Bombay High Court
Meher Distilleries Pvt.Ltd vs Sg Worldwide Inc., And Anr on 22 March, 2021
Author: G. S. Patel
Bench: G.S.Patel
Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr
ial8940-2020 in comipl8936-2020-J.docx
Shephali
REPORTABLE
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
IN ITS COMMERCIAL DIVISION
INTERIM APPLICATION (L) NO. 8940 OF 2020
IN
COMMERCIAL IP SUIT (L) NO. 8936 OF 2020
Meher Distilleries Pvt Ltd,
a company incorporated under the
Companies Act, having its registered office
at 2nd Floor - GRD,
Plot-1/283 Ratanbad CHS.,
Jahangir Daji Street, Khatauwadi,
Bhatia Hospital, Grant Road,
Mumbai 400 007, Maharashtra
AND having its factory at Village Aswa,
Taluka Dahanu, Pin - 401 602, ...Plaintiff/
District Palghar, Maharashtra Applicant
~ versus ~
Shephali
Mormare
1. SG Worldwide Inc.,
Digitally signed
by Shephali
Mormare
an entity organized under the Laws of
Date: 2021.03.30
11:03:39 +0530 United States of America, having its
place of business at Edison, NJ, USA
and having its email ID as
[email protected]
Page 1 of 35
17th/18th February 2021 &
18th & 22nd March 2021
Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr
ial8940-2020 in comipl8936-2020-J.docx
2. Radico Khaitan Ltd.,
a company incorporated under the
Companies Act, 1956, having its
registered office at Bareilly Road,
Rampur - 244 901, Uttar Pradesh,
AND having its corporate office at
Plot No. J-I, Block B-I, Mohan Co-op.
Industrial Area, Mathura Road,
New Delhi 110 044 and having its
email id as
[email protected];
[email protected];
[email protected];
[email protected]; and
[email protected] ...Defendants
A PPEARANCES
FOR THE PLAINTIFF Dr Veerendra Tulzapurkar,
Senior Advocate,
with HW Kane, Nikhil Sharma, &
Merin Mathew, i/b WS Kane & Co.
FOR THE DEFENDANTS Mr Sharan Jagtiani,
Senior Advocate,
with Hiren Kamod, Mahesh
Mahadgut, Prem Khullar, & Poonam
Teddu, i/b Mahesh A Mahadgut.
CORAM : G.S.Patel, J.
DATED : 17th/18th February 2021,
18th & 22nd March 2021
ORAL JUDGMENT:
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1. The trade mark infringement action is in respect of whisky; specifically, single-malt whisky. The Plaintiff and the 2nd Defendant are both well-known manufacturers of various kinds of spirits and liquors. The 1st Defendant is an importer of the 2nd Defendant's products in the US. It is largely, in my view, unnecessary to this controversy.
2. The Plaintiff first sought ex parte ad-interim relief on 14th December 2020. I declined leave to move ex parte and directed the Plaintiff's Advocate to give notice. They did so. The Defendants' appeared on 17th December 2020. Having briefly heard both sides, I thought an Affidavit in Reply was necessary, and I allowed that. There is now an Affidavit in Rejoinder, too.
3. I have heard Dr Tulzapurkar for the Plaintiff, Mr Jagtiani for the Defendants and Mr Kane for the Plaintiff in Rejoinder. With their assistance, I have considered the material, the Affidavits, the pleadings and the decisions they have placed before me.
4. As I noted, this is an action in, and only in, trade mark infringement. No relief is sought in passing off. This distinction is vital to the discussion that follows.
5. A brief consideration of Section 29 of the Trade Marks Act 1999 is crucial to one of the issues involved. In its entirety, the Section says:
"29. Infringement of registered trade marks.-- (1) A registered trade mark is infringed by a person who, not being a registered proprietor or a person using by way of permitted Page 3 of 35 17th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx use, uses in the course of trade, a mark which is identical with, or deceptively similar to, the trade mark in relation to goods or services in respect of which the trade mark is registered and in such manner as to render the use of the mark likely to be taken as being used as a trade mark. (2) A registered trade mark is infringed by a person who, not being a registered proprietor or a person using by way of permitted use, uses in the course of trade, a mark which because of --
(a) its identity with the registered trade mark and the similarity of the goods or services covered by such registered trade mark; or
(b) its similarity to the registered trade mark and the identity or similarity of the goods or services covered by such registered trade mark; or
(c) its identity with the registered trade mark and the identity of the goods or services covered by such registered trade mark, is likely to cause confusion on the part of the public, or which is likely to have an association with the registered trade mark. (3) In any case falling under clause (c) of sub-section (2), the court shall presume that it is likely to cause confusion on the part of the public.
(4) A registered trade mark is infringed by a person who, not being a registered proprietor or a person using by way of permitted use, uses in the course of trade, a mark which --
(a) is identical with or similar to the registered trade mark; and
(b) is used in relation to goods or services which are not similar to those for which the trade mark is registered; and Page 4 of 35 17th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx
(c) the registered trade mark has a reputation in India and the use of the mark without due cause takes unfair advantage of or is detrimental to, the distinctive character or repute of the registered trade mark.
(5) A registered trade mark is infringed by a person if he uses such registered trade mark, as his trade name or part of his trade name, or name of his business concern or part of the name, of his business concern dealing in goods or services in respect of which the trade mark is registered. (6) For the purposes of this section, a person uses a registered mark, if, in particular, he --
(a) affixes it to goods or the packaging thereof;
(b) offers or exposes goods for sale, puts them on the market, or stocks them for those purposes under the registered trade mark, or offers or supplies services under the registered trade mark;
(c) imports or exports goods under the mark; or
(d) uses the registered trade mark on business papers or in advertising.
(7) A registered trade mark is infringed by a person who applies such registered trade mark to a material intended to be used for labeling or packaging goods, as a business paper, or for advertising goods or services, provided such person, when he applied the mark, knew or had reason to believe that the application of the mark was not duly authorised by the proprietor or a licensee.
(8) A registered trade mark is infringed by any advertising of that trade mark of such advertising --
(a) takes unfair advantage of and is contrary to honest practices in industrial or commercial matters;
or Page 5 of 35 17th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx
(b) is detrimental to its distinctive character; or
(c) is against the reputation of the trade mark. (9) Where the distinctive elements of a registered trade mark consist of or include words, the trade mark may be infringed by the spoken use of those words as well as by their visual representation and reference in this section to the use of a mark shall be construed accordingly."
6. It is well established that Section 29 deals with several different classes of infringement. It is a significant departure in some ways from The Trade and Merchandise Marks Act, 1958. I note this at the forefront because of a submission that Mr Kane made well into his rejoinder. This was based on the decision of a Single Judge of the Bombay High Court, SH Kapadia, J, as he then was in Cluett Peabody & Co Inc v Arrow Apparals.1 This was a decision of 24th October 1997. Evidently, it was a decision under the 1958 Act and not under the 1999 Act. Both sides have relied on this judgment for slightly different purposes, but for the present, it is Mr Kane's reliance on paragraph 27(c) with which I am concerned. For he says that in an infringement action, the 'question of deception or confusion will not arise and this is the settled position in law as it continues even today, i.e. after the advent of the 1999 Act'. I believe this submission to be materially misdirected for at least two reasons. First, Section 29 itself uses the terms 'deception' and 'confusion'. 'Deceptive similarity' finds mention in Section 29(1). 'Confusion' is a crucial ingredient of Section 29(2) and 29(3). Second, this is not even how the Plaintiff itself understood the position in law. Paragraph 9 of the plaint itself speaks of 'deceptive similarity' and 'confusion':
1 1998 (18) PTC 156 (Bom).Page 6 of 35
17th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx "9. The Plaintiff says and submits that the Defendants' impugned trade mark "ASĀVA" is almost identical with, especially phonetically, or closely and deceptively similar to the Plaintiff's registered trade mark "THE ASWA" bearing Registration No. 2716867. The goods in respect of which the Defendants are using the impugned trade mark are also identical with the goods in respect of which the Plaintiff has secured the registration of its said trade mark. Therefore, the use of the impugned trade mark by the Defendants in relation to the impugned goods is likely to cause confusion and deception on the part of the public which includes likelihood of association of the impugned trade mark with the Plaintiff's said registered trade mark. The Plaintiff says and submits that in the circumstances, by the use of the impugned trade mark in respect of the impugned goods, the Defendants have infringed and are continuing to infringe the Plaintiff's registered trade mark bearing Registration No. 2716867 in Class 33. The Plaintiff submits that the use of the word "Rampur" in the impugned trade mark by the Defendants does not and cannot avoid infringement of the Plaintiff's registered trade mark "THE ASWA". The Plaintiff is, therefore, entitled to a permanent order and injunction of this Hon'ble Court restraining the Defendants by themselves, their directors, agents, associates, servants, stockists, dealers, distributors and all persons claiming through them from infringing the Plaintiff's registered trade mark "THE ASWA" bearing Registration No. 2716867 in Class 33, by using the impugned trade mark "ASĀVA" and/or any other trade mark identical with or deceptively similar to the Plaintiff's registered trade mark "THE ASWA" bearing Registration No. 2716867 in Class 33 upon and/or in relation to alcoholic beverages including single malt whisky and/or any other goods which are same as/ similar to the goods in relation to which the Plaintiff has Page 7 of 35 17th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx secured the aforesaid registration or in any other manner whatsoever."
(Emphasis added)
7. Therefore, and obviously, the first test is whether or not there is any similarity between the Plaintiff's registered mark, "THE ASWA", and the Defendants' mark "ASĀVA".
8. Before I proceed further, a very brief word about the provenance of these two words. The Plaintiff says that Aswa is the name of a village in Dahanu Taluka, where it has its factory. It accepts that it is yet to use the mark, though registered in 2016, but that it proposes to do so for a single malt whisky. The Defendants say the word ASĀVA is not geographic. It is a transliteration into English of a Sanskrit word which means 'that which is fermented', presumably distilled.
9. The structure of the case, therefore, would be like this. If I find there is no similarity between the rival marks, that is to say, each is distinctive, and one is distinguishable from the other, then the case ends at that. On the other hand, should I find that there is some similarity -- whether oral, phonetic or structural, and however slight
-- then I would need to test this against the parameters of Section 29, and apply as necessary the tests of deception and confusion as the law requires. This will also necessitate a consideration of the other defences Mr Jagtiani takes.
10. I am mindful that a finding on the first issue of similarity is actually sufficient to close the matter, and the rest of the discussion Page 8 of 35 17th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx would then perhaps be moot. But since I have heard both sides on the full range of issues, I will indicate my views on each. I do not believe it will be fair to either side to leave any of these issues without discussion.
11. The factual narrative is short. The Plaintiff has registration of THE ASWA. It applied on 11th April 2014 and obtained registration in 2016 under Registration No. 2716867 in Class 33 in respect of whisky, vodka, brandy, rum, gin, wine, alcoholic coolers, alcoholic mixes and country liqueur. Images of the label and the bottle are appended to this order. Admittedly, the product is not yet in the market. The image shows the mark and the proposed label.
12. According to the Plaintiff, it learnt of the 2nd Defendant's rival product only in November 2020. What it saw is described at Exhibit "C" at page 23. The image is appended.
13. The plaint contains none of the usual wearying narrative about the Plaintiff's sales, expenses, promotions, awards, reputation and goodwill -- and for good reason. There are none. From paragraph 9 onward, the plaint segues directly into legal submissions.
14. The Affidavit in Reply from page 17 says that the 2nd Defendant was established in 1943 as the Rampur Distillery. In 1992, it adopted the house mark "Radico". It launched various liquor products under several brands and names. Some of these are set out. The RAMPUR brand itself was taken up and adopted as one of Radico Khaitan's several brands. It then says that the word ASĀVA Page 9 of 35 17th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx is a Sanskrit word for wine or self-generated fermentations known to traditional Ayurveda. These are alcoholic medicaments: extractions or decoctions are allowed to ferment with added sugars. ASĀVA, therefore, means an "Ayurvedic medicated wine". Paragraph 10 of the Affidavit in Reply at page 21 is really the heart of the defence. This is what it says:
"21. I say that the Defendant No. 2 launched Indian Single Malt luxury whisky under the brand name 'RAMPUR' in 2016. I further say that currently, Defendant No. 2 uses the trade mark RAMPUR for four types of Indian Single Malt whiskies being 'Sherry PX Finish', 'Vintage Select Casks', 'Double Cask' and 'ASĀVA' apart from limited edition super luxury RAMPUR Signature Reserve."
15. The submissions in law here are, therefore: first, that ASĀVA is a sub-brand; second, that it is used only with RAMPUR, and that it is RAMPUR that is the mark; third, ASĀVA is only suggestive of a manner of maturing or finishing the RAMPUR whisky; and fourth, there is no likelihood of confusion.
16. The 2nd Defendant has not applied for registration of ASĀVA at all.
17. What the 2nd Defendant does say is that it adopted the mark not in November 2020, as the Plaintiff suggests, but openly in January 2020. It set up a kiosk at a trade fair in 2020, which showed RAMPUR ASĀVA as a backdrop. It has been used in various promotions since then. RAMPUR ASĀVA has been in use since August 2020. What it connotes is the single malt from the RAMPUR Page 10 of 35 17th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx house but matured in Indian cabernet sauvignon wine barrels. Excise Department approval for the label came in on 3rd September 2020. There was open and extensive media coverage of the launch of RAMPUR ASĀVA. It is available in and chiefly in the international market. It has been widely reviewed as a "luxury whisky". The RAMPUR brand itself is in this luxury whisky space. It entered that competitive and crowded arena sometime in 2016, with four different varietals: Sherry PX Finish, Vintage Select Casks, Double Cask and the limited edition ultra-premium "RAMPUR Signature Reserve". Now the 2nd Defendant has added ASĀVA to this portfolio. There is then a description of each of these finishes in paragraph 22. RAMPUR itself has won several awards, and its offerings have been reviewed in international publications. In paragraph 25, the 2nd Defendant sets out the sales in the international market since August 2020. These are said to be in excess of Rs. 85.31 lakhs. The aggregate turnover of the 2nd Defendant exceeds Rs. 9,000 crores. There is also in the concluding paragraph 28 a reference to domestic sales. These are shown in Exhibit 'Q'. The domestic sales are negligible. This may actually have a bearing on at least one of the points that Mr Jagtiani has argued in the second part of his submissions.
18. On the factual aspect, that is all there is to it. I need to consider one paragraph of the Affidavit in Reply because Dr Tulzapurkar urged that there is an admission by the 2nd Defendant that ASĀVA is a "sub-brand". He referenced paragraph 21 of the Affidavit in Reply at page 25 and the opening line of paragraph 22. Paragraph 21 does not say that any of the variants are sub-brands. Paragraph 22 does refer to them as sub-brands. It is in Dr Tulzapurkar's submission, therefore, Page 11 of 35 17th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx enough to establish that ASĀVA alone can be considered for similarity, for a sub-brand is a mark.
19. First, as to the question of similarity, one that is, as I said earlier, dispositive. Both Dr Tulzapurkar and Mr Kane say that I must look not at RAMPUR ASĀVA, i.e., not at 'the mark as a whole' as Mr Jagtiani would have it (for he insists that the 2nd Defendant never uses ASĀVA divorced from RAMPUR). Instead, I must look at ASĀVA alone, separate from RAMPUR.
20. I find that hard to do. There is not the slightest evidence that ASĀVA is ever used separately from RAMPUR. There is no visual indication that RAMPUR is given less prominence than ASĀVA. On the outer circular carton, ASĀVA appears in gold and RAMPUR in white. This is on a brown background. Indeed, even the very great distance from which alone Mr Jagtiani permits me to view it -- he seems remarkably loath to let the bottle get anywhere near me -- it is RAMPUR that is far more distinctive than ASĀVA. The bottle itself is sheathed in a violet sack with an embroidered coat of arms or two crossed swords. The sack seems to show only RAMPUR Distilleries, not ASĀVA. The bottle has a white label. On this, RAMPUR is in dark lettering. ASĀVA appears in a slightly smaller sized gold font; against the white background, ASĀVA is not nearly as distinct as RAMPUR. On the reverse of the bottle, ASĀVA is all but invisible.
21. This lends heft to Mr Jagtiani's submission that it is not possible to Balkanise the two words merely because it suits the Plaintiff. ASĀVA is used only with RAMPUR, and RAMPUR is not Page 12 of 35 17th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx rendered in a less distinct or less prominent manner. This is an important indicator.
22. But let us take the Plaintiff's case at its highest and at its optimal and set THE ASWA against ASĀVA. The fact that there are three common letters -- one vowel repeated twice and one consonant
-- does not necessarily mean that there is either structural, phonetic or visual similarity. THE ASWA is bisyllabic. ASĀVA is carefully rendered with a diacritical mark over the 'A' -- Ā -- to indicate the AH sound. Thus, the emphasis is on the middle of three syllables:
ahs-AH-va. Therefore: I find no structural similarity. I find no visual similarity. I find no phonetic similarity.
23. There is not, in my judgment, the kind of similarity, let alone deceptive or confusing similarity, that the Plaintiff alleges in paragraph 9 between these the Plaintiff's mark and the 2nd Defendant's mark. This is not an acceptance of the Plaintiff's argument that ASĀVA is indeed a mark, or used in the "trade- marky" sense. It seems to be used by the 2nd Defendant to distinguish one product from others under the mark RAMPUR.
24. This will now immediately take us to the next set of submissions.
Dictated on 18th March 2021:
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25. As I said earlier, this really ends the case. But since other defences have been canvassed and addressed in rejoinder, I proceed to consider them.
26. The next point Mr Jagtiani makes is that the products are in different markets. The Plaintiff does not have a single malt in the international market. Almost the entirety of the 2nd Defendant's single malt business is in the export or overseas market, with negligible sales in India. The domestic and international markets are totally different; and the single-malt and general whisky markets are also totally different. As he points out, the Plaintiff's product, although it may have permission from the Excise Department, is not in the market at all. The Affidavit in Reply, however, shows that Rampur products enjoy very high overseas sales. The aggregate value for the sales across the entire range of Rampur-brand whiskies between 2016 and 2021 is nearly Rs. 19 crores with sales of over 26,000 cases. The domestic sales of the Defendant's RAMPUR ASĀVA are very low. Only a handful of cases have been sold between 2018 and 2020 in India, and the net sale value is not more than Rs.46.56 lakhs. This is obvious from the documents at Exhibit "P" and "Q" at pages 287 and 288. The Affidavit in Reply in paragraphs 27 and 28 refers to these figures.
27. Mr Jagtiani's submission is that the class of customer buying niche single malt whisky is not the average consumer. It is a particularly discerning class that knows exactly what it wants and has its own specific preferences. The test to be applied here cannot be of a casual buyer, let alone somebody totally ignorant because this is a niche and specialised market. Consumers of single malt whiskies do Page 14 of 35 17th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx not buy on impulse. They are discerning to a fault, clear about what it is that they will purchase and what they will not. Even within the international single malt market, consumers have distinct niche- within-niche preferences: Islay, Speyside, peaty and so on.
28. The Supreme Court in Khoday Distilleries Limited v Scotch Whisky Association And Ors2 specifically recognised that a different test is to be applied where there is clearly a distinct class of buyer. It recognised that purchasers of single malt whisky, and particularly expensive ones, are not impulse purchasers. The Khoday Distilleries Court relied on the decision of the Federal Court of Australia in Scotch Whisky Association v Marton De Witt3 to say that the habits of alcohol purchasers differ from those who buy soft drinks or sports drinks. Pricing and product quality are important factors that make for more discerning consumers. Paragraph 39 of the Australian decision provides an illuminating distinction.
"39. The uninvolved purchaser buying a present or someone else will usually ask a salesperson, who will assist in product distinction between bourbon products and scotch whisky products. The salesperson in a liquor store is a means by which consumers become knowledgeable about different products. By contrast, consumers would not typically ask a salesperson what a bottle of coke or a new soft drink tastes like. They would purchase the product and try it themselves. Consumers would also read product labels,, see that "scotch whisky" is written on the container, and infer that scotch whisky is made in Scotland."
2 2008 (37) PTC 413 (SC).
3 (2008) FCA 73.
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29. There is also a reference in Khoday Distilleries to the very old and as yet classic English decision in In Re Pianotist Co's Application.4 "You must take the two words. You must judge of them, both by their look and by their sound. You must consider the goods to which they are applied.
You must consider the nature and kind of customer who would be likely to buy those goods. In fact, you must consider all of the surrounding circumstances; and you must further consider what is likely to happen if each of those trade marks are used in a normal way as a trade mark for the goods of the respective owners of the marks."
30. One cannot judge this 'on the touchstone of exceptional carelessness or stupidity. The standard is the way in which a particular class of goods is sold, the setting an environment in which this is done and the habits and observations of men considered in the mask'.5 Then the Khoday Distilleries Court affirmed the judgment of this Court in Carew Phipson Limited v Deejay Distillers Pvt Ltd.6 "On comparison of the two marks bearing the aforesaid principles in mind, it is difficult to appreciate as to how there is even a remote possibility of any customer being misled. In my opinion, when a customer goes to a shop to buy the plaintiffs' product, he will not ask for "Duet" or "Gin L Lime" or "Gin N Orange" but he will ask for a "Blue Riband Gin N Lime" or "Blue Riband Tango Gin N Orange". Further having regard to the fact that the customer who is likely 'to buy the products of the plaintiffs and the defendants will be normally educated and discerning type, it 4 1906 23 RPC 774, cited with approval in Cooper Engineering Co Pty Ltd v Sigmund Pumps Limited, (1952) 86 CLR 536.
5 Cooper Engineering, supra.
6 AIR 1994 Bom 231: PTC (Suppl) (2) 263 (Bom).
Page 16 of 3517th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx is impossible to hold that there is any likelihood of confusion. It is pertinent to note that the plaintiffs have failed to cite even a single instance showing that there was confusion in the minds of the customers. The absence of evidence of actual deception is a circumstance which definitely weighs in favour of the defendants. It is also necessary to mention that the defendants have produced on record voluminous evidence showing that such premixtures are sold by several other companies under the names "American Extra Dry Gin with Lime Duet Plus", "Forbes Two in One Dry Gin and Lime", "Rainbow Gemlet Gin and Lime" etc. In my opinion, there is no possibility of any confusion in this case at all."
31. The submission, therefore, is that unless the Plaintiff is able to show that it has a range of products that are in the same niche market of discerning and knowledgeable customers as the 2nd Defendant, it cannot sustain such an action. This market or purchaser distinction must be given due weightage. There is no such material in the Plaint, Mr Jagtiani submits, and I think quite correctly. Indeed I believe I am being asked by the Plaintiff to speculate that its yet-to-be-launched product will garner the same kind of international attention and sales, or even that it already has a sort of "market awareness" or "brand equity" attached to it sufficient to obliterate this distinction between classes of purchasers. The mere fact that the Plaintiff's product is also presently conceived as a single malt whisky is not relevant. This has nothing to do with passing off. It has everything to do with, and only with, distinctiveness, confusion, deception and similarity.
32. Tied to this is the submission that ASĀVA is not a mark in and of itself and is not being used by the Defendants in a "trade-marky"
Page 17 of 3517th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx manner. The Defendants use ASĀVA as an identifier to distinguish this particular distillation from the 2nd Defendant's range of other distillations. The 2nd Defendant uses only one 'mark':
"RAMPUR". Within that mark, it has several variants, all different single malt whiskies. These are all different from each other. Each, therefore, requires to be distinctly identified: SELECT, PX, Double Cask, and so on. ASĀVA is only the latest of these. He says, therefore, the comparison is not firstly between THE ASWA and ASĀVA, but between THE ASWA and RAMPUR, or, at the highest, between THE ASWA and RAMPUR ASĀVA. The 2nd Defendant never uses ASĀVA independently of RAMPUR. Where, as here, a mark is used along with a house mark -- and only in that manner -- there cannot be said to be confusion by cleaving the house mark from the so-called sub-brand.
33. Mr Jagtiani relies on the decision of the Division Bench of this Court in MESO Private Limited v Liberty Shoes Ltd And Anr.7 It was there contended by the respondent, precisely as Mr Jagtiani does here, that the marks in question (Legend and Flirt), were used along with a house mark and house name, and this could not conceivably result in confusion of any kind. In this context, the Division Bench said that when considering the likelihood of confusion, a Court must consider the mode of purchasing goods, the class of consumers, the surrounding circumstances and the degree of similarity. The average consumer in such a case, whose perception is to be considered, is the average consumer of such products, one who is reasonably well-informed, observant and circumspect. Once I have seen that the house mark is 7 AIR 2019 Bom 305.
Page 18 of 3517th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx clearly and prominently used and that ASĀVA is never used without the house mark, then the present case falls squarely within the frame of MESO. The MESO Court reiterated the same principle we see in Khoday Distilleries. A consumer or purchaser of premium products does not buy them casually, or, in the words of Khoday Distilleries, on an impulse. This is not indifferent "anything-will-do" purchasing. A single malt purchaser will want a particular brand or has a ranked preference of brands. Recommendations between purchasers are generally on the house names, as the MESO Division Bench observed, and a discerning consumer, fully aware that there may be products with identifying or in-range distinguishing names, will first go with the house name before drilling down to a particular product in that range. In this class of products, Indian single malt whisky, a purchaser may prefer the Paul John to the Amrut and may prefer RAMPUR above all. If he does prefer the Paul John, he will have a range to choose from and similarly for the other house names. This is the reason why the MESO Court accepted the defence that the use of marks along with the house names had no likelihood of causing confusion. The result, in that case, was, as in this case, that other aspects lose relevance.
34. What this tells us in plain words is that no consumer will ask for "ASĀVA" on its own, but only for "RAMPUR ASĀVA". It makes no difference if the Plaintiff does not, in fact, have this close an association of a house name with a mark. The reason is that the Defendant's mark is not ASĀVA at all but is, taken as a whole, RAMPUR ASĀVA. Although it is true that an identified range may Page 19 of 35 17th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx be a trade mark,8 this is not always or invariably true. In this case, the fact that ASĀVA is a "sub-brand" will make no difference. It must be shown that it is used as a distinctive mark on its own. To put it differently, some, not all, sub-brands are marks.
35. Mr Jagtiani then relies on my decision in Ajanta Pharma Limited v Theon Pharmaceuticals Limited And Anr of 5th May 2017.9 His submission is that the matter was compromised in Appeal10 but the judgment was not set aside. In paragraph 21 of my judgment I said:
"21. Whether or not we should make fine distinctions when looking at goods that, though in the same 'class', are used in distinct ways [Indchemie Health Specialties Pvt Ltd v Intas Pharmaceuticals Ltd & Ors., 2015 (63) PTC 391 (Bom)] is a question that would arise if one found a similarity in the marks to begin with. One must guard as much against an approach that is overbroad, and sweeps in all manner of goods easily distinguished, and one that is much too narrow [See British Sugar PLC v James Robertson & Sons Ltd, [1996] RPC 281]. Given the similarity of marks, the next step would then be to test similarity of goods. Intas' product is not adapted for medical use. The NICE classification to which Mr Kane refers (2016 version, 10th edition) in its entry for Class 5 says the class does not include meal replacements, dietetic food and beverages not for medical or veterinary use. If Intas' product is such a dietetic food, then that may be another point of distinction. But I do not need to go that far, 8 Pidilite Industries Limited v Jubilent Agri And Cousumer Products Ltd, MIPR 2014 (1) 0109.
9 Notice of Motion No. 2681 of 2016 in Suit No. 798 of 2016. 10 Order dated 27th November 2017.Page 20 of 35
17th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx on my finding that the two marks, as now used, as sufficiently distinguishable."
36. On the question of a knowing consumer, in paragraph 20 I observed:
20. As to the likelihood of confusion, it is true that I have no material at all to substantiate this barring an invocation of the 'eye of the beholder', usually the judge. Increasingly, I find this to be a most fallible and unreliable test. It is unacceptably paternalistic and perhaps even a shade condescending. Perhaps at a time when industry and commerce lacked the means to gather swiftly public responses and reactions, marshal the data and then put it through a series of analytics, courts and lawyers had little choice. Those days are behind us. With the sophistication --
and speed -- of data gathering, the effect on a representative sample of consumers cannot be so hard to assess that courts must continue to perceive themselves helpless and without an option but to fall back on a mere assumption of what a consumer might or might not feel, say, think or believe. Why should we be so astute to believe that consumers are not? It is the consumer's preferences and known 'associations' that drive manufacturers to adopt a particular design or artwork or name. Yet we persist in the impression of a consumer who is not just of 'average intelligence and imperfect recollection' -- something that, incidentally, might equally well be said of lawyers and judges -- but is actually infantile and incapable of any sort of differentiation; and then we project this to all consumers. Perhaps the time has come to demand rather more than we are used to doing from plaintiffs seeking protection. Perhaps we need to accept that fair competition and open markets are often better judges of these matters than the ones in robes; and, certainly, that the Page 21 of 35 17th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx latter should not so readily assume they always know better or are wiser than the former."
Resumed on 22nd March 2021:
37. Mr Jagtiani's next submission relates to the failure by the Plaintiff to use the mark. The Plaintiff does not yet have a product. It has an idea of a product. The mark has lain fallow since 2016, and this might even give the Defendant a right to apply for its removal on the register under Section 47 of the Trade Marks Act. There is no doubt that the Plaintiff's mark "THE ASWA" is a mark yet to be put to use. Mr Jagtiani relies on the decision of a Division Bench of Delhi High Court in Veerumal Praveen Kumar vs Needle Industries (India) Ltd.11 This was a suit under the 1958 Act. The defendants before the Division Bench were the original plaintiffs in the suit. They sought a permanent injunction and damages. In respect of snap fasteners, the plaintiffs claimed relief against defendant using the same packaging colour scheme of orange and grey, and a layout and get-up identical or deceptively similar to the one used by them and in which they claimed rights. One of the defences was whether the non-user of the trade mark for a very long time, since 1981, afforded the defendant a defence. Is mere registration sufficient to grant the plaintiff relief? Is something more required? These were the questions before the Division Bench. It was submitted that trade marks do not exist in a vacuum. The sheer non-user for a long period of time disentitled the plaintiff to any protection. The Division Bench followed the decision of this Court in Cluett Peabody. There, it was argued that a mere non-
11 2001 PTC 889 Page 22 of 35 17th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx use of the mark in India provided no defence to an infringement action. Rejecting this argument, this Court held that the essential feature for constituting a proprietary right in the trade mark is that it should be used by the proprietor in his business or in connection with a vendible commodity.
38. I do not think the proposition is that a mark must be used immediately. That is not even Mr Jagtiani's case before me. What he does advocate, based on the decision in Veerumal Praveen Kumar, is that if there is non-user for a very long period of time, one or both of two things begin to happen. Either the mark loses distinctiveness, or it simply dies from non-user. Cluett Peadbody recognises that a lapse in time may alter the state of things such that granting an injunction would be unduly harsh and would cause irreparable damage or harm. The learned Single Judge in Cluett Peadbody set out certain principles. One of these is that the purpose of trade mark law is to protect a right recognised by the statue and not to create monopolies or mini- monopolies. That Court further observed that a mark can certainly lose distinctiveness through non-user. Enforcement of the right to exclusive use of a mark depends on whether the mark is shown to have been in continuous and uninterrupted use. There is then the proposition that a Court will not protect a right of a proprietor unless there is attached to it a sale of articles under the mark. A mark may be rendered thus non-distinctive for non-user. This appears to me to be straightforward and relentlessly logical. It ensures that any practice or attempt at "trade mark squatting" does not receive protection. A person who obtains registration of a mark and then does nothing with it for years and decades together cannot then claim that the mark is "distinctive". This will immediately raise the question how it can be Page 23 of 35 17th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx said to be distinctive if it has never been used, to begin with. Paragraph 27 of Cluett Peadbody sets out these principles.
39. The plaint is entirely silent on why the mark has not been put into use. It is one thing for a Court to say in a lighter vein that the proposed use of a mark on a single malt whisky product has a wait time of 10 years, 12 years or even much more, and, in that context, five years is a nothingness (nobody will buy a five-year-old single malt); but that courtroom levity -- such as it is -- will not substitute for an explanation of non-user. As Mr Jagtiani, riposting in kind, says, "that is not the spirit of the law". He submits that as opposed to such non-user, primacy must be afforded to he who is first out of the gates and is the first user as against someone who is not a user at all. Even if, therefore, there is said to be sufficient similarity between the marks (and I have held there is not), there is no manner of doubt that the 2nd Defendant is the first, prior and only user of ASĀVA in the market. This must count for something. Again, on a return to first principles, it is the 2nd Defendant that has used the mark and deployed it in relation to a product. This serves the purpose of achieving distinctiveness through use.
40. In Neon Laboratories v Medical Technologies Ltd and Ors12 the Supreme Court said this in paragraph 9:
"What has actually transpired is that after applying for registration of its trademark ROFOL in 1992, the Defendant- Appellant took no steps whatsoever in placing its product in the market till 2004. It also was legally lethargic in not seeking a curial restraint against the Plaintiff-Respondents.
12 2015 (64) PTC 225 (SC).Page 24 of 35
17th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx This reluctance to protect its mark could well be interpreted as an indication that the Defendant-Appellant had abandoned its mark at some point during the twelve year interregnum between its application and the commencement of its user, and that in 2004 it sought to exercise its rights afresh. It would not be unfair or fanciful to favour the view that the Defendant-Appellant's delayed user was to exploit the niche already created and built-up by the Plaintiff-Respondents for themselves in the market. The 'first in the market' test has always enjoyed pre- eminence. We shall not burden this Judgment by referring to the several precedents that can be found apposite to the subject. In the interest of prolixity we may mention only N.R. Dongre v. Whirlpool Corporation (1996) 5 SCC 714 and Milmet Oftho Industries v. Allergan Inc. (2004) 12 SCC 624. In Whirlpool, the worldwide prior user was given preference nay predominance over the registered trademark in India of the defendant. In Milmet, the marks of pharmaceutical preparation were similar but the prior user worldwide had not registered its mark in India whereas its adversary had done so. This Court approved the grant of an injunction in favour of the prior user. Additionally, in the recent decision in S. Syed Mohiden v. P. Sulochana Bai (2015) 7 SCALE 136, this Court has pithily underscored that the rights in a passing-off action emanate from common law and not from statutory provisions, nevertheless the prior user's rights will override those of a subsequent user even though it had been accorded registration of its trademark. Learned counsel for the Defendant-Appellant has endeavoured to minimise the relevance of Whirlpool as well as Milmet by drawing the distinction that those trademarks had attained worldwide reputation. However, we think that as world shrinks almost to global village, the relevance of the transnational nature of a trademark will progressively diminish into insignificance. In other words, the Page 25 of 35 17th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx attainment of valuable goodwill will have ever increasing importance. At the present stage, the argument in favour of the Defendant-Appellant that we find holds more water is that in both Milmet and Whirlpool, as distinct from the case before us, the prior user of the successful party predated the date of application for registration of the competing party."
(Emphasis added)
41. Mr Jagtiani's next argument is that there is on the Plaintiff's part an unforgivable suppression in the plaint. It did not disclose that after it learnt of the 2nd Defendant's RAMPUR ASĀVA product, the Plaintiff applied for registration of a word and device mark ASĀVA. It is settled law, he submits, that when a defendant in an infringement action applies for registration of the very mark that he is accused of infringing, he is confronted successfully with a species of estoppel. He can no longer then argue that the mark in question, since he himself has sought registration, is not distinctive. The requirements of the Trade Marks Act 1999 itself provide inter alia that distinctiveness is a prerequisite. A mark that is sought to be registered cannot be similar to another mark, let alone identical to it. Section 9 provides for absolute grounds for refusal of recognition. A mark devoid of distinctiveness, i.e. one incapable of distinguishing the goods or services of one person from another, cannot be registered. A defendant who applies for registration of the very mark can obviously no longer say that the mark is not distinctive. He must be deemed to have accepted its distinctiveness by his very act of applying for registration. But the reverse must also apply, Mr Jagtiani submits, when a plaintiff comes to Court alleging infringement by a Defendant who uses another (not identical) mark, and then the plaintiff itself seeks registration of the defendant's very mark. By the Page 26 of 35 17th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx same token, the plaintiff must also encounter a question of estoppel. He must be confronted by his own acts as an estoppel by conduct. The conclusion would be that the act of applying for registration of the defendant's mark is an admission by the plaintiff that the defendant's mark is indeed distinct, distinctive and capable of distinguishing goods. If, therefore, the plaintiff's original mark exists on the register and the plaintiff also applies for registration of the defendant's mark, this necessarily means that according to the plaintiff itself, both marks can co-exist and are capable of distinguishing the rival products one from the other. In this case, therefore, the present Plaintiff's act of applying for registration of ASĀVA precludes it from arguing that it is not distinctive.
42. This, in Mr Jagtiani's submission, has two consequences. First, there is the question of estoppel, possibly estoppel by conduct and estoppel by record on its own.13 More serious, he argues, is the question of suppression. There was no reason for the Plaintiff to withhold this information about this application, since the application was made on 6th November 2020, about a month or so before the suit's institution on 11th December 2020. The explanation in the Rejoinder, Mr Jagtiani points out, is only that the Plaintiff sought "better protection". But such 'better protection' can only work if there is no other user of the rival mark in the market. If someone else is already using the mark complained of, then applying for registration 13 UltraTech Cement v Alaknanda Cement Pvt Ltd & Ors, 2011 (5) Bom CR 588 (appeal dismissed); Jagdish Gopal Kamath & Ors v Lime & Chilli Hospitality Services, 2015 (62) PTC 23 (Bom) : 2015 SCC OnLine Bom 531.
Page 27 of 3517th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx is not 'better protection'. It is a worse plaint, one denuded of a cause of action.
43. Thus, the Plaintiff was aware of the Defendant's mark and the fact that the Defendant had put it to use. The Plaintiff has no use whatsoever for the 2nd Defendant's mark (for which it has sought registration). It has also not used its own registered mark either. This perhaps puts the matter on a stronger footing even then was before the Supreme Court in Neon Laboratories.
44. Mr Jagtiani distinguishes the decision in Hem Corporation Pvt Ltd And Ors v ITC Ltd,14 relied on by the Plaintiff, by pointing out that the defence there was not that the two marks should be taken as a whole. The submission was that the word Madhur was inherently incapable of registration being merely descriptive. It could not be used in any trade marky sense. No general principle seems to have emerged from Hem Corporation, and this is in direct contrast to the principles we found enunciated in Khoday Distilleries, Intas and MESO, all discussed above.
45. As to Pidilite Industries Limited v Jubilant Agri And Consumer Products Ltd,15 the mark (taken as a whole, which the Plaintiff here says should not be done) was "FEVICOL MARINE". The defendant there said that the plaintiff's use of Marine was descriptive. This decision ill-serves as any sort of precedent for the case at hand where both sides claim -- or in the Plaintiff's case must be deemed to have 14 2012 (52) PTC 600 (Bom).
15 MIPR 2014 (1) 0109.
Page 28 of 3517th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx claimed -- that the rival marks are indeed distinctive. The only question that is being raised is that the Defendant's mark the "RAMPUR ASĀVA" should be broken up by Rampur being ignored, and it should then be found that ASĀVA -- never used alone in that manner -- is precariously close to the Plaintiff's "THE ASWA", a mark not even in use after five years.
46. The other decisions relied on by Mr Kane in Rejoinder will not carry the matter much further. Kaviraj Pandit Durga Dutt Sharma v Navaratna Pharmaceuticals Laboratories16 tells us of the distinction between actions in infringement and actions in passing off. The proposition that, if the essential features of the Plaintiff's mark have been adopted by the Defendant, mere differences in packaging or indicating clearly a different trade origin would be immaterial for an infringement action but relevant for a passing off action is hardly applicable here
47. I am unable to see the relevance to this discussion of the Delhi High Court decision in Radico Khaitan Ltd v Devans Modern Breweries Ltd.17 That decision says that prior use is not a pre-requisite of registration. That is not the issue here. The question here is of prolonged non-used after registration.
48. Then Mr Kane relies upon the decision of a Division Bench in Reckitt And Colman of India Ltd v Wockhardt Ltd.18 The Division 16 AIR 1965 SC 980.
17 2019 (78) PTC 223 (Del).
18 Appeal No. 1180 of 1991. Page 29 of 3517th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx Bench said that once it is found that the defendant uses a mark as a trade mark, the fact that he makes it clear that his goods are of a different commercial origin avails him nothing since infringement consists in using the mark as a trade mark. There is no quarrel with this proposition whatsoever, but what the argument before me misses is that the two marks have to be found to be similar to begin with. That is the starting point of the discussion, and not merely that the defendant uses some mark and must therefore be presumed to be using it as a trade mark. Mr Jagtiani is at pains to point out, yet again, that the 2nd Defendant does not in fact use ASĀVA as a mark and on its own. It is part and parcel of an inseverable mark, RAMPUR ASĀVA. This level of abstraction will not help the Plaintiff in this case.
49. The discussion in Gorbatschow Wodka KG v John Distilleries Ltd19 helps the Plaintiff not at all. Here the learned Single Judge also referred to the Supreme Court decision in Khoday Distilleries and re- emphasised that the class of buyers of this kind of product are educated, and, therefore, the test to be applied is different from one where the product is more commonly used and purchased. The learned Single Judge held this might not be dispositive of the issue as to whether the conduct of the Defendant does or does not amount to passing off. I do not see how this even remotely assists the Plaintiff here, in a pure infringement action. The Plaintiff is not even in the market. As a logical starting point, passing off can only occur where the Plaintiff's mark is actually in use and has both reputation and goodwill, both fundamental to maintain an action in passing off. If the 19 2011 (47) PTC 100 (Bom).
Page 30 of 3517th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx product itself under the Plaintiff's mark is not even in the market, there is no question of anyone mistaking the Defendant's product for the Plaintiffs.
50. To translate this into practical terms in the present case, and breaking down the structure of it: (1) the Plaintiff's product is not known as "Meher Distilleries THE ASWA"; (2) when -- if -- launched it is proposed to be called simply THE ASWA; (3) today RAMPUR ASĀVA is in the market; (4) Rampur is both a brand/trade mark and an indication of origin; and (5) nobody can mistake RAMPUR ASĀVA as pointing to Meher Distilleries. That, frankly, is stretching things a little too far; even in the context of single malt whiskies
51. I do not see any substance in the Notice of Motion and do not find any grounds for the grant of relief.
52. The Notice of Motion is dismissed.
53. This being a Commercial IP Suit, Mr Jagtiani applies for an order of costs. He tenders a statement of costs. This is taken on record and marked "X2" for identification with today's date.
54. Section 35 of the Code of Civil Procedure 1908 ("CPC") as amended by the Commercial Courts Act 2015 requires me to grant an order of costs unless, for reasons to be recorded these are not be granted.
Page 31 of 3517th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx
55. Having found no merit in the Motion, I can see no reason to refrain from awarding costs. There will be an order of costs in favour of the Defendants against the Plaintiff in the amount of Rs 12,56,000/- (all fees, not including court fees paid). This is a figure that I consider reasonable, having regard to the circumstances of the case. The amount is to be paid within two weeks from today and will carry simple interest at 6% per annum, as also contemplated by amended Section 35.
56. At Mr Kane's request, the order of costs is stayed for two weeks.
57. This order will be digitally signed by the Personal Assistant of this Court. All concerned will act on production of a digitally signed copy of this order.
(G. S. PATEL, J) Page 32 of 35 17th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx PLAINTIFF'S MARK, LABEL AND PRODUCT Page 33 of 35 17th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx Page 34 of 35 17th/18th February 2021 & 18th & 22nd March 2021 Meher Distilleries Pvt Ltd v SG Worldwide Inc & Anr ial8940-2020 in comipl8936-2020-J.docx 2ND DEFENDANT'S PRODUCT, MARK AND LABEL Page 35 of 35 17th/18th February 2021 & 18th & 22nd March 2021