispute as that of an action for passing off, whereas, what is questioned by the appellant is infringment of their registered trade mark by the first respondent. The learned Single Judge further erred in ignoring the fact that there is no reason assigned by the first respondent to terminate the contract. Inasmuch as there is no breach of contract and in the absence of any pleading made by the first respondent regarding the same, the learned single Judge ought not to have dismissed the applications filed by the appellant.
11. On the contrary, Mr. Satish Parasaran, learned counsel for the first respondent would contend that the first respondent commencd the television channel even in the year 1993 itself and in the year 1997, the second channel was opened by them which is collectively called as Daystar Television Network. Even in the internet, the name of the first respondent has been registered under the domain name "www.daystar.com" in the year March 1995. Earlier, the first respondent entered into agreements with one Michael Jeba Prabhu and he was appointed as Indian representative for the first respondent from 2004 till November 2005. As per the then regulation, there was no requirement for getting prior approval or licence from the Government authorities for mere downlinking of television channel from the satellite and broadcasting the same in India. In fact, the appellant Jasper New Prabhu only approached the first respondent from 2004 onwards and expressed his willingness to work as a representative of the first respondent in India. In fact, the said Mr. Jasper New Prabhu offered his service as true service to God and at free of cost. Later on, since the earlier Indian representative was not functioning properly, the contract with him was terminated and the appellant was appointed as Indian representative by the first respondent. It is pertinent to point out here that the appellant was only authorised to represent the first respondent in India. It is also pertinent to mention here that even prior to the appointment of the appellant, right from the year 2004, Daystar India was broadcasting television channel in India through their representatives appointed from time to time. Therefore, Daystar Channel was available in India and the trade name as well as the trade mark were in existence in India even prior to the formation of the appellant company and the registration of the appellant trade name. Even under the grounds of prior user, since the television channels of the first respondent are being telecast in India even prior to the incorporation of the appellant company, the contention of the appellant that as a registered proprietor, the first respondent cannot use the appellant's trade name is immaterial. Furthermore, it is the first respondent which has permitted the appellant company to use their name in their business and also directed the appellant to register their trade name to suit to the needs of the Law of the Country, which has since been amended. Under those circumstances, the contention of the appellant, at this stage, that as a registered user, they cannot be prohibited from using the trade name of the first respondent as long as their trade name is not cancelled by the authorities concerned is untenable since the very use of the trade name of the first respondent by the appellant is only pursuant to the permission granted by the first respondent.
12. The first respondent company, even way back in May 2006, had clearly indicated to the appellant that the formation of the Indian entity and related business should be done for the telecasting of their channel. In fact, it was clearly stated that the first respondent has appraised Mr. A. Jasper New Prabhu to form a private limited company under the name and style of Daystar Television Network of India. In the letter dated 02.05.2006, it was clearly mentioned by the first respondent that to serve as a written authorisation from Word of God Fellowship Incorporation, the appellant has been authorised to do certain acts namely (i) to form a private limited company, Daystar Television Network of India Private Limited in which they appointed Mr. A.Jasper New Prabhu and Mercy Prabhu as initial Directors (ii) To complete the appropriate paper work and applications that are necessary and to submit to the Information and Broadcasting Ministry of India to procure the required license for downlinking Daystar Programming in India (iii) To open a bank account in the name of new private limited company with Citibank. Therefore, it is very clear that the appellant was an authorised person to start a new private limited company on behalf of Daystar Television Network in India and the appellant has to fulfil the required conditions contemplated in the said letter dated 02.05.2006. Thereafter, Mr. A. Jasper New Prabhu requested the first respondent company that he had got the name approved and requested them to send Rs.1,52,00,000/- and further sum of Rs.12,00,000/- towards registration fee to comply with the formalities for starting up a company. Subsequently, by a Government communication dated 08.12.2006, the appellant company was directed to get the logo of the channel registered under the Indian Trade Mark Act. In fact, in that letter, the Government of India also pointed out that the earlier agreement dated 13.09.2006 does not confirm to the downlinking policy guidelines as the Indian Government has not got exclusive right, as required under clause 13 of the guidelines.
13. Pursuant to this, the present contract was entered into or amended or altered by Daystar and even in this contract, in clause 1, it is clearly stated that the first respondent has permitted the appellant to channel the Word of God Fellowship in India. Further, in clause 6 it is clearly stated that the appellant shall register the logo of Daystar Television Network in India as per the guidelines stipulated by Ministry of Information and Broadcasting.
14. It is seen from the e-mail dated 20.01.2005 sent by Mr. Jasper New Prabhu that he had volunteered to help the appellant in their efforts to make propoganda about Christianity and he has offered to lend his service to the appellant as a volunteer for the sake of God. He has also sent the policy guidelines for downlinking of television channel as contemplated by the Government of India under which, the eligibility criteria clearly states that the appellant company himself either own the channel it wants downlinked for public viewing or must enjoy, for the territory of India, exclusive marketing/distribution rights for the same, inclusive of the rights to the advertising and subscription revenues for the channel and must submit adequate proof at the time of application. Only in order to fulfil this condition, the agreement was given by the first respondent so as to enable the appellant to get necessary permission. We are also able to see from the e-mail dated 13.12.2005 that Mr. Michael Prabhu was no longer employed by Daystar Television Network and therefore he was not representing Daystar in any way and in his place Mr. Jasper Prabhu was appointed as Indian Sales representative and he is authorised to speak to any one on behalf of Daystar. Therefore, it is clear that initially, the appellant was appointed only as an employee of Daystar, but consequent upon the requirements of Indian Law, the appellant company was permitted to register the trade name in India. In this context, we could find from the letter dated 02.05.2006 sent to Pastor A. Jasper New Prabhu that for formation of the Indian entity and related business, the first respondent had stated as follows:-
"Please allow this letter to serve as written authorisation from Word of God Fellowship, Inc., d/b/a Daystar Television Network to proceed on our behalf to do the following:
. form a private limited company, Daystar Television Network of India Private Limited. The initial Directors will be Pastor A. Jasper New Prabhu and Mercy Prabhu . Complete the appropriate paper work and applications that are necessary and to submit to the Information and Broadcasting Ministry of India to procure the required license for downlinking Daystar Programming in India . Open a bank account in the name of new private limited company with Citibank. The initial signatories will be Pastor A. Jasper New Prabhu and Mercy Prabhu. We want on-line services sothat we can access the account from our Corporate office in the United States.
15. Therefore, it is clear that the appellant was directed to start the business venture only at the instance of the first respondent to fulfil the conditions prevailing inIndia. From the subsequent e-mail dated 05.05.2006 also, it could be seen that the amount incurred by the appellant to fulfil the formalities for registering the company was sought to be paid by the first respondent. Subsequently, the first agreement dated 01.09.2006 was entered into between the appellant and the first respondent in which it was clearly stated that since Government of India require a formal agreement the same was entered into. It is also stated that the first respondent herein agreed and permitted the appellant to channel Word of God Fellowship in India in order to market and distribute their rights and to provide the said programme throughout the territory of India. Therefore, the first agreement dated 01.09.2006 clearly stated that it only permitted the appellant to utilise the right conferred upon him tomarket and distribute the programme on behalf of the first respondent.
16. It is seen from the records that the appellant had stated that the agreement entered into between them earlier is not acceptable to the Ministry of Broadcasting and therefore, he wanted to enter into a fresh agreement by altering/modifying by incorporating certain terms as per the norms. Under those circumstances, the agreement dated 01.05.2007 came into existence. By virtue of such agreement, the appellant claims that he is having a right to channel Word of God fellowship in India in order to market and distribute their rights throughout the Territory of India. It is also specifically stated in clause 6 of this agreement that the Daystar Television Network (India) Private Limited, represented by the appellant, shall follow the logo and title of Daystar in all the applications put forward before the Government and shall register the logo of the Daystar Television Network in India as per the guidelines stipulated by the Ministry of Information and Broadcasting and also the Ministry of Law and Justice, Government of India. Therefore, the first respondent has categorically permitted the appellant to register their trade name on behalf of the first respondent to do certain work namely to broadcast their programme but that does not mean that the appellant was permitted to fully utilise it. It is the telecast given by the first respondent which is being permitted to be used by the appellant. Therefore, the argument of the learned Senior counsel for the appellant that the appellant has become the registered proprietor of the trademark 'Daystar Television Network' pursuant to the registration of the trade name in India in India cannot be accepted.
17. In this context, it is relevant to see the observation made by the learned single Judge in para-24, wherein it was stated as follows:-
"24. ......Therefore, I do not know whether the Ministry of Information and Broadcasting treated the application of the plaintiff as one by the owner of the channel himself (in view of the same name being adopted) or as an application by a person holding exclusive marketing and distributing rights. In the absence of a specific clause in the MDA dated 01.05.2007, it cannot be presumed that the Ministry of Information and Broadcasting understood the MDA dated 01.05.2007 as one conferring exclusive rights of marketing and distribution upon the plaintiff. The very communications and registration certificates dated 15.02.2008, fild as plaint document Nos. 4, 5 and 6, go to show that the Ministry recognised the first defendant as the owner of the Daystar Television Network Channel. Therefore, the claim made by the plaintiff as though the plaintiff was recognised by the Ministry of Information and Broadcasting as the holder of exclusive marketing and distribution rights, is not really borne by the documents.'
18. As rightly pointed out by the learned single Judge, even as per the Government policy guideline, other than the owner of the channel or person holding exclusive right can apply for registration. Therefore, the registration could have been applied by the owner or an authorised reprsentative of the owner. In this case, as rightly pointed out by the learned single Judge, the appellant applied for registration of the trade name/trademark only as an authorised representative of the first respondent under the agreement. In fact, the very agreement specifically states that registration is necessary for the purpose of complying with the formalities exist in India and therefore, the trade name/ trade mark came to be registered. Even the policy guidelines issued by the Government is interpreted, it will not confer any right to the appellant and it cannot operate as a clout on the right of the first defendant to terminate the contract. In any event, when once the contract is terminated, the appellant cannot be heard to say that he will have exclusive right over the trade name/trade mark.
19. As regards the trade mark, the question of passing off will not arise as the mark Daystar has been used by the first respondent in United States of America long prior to its use in India. The television channel is being broadcasted allover the world even prior to its telecast in India. Admittedly, the first respondent is the prior user of the trade mark. Even for granting permission for downlinking, the Ministry of Information also stipulated certain conditions in favour of the appellant and therefore, the registration of the trade mark was only in terms of the authority or permission granted by the first respondent in favour of the appellant, therefore, the question of passing off cannot arise in this case.
20. It is pertinent to point out here that the product or service, which is the subject matter of agreement between the appellant and the first respondent, is only in respect of telecast of the programme made by the first respondent from United States of America, which is downlinked and distributed for viewing in India. As rightly pointed out by the learned single Judge, there is no new product sold or services to be offered by the appellant or the first respondent except the television programme of the first respondent which is broadcasted in India through an Indian representative, being the appellant. The appellant was only permitted to telecast the programme as per the agreement. In any event, once the agreement is terminated, the appellant cannot also even have the right to telecast. Therefore, the learned single Judge is right in rejecting the argument of the appellant with regard to passing off.
21. As regards infringement, the first respondent has not registered the trade mark in India and registered it only in United States of America. No doubt, Section 28 (1) of the Trade Marks Act, 1999 would contemplate that the exclusive owner/registered proprietor will have the exclusive right over a product, but that right is subject to the other provisions of the Act or subject to any other condition or limitation to which the registration is subject to. In this context, when we analyse the defence set up by the first respondent, it is clear that the first respondent is the prior user of the trade name. As rightly pointed out by the learned single Judge, the appellant itself is an extended arm of the first respondent, holding and dealing with the properties of the first respondent in a fiduciary capacity and therefore, the appellant cannot question the act of alleged infringement in the present case. In fact, there is no dispute relating to the prior user as the registration was done in India only with the permission of the first respondent.
22. Though a feeble attempt was made by the learned Senior counsel for the appellant that the defence of prior user pleaded by the first respondent is untenable inasmuch as the first respondent is not the exclusive user of the telecast right in India, it has to be pointed out that even in the year 2003, the erstwhile representative of the first respondent was receiving the channel Daystar. Therefore, the presence of Daystar in India existed even in the year 2003. The appellant, in his e-mail dated 17.12.2004 also stated that "efforts should be taken to promote Daystar". Therefore, it is not open to the appellant to contend that Daystar was not used in India prior to the entering into agreement between the appellant and the first respondent. The learned single Judge also pointed out various other evidence to hold that Daystar was in existence in India long prior to the registration by the appellant in India. The learned singleJudge also relied on the decision of the Honourable Supreme Court reported in (Hardia Trading Limited vs. Addisons Paint & ChemicalsLimited) 2003 11 SCC 92 for the proposition that "it is well established that manufacturer was the first to use the device as a trade mark and he alone can claim property over the name as a mark. Based on the ratio laid down by the Honourable Supreme Court, the learned single Judge has rightly held that the first respondent alone is the owner and can enjoy the telecast rights of Daystar and we do not find any justification to interfere with such a finding given by the learned single Judge.
23. In this connection, it is pertinent to point out here that the appellant has not produced or telecast on his own, any programme in India. What was telecast by the appellant is the programme designed and produced by the first respondent by downlinking the same to telecast it in India. Therefore, the television programme is the formula designed by the first respondent, which is being shown to the public by the appellant in India by downlinking it. Further, the trade mark 'Daystar' was also registered all over the World, including India. As far as the telecast of the programme in India is concerned, the first respondent only permitted the appellant to register it in India to suit the local Laws in India and to comply with the formalities formulated by the Indian Government. The trade mark came to be registered in India by the appellant pursuant to an agreement between the appellant and the first respondent. Therefore, at this stage, the appellant cannot say that he alone can use the trade mark or trade name 'Daystar' in India especially when the first respondent established that even prior to the registration of the trade name 'Daystar' in India at the instance of the appellant, the trade name is being used in India. Further, the first respondent only permitted the appellant to register the trade name as a permissive user and therefore, the appellant cannot complain of any infringement, as the question of infringement does not arise in this case. Further, once permissive usage given to the appellant was terminated by the first respondent, the appellant cannot claim to have vested with any legal right over the trade name or trade mark.
24. The learned Senior counsel for the appellant relied on the decision of the Honourable Supreme Court reported in (Midas Hygiene Industries (P) Ltd., vs. Sudhir Bhatia and others) 2004 3 SCC 90 for the proposition that mere delay in bringing an action in a trade mark dispute is not sufficient to defeat the grant of injunction in such cases. In that case before the Honourable Supreme Court, the appellate court dismissed the appeal only on the ground of laches. The Honourable Supreme Court held that the delay by itself cannot be a ground for refusing the claim made by the appellant. At the same time, it was found that the respondent therein used to work with the appellants and the advertisements issued by the appellants in the year 1991 show that atleast from that year they were using the mark LAXMAN REKHA on their products. Not only that the appellants have had a copyright in the marks KRAZY LINES and LAXMAN REKHA with effect from 19.11.1991, which was also renewed on 23.04.1999. It was further held that a glance at the cartons used by hoth the parties shows that in 1992, when the respondent first started, he used the mark LAXMAN REKHA on cartons containing colours red, white and blue, but no explanation could be given as to why that carton had to be changed to look almost identical to that of the appellant at a subsequent stage. Therefore, it was held that it prima facie indicates the dishonest intention to pass off his goods as that of the appellants and therefore the Honourable Supreme Court granted an order of injunction. In this case, as rightly pointed out by the learned single Judge, there is no goods or service in dispute and the dispute is centered-around the television programme which is admittedly produced by the first respondent, which is being downlinked and telecast by the appellant. Therefore, the question of using the same trade mark or a mark which is deceptively or phonetically similar by the first respondent does not arise, thus, the decision relied on by the learned Senior counsel for the appellant is not applicable to the facts of this case.
25. The learned Senior counsel for the appellant further relied on the decision relied on the decision reported in (Ramdev Food Products Pvt Ltd vs. Arvindhbhai Rambhai Patel and others) 2006 8 SCC 726 for the proposition that ordinarily two persons are not entitled to use the same trade mark, unless there exists an express licence in that behalf. Further, the permitted user of the name under Memorandum of Understanding did not imply that they use the trade mark. In that case, the Honourable Supreme Court, after pointing out the Memorandum of Understanding, held that what was given in the Memorandum of Understanding was that the first respondent can only sell the product of the appellant, but the respondent however was not restrained from manufacturing the same in their factory and therefore, they started the same under the brand name 'Swad' and they can even use the same in retail outlet for the purpose of promoting their own product, but prima facie, they cannot use the mark registered in the name of the appellant company. In the present case on hand, it is the first respondent who permitted the appellant to represent them in India for the purpose of downlinking the programme designed and prepared by them after getting it registered in India to suit the local laws. In fact, the first respondent alone provided funds for the appellant for the purpose of telecasting their television channel in India. Under those circumstances, the appellant cannot complain of any infringement of his trademark by the first respondent and the decision relied on by the senior counsel for the appellant is not applicable to the facts of the present case on hand.
26. The learned Senior counsel for the appellant also relied on the decision of the Bombay High Court reported in (Reed Elsevier Properties Inc., and another vs. Best Media Associates (India) Private Limited) 2010 1 Bombay CR 839 for the proposition that Section 34-A pertains to use of the mark in India and not anywhere in the World. This decision will not help the appellant because it is clearly proved by the first respondent that the trade mark was used in India even before it was registered at the instance of the appellant.
27. Lastly, the learned Senior counsel for the appellant relied on the decisoin reported in (Adhunik Steels Limited vs. Orissa Manganese and Minerals Private Limited) (2007) 7 Supreme Court Cases 125 for the proposition that well recognised principles applicable for general power to grant interim relief, including specific injunctive relief, under Order 39 of Civil Procedure Code and Specific Relief Act, will be applicable to exercise powers under Section 9 of the Arbitration and Conciliation Act. In that case, the Honourable Supreme Court held that in respect of an application under Section 9 of the Arbitration and Conciliation Act, whatever is applicable under Order 39 Rule 1 and 2 of CPC will also be applied. In that particular facts and circumstances, the Honourable Supreme Court held that since the contract was terminated, there will be a limited injunction restraining the respondent not to enter into any contract for mining for lifting ofminerals with ano other entity until the conclusion of arbitration proceedings. The Honourable Supreme Court also held that there is no justification in preventing OMM Private Limited from carrying on the mining operation by itself as they got a mining lease and subject to any award thatmay be passed by the arbitrator on the effect of the contract,it had entered into with the respondent, it has the right to mine and lift the minerals therefrom. This decision will also not be of any help to the appellant in the present case inasmuch as the contract was duly terminated by the first respondent after discussion with the appellant and therefore, once the contract is terminated, the appellant has no vested right to claim any relief against the first respondent.
28. The learned Senior counsel for the appellant argued that there is no reason for the first respondent to terminate the contract. Even the alleged financial irregularities now pointed out by the first respondent is after the filing of the present original side appeal and there is nothing to show that prior to the termination of the contract, there were any such alleged irregularities. We are unable to accept this contention. The wording used in the contract itself would reveal that the first respondent can terminate the contract in case of any violation of the conditions of the contract. In this case, prior to termination, the first respondent sent a communication to the appellant, pursuant to a discussion that took place between them, and required the appellant to sign the same. This is evident that the appellant is having full knowledge about the proposed termination of the contract by the first respondent. But later, the appellant refused to sign the documents relating to termination of the contract and came forward with this appeal. Therefore, the argument of the learned Senior counsel for the appellant that there was no reason for termination of the contract cannot be accepted.
29. From the above discussion, it is clear that the first respondent is doing no more than honestly using their own business name, which they have previously used all over the World and also in India and there is no misrepresentation in this regard. At the same time, if the appellant herein had in fact established reputation and goodwill in the trade name 'Daystar', either in India earlier than the use of the first respondent, however honest and however much used elsewhere, it constitutes a misrepresentation if it leads people to believe that the goods of the first respondent are the goods of the appellant. In this case, there is no misrepresentation on the part of the first respondent in using the trade name prior to its registration in India, through the appellant. Further, the programme was designed and prepared by the first respondent and therefore the first respondent alone is the original owner, who permitted the appellant to comply with necessary formalities to suit the local laws, including registration, for downlinking their programme in India for being telecast. Under those circumstances, the first respondent cannot be prohibited or restricted and the learned single Judge was right in refusing to grant interim injunction as sought for by the appellant.
30. In the result, we see no reason to interfere with the well considered order passed by the learned single Judge. Accordingly, the appeals are dismissed. No costs. Consequently, connected miscellaneous petitions are closed.
(R.B.I.J.) (B.R.J.) 02.12.2011 rsh Index : Yes / No Internet : Yes / No R. BANUMATHI, J and B. RAJENDRAN, J rsh Pre-delivery Judgment in OSA Nos. 300 to 303 of 2011 02.12.2011