Madras High Court
The Proctor And Gamble Company ... vs Christian Hoden (India) Private Ltd. ... on 18 April, 1988
Equivalent citations: (1989)1MLJ36
JUDGMENT Srinivasan, J.
1. These two appeals are directed against the order of Bhaskaran, J., sitting on the original side of this Court, dismissing the applications filed by the appellant for injunction and allowing the applications filed by the respondents for vacating the interim injunction granted. The relevant facts are shortly these: The appellant claiming to be a Corporation organised under the Laws of State of Ohio, United States of America has instituted the suit C.S. No. 425 of 1987 for a permanent injunction restraining the defendants from infringing the plaintiffs copyright in the artistic design and literary work contained in its package filed along with plaint as documents C.1 and C.2by use of their package filed as documents G.I and G.2 along with the plaint or by any other package containing any artistic work or literary work deceptively similar to that of the plaintiff, for a permanent injunction restraining the defendants from passing off their goods as and for those of the plaintiff by using the trade mark Always or by use of the package filed as documents G.1 and G.2 along with the plaint or by using the distinctive colour scheme and get-up and in particular the device of a flying bird in a logo form or in any other design deceptively similar to the plaintiffs package design, for a sum of Rs. 51,000 by way of damages for infringement of copyright of the plaintiff and passing off defendant's goods as and for those of the plaintiff, for rendition of accounts of the profits made by the defendants by sale of their products under the trade mark Always and for surrender for destruction of all plastic pouches, wrappers, cartons, labels, etc., bearing the trade mark Always. The claim of the plaintiff/appellant is that it is carrying on business as manufacturers of cosmetics, soaps, laundry and dish washing products, foods, beverages, health and personal care product, disposable diapers, personal hygiene and catamenial products such as sanitary napkins. The sanitary napkins and female hygiene products manufactured by the plaintiff are sold under the trademark Always. In or about 1982, the plaintiff has prepared a distinctive package for marketing its sanitary napkins and catamenial products under the trade mark Always with a distinctive colour scheme, get up and lay out. The instructions and directions in respect of the said sanitary napkins are written on the said package. According to the plaintiff, the design of the said package is an original artistic work and the text written thereon is an original literary work of the plaintiff. The plaintiff claims to have registered the package in the United States of America under the Copyrights Law. Invoking the provisions of the International Copyright Order, 1958, the plaintiff submits that the artiscic and literary work published by the plaintiff in the United States of America as aforesaid enjoins protection under the Copyright Act, 1957, as if the said work was first published in India. In December, 1984, the plaintiff applied for registration of the trade mark Always in India in Class 5 in respect of the articles for feminine hygiene, sanitary tempons and pads, pantiliners, and personal deodorants. In December, 1986, the plaintiff applied for registration of the said trade mark device of a flying bird in a logo form in class 5 in respect of personal deodorants and antiperspirants. The applications are said to be pending. The plaint sets out the sales figures in U.S A. and claims that the catamenial products of the plaintiff under Always package design have been sold on an extensive scale in several countries all over the world. The figures of sales in Middle East and Gulf countries are also given in the plaint. It is stated in the plaint that in or about 1986, the plaintiff learnt for the first time through its trade mark attorneys in India that the defendants have adopted the plaintiffs trade mark Always and device of a flying bird in a logo form along with the word Comfit in respect of sanitary napkins manufactured and sold by the defendants. It is also alleged that the defendant's products are sold in a plastic pouch having a colour scheme, get-up and lay out identical to the plaintiffs package design. According to the plaintiff, even the text appearing in the pouch had been copied by the defendants. Thus, the plaintiff alleged that the defendants have infringed the plaintiffs copyright. It is further alleged by the plaintiff that the defendants have deliberately and dishonestly made a false and misleading legend appearing on the sanitary napkins pouch viz., 'London, Rome, Stockholm" and submits that the said legend is adopted to create an impression in the minds of the trade and public that the defendants are in some way connected with the plaintiff. The plaint makes a reference to an application by the defendants dated 19th July, 1984 for registration of the trade mark Comfit Always in Class 5 for "toilet papers (medicated), sanitary Knickers, sanitary chemical substances, medical and surgical bandages, absorbent cotton wool, surgical gauze, sanitary towels, napkins, tampons, pads, belts and panties included in class 5". The plaintiff rests his prayers both on the ground of infringement of copyright and on the ground of passing off.
2. The plaintiff filed applications 2640 and 2641 of 1987 for injunction restraining the defendants from infringing copyright and passing off their goods as and for those of the plaintiff. The averments made in the affidavit filed in support of the applications are the same as those found in the plaint. An interim injunction was granted, and the defendants after service of notice came forward with applications 2827 and 2828 of 1987 for vacating the interim injunction. In the affidavit filed on behalf of the defendants, they had stated that they are carrying on business in the manufacture and sale of sanitary napkins, tampons and other catamenial products for about 20 years. The trade mark Comfit was registered in 1968 and the first defendant acquired tremendous reputation and goodwill in the said trade mark. The second defendant is using the said trade mark under licence from the first defendant. According to the defendants, the total sales under the trade mark Comfit exceed 10 crore rupees and several lakhs of rupees were being spent on advertisement and publicity. According to them, in or about 1984, they imported a machine for the manufacture of Stayfree beltless type of sanitary towels and started manufacturing and marketing the same. At that time, they devised a new packet for marketing that product and called it Comfit Always, to distinguish the new product from the earlier one. The sales figures and publicity expenses in respect of the new products are over 64 lakhs of rupees of 4 lakhs of rupees respectively. They had stated that the plaintiff did not carry on any manufacturing, marketing or importing of their products in India at any time. According to the defendants, the plaintiff is guilty of suppressio veri and suggestio falsi. A contention was raised by the defendants that the alleged copyright of the plaintiff in their design has ceased to exist long back by virtue of Section 15 of the Copyright Act, 1957, as the plaintiffs products were manufactured by industrial process and the design was capable of being registered under the Designs Act, 1911. The defendants proceeded to state that the plaintiff had no reputation or goodwill in India, and therefore, there cannot be any deception caused in the minds of public and consequently, there can be no passing off. The defendants also referred to the absence of any reputation or goodwill of the plaintiff in India and the ban on the import of sanitary napkins into India by law. Ultimately, the defendants pleaded in their affidavit that by the grant of interim injunction, their entire activity came to a stand-still and they were losing over Rs. 30,000 per day so long as the injunction is in force. They also referred to the circumstance that the Government is losing revenue on account of loss in excise duty, sales tax and other applicable taxes and duties. According to the defendants over 1000 persons are engaged directly or indirectly in the manufacture and distribution and sale of their products and that they would suffer loss of earnings on account of the injunction.
3. A reply affidavit is said to have been filed by the plaintiff on the day when the matters were heard by the single judge. The plaintiff merely reiterated its stand in the reply affidavit while denying the averments made by the defendants and challenging the sales figures given by the defendants in their affidavit. It was also alleged in the reply affidavit that the defendants are habitual infringers who have copied the trade mark Freedom and package design in respect of the type of their sanitary napkins from world famous M/s. Kimberly Clarke.
4. The learned single Judge after observing that the plaintiff s goods never came to Indian market and that there was no reputation of plaintiffs goods in this country, held that the plaintiff is not entitled to an injunction during the pendency of the suit as the balance of convenience is in favour of the defendants. Though the learned judge observed that on a comparison of the plaintiffs and defendants' packets on which their respective products were sold, there appears similarity regarding colour schemes containing the device of a flying bird appearing in a logo form and also the word Always, the defendant's packets contain the word Comfit in addition to the word Always. After referring to the circumstances that the defendants applied for registration of the mark Comfit Always on 19.7.1984, six months earlier than the plaintiffs application for registration of the mark Always and that the plaintiff has not exported any of its products to India, held that there is no question of any loss in the sale or reputation of the products of the plaintiff in India. The learned Judge also referred to the contention raised by the defendants that the provisions of the Designs Act would apply and by virtue for Section 15 of the Copyright Act, the alleged copyright of the plaintiff has ceased to be in force and observed that it was not necessary for him to go into that question for the purpose of the interlocutory applications. Ultimately, the learned Judge dismissed the applications filed by the plaintiff/appellant and allowed the applications filed by the defendants to vacate the interim injunction.
5. It is in those circumstances, the present appeals have been brought before us. Learned Counsel for the appellant contends that the plaintiff has come to Court with two causes of action, one based on copy-right and the other on passing off. According to him, the learned Judge on the original side has confused the issue by mixing up the two different causes of action without dealing with them separately and distinctly. It is submitted by learned Counsel that in the present case, there is no dispute as to the plaintiffs copyright for the package design as registered in the United States of America. According to him, even though the defendants have not disputed the copyright of the plaintiff, sufficient evidence has been adduced in the applications to prove the subsisting copyright and the infringement thereof is self-evident on a mere look at the package pouches used by the defendants. Learned Counsel proceeds to submit that once the infringement of the plaintiffs copyright is found, then the Court is bound to grant an injunction in favour of the plaintiff to protect its copyright. According to him, there is no question of considering the balance of convenience in such cases. It is submitted by him that the absence of any sale of plaintiffs products in Indian Market is wholly irrelevant with regard to the infringement of copyright. He refers to the provisions of the International Copyrights Order and Section 40 of the Copy Right Act, 1957, and contends that if there is an infringement of the copyright, injunction must automatically follow. According to him, acquisition of goodwill or reputation by the plaintiff in Indian market would be relevant only with reference to the relief based on passing off and not the relief based upon infringement of copyright. As regards passing off, learned Counsel submits that a perusel of the package pouch used by the defendants keeping it by the side of the package pouch used by the plaintiff, would prove beyond doubt that the defendants are dishonestly attempting to pass off their goods as and for those of the plaintiff. Learned Counsel also submits that even while considering the question of balance of convenience, the learned Single Judge has failed to note that the defendants' user of the mark Always has admittedly started recently and the sales of the new products are very much less than the sales of the old products under the mark Comfit. According to him, the allegation that the business of the defendants has come to a stand still cannot be true in the face of the averments that the old products are still capturing more than half of the market, His submission is that even on the question of balance of convenience, the learned single Judge has not taken note of the relevant facts. He contends that Section 15 of the Copy Right Act cannot be invoked by the defendants as the package design over which the plaintiff claims a right will not be covered by the provisions of the Designs Act. According to learned Counsel, this is a case in which junction ought to have been granted in favour of the plaintiff restraining the defendants from infringing the copyright and passing off their goods till the disposal of the suit.
6. Learned Counsel for the defendants/respondents contends that the plaintiff cannot claim to have made out a prima facie case and that the contention of the plaintiffs counsel that there is no dispute as to the copyright put forward by the plaintiff is erroneous. According to him, the affidavit filed by the defendants in support of the application for vacating the interim injunction questioned the claim made by the plaintiff in the plaint as well as the affidavit filed in support of the application for injunction and it cannot be taken for granted that there is a copyright subsisting with the plaintiff as claimed. According to learned Counsel, there can be no doubt that Section 15 of the Copy Right Act is applicable and that the package design of the plaintiff would fall within the scope of the Designs Act. Learned Counsel submits that the balance of convenience is in favour of the defendants, as they are doing business in a large scale and that the plaintiff is not doing any business in this country. Learned Counsel also submits that the trial Court having exercised its discretion and refused to grant injunction, the appellate Court should not interfere with the same. According to him, the discretion of the appellate Court is not to be exercised independently of the discretion of the trial Court as if the matter is being dealt with for the first time.
7. The principles relating to grant of interlocutory injunction in matters of this type and the exercise of the power of the appellate Court are by now well-settled. In Halsbury's Laws of England, Fourth Edition, Volume 24, the general principles relating to grant of interlocutory injunctions are stated thus in paragraph 953:
On application for an injunction in aid of a plaintiffs alleged right, the Court will usually wish to consider whether the case is so clear and free from objection on equitable grounds that it ought to interfere to preserve property without waiting for the right to be finally established. (Sounders v. Smith (1838) 3 My & Cr. 711). This depends upon a variety of circumstances, and it is impossible to lay down any general rule on the subject by which the court ought in all cases to be regulated (Sounders v. Smith (1838) 3 My & Cr. 711), but in no case will the court grant an interlocutory injunction as of course. (Potter v. Chapman. (1750) Amb 98 at 993.
The tendency is to avoid trying the same question twice and to grant injunctions only in clear cases; where there is no doubt as to the legal rights an interlocutory injunction will be granted, and it is no objection that the relief so granted is substantially the same as the whole relief claimed in the action except that it is only to endure until the hearing of the action. A-G v. Stockton-on-Tees Corporation (1927)91 JP 172 at 174. It is not necessary that the court should find a case which would entitle the plaintiff to relief at all events; it is quite sufficient for it to find a case which shows that there is a substantial question to be investigated, and that the status quo should be preserved "until that question can be finally disposed of (Powell v. Lloyd (1827)1 Y & J 427).
In paragraph 955, it is stated:
It has been stated in the past that where the plaintiff is asserting a right he should show a strong prima facie case, at least, in support of the right which he assets. (Tonson v. Walker (1752)3 Swan 672 at 679).
The plaintiff must also as a rule be able to show that an injunction until the hearing is necessary to protect him against irreparable injury; mere inconvenience is not enough.
8. In Vol.9 of Halsbury's Laws of England, Fourth Edition, which deals with law of Copyrights, the principles relating to interlocutory injunctions are stated thus in paragraph 944:
It is often of importance for a plaintiff to obtain immediate protection from a threatened infringement of his copyright. In such a case he should apply for an interlocutory injunction for the purpose of preserving his rights from further interference pending the trial of the action and, if the granting of such an injunction will not seriously "interfere with the defendant, it may be granted although the plaintiff does not fully prove his title to the right alleged to be infringed, Andrew v. Raebum (1874)9 Ch. App.522 or has only an equitable title (Oxford and Cambridge Universities v. Richardson,(1802) 6 Ves 689) or although the quantity of the defendant's work which constitutes the infringement has not been ascertained, Lewis v. Fullarton (1839) 2 Beav 6. The defendant, if injured as the result of the injunction, will be entitled to compensation by virtue of the undertaking as to damages by the plaintiff which is an invariable term of the granting of such an interlocutory injunction. Chappel v. Davidson (1856)8 De GM & G1.
An interlocutory injunction will not, however, be granted where the defendant might suffer irreparable injury from an injunction restraining him from publishing pending the trial Spottiswoode v. Clark (1846)2 Ph. 154 and the plaintiff can be properly protected by the defendant being ordered to keep an account, nor will it normally be granted where a bona fide defence of fair dealing has been pleaded (Hubbard v. Vosper (1972) 2 QB 84), or if the plaintiff "has been guilty of undue delay in coming to the court or his conduct has amounted to acquiescence in the infringement Sounders v. Smith (1838)3 My & Cr. 711, or if there is any substantial doubt as to the plaintiffs right to succeed (Walcot v. Walker (1802)7 Ves 1).It has been said that in considering whether to grant an interlocutory injunction the judge must look at the whole case and that the remedy by interlocutory injunction must not be made the subject of strict rules, Hubbard v. Vosper (1972)2 Q.B 84 at 96.
9. In V. Manicka Thevar v. Messrs. Star Plough Works, Melur , a single Judge of this Court observed that where the main issue to be divided in the stage of the interim injunction application is the same as the one to be tried in the suit the best course will be to expedit the trial in the suit, so that neither party would be put to any irreparable damage or loss or prejudice. In that case, the suit was based on an alleged infringement of a patent and the defendant questioned the validity of the grant in favour of the plaintiff. The learned Judge observed that an interim injunction will not be granted if the defendant disputes the validity of the grant and if the patent is new and its validity has not been established in a judicial proceeding till then and if it is endeavoured to be shown that the patent ought not to have been granted under the provisions of Section 26 of the Patents and Designs Act, 1911, the Court will not interfere by issuing a temporary injunction.
10. In Hubbard and Anr. v. Vosper and Anr. (1972)1 All E.R.1023, the question was considered by Lord Denning MR at some length. The action was based on an infringement of copyright and breach of confidence. The appeal before the Court of Appeal was against an order granting an interlocutory injunction in favour of the plaintiffs. While allowing the appeal, Lord Denning, MR., observed thus:
The Judge fully appreciated that Mr. Vosper might well have good defences; but, nevertheless, he granted an injunction to prevent him publishing the book. The reason was because of two decisions by judges of first instance. Donmar Productions Ltd., v. Bart (1967)2 All. ER 338 decided in 1964 but reported in 1967 and Barman Pictures N.V. v. Osbome (1967)2 All ER.324. Those cases do seem to suggest that, in an action for infringement of copyright (and also it would appear in any other action for the infringement of a right) when a plaintiff seeks an interlocutory injunction, he has to do two things; first, he must establish a strong prima facie case that he owns the copyright or other right; but, secondly, having done that, he need only show as arguable case that the defendant has infringed it or is about to infringe it. In the words of Goff. J. in Harman's case (1967)2 All E.R. at 336), the plaintiff:
does not have to show that he is likely to be successful or more likely to be so than the defendant, but only that he has a case reasonably capable of succeeding.
We are told that practitioners have been treating these cases as deciding that, if the plaintiff has an arguable case, an injunction should be granted so that the status quo may be maintained. The judge was so told in the present case, and that is why he granted the injunction.
I would like to say at once that I cannot accept the propositions stated in those two cases. In considering whether to grant an interlocutory injunction, the right course for a judge is to look at the whole case. He must have regard not only to the strength of the claim but also to the strength of the defence", and then decide what is best to be done. Sometimes it is best to grant an injunction so as to maintain the status quo until the trial. At other times it is best not to impose a restraint on the defendant but leave him free to go ahead. For instance, in Fraser v. Evans (1969)1 All E.R.8, although the plaintiff owned the copyright, we did not grant an injunction, because the defendant might have a defence of fair dealing. The remedy by interlocutory injunction is so useful that it should be kept flexible and discretionary. It must not be made the subject of strict rules.
Lord Justice Megaw while agreeing with the reasons given by Lord Denning MR., enunciated the law thus:
... First, I wish to say something with regard to the matter with which Lord Denning MR has dealt at the end of his judgment, in relation to interlocutory injunctions. I very much doubt whether the passage in Halsbury's Laws of England (21 Halsbury's Laws (3rd Edition), 365,366, paras 765,766), cited by Ungoed-Thomas J, in his judgment in Donmar Productions Ltd., v. Bart (1967)2 All E.R 338 at 339, was intended to state as a general proposition that different standards of proof are to be applied when the court considers, first, the question whether the plaintiff has a right, and, secondly, the question whether, if the plaintiff does have the right, that right has been infringed. It is true that in certain special cases one can approach the matter in that way. Suppose, for example, the plaintiffs claim for an interlocutory injunction is based on his contentions that he is the owner of a piece of land and that the defendant does not dispute that the piece of land belongs to the plaintiff, then it may, in some cases, require only the slightest evidence on the part of the plaintiff of the fact the defendant has gone on that land to entitle the plaintiff to an injunction. The defendant in those circumstances, if he has a defence at all, has a defence to the action only on the basis: 'I have not gone on that land.' In those circumstances, there is no reason why an interlocutory injunction should not normally be granted against him if there is some evidence that he has in fact done so. 3ut to change the example, if the plaintiffs case is: "You, the defendant, trespassed on my land," and the defendant's defence is 'true, you are the owner of that land, but you gave me a licence to walk over that land'-then, although the plaintiffs right in one sense is not disputed, in that he is the owner of the land, the question, and the whole question is: is there a licence? It may be that the onus of establishing that is on the defendant; but this is not a question of onus of proof. In such circumstances in my judgment it could not rightly be said that, once the plaintiff has established that he is the owner of the land, it only needs a mere possibility of success in connection with the assertion of the absence of a licence to entitle him as of right to an interlocutory injunction. It must be looked at on the whole of the case; the existence of the right and of any defences that are asserted in relation to the admitted existence of that right. In addition, one has to take into account the evidence of the alleged breach, the facts relating to the alleged breach, and even then there is no firm and invariable criterion which can be laid down on the basis of the prospects of success in the action because frequently one has to consider also the balance of convenience, as well as the status quo. One can readily imagine a case in which the plaintiff appears to have a 75 per cent chance of establishing his claim, but in which the damage to the defendant from the granting of the interlocutory injunction, if the 25 per cent defence proved to be right, would be so great compared with the triviality of the damage to the plaintiff if he is refused the injunction, that an interlocutory injunction should be refused. To my mind it is impossible and unworkable to lay down different standards in relation to different issues which fall to be considered in an application for an interlocutory injunction. Each case must be decided on a basis of fairness, justice and common sense in relation to the whole of the issues of fact and law which are relevant to the particular case.
11. The matter came to be considered in greater detail by the House of Lords in American Cyanamid Co. v. Ethicon Ltd. (1975) A.C.396. Referring to the view of the Court of Appeal in that case that there was a rule of practice so well established as to constitute a rule of law that precluded them from granting any interim injunction unless upon the evidence adduced by both the parties on the hearing of the application the applicant had satisfied the court that on the balance of probabilities the acts of the other party sought to be enjoined would, if committed, violate the applicant's legal rights, Lord Diplock observed that the House of Lords gave leave to appeal only for the purpose of considering the existence of any such rule of law. It was pointed out that it was most exceptional for the House of Lords to give leave to appeal in a case which turned upon where the balance of convenience lay. After pointing out that grant of interlocutory injunctions in actions for infringement of patents is governed by the same principles as in other actions, Lord Diplock observed as follows: "My Lords, when an application for an interlocutory injunction to restrain a defendant from doing acts alleged to be in violation of the plaintiffs legal right is made upon contested facts, the decision whether or not to grant an interlocutory injunction has to be taken at a time when ex hypothesi the existence of the right or the violation of it, or both, is uncertain and will remain uncertain until final judgment is given in the action. It was to mitigate the risk of injustice to the plaintiff during the period before that uncertainty could be resolved that the practice arose of granting him relief by way of interlocutory injunction; but since the middle of the 19th century this has been made subject to undertaking to pay damages to the defendant for any loss sustained by reason of the injunction if it should be held at the trial that the plaintiff had not been entitled to restrain the defendant from doing what he was threatening to do. The object of the interlocutory injunction is to protect the plaintiff against injury by violation of his right for which he could not be adequately compensated in damages recoverable in the action if the uncertainty were resolved in his favour at the trial; but the plaintiffs 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 under the plaintiffs undertaking in damages if the uncertainty were resolved in the defendant's favour at the trial. 'The court must weigh one need against another and determine where "the balance of convenience" lies.
In those cases where the legal rights of the parties depend upon facts that are in dispute between them, the evidence available to the court at the hearing of the application for an interlocutory injunction is incomplete. It is given on affidavit and has not been tested by oral cross-examination. The purpose sought to be achieved by giving to the court discretion to grant such injunctions would be stultified if the discretion were clogged by a technical rule forbidding its exercise if upon that incomplete untested evidence the court evaluated the chance of the plaintiffs ultimate success in the action at 50 per cent, or less, but permitting its exercise if the court evaluated his chances at more than 50 per cent.
12. After referring to the decision of the Court of Appeal in Hubbard v. Vosper (1972)1 All E.R. 1023 , Lord Diplock observed that in the case under consideration Graham, J., and the Court of Appeal has proceeded as if the ruling in Hubbard v. Vosper (1972)1 All E.R. 1023,did not affect the rule that the Court was not entitled to take any account of the balance of convenience unless it had first been satisfied that if the case went to trial upon no other evidence than was before the Court at the hearing of the application, the plaintiff would be entitled to judgment for a permanent injunction in the same terms as the interlocutory injunction sought. Lord. Diplock exhorted the members of the House of Lords to take the opportunity of declaring that there was no such rule. He observed;
... The use of such expressions as "a probability," "a prima facie case," or "a strong prima facie case" in the context of the exercise of a discretionary power to grant an interlocutory injunction leads to confusion as to the object sought to be achieved by this form of temporary relief. The court no doubt must be satisfied that the claim is not frivolous or vexatious; in other words, that there is a serious question to be tried.
It is no part of the Court's function at this stage of the litigation to try to resolve conflicts of evidence on affidavit as to facts on which the claim of either party may ultimately depend nor to decide difficult questions of law which call for detailed argument and mature considerations. These are matters to be dealt with at the trial.
13. The Law Lord proceeded to state:
As to that, the governing principle is that the court should first consider whether, if the plaintiff were to succeed at the trial in establishing his right to a permanent injunction, he would be adequately compensated by an award of damages for the loss he would have sustained as a result of the defendant's continuing to do what was sought to be enjoined between the time of the application and the time of the trial. If damages in the measure recoverable at common law would be adequate remedy and the defendant would be in a financial position to pay them, no interlocutory injunction should normally be granted, however strong the plaintiffs claim appeared to be at that stage. If on the other hand, damages would not provide an adequate remedy for the plaintiff in the event of his succeeding at the trial, the court should then consider whether, on the contrary hypothesis that the defendant were to succeed at the trial in establishing his right to do that which was sought to enjoined, he would be adequately compensated under the plaintiffs undertaking as to damages for the loss he would have sustained by being prevented from doing so between the time of the application and the time of the trial. If damages in the measure recoverable under such an undertaking would be an adequate remedy and the plaintiff would be in a financial position to pay them, there would be no reason upon this ground to refuse an interlocutory injunction.
It is where there is doubt as to the adequacy of the respective remedies in damages available to either party or to both, that the question of balance of convenience arises. It would be unwise to attempt even to list all the various matters which may need to be taken into consideration in deciding where the balance lies, let alone to suggest the relative weight to be attached to them. These will vary from case to case.
Where other factors appear to be evenly balanced it is a counsel of prudence to take such measures as are calculated to preserve the status quo. If the defendant is enjoined temporarily from doing something that he has not done before, the only effect of the interlocutory injunction in the event of his succeeding at the trial is to postpone the date at which he is able to embark upon a course of action which has not previously found it necessary to undertake; whereas to interrupt him in the conduct of any established enterprise would cause much greater inconvenience to him since he would have to start again to establish it in the event of his succeeding at the trail.
In unmistakable terms, His Lordship had ruled that the Court is not justified in embarking upon anything resembling a trial of the action upon conflicting affidavit in order to evaluate the strength of either party's case. The dictum of Lord Diplock was agreed to by the other four law Lords who heard the appeal with him.
14. In R.M. Subbiah v. N. Sankaran Nair , a Division Bench of this Court had an occasion to consider the principles relating to grant of interlocutory injunction during the pendency of a suit. That was also a case based on infringement of copyright. It will be useful to refer to the following observations of the Bench:
This is a case where literary piracy is pleaded. Injunction being an equitable remedy, which is granted by a Court in exercise of its judicial discretion, has to be considered from various facts which arise from a particular set of circumstances in each case. There maybe cases in which the grant of an injunction temporary or permanent will only meet the ends of justice and an alternative safeguard for the preservation of the rights of the challenging party cannot at all be thought of. There may be also cases where the remedy of injunction has to be made flexible and adjustable to the situation arising in each case. A rigid invocation without contemplating elasticity in the application of the rule as to the grant of injunction might sometimes result in hard ship, which cannot be later cured.... The first plaintiffs claim is that his literary work has been pirated. This relief Could be compensated for sufficiently in money. In cases where an equitable relief would be sufficiently compensated for monetarily, then courts refrain from being wooden and granting injunctions alone, instead of contemplating the nearest approximation which it can make. The mere fact that a prima facie case exists for the grant of an injunction or even the additional intelligence that a party seeking for it would suffer irreparable harm or inconvenience by this, may not be sufficient criteria for the granting of an interim injunction. Before the Court exercises its jurisdiction, to grant such an interim relief, which is essentially an equitable and a discretionary remedy "the court will have to be further satisfied that the comparative mischief or inconvenience which is likely to arise from withholding an injunction will be greater than that which is likely to arise from granting it.
Their Lordships placed reliance on the statement of law found in Hubbard v. Vosper, .1972)1 All E.R. 1923, which we have already extracted. Ultimately, the Division Bench gave directions to the defendants to furnish bank guarantee to the tune of Rs. 50,000 and to file accounts as indicated in their order.
15. The principles governing the circumstances in which an appellate Court can interfere with a discretionery order of the trial Court granting or refusing injunction were laid town by Lord Dip-lock in Hadmor Productions Ltd, v. Hamilton (1983)1 A.C.191 and the other members of the House agreed with him. They were reiterated by him in Gordon Cottage Ltd. v. Milk Marketing Board (1984)1 A.C.130. The following passage in the later judgment is relevant.
In an expedited appeal by the company against the judge's refusal to grant interlocutory injunction, the Court of Appeal (1982) Q.B.1114) delivered an extempore judgment on May 18, 1982, shortly the publication in the Weekly Law Reports (1982)2 W.L.R. 322 of the decision of this House in Hadmor Productions Ltd. v. Hamilton (1983)1 A.C.191 in which this House took occasion, at P.220, to point out that on appeal from the judge's grant or refusal of an interlocutory injunction an appellate court, including your Lordship's house, must defer to the judge's exercise of his discretion and must not interfere with it merely upon the ground that the members of the appellate court would have exercised the discretion differently. The function of an appellate Court is initially that of review only. It is entitled to exercise an original discretion of its own only when it has come to the conclusion that the Judge's exercise of his discretion was based on some misunderstanding of the law or of the evidence before him, or upon on inference that particular facts existed or did not exist, which although it was one that might legitimately have been drawn upon the evidence that was before the judge, can be demonstrated to be wrong by further evidence that has become available by the time of the appeal, or upon the ground that there has been a change of circumstances after the judge made his order that would have justified his acceding to an application to vary it. Since reasons given by judges for granting or refusing interlocutory injunctions may sometime be sketch there may also be occasional cases where even though no erroneous assumption of law or fact can be identified the judge's decision to grant or refuse the injunction is so aberrant that it must be set aside upon the ground that no reasonable judge regardful of his duty to act judicially could have reached it. It is only if and after the appellate court has reached the conclusion that the judge's exercise of his discretion must be set aside for one or other of the reasons, that it become entitled to exercise an original discretion of this own.
16. Lord Wilberforce, who differed from the view taken by Lord Diplock on the merits of the case, observed that Hadmor's case (1983)1 A.C.191 did not lay down any new law and that "it restated, by way of reminder, in clear and vigorous terms principle long applied to appeals from discretionary decisions."
17. A Division Bench of the Delhi High Court in Penguin Books Ltd., England v. India Book Distributors and Ors. A.I.R. 1985 Delhi 29 laid down the following principles after referring to number of authorities including the decision:
As most infringements of copyrights consist of a continuous process of successive infringing acts such as importation of 'infringing copies' as in this case the most important remedy and in many case the only effective one is the injunction. This is always in the discretion of the Court and the Court has to weigh the possible damage to the plaintiff if the injunction is not granted against the possible damage to the defendant if it is granted. Thus once the infringement and its continuance is proved the plaintiff will usually be entitled to an injunction, but that injunction would not be granted if the damage caused to the defendant by granting the injunction would be out of all proportion to the seriousness of the infringement or to the possible damage to the plaintiff.
In fact, learned Counsel for the appellant relied on this decision to contend that once infringement is proved, injunction should normally be granted and that the final order in that case was one directing the plaintiffs to furnish a bank guarantee in a sum of as Rs. one lakh as cross undertaking in damages for the loss which the defendants may sustain in case the plaintiffs fail in the suit. We are not really concerned with the final order made by the Bench on the facts and circumstances of that case, but the general principles laid down by the Bench will have to be applied with reference to the facts and circumstances of each case.
18. Bearing the aforesaid principles in mind if we consider the facts of the present case, we cannot say that the learned judge on the original side has exercised his discretion unreasonably or capriciously nor can it be said that he has ignored the relevant facts or that his order is based on a misunderstanding of the law or the evidence before him. The order under appeal is not vitiated by any judicial approach. The learned Judge has rightly observed that since the plaintiffs products are not marketed in India, it is a matter for detailed evidence as to what extent the plaintiffs products are well known in India and to what extent the Indian customers purchasing the defendant's products are doing so under the belief that they are the products of the plaintiff. With regard to the claim based on infringement of copyright, the learned Judge has said that in so far as the interim relief is concerned, the plaintiff has to make out a case that by the defendants selling their product with the mark and design similar to that of the plaintiff, its trade is affected and that the injunction is the only remedy to protect its interest. Admittedly, the plaintiff is not having any business in India and the defendants had already commenced their business and selling their products with the mark Comfit Always for nearly two years prior to suit. As laid down in American Cyanamid's case (1975) A.C.396, the effect of the interlocutory injunction would lead to interrupt the conduct of the business which has already commenced and was being successfully carried out for nearly two years prior to suit. That would certainly cause greater inconvenience to the defendants than the inconvenience to which the plaintiff would be put by not granting the injunction prayed for by him. In our view, the learned judge has correctly applied the test of balance of convenience which is the most important and relevant test at this stage of the case. It is not possible for the Court to have a trial within trial and decide whether the plaintiff has got a foolproof case and that the defence raised by the defendants is so hollow that there is no likelihood of its success at the trial. This is not a case as contended by learned Counsel for the appellant in which there is no dispute by the defendants with regard to the right claimed by the plaintiff. Learned Counsel for the appellant repeatedly contended that there is no dispute as to facts pleaded by him in the plaint and the affidavit filed in support of the application for injunction in so far as it related to the copyright claimed by him. That contention is clearly erroneous, as the defendants have not only challenged the correctness of the averments made by the plaintiff in the plaint and the affidavit, filed in support of the application for injunction, but also have gone one step further and contended that by virtue of Section 15 of the Copyright Act, the copyright claimed by the plaintiff has ceased to exist long back. The defence raised by the defendants under Section 15 of the Copyright Act has certainly to be considered at the time of trial. That cannot be rejected off-hand as a frivolous ground. Learned Counsel for the appellant attempted to argue that Section 15 of the Copyright Act would apply only to designs on the article itself and not to designs on the package. That is a question of law turning on the interpretation of Section 15 of the Copy Right Act and the provisions of the Designs Act. That is not a matter which can be decided at the interlocutory stage. In fact, we directed learned Counsel for the appellant not to argue the question raised by the defendants under Section 15 of the Copy Right Act.
19. No doubt, as urged by learned Counsel for the appellant, there is a similarity in the colour scheme and the device of a flying bird appearing in a logo form as well as the word "Always" in the package pouches of the defendants and the appellant. But, that is not sufficient to grant an injunction in favour of the appellant. As the appellant has not so far marketed his goods in any place in India, there is no question of any reputation for its goods in this country. Nor can there be any loss in sales of the plaintiffs products in India.
20. We do not think it necessary or proper to consider the merits of the claim made by the appellant on the basis of the certificate of copyright registration produced by him along with the plaint. As the claim is disputed by the defendants, any observation made by us either way will have a bearing at the time of trial and disposal of the suit. In our view, it is really a matter to be decided after trial and after the entire evidence is recorded.
21. It is necessary at this stage to refer to the decisions cited by the learned Counsel for the appellant. He relied on the judgment of Yogeshwar Dayal, J., of the Delhi High Court in Anglo Dutch Paint, Colour and Varnish Works Pvt. Ltd. v. India Trading House A.I.R. 1977 Delhi 41 for the proposition that once infringement is made out, no question of balance of convenience arises. The following passage in that judgment is relied on by learned Counsel:
The infringement of copyright being prima facie established, the plaintiff if entitled to interim relief for the infringement of the copyright as well.
The principle which applies to the present case for the grant of interim relief is the same as laid down by Deshpande, J., in Wearwell Cycle Co. (India) Ltd., v. Wearwell Industries, Ludhiana (1969) Delhi L.T.469. No question of even balance of convenience arises. The defendant has used the plaintiff s trade-mark only for three months and the balance of convenience is in favour of the plaintiff that the defendant should be injuncted by temporary injunction till the disposal of the suit from dealing in white zinc paint under the containers bearing numeral '9001' having the colour combination of violet, grey and white as those of the applicants containers bearing numeral '1001' and from 'passing off the goods as those of the applicant's in any manner.
The passage extracted above is self-explanatory. That shows that the learned Judge did not intend to lay down general proposition of law that balance of convenience should not be considered in cases where prima facie infringement of copyright has been made out. It is seen that on the facts of the case the court concluded that the balance of convenience was in favour of the plaintiffs as the defendant had used the plaintiffs trade mark only for three months.
22. The next decision relied on by learned Counsel for the appellant is that of the Andhra Pradesh High Court in P. Lakshmikantham v. Ramakrishna Pictures . That is not a case of interlocutory disposal. The Letters Patent Appeals before the Bench arose out of final disposals in which infringement of copyright was found and it was observed by the Bench that there was no merit in the contention that injunction was not the appropriate remedy in that case. That judgment will not in any way help the appellant in the present case.
23. Nor does the ruling of Jagdish Chandra, J. in Philip Morris Belgium S.A. v. Golden Tobacco Co. Let. A.I.R. 1986 Delhi 145, help the appellant in his contention that the non-user of his copyright in India will not disentitle him to the relief of interim injunction. That case related to a trade mark registered in India, but which could not be used by the proprietor on account of the import restrictions imposed by the Government of India. It was held that the non-user of the registered trade mark was under special circumstances within the meaning of Section 6(3) of the Trade and Merchandise Marks Act and the defendant could not take advantage of the same and deceive the public in India by inducing belief in them that the goods sold under the mark were that of the registered proprietor. There is no resemblance between the present case and that case on the facts.
24. Learned Counsel for the appellant invited our attention to the decision of a Division Bench of this Court in The Braithwaite Bum and Jessop Construction Company Ltd., Calcutta v. The Trustees of the Port of Madras I.L.R. 1956 Mad. 1347 in which it was held that economic value was irrelevant when considering copyright. That is a matter which has to be taken into account at the time of final disposal of the suit and it does not help the appellant at his stage.
25. Learned Counsel for the appellant placed reliance on the following passage in the judgment of Parker ,J in Weather by & Sons., v. International Horse Agency and Exchange, Ltd. (1910)2 Chancery 297 in support of his contention that a copyright should be protected even if there is no competition between the appellant and the respondents in the Indian market:
Then it is said that the real and only test as to whether or not the defendants have made an unfair use of vol.21 of the Stud Book lies in the answer to the question whether there will be any competition between such volume and the defendant's book. It is no doubt true that where, as is often the case, it is a difficult matter to determine whether in preparing one publication an unfair use has been made of another, the nature of the two publications and the likelihood or unlikelihood of their entering into competition with each other is not only a relevant but may be even the determining factor of the case. But, in my opinion an unfair use may be made of one book in the preparation of another, even if there is no likelihood of competition between the former and the latter. After all "copyright is property, and an action to restrain the infringement of a right of property will lie even if no damage be shown.
This is again a matter relating to the relief to be finally granted after trial and not at the interlocutory stage.
26. Learned Counsel places reliance on Coral Index Limited., v. Regent Index Ltd. and Anr. (1970)R.P.C.147 wherein Stamp J., granted interlocutory injunction restraining infringement of copyright on the finding that a prima facie case of infringement was established. In that case, the second defendant who was an employee of the plaintiff company for five years as its office manager, resigned and lent his services to arrival establishment running a similar business. Several of the plaintiffs customers were circularised by the first defendant and literature similar to that of the plaintiff was employed. The plaintiff alleged that his former employee must have taken away or memorised a list or lists of the plaintiffs customers, secondly that its literature has been copies, and thirdly that use of the first defendants name would suggest an association with the plaintiff and constituted passing off. It was in these circumstances, when the Court found that a prima facie case of copying was established, an interlocutory injunction was granted. The facts of the case do not bear any resemblance to these in the present case.
27. Learned Counsel for the appellant referred to the decision of the House of Lords in Charles Osenton and Company v. Johnston (1942) A.C. 130, in which it was held that if an appellate Tribunal reaches the clear conclusion that there has been a wrongful exercise of discretion in that no weight or no sufficient weigh has been given to relevant considerations, then the reversal of order on appeal may be justified.
28. Our attention is also drawn to the decision of the Supreme Court in Printers (Mys.) Private Ltd. v. P. Joseph in which the power of the appellant court in matters arising out of discretionary orders made by the trial Court has been defined thus:
... As is often said, it is ordinarily not open to the appellate court to substitute its own exercise of discretion for that of the trial judge; but if it appears to the appellate court that in exercising its discretion the trial court has acted unreasonably or capriciously or has ignored relevant facts and has adopted an unjudicial approach then it would certainly be open to the appellant court-and in many cases it may be its duty-to interfere with the trial court's exercise of discretion. In cases falling under this class the exercise of discretion by the trial court is in law wrongful and improper and that would certainly justify and call for interference from the appellate Court. These principles are well established; but, as has been observed by Viscount Simon L.C., in Charles Osenton & Co. v. Johnston, 1942 A.C. 130 at P. 138 "the law as to the reversal by a court of appeal of an order made by a judge below in the exercise of his discretion is well established, and any difficulty that arises is due only to the application of well settled principles in an individual case.
29. The principles set out above do not differ from those enunciated by the House of Lords in Hadmor's case (1983)1 A.C.191 and Garden Cottage Ltd., case (1984)1 A.C.130.
30. Learned Counsel for the appellant produced before us typed copies of two judgments of the Bombay High Court in Katnal Trading Co., v. Gillette U.K. Ltd. (A. No. 1092 of 1986-Judgment dated 25th September, 1987) and Yardley & Co, Ltd. v. Kamal Trading Company, (Appeal No. 116 of 1987 of judgment dated October 5,1987), wherein it was held that goodwill is not limited to a particular country as in the present days the trade is spread all over the world and the goods are transported from one country to another very rapidly and on extensive scale. The Division Bench took the view that it was not possible to conclude that the goodwill or reputation stood extinguished merely because the goods are not available in the country for some duration. In the facts of the present case, the goods of the plaintiff never entered this country and there is no question of the goodwill or reputation having existed at sometime past. It will be relevant to refer to the decision of a Division Bench of this Court in Hayakawa Denki Kogya Kabushiki Kaisha (Hayakawa Electric Company Ltd.), Japan v. Associated Electronic and Electrical Industries, Bangalore 1974 M.L.J. 392, wherein this Court held that Section 11(a) of Trade and Merchandise Marks Act could be invoked to prevent registration of a trade mark only if the goods of the objector has a reputation in this country and in that case, the goods of the Japanese firm has never come into the Indian Market and, therefore, there was no question or reputation for its goods in this country.
31. We do not find any error whatever in the order of the learned single Judge. Sufficient safeguards have been provided in the order under appeal inasmuch as the defendants have been directed to maintain an account of their manufacture and sale of the personal hygiene and catamenial products sold in packages with the trade mark Comfit Always and file quarterly statements into this Court.
32. In the result, the appeals fail and they and dismissed with costs.
Order of Court by Srinivasan, J. Learned Counsel for the appellant prays for leave to appeal to the Supreme Court. In our opinion, this is not a fit case to be taken up on appeal to the Supreme Court. No substantial question of law of general important arises. Leave refused.