Karnataka High Court
Ph4 Food And Beverages Private Limited vs M/S Cafe Toit on 17 August, 2022
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IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 17TH DAY OF AUGUST, 2022
BEFORE
THE HON'BLE MR. JUSTICE SACHIN SHANKAR MAGADUM
MFA NO.7011 OF 2021(IPR)
BETWEEN:
PH4 FOOD AND BEVERAGES PRIVATE LIMITED
A COMPANY INCORPORATED UNDER THE PROVISIONS OF
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT NO.298,
100 FEET ROAD, INDIRANAGAR
BENGALURU-560038
REPRESENTED HEREIN BY ITS DIRECTOR
MR SIBI VENKATARAJU
...APPELLANT
(BY SRI.PRADEEP NAYAK, ADVOCATE FOR SMT.ANUPAMA
G HEBBAR, ADVOCATE)
AND:
M/S CAFE TOIT
A PARTNERSHIP FIRM
REGISTERED UNDER THE PROVISIONS OF THE
INDIAN PARTNERSHIP ACT 1932,
REPRESENTED BY ITS PARTNERS,
MR J AVINASH AND MS K M SHANMUGAPRIYA
2ND FLOOR, KK COMPLEX,
92/1, BAGALUR ROAD
ABOVE WOODLAND SHOWROOM
HOSUR, TAMIL NADU-635109
...RESPONDENT
(BY SRI.G.L.VISHWANATH, SR.COUNSEL FOR
SMT.MANASA.B.RAO, ADVOCATE)
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THIS MFA IS FILED U/O.43 RULE 1(r) R/W SECTION
151 OF CPC, AGAINST THE ORDER DT.13.12.2021 PASSED
ON IA NOS.2 TO 5 IN O.S.NO.4350/2021 ON THE FILE OF
THE XVIII ADDITIONAL CITY CIVIL JUDGE, BENGALURU
CITY, (CCH NO.10), DISMISSING IA NO.2 TO 5 FILED
U/O.39 RULE 1 AND 2 R/W SECTION 151 OF CPC.
THIS APPEAL HAVING BEEN HEARD AND RESERVED
FOR JUDGMENT ON 19.04.2022, COMING ON FOR
PRONOUNCEMENT OF JUDGMENT THIS DAY, THE COURT
DELIEVER THE FOLLOWING:
JUDGMENT
The captioned appeal is filed by the plaintiff- appellant assailing the impugned order dated 13.12.2021 passed by the trial Court in dismissing the applications I.A.Nos.2 to 5 filed under Order 39 Rule 1 and 2 of CPC. The said applications are rejected by the learned Judge which is under challenge.
2. For the sake of convenience, the parties are referred to as per their rank before the Trial Court.
3. The brief facts of the case are as under:
The appellant has instituted a suit in O.S.No.4350/2021 seeking perpetual injunction and 3 relief of mandatory injunction. The appellant-plaintiff runs restaurants and brewpubs under the name "Toit". The appellant claims that the word Toit is a unique word which was coined by the appellant in 2010 and the same is being used continuously and exclusively since then. The appellant is a registered proprietor of the said word. It is the specific case of the appellant that their restaurants and brewpubs have received positive response and gained reputation in the eyes of the public. It is further contended that the appellant has incurred advertisement expenses which runs into several lakhs. It is also further contended that the popularity of appellant's restaurants and brewpubs is evident from the star ratings given by the food delivery platforms namely Zomato and Swiggy. It is in this background, the appellant claims that the respondent which runs a fast food and beverages restaurants under the name 'Café Toit' and using the 4 logo similar to the appellant company is also listed on food delivery platforms. It is alleged that the respondent is also using the trademark Café Toit on their website and also in Social Media platforms.
3(a) In the light of the evident infringement and passing off the mark of the appellant by the respondent, the appellant-company issued a notice calling upon the respondent to cease and desist from infringing on the appellant's mark. On these set of pleadings, the present suit was filed and interim injunction was sought against the respondent.
3(b) While respondent-defendant on receipt of summons contested the proceedings by filing written statement. The respondent-defendant stoutly denied the entire averments made in the plaint. The respondent-defendant claims that it is in the business under the name and style of "M/s.Cafe Toit" The respondent-defendant claims that they only serve fast 5 food and beverages such as coffee and juice. The respondent-defendant claims that it is one of the first and only roof top cafes in Hosur and undertakes home delivery in Hosur within the radius of 10 Kms. The respondent-defendant also contends that they do not serve alcohol and is not a pub/brewery/bar. The respondent-defendant contends that it has garnered a formidable reputation in Hosur and is a popular spot amongst the residents. The respondent claims that the name of Café is derived from the French word "Toit" meaning roof and therefore it is a generic French word. Therefore, contended that since it is a roof top café, the defendant thought it fit to name it "Toit".
3(c) The learned Judge having examined the rival contentions has proceeded to reject the applications, which are under challenge. 6
4. The learned counsel appearing for the appellant reiterating the grounds urged in the appeal memo would contend that the trial Court committed a serious error in law and the impugned order does not indicate that trial Court while examining the prima facie material has adverted to the appellants inviolable right to protect its registered marks. He would further contend that the appellant is the proprietor of the registered trade mark under clause 43 for food and beverages and therefore, contended that the prominent and essential feature of this mark being 'Toit' is also protected. Therefore, he would contend that the respondent by using the mark "Café Toit" for the same services under Clause 43 is infringing the registered trademark of the appellant. His grievance before the Court is that the learned Judge has failed to appreciate that when a label mark is registered it presupposes that the word mark i.e. Toit is also 7 registered. He would further contend that the trial Court erred in holding that Café Toit is a generic term and nobody can claim exclusive right over the same. He would further contend that once an infringement of a trade mark is shown, an injunction should follow. Referring to the judgment rendered by the Apex Court in the case of Midas Hygiene Industries (P) Limited .vs. Sudhir Bhatia and Others1, he would contend that all that needs to be seen is whether the names are deceptively similar and further whether they operate in the same field. He would further contend that unlike passing off, there is no question of proving any confusion or damages that would arise. He has placed reliance on the judgment rendered by the Apex Court in the case of Renaissance Hotel Holdings Inc .vs. B. Vijaya Sai and others rendered in Civil Appeal No.404/2022. Placing reliance on para 47 of the judgment, he would 1 (2004) 3 SCC 90 8 contend that prima facie material indicate that the respondent-defendant is improperly using the plaintiff's mark and therefore, there is no need to prove actual deception or actual damages. He would further point out that the injunction is bound to be granted even if defendant's goods may be different from the plaintiff's goods. He would seriously question the reasons assigned by the learned Judge while declining to grant injunction on the premise that the registered mark of the appellant cannot be considered to be a generic term. Countering the defendant's contention, the learned counsel would further point out that the word in the present lable or logo is a central part and therefore, the word Toit is also covered by the protection. However, the learned Judge has ignored the mark. Therefore, he would contend that the order is not sustainable and would warrant interference. He would conclude his 9 arguments by contending that the learned Judge has totally misread the pleadings of the parties and therefore, the reasons assigned while rejecting the application that appellant and respondent are operating in completely different spheres is contrary to the material on record.
5. The learned Senior Counsel appearing for the respondent-defendant would however counter the contentions raised by the learned counsel appearing for the appellant and reiterating the defence set up by the respondent, he would contend that the word 'Toit' is a generic term and not an invented word as alleged by the appellant. Therefore, the appellant-plaintiff cannot seek monopoly and hold rights over the use of it. He would also contend that the appellant's products are different from that of the respondent and therefore, no confusion would be caused in the minds of the customers. Reiterating the stand taken in the 10 written statement and the objections, the learned Senior Counsel would contend that absolutely there is no visual, phonetic, etymological or structural similarity between the two marks. By comparing both the logos, the learned Senior Counsel would contend that the essential features are wholly different and absolutely distinct from one another. He would also contend that the colour scheme of the two marks is different and so also the logo. Supporting the reasons assigned by the learned Judge, the learned Senior Counsel would contend that the parties are located in different cities as well as in different States. He would also point that the customer base of the parties is wholly different. The learned Senior Counsel would contend that the respondent-defendant is carrying on business under the name and style "M/s.Cafe Toit"
since 2017 and the word "Toit" is derived from the French word for 'roof top". The learned Senior 11 Counsel submits that the defendant serves only fast food and beverages. His main thrust is on the point that the respondent-defendant apart from dine-in services undertakes home delivery in Hosur only which is within the radius of 10 Kms. of the Cafe and respondent-defendant does not serve alcohol and is not a pub/brewery/bar. To buttress his arguments, he has placed reliance on the judgment rendered by the this Court in the case of Basavaraj Shivaramagouda Patil .vs. Mahesh2. He has also placed reliance on the judgment rendered by the Apex Court in the case of Purushottam Vishandas Raheja & another .vs. Shrichand Vishandas Raheja and others3. He also placed reliance on the judgments of this Court in the case of Sterling's MAC Fast Food .vs. MC Donald's Corporation4 and 2 ILR 1998 KAR 419 3 (2011) 6 SCC 73 4 ILR (2004) KAR 2893 12 Lalithakkshi .vs. Sadashivappa5. Referring to these judgments, the learned Senior Counsel would contend that the scope of enquiry under the provisions of Order LXIII of CPC is very limited and the appellate Court can interfere provided only the order is shown to be capricious, arbitrary or perverse. Referring to the judgment, he would contend that the appellate Court has no jurisdiction to interfere with the order of the Trial Court granting or refusing injunction merely because there is a possibility of taking another view.
To demonstrate that the appellant's products are totally different from that of the respondent, he has placed reliance on the judgment of the Apex Court in the case of Nandhini Deluxe .vs. Karnataka Co- Operative Milk Producers Federation Limited6
6. Heard the learned counsel for the appellant and the learned Senior counsel for the respondent. 5 AIR 1984 KANT 74 6 (2018) 9 SCC 183 13 Perused the order under challenge. I have also gone through the pleadings and the judgments cited by the respective parties.
7. Before I advert to the facts of the present case on hand, it would be useful for this Court to refer to some of the judgments relating to infringement of trade mark. In my view, the trade mark is not intended to protect a person who deliberately sets out to take the benefit of some body else's reputation with reference to goods, especially when the reputation extends to several States. The following are the judgments which are relevant to be referred for the purpose of grant of relief in case of infringement of trade marks:
"i. Kaviraj Pandit Durga Dutt Sharma v. Navaratna Pharmaceutical Laboratories AIR 1965 SC 980, it was held in Para 28 that:
28. The other ground of objection that the findings are inconsistent really proceeds on an error in appreciating the basic differences between the causes of action and right to relief 14 in suits for passing off and for infringement of a registered trade mark and in equating the essentials of a passing off action with those in respect of an action complaining of an infringement of a registered trade mark. We have already pointed out that the suit by the respondent complained both of an invasion of a statutory right under s. 21 in respect of a registered trade mark and also of a passing off by the use of the same make. The finding in favour of the appellant to which the learned Counsel drew our attention was based upon dissimilarity of the packing in which the goods of the two parties were vended, the difference in the physical appearance of the two packets by reason of the variation in their colour and other features and their general get-up together with the circumstance that the name and address of the manufactory of the appellant was prominently displayed on his packets and these features were all set out for negativing the respondent's claim that the appellant had passed off his goods as those of the respondent.
These matters which are of the essence of the cause of action for relief on the ground of passing off play but a limited role in an action for infringement of a registered trade mark by the registered proprietor who has a statutory right to that mark and who has a statutory remedy in the event of the use by another of that mark or a colourable limitation thereof. While an action for passing off is a Common Law remedy being in substance an action for deceit, that is, a passing off by a person of his own goods as those of another, that is not the gist of an action for Infringement. The action for infringement is a statutory remedy conferred on the registered proprietor of a registered trade mark for the vindication of the exclusive right to 15 the use of the trade mark in relation to those goods (Vide s. 21 of the Act). The use by the defendant of the trade mark of the plaintiff is not essential in an action for passing off, but is the sine qua non in the case of an action for Infringement. No doubt, where the evidence in respect of passing off consists merely of the colourable use of a registered trade mark, the essential features of both the actions might coincide in the sense that what would be a colourable limitation of a trade mark in a passing off action would also be such in an action for infringement of the same trade mark. But there the correspondence between the two ceases. In an action for Infringement, the plaintiff must, no doubt, make out that use of the defendant's mark is likely to deceive, but were the similarity between the plaintiff's and the defendant's mark is so close either visually, phonetically or otherwise and the court reaches the conclusion that there is an limitation, no further evidence is required to establish that the plaintiff's rights are violated. Expressed in another way, if the essential features of the trade mark of the plaintiff have been adopted by the defendant, the fact that the get-up, packing and other writing or marks on the goods or on the packets in which he offers his goods for sale show marked differences, or indicate clearly a trade origin different from that of the registered proprietor of the make would be immaterial; whereas in the case of passing off, the defendant may escape liability if he can show that the added matter is sufficient to distinguish his goods from those of the plaintiff.
ii. In the case of American Home Products v. Mac Laboratories AIR 1986 SC 137 in Para 36 it was held as under:
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"When a person gets his trade mark registered, he acquires valuable rights by reason of such registration. Registration of his trade mark give him the exclusive right to the use of the trade mark in connection with the goods in respect of which it is registered and if there is any invasion of this right by any other person using a mark which is the same or deceptively similar to his trade mark, he can protect his trade mark by an action for infringement in which he can obtain injunction.
iii. In the case of National Bell Co. v. Metal Goods Mfg. Co. AIR 1971 SC 898 at page 903 it was held as under:
On registration of a trade mark the registered proprietor gets under Section 20 the exclusive right to the use of trade marks in relation to the goods in respect of which the trade mark is registered and to obtain relief in respect of any infringement of such trade mark."
iv. Avis International Ltd. v. Avi Footwear Industries, reported in AIR 1991 Delhi 22, the relevant paras of which read as under:
14. At this stage of the case, we have no affidavit against another affidavit, and in view of the statutory provisions of Ss, 20 and 31 of the Trade and Merchandise Marks Act, it would be appropriate to rely upon contentions of the plaintiffs.
15. It is apparent that the word AEVI is not a commonly used word. The word is not in a dictionary. Its adoption by the defendants, therefore, needed to be explained, which the 17 defendants have not explained in the pleadings before the Court.
16. Phonetically the word AVIS, which is registered mark for footwear, and the word AEVI'S have to be pronounced identically. The business name of the defendants is known as AVI Footwear Industries. Prima facie, if it was the intention of the defendants by affixing the label AEVI'S on the footwear made by them was to indicate that the footwear carrying that label is made by the AVI Footwear Industries, then the mark they would have adopted would have been AVI, but that they have not done. They have tried to bring their mark/label as close as possible phonetically to the registered mark AVIS.
17. In my view, the statutory monopoly which has been conferred upon the plaintiffs in connection with use of the mark AVIS for any other consideration in relation to grant or non-
grant of an injunction, especially when the matter is at an interlocutory state, and is yet to be tried, and it cannot be foreseen as to whether the defendants who seek rectification of the plaintiffs mark, on account of nonuser would be able to prove their case. The statutory registration establishes prima facie case in favour of the plaintiffs.
18. In this view of the matter, I think that the balance of convenience would be in favour of the plaintiffs, to ensure that by concurrent user, during the period of the trial, no other rights come into existence. In my view, it is very convenient, if the defendants are so minded, to adopt any other label that establishes a 18 connection in the course of trade with respect to the footwear manufactured by them."
8. Therefore, in the light of what is laid down by the Apex Court in the judgment cited supra what emerges is that to prove the case for infringement of trade mark, the plaintiff has to show that the essential features of the registered trade mark which has been adopted by the defendant has been taken out from the plaintiff's registration. In such an eventuality, only the marks have to be compared by the Court and in case the registration is granted in favour of the plaintiff, he acquires valuable right by reason of the said registration. In order to establish infringement, the main ingredients of Section 29 of the Trade Marks Act, 1999 are that the plaintiff's mark must be registered under the Act; the defendant's mark is identical with or deceptively similar to the registered trade mark; and the defendant's use of the mark is in the course of trade in respect of the goods covered by 19 the registered trade mark. Therefore, the rival marks have to be compared as a whole. Where two rival marks are identical, it is not necessary for the plaintiff to prove further that the use of defendant's trademark is likely to deceive or cause confusion as the registration shows the title of registered proprietor and therefore, the things speak for themselves. In an infringement action, once a mark is used as indicating commercial origin by the defendant, no amount of added matter intended to show the true origin of the goods can affect the question. What the Court has to examine is that whether the defendant's mark is closely, visually or phonetically similar and if so, no further proof is necessary. The plaintiff is able to demonstrate by way of prima facie material that by essence of features of trade mark adopted by the defendant any minor differences in the mark used by the defendant would be immaterial.
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9. In order to succeed, the Court is not required to insist on a high standard of proof before it grants injunction in favour of plaintiff. The defence set up by the defendant that the goods sold under both the trade marks are totally different and therefore, no confusion will be caused in the minds of the customers also needs to be examined. The question that needs to be examined by the Court is as to whether competing fields being entirely different would warrant action and amounts to infringement under Sections 28 and 29 of the Infringement of Trade Marks Act.
10. In the background of the above said observations and discussions, the plaintiff has registered the trade mark "Toit". The lable mark is registered in the name of the plaintiff in Class 25, 32, 41 and 43. The plaintiff company secured registration to the word "Toit" in class 33. The plaintiff alleges 21 that the defendant is carrying on the business under the name and style "Café Toit" which is identically and deceptively similar. By way of prima facie material, to demonstrate the plaintiff-company's popularity and success of restaurants and breweries operated under the brand "Toit", the annual turn over is stated around Rs.60,43,90,057/- for the financial year 2019-20. Several documents are placed on record. Plaintiff claims that the mark "Toit" has acquired a brand name and is known for its popularity. Plaintiff has also placed on record, prima facie material indicating its popularity and its presence on social media. Several documents are produced. Plaintiff claims that good will and reputation is built by the restaurants and breweries run by the plaintiff through high-quality beverages, food and allied services and therefore, the trade mark is exclusively associated with the services offered by the plaintiff-appellant. 22 The plaintiff has also produced prima facie material indicating the amount spent towards advertisement. Plaintiff by way of prima facie material has produced documents indicating the awards won by the plaintiff- company. To prima facie demonstrate that there is infringement and passing off the marks of the plaintiff by the defendant, plaintiff has produced documents indicating that defendant is also listed both on Zomato and Swiggy. Materials are also produced indicating the defendant's rating on these platforms. By way of prima-facie material, plaintiff has also furnished the documents indicating the ratings of the appellant's and respondent's establishments. The search for "Toit" on the platforms in Bengaluru shows up both the plaintiff's and defendant's establishments and whenever a customer makes a search of plaintiff's restaurant on these platforms is likely to come across the defendant's restaurant on such platforms. 23
11. If all these significant details are taken into consideration, then I am of the view that the finding recorded by the learned Judge while rejecting the application prima facie appears to be perverse. The finding of the learned Judge that merely because the word "Toit" is found in the defendant's mark in itself would not amount to infringement or passing off plaintiff's mark is erroneous. The learned Judge was of the view that the word Toit is registered under Class 43 for providing services in food and drink. Therefore, the learned Judge was of the view that though plaintiff is using the word "Toit" in their business they are predominately using the mark in respect of alcohol and beverages and it is unlikely that the customer who is likely to have beer at plaintiff's brewery at Bengaluru would visit defendant's cafe at Hosur. The learned Judge also erred in recording the finding that the word 'Café Toit' used by the 24 establishment is a generic term and no body can claim exclusive right over it. This finding is erroneous, which can be adjudicated only by a full fledged trial.
12. The names and the mark and symbol are deceptively similar and therefore, while considering the interim injunction application it was necessary to ascertain whether they are deceptively similar unlike passing off. In case of infringement no question of confusion or damages arises. At this juncture, having examined the prima facie materials on both the sides, this Court is of the view that the defendant is improperly using the plaintiff's mark. On examination of both the label or logo, this Court would find that the essential features of both the marks are quite similar. Therefore, the Trial Court erred in rejecting the interim injunction application filed under Order XXXIX Rule 1 and 2 of CPC. This Court is of the view that the 25 Trial Court has committed a serious error in law and the prima-facie material is not properly appreciated.
13. Therefore, the prima facie materials placed by both the parties on record gives an indication that the logo of defendant is found to be deceptively similar to that of plaintiff. The food and beverage services offered by the defendant prima facie overlaps with the services offered by the restaurants and breweries run by the plaintiff. This Court is also of the opinion that prima facie the name "Café Toit" and the defendant's logo is deceptively similar to the registered trade mark of the plaintiff. The plaintiff has also produced prima facie materials indicating that the word "Toit" and logo are the registered trade marks of the plaintiff and the same are used by the plaintiff since 2010. The statutory registration establishes prima facie case.
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14. Plaintiff has made out a prima facie case. In this view of the matter, I am of the view that balance of convenience would be in favour of the plaintiff, to ensure that by concurrent user, during the period of the trial, no other rights come into existence, the plaintiff is entitled for interim injunction. The learned Judge has not considered all these significant details while rejecting the application seeking injunction. Therefore, the order suffers from perversity. The Trial Court has not exercised discretion judiciously and therefore, the order under challenge is not sustainable. The reasons assigned by the learned Judge are not tenable and there are compelling reasons for this Court to reverse the reasons and conclusions arrived at by the learned Judge while rejecting the application.
15. In the light of the discussions made supra, plaintiff being the registered owner of trade mark 27 "Toit" and having invested substantial amount is lawfully entitled to protect its registered trade mark till the suit is decided on merits and therefore, defendant has to be restrained by way of an interim injunction from infringing the plaintiff's registered trade mark as well as deceptively passing of the services of its café as those of the restaurants and breweries run by the plaintiff.
16. For the foregoing reasons, I pass the following:
ORDER The appeal is allowed. The impugned order dated 13.12.2021 passed on I.A.Nos.2 to 5 filed under Order XXXIX Rule 1 and 2 of CPC is set aside. Consequently, the applications are allowed. 28
The defendant is hereby restrained from adopting or using the plaintiff's registered trade mark "Toit" till the disposal of the suit.
Sd/-
JUDGE *alb/-