Delhi District Court
Mankind Pharma Limited vs . Shrinivas (Gujarat) Laboratories ... on 8 June, 2023
In the court of Ms. Anu Grover Baliga,
District Judge (Commercial Court-04), South East District,
Saket Courts, New Delhi.
CS (COMM) 491/21
Mankind Pharma Limited Vs. Shrinivas (Gujarat) Laboratories Pvt. Ltd.
In the matter of:
Mankind Pharma Limited,
Having its registered office at,
208, Okhla Industrial Estate-III,
New Delhi-110020. .....Plaintiff
Versus
Shrinivas (Gujarat) Laboratories Pvt. Ltd.,
604, Corporate House,
Opp Torrent House, Near Dinesh Hall,
Ashram Road,
Ahmadabad-380009.
Also At:
Veena Vihar, Ekoratoli,
37 No. Highway, Binoigutia Goan,
P. O. Dikom, Dist. Dibrugarh,
Assam - 7860120.
Email ID - [email protected] .....Defendant
Date of institution : 01.11.2021
Date of reserving judgment : 31.05.2023
Date of pronouncement of Judgment : 08.06.2023
JUDGMENT
1. Vide the present judgment, I shall decide a suit filed by the Plaintiff interalia seeking permanent injunction for restraining the Defendant, their dealers, distributors, stockists, agents, associates, employees, servants, assignees from CS (COMM) NO. 491/21 Mankind Pharma Ltd. Vs. Shrinivas (Gujarat) Laboratories Pvt. Ltd. Page 1/12 infringing the Plaintiff's trademark ZENFLOX with respect to medicinal and pharmaceutical preparations, in any manner whatsoever and from trading and/or selling and/or dealing and/or advertising and selling on internet under the trademark ZONFLOX. Reliefs for rendition of accounts and punitive / compensatory damages to the tune of Rs.5 lakhs have also been sought vide the present suit.
2. Briefly stated, the following averments have been interalia made in the present suit:-
a. The plaintiff is the 5th largest pharmaceutical company of India (Source IQVIA, November 2020) that was incorporated as a Private Limited Company in the year 1991 and subsequently converted to a public Limited Company which is involved in manufacturing and/or marketing medicinal, pharmaceutical and veterinary preparations hereinafter referred to as "goods") under various well-known brand names. Copy of IQVIA, November 2020 circulated Online evidencing the Plaintiff as the 5th largest pharmaceuticals in India is filed with the list of documents.
b. Sometime in the year 1995, the Plaintiff independently coined and adopted one trademark by the name of ZENFLOX (hereinafter referred to as "said mark") in respect of pharmaceutical and medicinal preparations (hereinafter referred to as "goods") falling under Class 5 and the same had been applied for registration by the Plaintiff under application number 711276 dated April 12, 1996 which, as of today, stands registered in the name of the Plaintiff. Due to the impeccable quality products being sold under the said mark, the said mark has recorded a wide spread patronage amongst the members of trade and public.
c. The Plaintiff has been selling its goods under the said mark since 1995 and since its inception the said mark has been very well accepted in the market wherein members of the public and trade have appreciated the qualitative products at affordable prices being sold by the Plaintiff in the market.
d. On/about August 09, 2021 during the course of business, the Plaintiff came across products under the trademark ZONFLOX of the CS (COMM) NO. 491/21 Mankind Pharma Ltd. Vs. Shrinivas (Gujarat) Laboratories Pvt. Ltd. Page 2/12 Defendant in respect of medicinal and pharmaceuticals preparations wherein Defendant is involved in manufacturing, marketing and selling of pharmaceutical preparations under the impugned mark. The impugned mark so adopted by the Defendant is deceptively similar to the Plaintiff's trade mark ZENFLOX and such adoption of the impugned mark is devoid of any ounce of creativity or efforts as the impugned mark is structurally, phonetically and visually deceptively similar to the Plaintiff's said mark.
e. The impugned mark of the Defendant has been adopted sans any creativity or innovation and is a replica of the Plaintiff's mark ZENFLOX wherein the Defendant has only replaced the alphabet "E" from the Plaintiff's mark ZENFLOX with the alphabet "O" resulting in the visually, structurally and phonetically similar impugned mark ZONFLOX. Furthermore, the defendant's impugned mark is a slavish imitation of the Plaintiff's said mark in order to somehow show an association and connection with the Plaintiff company.
f. Plaintiff on August 09, 2021 immediately served a cease-and-desist notice to the Defendant demanding interalia to refrain using the trade mark ZONFLOX, to which no reply has been received by the Plaintiff.
g. The Defendant is manufacturing and/or marketing and selling the same goods in the market under the impugned mark, which is visually, phonetically and structurally similar to the earlier registered trademark of the Plaintiff. Since the Plaintiff's said mark and the impugned mark are visually, phonetically and structurally similar, the same would lead to confusion due to incorrect recollection of the product's trade mark by a consumer of ordinary prudence and imperfect memory.
h. The Defendant is making a deliberate and malafide attempt to cash upon the goodwill of the Plaintiff.
3. Based on the aforementioned averments, the reliefs as narrated in para 1 hereinabove have been sought vide the present suit.
4. As per record, on applications filed by the Plaintiff seeking ex-parte interim injunction and appointment of a Local Commissioner, one of the Ld. Predecessors of this Court vide order dated 04.02.2022 had restrained the Defendant from CS (COMM) NO. 491/21 Mankind Pharma Ltd. Vs. Shrinivas (Gujarat) Laboratories Pvt. Ltd. Page 3/12 infringing the trademark of the Plaintiff till further orders and a Local Commissioner had been appointed to seize the impugned goods and ledger accounts, etc. of the Defendant from its office at 604, Corporate House, Opp Torrent House, Near Dinesh Hall, Ashram Road, Ahmadabad-380009.
5. The record further reflects that on 27.04.2022, one Ld. Counsel Sh. Jitender had filed vakalatnama on behalf of the Defendant Company but thereafter, no written statement was filed on behalf of the Defendant Company, despite the expiry of 120 days from the date of service of the Defendant. Vide order dated 16.08.2022, the Ld. Predecessor of this Court had therefore struck off the right of the Defendant Company to file written statement and had listed the matter for leading of the evidence by the Plaintiff.
6. Before this Court one Sh. Aviral Shukla, Manager (Legal), has filed his affidavit affirming therein that he is the authorised representative of the Plaintiff Company. In his affidavit, he has more or less reiterated the assertions made in the plaint. Based on his deposition, the Certificate of Incorporation of the Plaintiff Company has been exhibited as Ex.PW1/3 and the Registration Certificate of the trademark ZENFLOX in favour of the Plaintiff has been exhibited as Ex.PW1/4. Original Certificate issued by the Auditor for the Plaintiff's group, evidencing year wise sales figures of the pharmaceutical products/medicines under the said mark ZENFLOX, has been exhibited as Ex.PW1/5. Copies of invoices relating to the sale of the aforementioned products during the relevant period have been exhibited as Ex.PW1/6. Original specimen of the Plaintiff's goods under the mark ZENFLOX and Defendant's goods being sold under the impugned mark ZONFLOX have been exhibited as Ex.PW1/7. The seized and desist notice issued by the Plaintiff company to the Defendant asking it to refrain from using the trademark ZONFLOX has been exhibited as Ex.PW1/8.
CS (COMM) NO. 491/21 Mankind Pharma Ltd. Vs. Shrinivas (Gujarat) Laboratories Pvt. Ltd. Page 4/127. I have heard the Ld. Counsel for the Plaintiff and have carefully perused the documents which have been proved on record.
8. Ld. Counsel for the Plaintiff, Sh. Hemant Deswani has vehemently contended that since the evidence of the Plaintiff has gone unchallenged and unrebutted, the suit of the Plaintiff is liable to be decreed. He has submitted that the copies of the registration certificates of the Plaintiff's trademark ZENFLOX, Ex.PW1/4 establishes that the Plaintiff is the owner of the said trademark and has the exclusive right to use the same. He further submits that on account of continuous, open, extensive and exclusive use for many years, Plaintiff has been able to built an unparalleled reputation and goodwill with respect to its trademark ZENFLOX. Ld. Counsel has contended that this Court must take into account that the Plaintiff has proved on record vide Ex.PW1/5 that the annual sale of the Plaintiff's goods with respect to the medicines sold under the mark ZENFLOX for the financial year 2020-21 was Rs.100.36 crores. According to Ld. Counsel, this sales figure itself proves the wide spread patronage that the produce of the Plaintiff enjoys amongst the members of trade and public. He further submits that the Plaintiff by placing on record the original specimen of the Plaintiff's goods and that of the Defendant's goods, Ex.PW1/7 has also been able to establish on record that the Defendant is using the trademark ZONFLOX which is phonetically, structurally and visually deceptively similar to the trademark of the Plaintiff, ZENFLOX in respect of pharmaceutical and medicinal preparations.
9. Ld. Counsel for the Plaintiff has also pointed out that though the Local Commissioner appointed by the Court could not seize any impugned goods for the reasons that the premises visited by the Local Commissioner was the corporate office of the Defendant, the same does not effect the rights of the Plaintiff in CS (COMM) NO. 491/21 Mankind Pharma Ltd. Vs. Shrinivas (Gujarat) Laboratories Pvt. Ltd. Page 5/12 seeking a perpetual injunction against the Defendant Company. It is his contention that since the Defendant Company despite service failed to file a written statement and to deny the categorical assertions of the Plaintiff that the Defendant Company was selling pharmaceutical and medicinal preparations by the name of ZONFLOX, the assertions of the Plaintiff have to be taken as true and correct.
10. It is the contention of the Ld. Counsel for the Plaintiff that by causing confusion in the minds of the consumers of pharmaceutical and medicinal preparations, the Defendants are playing with human lives and causing irreparable damage to public interest and therefore are liable to be saddled with punitive damages. He submits that though in the absence of the Defendants failure to provide rendition of accounts and exact figures of sales under the infringing copyright, Plaintiff has been unable to prove the actual damages suffered by it, the Plaintiff is entitled to be granted punitive and exemplary damages of Rs.5 lakhs. In support of this contention, Ld. Counsel for the Plaintiff has relied upon the judgment of Hon'ble Delhi High Court pronounced in the case titled and reported as Microsoft Corporation Vs. Deepak Raval 2006 (33) PTC 122 (Del).
11. Ld. Counsel for the Plaintiff has further submitted that this Court does have the territorial jurisdiction to try the present suit in view of Section 134 of the Trademark Act and the fact that the Plaintiff is running its business within the jurisdiction of this Court and the Defendants are infringing the registered trademark of the Plaintiff. In support of this contention, he has relied upon the judgment of Hon'ble Delhi High Court pronounced in the case titled and reported as Ultra Home Construction Pvt. Ltd. Vs. Purushottam Kumar Chaubey and Ors. 227 (2016) DLT 320.
12. Apart from the aforementioned judicial dicta, in support of his contentions Ld. Counsel for Plaintiff has also relied upon the following judgments:
CS (COMM) NO. 491/21 Mankind Pharma Ltd. Vs. Shrinivas (Gujarat) Laboratories Pvt. Ltd. Page 6/12• Kaviraj Pandit Durgadutt Sharma vs. Navaratna Pharmaceutical Laboratories (AIR 1965 SC 980) • Laxmikant V Patel vs. Chetanbhai Shah and Ors. (AIR 200 2 SC 275) • Cadila Healthcare Limited vs. Cadila Pharmaceuticals Limited (2001 5 SCC 73) • Pfizer Products Inc. & Anr. vs. Vijay Shah & Ors.
• Smithkline Beecham Ltd. & Anr. vs. Hanish K Ajmera & Anr. (AIR 2014 Delhi 76). • Consitex S. A. vs. Kamini Jain & Ors. (2014 47 PTC 337 Del)
13. Having gone through the judicial dicta referred to by the Ld. Counsel for Plaintiff and the records of this case, this Court is satisfied that the Plaintiff is entitled to the perpetual injunction sought against the Defendant Company.
14. It is well settled law that in an action for infringement of its trademark, the Plaintiff is not required to prove that the whole of its registered trademark has been copied and he can even succeed if he shows that the mark used by the Defendant is similar to its mark, as would cause confusion in the mind of consumers. In as far back as in 1965, the Hon'ble Supreme Court had recognized the statutory rights of the owner of a registered trademark and in the case titled and reported as Kaviraj Pandit Durga Dutt Sharma Vs. Navaratna Pharmaceutical Laboratories AIR 1965 SSC 980, had held as under:-
"The action for infringement is a statutory remedy conferred on the registered proprietor of a registered trade mark for the vindication of the exclusive right to the use of the trade mark in relation to those goods"
"It the essential features of the trade mark of the plaintiff have been adopted by the defendant, the fact that the get-up, packing and other writing or marks on the goods or on the packets in which he offers his goods for sale show marked differences, or indicate clearly a trade origin different from that of the registered proprietor of the mark would be immaterial."
15. In another case of Laxmikant V. Patel Vs. Chetanbhai Shah And Another, reported at (2002) 3 SCC 65, the Hon'ble Apex Court made following observation:
CS (COMM) NO. 491/21 Mankind Pharma Ltd. Vs. Shrinivas (Gujarat) Laboratories Pvt. Ltd. Page 7/12"........The law does not permit any one to carry on his business in such a way as would persuade the customers or clients in believing that his goods or services belonging to someone else are his or are associated therewith. It does not matter whether the latter person does so fraudulently or otherwise. The reasons are two. Firstly, honesty and fair play are, and ought to be, the basic policies in the world of business. Secondly, when a person adopts or intends to adopt a name in connection with his business or services which already belongs to someone else it results in confusion and has propensity of diverting the customers and clients of someone else to himself and thereby resulting in injury."
16. In the case of Cadila Health Care Ltd Versus Cadila Pharmaceuticals Ltd., reported at (2001) 5 SCC 73, the Hon'ble Apex Court made following observation:
"32. Public interest would support lesser degree of proof showing confusing similarity in the case of trade mark in respect of medicinal products as against other non-medicinal products. Drugs are poisons, not sweets. Confusion between medicinal products may, therefore, be life threatening, not merely inconvenient. Noting the frailty of human nature and the pressures placed by society on doctors, there should be as many clear indicators as possible to distinguish two medicinal products from each other. It is not uncommon that in hospitals, drugs can be requested verbally and/or under critical/pressure situations. Many patients may be elderly, infirm or illiterate. They may not be in a position to differentiate between the medicine prescribed and bought which is ultimately handed over to them."
17. Now in the present case, the evidence on record referred to hereinabove clearly proves that the Plaintiff Company has a registered trademark ZENFLOX with respect to medicinal preparations. On the basis of the documents placed on record, in particular the Auditors Certificate reflecting the annual sale of the Plaintiff with respect to ZENFLOX medicines for the year 2020-21 to be Rs.100.36 crores, the Plaintiff has been able to establish that it enjoys an unparallel reputation and goodwill with respect to its trademark ZENFLOX. The photographs of the specimen product of the Plaintiff's goods and the Defendants' goods, Ex.PW1/7 establishes that the Defendants are using a trademark CS (COMM) NO. 491/21 Mankind Pharma Ltd. Vs. Shrinivas (Gujarat) Laboratories Pvt. Ltd. Page 8/12 ZONFLOX which is structurally and visually similar to the registered trademark of the Plaintiff. Even phonetically the two trademarks are quite similar.
18. In view of the above and the judicial dicta discussed hereinabove, it is therefore clear that the Defendant has infringed the trademark of the Plaintiff and therefore is bound to be perpetually restrained from selling its medicinal preparations under the trademark ZONFLOX or any other mark deceptively similar to the trademark of the Plaintiff namely ZENFLOX.
19. Coming now to the quantum of damages to be awarded in favour of the Plaintiff, in the judgment pronounced by the Hon'ble Delhi High Court in Microsoft Corporation's case (supra - the judgment relied upon by Ld. Counsel for the Plaintiff), it has been categorically held that the Courts must award punitive damages even in cases where the exact damages suffered by the Plaintiff due to the acts of the Defendants are not available. The Hon'ble High Court has distinguished between compensatory damages and punitive damages and has held that the Courts dealing with actions for infringement of trademarks, copyrights, etc. should grant punitive damages with a view to discourage law breakers who indulge in violation of trademarks and copyrights with impunity. It will be relevant herein to reproduce the following paragraphs from the said judgment:
"24. Coming to the legal position in India, a positive trend has started. Here also as Courts are becoming sensitive to the growing menace of piracy and have started granting punitive damages even in cases where due to absence of the defendant's exact figures of sales by the defendants under the infringing copyright and/or trademark, exact damages are not available.
25. Time Incorporated v. Lokesh Srivastava 2005 (30) PTC 3 was also a case where the defendants chose to remain ex parte. While refusing to grant damages on the ground that nothing was proved on record as to how these damages were calculated, the Court still granted punitive and exemplary damages of Rs. 5 lacs. It would be apposite to reproduce discussion on this aspect contained in paras 6 to 8 of the judgment:CS (COMM) NO. 491/21 Mankind Pharma Ltd. Vs. Shrinivas (Gujarat) Laboratories Pvt. Ltd. Page 9/12
6. The plaintiff has claimed a decree of Rs. 12.5 lacs on account of damages suffered by the plaintiff or an order of rendition of accounts of the profits illegally earned by the defendants by use of the impugned trade mark. In view of the fact that the defendants have not chosen to turn up and face these proceedings, this Court is of the considered view that an order of rendition of accounts is fully warranted and called for. Damages in the sum of Rs. 12.5 lacs as claimed cannot be awarded on account of the fact that the plaintiff has not succeeded in proving on record as to how and on what basis these damages have been calculated. Damages of Rs. 5 lacs are claimed on account of loss of reputation of the plaintiff. These can be awarded inasmuch as the readers who might have read the defendants' TIME ASIA SANSKARAN, must have formed a very poor opinion about the plaintiff's Magazine and as such, the reputation and goodwill of the plaintiff has suffered.
7. Coming to the claim of Rs. 5 lacs as punitive and exemplary damages for the flagrant infringement of the plaintiff's trade mark, this Court is of the considered view that a distinction has to be drawn between compensatory damages and punitive damages. The award of compensatory damages to a plaintiff is aimed at compensating him for the loss suffered by him whereas punitive damages are aimed at deterring a wrong doer and the like minded from indulging in such unlawful activities. Whenever an action has criminal propensity also the punitive damages are clearly called for so that the tendency to violate the laws and infringe the rights of others with a view to make money is curbed. The punitive damages are founded on the philosophy of corrective justice and as such, in appropriate cases these must be awarded to give a signal to the wrong doers that law does not take a breach merely as a matter between rival parties but feels concerned about those also who are not party to the lis but suffer on account of the breach. In the case in hand itself, it is not only the plaintiff, who has suffered on account of the infringement of its trade mark and Magazine design but a large number of readers of the defendants' Magazine 'TIME ASIA SANSKARAN' also have suffered by purchasing the defendants' Magazines under an impression that the same are from the reputed publishing house of the plaintiff company.
8. This Court has no hesitation in saying that the time has come when the Courts dealing actions for infringement of trade marks, copy rights, patents etc. should not only grant compensatory damages but award punitive damages also with a view to discourage and dishearten law breakers who indulge in violations with impunity out of lust for money so that they realize that in case they are caught, they would be liable not only to reimburse the aggrieved party but would be liable to pay punitive damages also, which may spell financial disaster for them. In Mathias v. Accor Economy Lodging Inc. 347 F.3d 672 (7th Cir. 2003) the factors underlying the grant of punitive damages were discussed and it was observed that one function of punitive damages is to relieve the pressure on an overloaded system of criminal justice by providing a civil alternative to criminal prosecution of minor crimes. It was further observed that the award of punitive damages serves the additional purpose of limiting the defendant's ability to profit from its fraud by escaping detection and prosecution. If a tortfeasor is caught only half the time he commits torts, then when he is caught he should be punished CS (COMM) NO. 491/21 Mankind Pharma Ltd. Vs. Shrinivas (Gujarat) Laboratories Pvt. Ltd. Page 10/12 twice as heavily in order to make up for the times he gets away. This Court feels that this approach is necessitated further for the reason that it is very difficult for a plaintiff to give proof of actual damages suffered by him as the defendants who indulge in such activities never maintain proper accounts of their transactions since they know that the same are objectionable and unlawful. In the present case, the claim of punitive damages if of Rs. 5 lacs only which can be safely awarded.
Had it been higher even, this Court would not have hesitated in awarding the same. This Court is of the view that the punitive damages should be really punitive and not flee bite and quantum thereof should depend upon the flagrancy of infringement."
20. In another case reported Larsen and Toubro Limited v. Chagan Bhai Patel reported at MIPR 2009 (1) 194, the Hon'ble Delhi High Court has observed that it would be encouraging the violators of intellectual property, if the Defendants notwithstanding having not contested the suit are not burdened with punitive damages.
21. In both the aforementioned cases, the Hon'ble Delhi High Court has awarded punitive damages to the extent of Rs.5 lakhs. In the Microsoft Corporation's case, the Hon'ble High Court took note of the fact that despite the Defendant being a private limited company and presumed to be doing its business in an organized manner, failed to respond to the summons of the suit and that the same reflects willful, intentional and flagrant violation by the Defendant of the Plaintiff's right in intellectual property. In the present case also, the Defendant is a private limited company and despite having been served with the summons of the suit has chosen not to contest it. As narrated hereinabove, it also has to be taken note that the Defendant is dealing with medicinal preparations and thus its illegal act of infringing the trademark of the Plaintiff has a grave impact on public interest.
22. In such view, this Court has no hesitation in decreeing the suit of the Plaintiff by grant of perpetual injunction against the Defendants and by awarding CS (COMM) NO. 491/21 Mankind Pharma Ltd. Vs. Shrinivas (Gujarat) Laboratories Pvt. Ltd. Page 11/12 punitive damages in favour of the Plaintiff to the extent of Rs.5 lakhs. The Defendant Company either by itself or through its dealers, distributors, stockists, agents, associates, employees, servants and/or assignees are therefore hereby perpetually restrained from infringing the Plaintiff's trademark ZENFLOX with respect to medicinal and pharmaceutical preparations in any manner whatsoever and from trading and/or selling and/or dealing and/or advertising including advertising and selling on internet under the impugned trademark ZONFLOX. The Defendant is also directed to pay an amount of Rs.5 lakhs to the Plaintiff. Costs of the suit are also allowed. Decree-sheet be prepared accordingly.
23. This file be consigned to Record Room.
ANU Digitally signed by
ANU GROVER BALIGA
GROVER Date: 2023.06.08
BALIGA 16:01:07 +0530
Announced in the Open Court (Anu Grover Baliga)
on 8th June, 2023. District Judge (Commercial Court-04)
South-East District/Saket/New Delhi
CS (COMM) NO. 491/21
Mankind Pharma Ltd. Vs. Shrinivas (Gujarat) Laboratories Pvt. Ltd. Page 12/12