Inter Ikea Systems Bv vs Annanya Gautam & Anr. on 28 September, 2018

[Cites 9, Cited by 5]

Delhi High Court

Inter Ikea Systems Bv vs Annanya Gautam & Anr. on 28 September, 2018

1. Present suit has been filed for permanent injunction restraining infringement of trademark, passing off, rendition of accounts, damages and delivery up. The prayers sought in the present injunction application are as under:-

(a) Restrain the defendants, their employees, servants, agents and all others in active concert or participation with them from manufacturing/selling/advertising/ importing or in any other way dealing in goods and providing services under the mark IKAH or any other mark which amounts to an infringement CS(COMM) 1089/2018 Page 1 of 13 of the IKEA trademarks of the plaintiff as listed in paragraph 13 of the plaint;

(b) Restrain the defendants, their employees, servants, agents and all others in active concert or participation with them from manufacturing/selling/advertising/ importing or in any other way dealing in goods and providing services under the mark IKAH or any other mark which amounts to passing off the defendants‟ products and services as that of the plaintiff;

(c) Direct the Chief Commissioner of Customs to issue an appropriate alert to all ports to ensure that consignments containing the impugned products of the defendants are not cleared;

(d) Direct the National Internet Exchange of India (NIXI) to suspend the domain www.ikah.in during the pendency of the present suit.

(e) That the above orders may be passed ex pare.

2. Ms. Shwetasree Majumder, learned counsel for the plaintiff, states that the plaintiff is engaged in the business of providing a wide range of well designed, functional and affordable home furnishing products and accessories, bathroom and kitchen fittings, home and office furnishing products, stationery including paper and paper articles, tools and implements under the trade mark IKEA. In the plaint it is averred that the plaintiff is the proprietor of the trademark IKEA which is being used by the plaintiff since 1943 and in India since 1994.

3. Learned counsel for the plaintiff states that the trademark IKEA is an invented mark derived from the first letters of the name and surname of the plaintiff‟s founder Ingvar Kamprad as also the first letters of the farm and CS(COMM) 1089/2018 Page 2 of 13 the village where he grew up i.e. Elmtaryd and Agunnaryd.

4. Learned counsel for the plaintiff further states that the plaintiff is the registered proprietor of the word IKEA in several classes in India including Classes 7, 11, 21, 35 and 37 which are the Classes in which the defendants‟ activities fall. She states that the mark IKEA also forms an essential and integral part of the domain names used by the plaintiff i.e. www.ikea.com and www.ikea.in.

5. Ms. Shwetasree Majumder points out that the plaintiff group is the first major single brand retailer to be given FDI approval to set up retail operations in India. She contends that the plaintiff group has regularly and continuously been promoting its trademark IKEA and goods and services thereunder through extensive advertisement, publicity, promotion and marketing and has been spending enormous amounts of money, efforts and time for the said purpose.

6. Learned counsel for the plaintiff states that in July, 2018, the representative of the plaintiff came across the defendant no.2 company which is engaged in the business of selling home appliances under the mark IKAH. She states that the defendants are advertising and promoting their infringing products under the trademark IKAH on their website www.ikah.in which was owned initially by an entity, Porche Products Private Limited which has been struck off from the Register of Companies.

7. It is the plaintiff‟s case that the defendants‟ mark IKAH is phonetically, structurally and conceptually similar to plaintiff‟s registered trade mark IKEA and is being used in relation to identical goods to encash upon the plaintiff's goodwill and international reputation. She states that the defendants' mala fides and deliberate attempt to deceive current and CS(COMM) 1089/2018 Page 3 of 13 potential customers is additionally apparent from the fact that they describe their products as "International Kitchen and Hardware" on their website www.ikah.in. A screenshot of the defendants' website is reproduced herein below:-

8. Learned counsel for the plaintiff contends that the defendants also sell their products on e-commerce platforms such as www.amazon.in. She states that the unauthorized use of the deceptively similar mark IKAH is causing irreparable loss in the course of trade and severe detriment to the business, goodwill and market positioning of the plaintiff. She states that the defendants' misuse of the plaintiffs' mark IKEA will result in eroding the distinctiveness and value of the same. She lastly states that if the defendants' activities are not curbed, it would prompt other third parties to copy and imitate the plaintiff's IKEA trademark, thereby leading to its further dilution.

9. Per contra, Mr. T. Sundar Ramanathan, learned counsel for the defendants, who appears in response to a short notice issued by this Court, CS(COMM) 1089/2018 Page 4 of 13 contends that the plaintiff‟s mark IKEA and the defendants‟ mark IKAH are neither phonetically nor visually similar. He points out that while the defendants‟ logo is in black colour, the plaintiff‟s logo is in yellow and blue colour. In support of his contention, he relies upon the judgment of the Supreme Court in Cadila Health Care Ltd. Vs. Cadila Pharmaceuticals Ltd., (2001) 5 SCC 73, wherein it has been held as under:-

"16. Dealing once again with medicinal products, this Court in F. Hoffmann-La Roche & Co. Ltd. v. Geoffrey Manner & Co.

(P) Ltd. had to consider whether the word "Protovit" belonging to the appellant was similar to the word "Dropovit" of the respondent. This Court, while deciding the test to be applied, observed at pp. 720-21 as follows: (SCC para 7) "The test for comparison of the two word marks were formulated by Lord Parker in Pianotist Co. Ltd.'s application [(1906) 23 RPC 774] as follows:

„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 to be applied. You must consider the nature and kind of customer who would be likely to buy those goods. In fact, you must consider all the surrounding circumstances; and you must further consider what is likely to happen if each of those trade marks is used in a normal way as a trade mark for the goods of the respective owners of the marks. If, considering all those circumstances, you come to the conclusion that there will be a confusion, that is to say, not necessarily that one man will be injured and the other will gain illicit benefit, but that there will be a confusion in the mind of the public which will lead to confusion in the goods -- then you may refuse the registration, or rather you must refuse the registration in that case.‟ (emphasis supplied) CS(COMM) 1089/2018 Page 5 of 13

10. Learned counsel for the defendants further states that the defendants‟ mark IKAH has been registered in Classes 7 & 11 and it has never been objected to either by the Registrar of Trade Marks or by the plaintiff. He points out that the mark IKAH is an acronym for "International Kitchen and Hardware".

11. Learned counsel for the defendants states that the defendants have been using the impugned mark IKAH from February, 2018 and have been selling their products in Ghaziabad and Bangalore as well as in other parts of the country.

12. Learned counsel for the defendants contends that the defendants‟ business model is different from that of the plaintiff. He points out that the plaintiff has 4000 sq.ft. stores which sell a large number of products; while the defendants sell their products only through retail outlets. He emphasises that not only the trade channels of the plaintiff and the defendants are different, but the plaintiff‟s products are DIY (DO IT YOURSELF) i.e. one needs to assemble them oneself.

13. He lastly states that a person buying the plaintiff or the defendants‟ product is a discerning consumer and he knows the difference between IKEA and IKAH marks.

14. In rejoinder, learned counsel for the plaintiff states that the marks IKEA and IKAH are both phonetically and visually similar. They contain :

     4 letters each
     The first two letters (50% of the mark are identical)
     Of the last two letters is an A in both - only the location of the „A‟ is
displaced in the Defendants‟ mark.




CS(COMM) 1089/2018                                         Page 6 of 13
       The Defendants‟ mark has an „H‟ which is a voiceless grottal

fricative, (used more as a vowel than a consonant).

15. She also states that the plaintiff will be opening smaller size stores or multi format stores in Delhi and Mumbai soon. She further states that the plaintiff provides assemblage services to its customers in India.

16. Having heard learned counsel for the parties, this Court is of the view that the plaintiff‟s mark is a coined word and is consequently entitled to the highest protection.

17. This Court is further of the opinion that the defendants‟ registrations are for logo/device mark and they do not vest the defendants with any rights over the underlying word mark IKAH. The Supreme Court in The Registrar of Trade Marks Vs. Ashok Chandra Rakhit Ltd., AIR 1955 SC 558 has held as under:-

"16. It is true that where a distinctive label is registered as a whole, such registration cannot possibly give any exclusive statutory right to the proprietor of the trade mark to the use of any particular word or name contained therein apart from the mark as a whole. As said by Lord Esher in Pinto v. Badman (8 R.P.C. 181 :

"The truth is that the label does not consist each particular part of it, but consists of the combination of them all".

(emphasis supplied)

18. Consequently, the defendants defence based on registration of their marks is untenable in law.

19. It is settled law that in order to come to the conclusion whether one mark is deceptively similar to another, the broad and essential features of the CS(COMM) 1089/2018 Page 7 of 13 two marks have to be considered. In Amritdhara Pharmacy Vs. Satyadeo Gupta, 1963 SCR 484, the Supreme Court has held, "..the overall structural and phonetic similarity of the two names „Amritdhara‟ and „Lakshmandhara‟ is, in our opinion, likely to deceive or cause confusion. We must consider the overall similarity of the two composite words „Amritdhara‟ and „Lakshmandhara‟. We do not think that the learned Judges of the High Court were right in saying that no Indian would mistake one for the other. An unwary purchaser of average intelligence and imperfect recollection would not, as the High Court supposed; split the name into its component parts and consider the etymological meaning thereof or even consider the meanings of the composite words as „current of nectar‟ or „current of Lakshman‟. He would go more by the overall structural and phonetic similarity and the nature of the medicine he has previously purchased, or has been told about, or about which has otherwise learnt and which he wants to purchase."

20. Subsequently, in K.R. Chinna Krishna Chettiar Vs. Shri Ambal and Co. & Ors., (1969) 2 SCC 131, the Supreme Court has held, "the resemblance between the two marks must be considered with reference to the ear as well as the eye. There is a close affinity of sound between Ambal and Andal.

21. McCarthy on Trademarks and Unfair Competition [J. Thomas McCarthy, IV Ed., Clark Boardman Callaghan 2007] under the sub-heading "Comparing Marks : Differences and Similarities, the treatise states :-

"23.15.... The typical shopper does not retain all of the individual details of a composite mark in his or her mind, but retains only an overall, general impression created by the CS(COMM) 1089/2018 Page 8 of 13 composite as a whole. It is the overall impression created by the mark from the ordinary shopper's cursory observation in the marketplace that will or will not lead to a likelihood of confusion, not the impression created from a meticulous comparison as expressed in carefully weighed analysis in legal briefs."

"In litigation over the alleged similarity of marks, the owner will emphasize the similarities and the alleged infringer will emphasize the differences. The point is that the two marks should not be examined with a microscope to find the differences, for this is not the way the average purchaser views the marks. To the average buyer, the points of similarity are more important that minor points of difference. A court should not engage in "technical gymnastics" in an attempt to find some minor differences between conflicting marks. However, where there are both similarities and differences in the marks, there must be weighed against one another to see which predominate."

(emphasis supplied)

22. Further, as pointed out by the Apex Court in Cadila Health Care Ltd. Vs. Cadila Pharmaceuticals Ltd. (supra), the approach of the Court has to be to examine similarity in the marks and not the dissimilarities.

23. In any event, phonetic and visual similarities are disjunctive and not conjunctive tests. As long as either test is satisfied, similarity stands established in accordance with Section 29 of the Trade Marks Act, 1999 and judgment of the Apex Court in Kaviraj Pandit Durga Dutt Sharma Vs. Navaratna Pharmaceutical Laboratories, AIR 1965 SC 980(1).

24. In the present case, the impugned mark bears an overall similarity to the plaintiff‟s registered mark and is likely to mislead a person usually dealing with one to accept the other if offered to him. In fact, the similarity between the plaintiff‟s and defendant‟s mark is so close visually and phonetically that this Court is of the prima facie view that there is an CS(COMM) 1089/2018 Page 9 of 13 imitation and the plaintiff‟s rights are violated. Consequently, this Court is of the prima facie view that the marks IKEA and IKAH are phonetically and visually similar.

25. Since in the present case the junior/subsequent mark of the defendants resembles a senior coined mark of the plaintiff, this Court is of the prima facie view that even if an explanation is offered for adoption and use of the junior mark, the same cannot constitute an adequate defence. In Satyam Inforway Ltd. Vs. Sifynet Solutions Pvt. Ltd., (2004) 6 SCC 145 the Supreme Court has held "What is also important is that the respondent admittedly adopted the mark after the appellant. The appellant is the prior user and has the right to debar the respondent from eating into the goodwill it may have built up in connection with the name." (emphasis supplied)

26. This Court is also of the view that the arguments with regard to the size or format of stores or trade channels or class of customers are irrelevant inasmuch as the present suit is for infringement of a registered trademark on the basis of Section 29 of the Trade Marks Act, 1999.

27. The Supreme Court in the case of Midas Hygiene Industries P. Ltd. & Anr. v. Sudhir Bhatia & Ors., 2004 (28) PTC 121 (SC) has held that in case of infringement of trademark normally an injunction must follow and that delay is not fatal in bringing infringing action.

28. The fact that the defendants‟ mark IKAH was owned by Porche Products Private Limited which was subsequently struck off from the Register of Companies due to an undertaking given by the defendant no. 1‟s father in an infringement suit as well as the fact that the defendants along with their name IKAH describe their product as "one that you have been waiting for"- coinciding with the launch of plaintiff‟s product in India -

CS(COMM) 1089/2018 Page 10 of 13

show that the defendants‟ intent is to prima facie deceive the customers. It is pertinent to mention that though the defendant no. 2 is a joint venture company between the defendant no. 1 and a Hong Kong based company, yet neither the defendant no.1 nor the foreign company sell their products by the name of IKAH anywhere in the world. A coordinate bench of this Court in Stiefel Laboratories, Inc & Anr. Vs. Ajanta Pharma Ltd., 2014 (59) PTC 24 (Del) has held as under:-

"30. ............In the process, difference between the confusion and deception is to be understood. This difference was explained by Lord Denning in "Difference: Confusion & Deception" in the following words:

"Looking to the natural meaning of the words, I would make two observations: first, the offending mark must "so nearly resemble" the registered mark as to be "likely" to deceive or cause confusion. It is not necessary that it should be intended to deceive or intended to cause confusion. You do not have to look into the mind of the user to see what he intended. It is its probable effect on ordinary people which you have to consider. No doubt if you find that he did intend to deceive or cause confusion, you will give him credit for success in his intentions. You will not hesitate to hold that his use of it is likely to deceive or cause confusion. But if he had no such intention, and was completely honest, then you will look carefully to see whether it is likely to deceive or cause confusion before you find him guilty of infringement.

Secondly, "to deceive" is one thing. To "cause confusion" is another. The difference is this: when you deceive a man, you tell him a lie. You make a false representation to him & thereby cause him to believe a thing to be true which is false. You may not do it knowingly, or intentionally, but you still do it, & so you deceive him. But you may cause confusion without telling him a lie at all, & without making any false representation to him. You may indeed tell him the truth, the whole truth & nothing but the CS(COMM) 1089/2018 Page 11 of 13 truth, but still you may cause confusion in his mind, not by any fault of yours, but because he has not the knowledge or ability to distinguish it from the other pieces of truth known to him or because he may not even take the trouble to do so."

(emphasis supplied)

29. This Court is further of the prima facie view that the defendants‟ use of IKAH in their domain www.ikah.in has to be evaluated as a separate head of infringement quite apart from its use on products as a visitor to the domain could reach it by a mere misspelling of the plaintiff‟s trademark with no knowledge of the defendant or its products. This is the principle of "Initial Interest Confusion", which is posited on the assumption that "Infringement can be based upon confusion that creates initial customer interest, even though no actual sale is finally created as a result of the confusion. Most Courts now recognize the initial interest confusion theory as a form of likelihood of confusion which can trigger a finding of infringement." [McCarthy Volume 4, 23:6].

30. Keeping in view the aforesaid, this Court is of the opinion that a prima facie case of infringement and passing off is made out in favour of the plaintiff and balance of convenience is also in its favour. Further, irreparable harm or injury would be caused to the plaintiff if an interim injunction order is not passed.

31. Consequently, till further orders the defendants, their employees, servants, agents and all others in active concert or participation with them are restrained from manufacturing/selling/advertising/importing or in any other way dealing in goods and providing services under the mark IKAH or any other mark which amounts to an infringement of the IKEA trademarks CS(COMM) 1089/2018 Page 12 of 13 of the plaintiff. The National Internet Exchange of India (NIXI) is also directed to suspend the domain www.ikah.in during the pendency of the present suit.

32. At this stage, learned counsel for defendants states that he would still like to make efforts to amicably resolve the matter. Consequently, it is directed that the present order shall not be given effect to for a period of ten days.

33. List on 28th November, 2018.

CS(COMM) 1089/2018 & I.A. 11356/2018 Let a written statement/reply be filed within four weeks. Replication/rejoinder be filed within two weeks of the receipt of the advance copy of the written statement.

List before Joint Registrar for completion of pleadings on 14 th November, 2018.

List before Court on 28th November, 2018.

MANMOHAN, J SEPTEMBER 28, 2018 KA/rn/js CS(COMM) 1089/2018 Page 13 of 13

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