Delhi High Court
Aveda Corporation vs Dabur India Ltd. on 14 January, 2010
Author: Shiv Narayan Dhingra
Bench: Shiv Narayan Dhingra
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of Reserve: 18th November, 2009
Date of Order: January 14, 2010
+ IA No. 14808/2009 in CS(OS) No. 2179/2009
% 14.01.2010
Aveda Corporation ... Plaintiff
Through: Mr. Abhishek Manu Singhvi, Sr. Advocate
with Ms. Anuradha Salhotra, Mr. Rahul Chaudhary,
Mr. Sumit Wadhwa & Mrs. Bhawna Gandhi, Advocates
Versus
Dabur India Ltd. ... Defendant
Through: Mr. Sudhir Chandra Aggrawal, Sr. Advocate
With Ms. Mamta R. Jha, Mr. Sachin Gupta,
Mr. Manish K. Mishra & Mr. Sumit Rajput, Advocates
JUSTICE SHIV NARAYAN DHINGRA
1. Whether reporters of local papers may be allowed to see the judgment? Yes.
2. To be referred to the reporter or not? Yes.
3. Whether judgment should be reported in Digest? Yes.
JUDGMENT
1. "Aveda" and "Uveda" the two marks are subject matters of consideration under present application. "Aveda" is the trademark of plaintiff for which plaintiff is having a registration certificate showing registration in the name of plaintiff since 1986 for hair care, skin care and other beauty products. The name of plaintiff itself is "Aveda Corporation". The defendant has adopted a mark "Uveda" for its skin care and beauty products recently.
2. The contention of plaintiff is that plaintiff had popularized this trademark throughout the word by spending considerable amount on promotional activities/advertisements. In the year 2008-09 itself, an amount in excess of 50 + IA No. 14808/2009 in CS(OS) No. 2179/2009 Aveda Corporation v. Dabur India Ltd. Page 1 of 11 million dollars was spent on promotion of goods worldwide by the plaintiff. Defendant introduced fairness cream, face wash and moisturizer under the mark "Uveda" in August, 2009. The mark "Uveda" adopted by defendant was phonetically similar to the plaintiff‟s mark. It was being used by the defendant for similar products and the mark was deceptively similar to that of the plaintiff. The defendant though a well known company was trying to take advantage of the reputation of the plaintiff. The defendant was prominently using the word "Uveda" on its products and was also guilty of passing off its goods as those of the plaintiff since the ordinary consumer with an imperfect recollection was bound to get confused between the two words "Aveda" & "Uveda". This application for interim injunction has been made for restraining defendant from using the word "Uveda" during pendency of the case.
3. The defendant accepted notice of the application and argued the matter. It is submitted by the defendant that the plaintiff had no sales in India and the mark of the plaintiff "Aveda" was not known in India. Plaintiff was admittedly supplying its beauty products in India to only one Spa in Rishikesh and its products were not available at any shop in the market anywhere in India. There was no question of same consumer getting confused since the products of the plaintiff were not even available in India for sale. The other ground taken is that the plaintiff was catering to a very high end limited market the cost of 50 ml packing of the plaintiff‟s product was more than Rs.300/- whereas the cost of 30 gm packing of defendant‟s product was Rs.95/-. The packaging of the defendant was altogether different from that of the plaintiff and in order to fortify this point samples of defendant‟s cream and the plaintiff‟s cream were brought to the Court. The plaintiff packaging was small in size in blue colour while the carton of the + IA No. 14808/2009 in CS(OS) No. 2179/2009 Aveda Corporation v. Dabur India Ltd. Page 2 of 11 defendant‟s product was in red and orange/saffron colours and bigger in size. It was also stated that the style of writing "Uveda" and "Aveda" was also different and there was no reason for confusion of the customer and there was no chance of passing off the goods of the defendant as that of the plaintiff since "Dabur" was prominently written over the word "Uveda". The get up and mode of writing was also altogether different.
4. The other plea taken is that the word "Veda" was in public domain and the plaintiff‟s adoption of "Aveda" and its literature indicated that the product has to do something with the Ayurvedic science. The plaintiff cannot have monopoly over the word "Veda". The defendant can also use the word "Veda" with variation and if the variation adopted by the defendant was sufficient to distinguish the product of the defendant from that of the plaintiff no cause of action was made for filing the suit or the application.
5. Defendant placed reliance on Office Cleaning Services Limited v. Westminister Window and General Cleaners Ltd. 63 RPC LXIII 39 wherein the contest was between titles of "Office Cleaning Services Ltd." and "Office Cleaning Association" and the issue was whether the two names were sufficient to distinguish the respective businesses. The House of Lords observed that in the case of a trademark where the words are descriptive and are used by two traders as part of their respective trade names, the Court will not readily assume that use of the descriptive words would disentitle another trader to use the same as part of his trade name and the Court would easily accept small differences between the two names as sufficient to avoid a confusion. Reliance is also placed on Three- N-Products Private Ltd. v. Emami Limited 2008 (4) CHN 608 wherein the contest + IA No. 14808/2009 in CS(OS) No. 2179/2009 Aveda Corporation v. Dabur India Ltd. Page 3 of 11 was between plaintiff‟s claim over word "Ayur" and the defendant‟s mark "Ayu" in respect of same class of products. The Calcutta High Court observed as under:
39. The plaintiff is on stronger ground in its assertion of its complaint of the use of the mark "Ayu" as part of one of the defendant's brands. It has been recognized that the use of a prefix or a suffix by the defendant with the plaintiff's registered mark may not allow the defendant the right to use such mark. Of its two marks that include "Ayu" the defendant uses its stable mark "Himani" in conjunction with "Ayucare" and since the plaintiff complains of the use of the word "Ayu" as part of the mark "Himani Ayucare", it appears that there is sufficient bona fide attempt by the defendant to avoid confusion and to preclude association of its such mark with the plaintiff or its registered mark "Ayu". The use of "Ayu" by the defendant in such mark notwithstanding, prima facie, no case of infringement in respect of "Ayu" is made out by the plaintiff in respect of the defendant's "Himani Ayucare" mark.
49. The word "Ayur" hints at an association with Ayurveda. Whether or not the plaintiff uses any Ayurvedic component in any of its products manufactured under the registered device in which the word "Ayur" features prominently, the word conveys - in the context of the products manufactured by the plaintiff - a nexus with Ayurveda. The word "Ayur" in the plaintiff's marks may be perceived to refer to the composition of the products. The more descriptive a word, the closer the resemblance of the word to the efficacy or the nature of the associated product, the more remote will be the presumption as to its exclusivity and the more demanding it will be on the plaintiff to establish distinctiveness. For the owner of an unregistered word mark to claim exclusivity over the mark in the trade, the word must almost be incapable of application to the goods of any other trader. The plaintiff's "Ayur" word does not pass such high test.
6. The defendant also submitted that while the plaintiff‟s presence in India was miniscule, the defendant‟s presence in India and of its products including the "Uveda" cream was at large scale. The sale of its product with "Uveda" mark was already Rs.75 lac and products of Rs.1crore were in the pipeline. The Court should consider while granting an interim injunction that the + IA No. 14808/2009 in CS(OS) No. 2179/2009 Aveda Corporation v. Dabur India Ltd. Page 4 of 11 plaintiff was not going to suffer any loss much less irreparable loss since the product of plaintiff was not in the market whereas the defendant would suffer an irreparable loss. The balance of convenience was also in favour of the defendant. Defendant relied upon Wander Ltd. & Anr. v. Antox India (P) Ltd. 1990(2) Arb.L.R 399 wherein Supreme Court observed as under:
5. Usually, the prayer for grant of an interlocutory injunction is at a stage when the existence of the legal right asserted by the plaintiff and its alleged violation are both contested and uncertain and remain uncertain till they are established at the trial on evidence. The court, at this stage, acts on certain well settled principles of administration of this form of interlocutory remedy which is both temporary and discretionary. The object of the interlocutory injunction, it is stated is to protect the plaintiff against injury by violation of his rights for which he could not adequately be compensated in damages recoverable in the action if the uncertainty were resolved in his favour at the trial. The need for such protection must be weighed against the corresponding need of the defendant to be protected against injury resulting from his having been prevented from exercising his own legal rights for which he could not be adequately compensated.
The court must weigh one need against another and determine where the "balance of convenience lies". The interlocutory remedy is intended to preserve in status quo, the rights of parties which may appear on a prima facie. The court also, in restraining a defendant from exercising what he considers his legal right but what the plaintiff would like to be prevented, puts into the scales, as a relevant consideration whether the defendant has yet to commence his enterprise or whether he has already been doing so in which latter case considerations somewhat different from those that apply to a case where the defendant is yet to commence his enterprise, are attracted.
7. Defendant also relied on Bimal Govindji Shah Trading as Acme Industries v. Pannalal Chandulal 1997(2) Arb.L.R.76 and J.R.Kapoor v. Micronix India 1994 (Suppl) (3) SSC 215. It was further argued by the defendant that word „Veda‟ being in public domain and indicative of the product implying vedic/ayurvedic knowledge could not be monopolized by the plaintiff and in + IA No. 14808/2009 in CS(OS) No. 2179/2009 Aveda Corporation v. Dabur India Ltd. Page 5 of 11 support of his contention he relied upon SBL Ltd. v. Himalaya Drug Co. 1997 PTC (17) (DB) and Ruston and Hornby Ltd. v. Zamindara Engineering Co. AIR 1970 SC 1649 wherein Supreme Court had observed as under:
7. x x x x In an action for infringement where the defendant's trade mark is identical with the plaintiff's mark, the Court will not inquire whether the infringement is such as is likely to deceive or cause confusion. But where the alleged infringement consists of using not the exact mark on the Register, but something similar to it the test of infringement is the same as in an action for passing off. In other words, the test as to likelihood of confusion or deception arising from similarity of marks is the same both in infringement and passing off actions.
8. It is also argued by the defendant that mere registration of the trademark without its use in India would not entitle the plaintiff to stop others from using a mark which was different from that of the plaintiff but had some similarity more so when word „Veda‟ was used by plaintiff with prefix „A‟ was being used by the defendant with prefix „U‟. It is also submitted that defendant‟s name "Dabur"
was a well known brand and nobody could buy a cream of "Dabur" thinking it as that of the plaintiff which was not a known brand in India. It is also submitted that registration of a mark has a prima facie evidential value about its validity and nothing more and this presumption was a rebuttable presumption and can be displaced. Right created under Section 13 in favour of registered property was not an absolute right to it was subservient to other provisions of the Act. He relied upon N.R.Dongre & Ors. v. Whirlpool Corporation & Ors. AIR 1995 Delhi 300 wherein this Court had observed as under:
30. x x "From a reading of the above sections it is clear that registration of mark in the trade mark registry would be irrelevant in an action for passing off.+ IA No. 14808/2009 in CS(OS) No. 2179/2009 Aveda Corporation v. Dabur India Ltd. Page 6 of 11
Thus, the law is pretty well settled that in order to succeed at this stage the appellant had to establish user of the aforesaid mark prior in point of time than the impugned user by the respondents. The registration of the said mark or similar mark prior in point of time to user by the appellant is irrelevant in an action for passing off and the mere presence of the mark in the register maintained by the trade mark registry did not prove its user by the persons in whose names the mark was registered and was irrelevant for the purposes of deciding the application for interim injunction unless evidence had been led or was available of user of the registered trademarks. In our opinion, these clear rules of law were not kept in view by the learned single Judge and led him to commit an error."
9. It is also submitted by the defendant that general rule was that the generic-ness of a composite word is determined by examining the composite word as a whole rather than examining it in isolation. Word „Aveda‟ was nothing but distortion of word „Veda‟ similarly „Uveda‟ used by defendant was a distortion of generic word „Veda‟ and the Court have not granted injunctions where the generic words have been used.
10. The plaintiff‟s contention is that merely because the sale of the plaintiff was only to one customer i.e. at a spa, could not be a ground for refusing protection to plaintiff for its trademark. The quantum of sale is not a measure of protection of the trademark. Moreover, the Court has to look upon the goodwill generated by the plaintiff through its international campaign and advertisements in reputed magazine like „Vogue‟. It is also submitted that the plaintiff‟s products bearing trademark "Aveda" were displayed on number of websites including www.aveda.com, www.ebay.com, www.beautyappointments.com and were easily accessible to the customers who wanted to purchase the same. The word "Aveda" was a coined word by the plaintiff and the plaintiff was entitled for + IA No. 14808/2009 in CS(OS) No. 2179/2009 Aveda Corporation v. Dabur India Ltd. Page 7 of 11 protection. To fortify this point plaintiff had relied upon Essel Packaging Limited v. Sridhar Narra & Anr. 2002(25)PTC 233 (Del.). The plaintiff submitted that the trans-border reputation of the plaintiff had spread throughout India with the help of internet, tv. etc and merely because the plaintiff had not marketed its product in India for general consumption and was supplying only to its few exclusive customers at a spa would not disentitle plaintiff to the protection. In support of this argument plaintiff relied upon India Shaving Products Ltd. & Anr. v. Gift Pack & Anr. 1998 PTC (18) 698 and Whirlpool Corporation and Anr. v. Mr. N.R.Dongre & Ors. 56(1994) DLT 304.
11. It is further pleaded that merely because the word „Veda‟ was in common domain would not prevent the plaintiff from getting protection. It is submitted that even common word like „Veda‟ can be used by the plaintiff with a prefix and would get as protection as trademark. He relied upon Century Traders v. Roshan Lal Duggar & Co. & Ors. AIR 1978 Delhi 250 wherein this Court observed as under:
21. We now come to the question of balance of conveniences. It has been urged on behalf of the respondents that the mark "RAJARANI" is common to the trade and for this purpose reliance has been placed on the registration in Andhra Pradesh and Amritsar. There is a distinction between a mark being "common on the register"
and "common to the trade". There is no evidence on record to show that there is actual user of this mark by any party other than the parties before us. Inasmuch as trade mark is property right, an invasion of it should be protected and the balance of convenience would obviously be in favour of the appellant who was admittedly the first user of this mark. We cannot accept that there is any prima facie evidence of respondent No.3 being the owner of the mark. Indeed, this is belied by the registration applications filed by the respondent no.2. As was observed by Goddard, L.J. in + IA No. 14808/2009 in CS(OS) No. 2179/2009 Aveda Corporation v. Dabur India Ltd. Page 8 of 11 Draper v. Irist, (1939) 3 All ER 513:-
"In passing off cases, however, the true basis of the action is that the passing off by the defendant of his goods as the goods of the plaintiff injures the right of property in the plaintiff, that right of property being his right to the goodwill of his business................"
This right is to be protected and the balance of convenience is in favour of the person who has established a prima facie right to property.
12. In order to grant an interim injunction under Order 39 Rule 1&2 CPC, the Court has to consider if plaintiff had a prima facie case; second if the plaintiff would suffer an irreparable loss and injury and third if the balance of convenience lies in favour of the plaintiff and against the defendant. It is an undisputed fact that the plaintiff‟s presence in India was miniscule. The product of plaintiff was not available in the market and plaintiff was supplying only to one spa in Rishikesh. The question of arising of confusion among the common customers thus does not arise. Spa in Rishikesh where the product of plaintiff is used is not a common customer. Spa is a known spa which caters to the need of high end customers and it is evident that the owners of spa, despite availability of many other similar beauty products in India, are using particularly costly products of plaintiff, only because they know about the product of the plaintiff, thus there is no question of confusion as far as owners of spa is concerned. The product of the plaintiff is not available in the market at any shop. The sample which plaintiff brought to the Court also does not have any price tag in rupees, it only has a bar code. Under these circumstances, the question that the defendant was making an effort of passing off its product as that of plaintiff does not arise. It is not the case of plaintiff that defendant has made any effort to export its products to any person representing that this was product of the plaintiff thus, it is not a case of + IA No. 14808/2009 in CS(OS) No. 2179/2009 Aveda Corporation v. Dabur India Ltd. Page 9 of 11 passing off.
13. The issue of confusion even otherwise cannot arise because the defendant‟s product clearly mentions that it is a product of „Dabur‟, though the font of „Dabur‟ is smaller than the font of "Uveda" but the defendant can be told to make the two fonts equal so that „Dabur‟ is written on the product equally prominent. It may appear that the defendant was inspired by using the word „Uveda‟ because of this word is associated with „Veda‟ and the plaintiff has prior registration of word „Aveda‟ as a trademark in its name and ultimately the Court may come to the conclusion that use of word „Uveda‟ amounted to infringement of the trade mark of the plaintiff but mere prima facie case is not sufficient to grant an interim injunction. Along with prima facie case, the Court has to see two other factors viz. balance of convenience and irreparable injury. The plaintiff, who has no market in India and was supplying to only one spa cannot claim to be suffering irreparable injury. All bills which have been attached by the plaintiff are in respect of sales, not in India but outside India. In India its sale is limited only to one spa. It does not seem to be a case where plaintiff would suffer an irreparable injury in case the injunction is refused. The plaintiff can always be compensated by costs in case ultimately it is found that defendant tried to capture the market on the basis of goodwill of the plaintiff‟s product. The price difference between the product of the plaintiff and defendant was also so much that defendant was catering to the different strata of market than the one being catered by the plaintiff. Under these circumstances, I do not think that any irreparable loss or injury was going to be caused to the plaintiff. The balance of convenience also does not lie in favour of the plaintiff. In case the defendant is restrained from + IA No. 14808/2009 in CS(OS) No. 2179/2009 Aveda Corporation v. Dabur India Ltd. Page 10 of 11 marketing its product, the defendant would suffer a loss of around Rs.1 crore in respect of pipeline products whereas the plaintiff has no market in India and its supplies to the spa were not going to be affected, since the spa was using plaintiff‟s product knowing fully well that it was not defendant‟s product and Dabur‟s "Uveda" was a different brand from that of plaintiff. In view of these circumstances, I consider that mere prima facie case would not suffice to grant an interim injunction, other two factors viz. balance of convenience and irreparable injury should also be present for granting injunction under Order 39 Rule 1&2 CPC.
14. The ends of justice would be served in case the defendant is directed that it would use the word „Dabur‟ more prominently and in a larger font as UVEDA on all future packaging of its cream, and the defendant is directed to maintain an account of sales of all its products under the mark "Uveda" so that if ultimately incase, the Court upholds the right of the plaintiff to claim damages from the defendant the damages can be determined. With this, the application is disposed of and defendant is directed as above.
CS(OS) No. 2179/2009
List on 17th March, 2010 before the regular Bench.
January 14, 2010 SHIV NARAYAN DHINGRA J.
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+ IA No. 14808/2009 in CS(OS) No. 2179/2009 Aveda Corporation v. Dabur India Ltd. Page 11 of 11