Delhi High Court
Plusplus Lifesciences Llp & Anr. vs Dr. Shiwani Singh & Ors. on 30 November, 2022
Author: Navin Chawla
Bench: Navin Chawla
Neutral Citation Number: 2022/DHC/005217
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Reserved on: 11.11.2022
Date of decision: 30.11.2022
+ CS(COMM) 570/2022, I.A. 16445/2022
PLUSPLUS LIFESCIENCES LLP & ANR. .....Plaintiffs
Through: Ms. Rajeshwari H. and
Ms.Sugandh Shahi, Advs.
versus
DR. SHIWANI SINGH & ORS. .....Defendants
Through: Mr.Satvik Verma, Sr. Adv.
with Mr.Rajneesh Chuni,
Mr.Ehtesham Hashmi,
Mr.Akbar Siddique, Advs.
CORAM:
HON'BLE MR. JUSTICE NAVIN CHAWLA
I.A. 13093/2022 & I.A. 16291/2022
1. By the present judgment, I shall be disposing of the application,
being I.A. No.13093/2022, filed by the plaintiffs under Order XXXIX
Rules 1 and 2 read with Section 151 of the Code of Civil Procedure (in
short, the 'CPC'), inter alia praying for an ad-interim order of injunction
restraining the defendants from manufacturing, selling, offering for sale,
advertising or in any manner dealing with the medicine bearing the mark
'NUTRIEPIC' or any medicine similar to the plaintiffs' medicine
bearing the mark 'TRIMACARE'. The plaintiffs further pray for an ad-
interim injunction restraining the defendants from manufacturing, selling,
offering for sale, or in any manner dealing with medicine containing
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'dienogest' under the mark 'UTTERCARE' or any mark deceptively
similar to the mark of the plaintiffs- 'LAYERCARE'.
2. I shall also be disposing of the application, being I.A.
No.16291/2022, filed by the defendants under Order XXXIX Rule 4 read
with Section 151 of the CPC, praying for vacation of the ex-parte order
of ad-interim injunction passed by this Court on 22.08.2022.
CASE OF THE PLAINTIFFS:
3. The plaintiffs have filed the above suit stating that the plaintiff
no.1, a healthcare company, was founded in 2020 by Mr. Sameer
Agarwal and Ms. Surbhi Gupta, who are currently the directors thereof;
while the plaintiff no.2 was founded in October, 2018. The plaintiff no.2
is engaged in the marketing and distribution of various pharmaceutical
and other goods manufactured or produced by the plaintiff no.1.
i) Trimacare v. Nutriepic:
4. It is further asserted by the plaintiffs that in and around the year
2019, Mr.Sameer Agarwal, the licensor of the plaintiffs, conducted a
survey in the Indian market for multi-vitamin products containing micro-
nutrients that can cater to all the nutritional and other mineral needs of
Indian women at once, that is, in a single pill. The survey was conducted
cutting across different socio-economic strata of women who are
currently pregnant, those who were pregnant three to five years ago, et
cetera. Various doctors in rural and urban areas were also interviewed.
The plaintiffs assert that as a result of the survey, it was found that there
was no pre-natal supplement in India, especially one which is designed
keeping in mind the different environmental, dietary, biological and
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nutritional factors that affect pregnant Indian women. It was found that
there was no single multi-micronutrient tablet that a pregnant Indian
woman could consume during her pregnancy.
5. It is further alleged that in order to address the problems found in
the survey, Mr.Sameer Agarwal and his team via extensive research,
developed a range of medicinal goods, which are now marketed under the
mark 'TRIMACARE', which is one of a kind multi-micronutrient, pre-
natal/antenatal supplement developed purely based on the biological
requirements of Indian pregnant women. A period of about two years
were invested in the research and development of this range of products
by the licensors of the plaintiffs, by expending a substantial amount of
time and resources to research on the medicinal goods that would address
the needs of Indian women.
6. It is alleged that the Food Safety and Standards Authority of India
(in short, 'FSSAI') licence for the medicine 'TRIMACARE' was
received on 12.01.2021, after which the plaintiffs started marketing the
same. Prior to its launch, the plaintiffs, through their in-house-team,
undertook a complete survey of the market targeting their two types of
customers, that is, gynaecology doctors, general practitioners, physicians,
researchers; as also patients ranging from different socio-economic
backgrounds, to test consumer acceptance and study the potential of this
medicine. The survey was aimed at collecting data pertaining to the
pricing of the medicinal goods, including focusing on various factors
such as affordability and the preferred price acceptable to the customers.
7. Though the plaint contains averments with respect to the trade
mark and copyright vested in the mark 'TRIMACARE', as would be
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evident from the later part of this judgment, the same are irrelevant to the
decision of the present application, inasmuch as, the claim of the
plaintiffs, as far as the intellectual property rights in 'TRIMACARE' is
concerned, is based on the misuse of the alleged confidential information
by the defendants and not on the violation of any alleged rights of the
plaintiffs in the trade mark and /or copyright in the packaging/label
thereof.
8. The plaintiffs assert that its medicine 'TRIMACARE' is unique
and one-of-its-kind in the market and no other company has been able to
launch a competing pharmaceutical product. The said medicine, which
was launched in January, 2021, has gained tremendous success.
9. It is further asserted that the plaintiffs, from time to time, had to
train and educate the sales and marketing personnel about the said
product, its efficacious advantages, uses, including the competitive edge
over other products. Special training to the sales and marketing teams
had to be imparted so that they could address and pre-empt all the queries
raised by the doctors for which special scripts, learning manuals, and
visual aids were created by Mr. Sameer Agarwal, which was licenced to
the plaintiff no.1.
10. It is asserted that the medicine 'TRIMACARE' was developed by
the plaintiffs in collaboration with Deccan Healthcare, with whom the
plaintiffs have executed a Non-Disclosure Agreement. The sales and
marketing and other teams of the plaintiffs do not interact with Deccan
Healthcare and, thus, the process and the formula for the preparation of
'TRIMACARE' is kept confidential and maintained as such.
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11. The plaintiffs further assert that it has adopted the following
practices to safeguard its proprietary and confidential information that
may be generated within the company:
"28. The Plaintiffs have adopted the following
practices to safeguard its proprietary and
confidential information that may be generated
within the company.
A. Execution of non-disclosure agreement at
the time of joining the Company.
B. No person is allowed to carry any
documents, physical or electronic, outside the
organisation without express consent from Mr.
Sameer Agarwal or Ms. Surbhi Gupta.
C. Specific training programmes are
conducted to sensitise employees and make them
aware of their obligations of confidentiality.
D. All employees are provided with secure
laptops and email ids which can function within
the intranet of the organisation.
E. Only certain employees are permitted to
carry the laptops home (on work-from-home
basis, with the express consent and knowledge of
the Founders Mr.Sameer Agarwal and Ms. Surbhi
Agarwal.
F. Employees are required to provide regular
updates of the work completed by them and the
research done to Mr. Sameer/Surbhi."
12. It is asserted that the medicine 'TRIMACARE' is unique in many
ways as it comprises of a combination of several vitamins, minerals, fatty
acids, et cetera, in a specific proportion. Such proportions were worked
out and arrived at after much trial and error by the Research and
Development Team (in short, 'R&D Team') at Deccan Healthcare in
collaboration with pharmacologists, running continuous stability and
synergy tests. Many of such ingredients are not compatible with other
ingredients, for example, absorption of high-dose of iron with high-dose
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of calcium. It was through continuous experimentation that the plaintiffs'
team was able to arrive at the manner in which they could be combined.
13. It is alleged that the technical know-how and the process for
manufacturing the plaintiffs' medicine bearing the mark
'TRIMACARE' is 'confidential information'. Such information was
known only to Ms. Surbhi Gupta and Mr. Sameer Agarwal (the founders
of the plaintiff no.1) and the R&D Team at Deccan Healthcare. No other
person working with or for the plaintiffs was aware of the aforesaid
intricacies. The sales and marketing personnel were extensively trained
and educated about the advantages of the medicine bearing the mark
'TRIMACARE', however, the aforesaid proprietary and confidential
information was not revealed to them. The plaintiffs have also filed a
patent for the same on 25.01.2021.
14. The plaintiffs further assert that they also have confidential
business information in the form of survey reports and sales models;
packaging information; regarding best distributors and dealers; data with
respect to special and specific requirements of customers; negotiable
price structure; list of vendors of the plaintiffs; and the distribution plan
of the plaintiffs.
15. The plaintiffs assert that vide Appointment Letter dated
01.07.2021, the defendant no. 1 was appointed by the plaintiffs as
'Project Manager'. Clause 1.5 of the Appointment Letter obliged the
defendant no.1 to maintain confidentiality. Apart from the Appointment
Letter, the defendant no.1 also executed a Confidentiality Agreement
dated 01.07.2021, which imposed upon the defendant no.1 an obligation
of confidentiality as well as non-solicitation of the plaintiffs' business
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and customers. The plaintiffs describe the role of the defendant no.1 as
under:
"42. It is submitted that role of Defendant No. 1
in the company of Plaintiff No 1 and 2 was as
under:
A. Developing marketing strategy of all the
products;
B. Scientific training of Medical
Representatives to give them a better
understanding of the product developed by the
Plaintiff so as to better equip them to handle
possible customer queries based on the know-how
and technical information provided to Defendant
No. 1 by the Plaintiff as the same is not known by
the public;
C. Joint-working in the field to meet selected
senior physicians;
D. Addressing queries raised by medical
professionals on product through scientific
knowledge as acquired from the data provided by
the Plaintiff.
E. Preparing presentations for conferences
and taking feedback of doctors."
16. The plaintiffs assert that by virtue of her position, the defendant
no.1 had access to virtually all the confidential data pertaining to
technical as well as business information, and over a period of time, the
plaintiff no.1 herself was involved in several confidential matters. She
was also the person in-charge for following up on the filing of the
Provisional Patent Application for 'TRIMACARE' and corresponding
with the Indian Patent Office for the filing of the complete specifications
for the same. In this manner, the defendant no.1 acquired some of the
most confidential and sensitive technical information of the plaintiffs,
including formulae, recommendations by doctors, points of improvement
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to be adopted in the product, and know-how to manufacture the product,
despite her not being a part of the R&D Team at Deccan Healthcare.
17. It is further asserted that on the defendant no.1's recommendation,
the defendant no.2 was appointed as the 'Zonal Business Manager', (a
designation which made him the Head of Sales for North India), on
04.08.2021. The defendant no.2 was also made in-charge of an entire
sales team of medical representatives, area managers and regional
managers.
18. On the same day, the defendant no.3 was appointed as the
'Regional Business Manager'. The defendant nos.2 and 3 also executed
Confidentiality Agreements dated 04.08.2021, which contained the
requisite covenants imposing an obligation of confidentiality as well as
non-solicitation of the plaintiffs' business and customers upon the said
defendants.
19. It is asserted that the defendant nos.2 and 3, by virtue of being part
of the sales and marketing team, were in possession of extensive
confidential information pertaining to the medicine bearing the mark
'TRIMACARE' and other data pertaining to sales, dealers, distributors,
among others. The defendant nos. 2 and 3 also received specialised
training regarding the subject medicine, in order for them to facilitate the
promotion and sales of the plaintiffs' medicinal goods in the market.
20. On 10.01.2022, the defendant no.1 served her Notice of
Resignation, which was accepted by the plaintiffs. The defendant no.1
was eventually relieved from her services on 17.02.2022. The defendant
nos.2 and 3, along with various other key sales and marketing personnel,
also tendered their Notices of Resignation on 08.02.2022, immediately
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after an extensive training workshop was conducted for the sales and
marketing personnel for the launch of another product of the plaintiffs,
being 'LAYERCARE', which is also one of the subject matter of the
present suit. Various other key sales and marketing personnel also served
their Notice of Resignation in the evening of 08.02.2022, immediately on
conclusion of the training exercise. The defendant nos.2 and 3 were
relieved from their employment at the plaintiffs on 08.02.2022.
21. The plaintiffs assert that it was later revealed that the defendant
nos.1 to 3 had acquired shares in the defendant no.4-company and while
the mothers of the defendant nos.2 and 3 had been directors of the
defendant no.4-company since 09.09.2020, the mother of the defendant
no.1 assumed the position of director in the said Company only on
05.01.2022. The plaintiffs assert that, therefore, the defendant nos.1 to 3
were already preparing for entering in competition with the plaintiffs,
while being in the employment of the plaintiffs.
22. The plaintiffs assert that it was later learnt by the plaintiffs that it is
through the defendant no.4-company that the defendant nos.1 to 3 were
about to launch a pre-natal supplement under the trade mark
'NUTRIEPIC', which the plaintiffs claim is based on and has the same
ingredients as that of the plaintiffs' goods 'TRIMACARE'. The
plaintiffs rely upon the following chart of ingredients of the two goods in
support of this submission:
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Ingredients Range as claimed Trimacare-2 Znutriepic
in Plaintiff's (Morning Tablet) (Morning
Patent Application Tablet)
Vitamin B9 (L- 0.2 to 10 mg 0.5 mg 0.57 mg
methyl Folate)
Viotamin A 600-6000 mcg 1600 mcg -
Zinc 10-40 mg 12 mg 14.5 mg
Vitamin E 7 to 400 mg 10 mg 10 mg
Iodine 100-300 lmg 200 mcg 0.9 mcg (4
ounces of
cranberry=
400 mcg of
iodine)
Vitamin C 30-200 mg 60 mg 80 mg
Vitamin B1 0.2 to 100 mg 1.6 mg 2 mg
Vitamin B2 0.2 to 100 mg 2 mg 2.70 mg
Vitamin B3 2 to 35 mg 18 mg 13 mg
Vitamin B5 1-10 mg 5 mg 5 mg
Vitamin B6 2-10 mg 3 mg 2.3 mg
Vitamin B7 10 mcg to 10 mg 30 mcg 40 mcg
Vitamin B12 0.2 to 1500 3.6 mcg 2.45 mcg
Vitamin K2 25-90 mcg 55 mcg -
Trace Minerals: 1-2 mg 1.7 mg -
Copper
Trace Minerals: 30-70 mcg 40 mcg -
Selenium
Trace Minerals: 2-6 mg 4 mg -
Maganese
Trace Minerals: 20-100 mcg 50 mcg -
Chromium
Trace Minerals: 45 mcg-2 mg 45 mcg -
Molybdenum
Trace Minerals: 100 mcg-10 mg 150 mcg -
Boron
Omega 3 50-2000 mg 200 mg -
Iron 30-100 mg 60 mg 27 mg
Choline 50-500 mg - 50 mg
Sodium - - 4.62 mg
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Ingredients Range as Trimacare- Nutriepic (Evening Tablet)
2 claimed in
(Evening Pill)
Plaintiff's Patent
application
Vitamin D2 200-4000 400 IU IU 15 mcg (600 IU)
Magnesium 200-400 206 mg mg, 120 mg
Calcium 300-800 mg 500 mg 260 mg
23. The plaintiffs assert that the medicine of the defendants has been
developed on the same lines as the plaintiffs' medicine and is intended to
directly compete with the plaintiffs' medicine. Its composition is within
the range provided in the plaintiffs' patent claims. As the defendant no.1
was aware and had access to the confidential experimental data regarding
the patent, therefore, she also knew that certain elements of the
composition such as the trace minerals could be eliminated without
affecting the efficacy thereof and that the minor changes in the amounts
of ingredients of the composition would also not affect the efficacy
thereof. The minor changes in the composition, therefore, were made by
the defendants only because of the confidential information received by
them in the course of their employment with the plaintiffs. It is asserted
by the plaintiffs that but for the confidential information received by the
defendant nos.1 to 3, it would have been impossible for the defendants to
have launched their medicine 'NUTRIEPIC' in such a short duration, as
they could not have conducted the research, formulate the medicine,
developed the brand name/artwork/packaging/trade dress, gotten it
manufactured and be ready for launch by July, 2022. The plaintiffs assert
that clearly, the defendant nos.1 to 3 were working for the development
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and launch of their goods 'NUTRIEPIC' while being in employment of
the plaintiffs.
24. It is further asserted that the defendant nos.2 and 3 also
incorporated the defendant no.5-company on 24.11.2021, that is, while
being in employment of the plaintiffs-company. The defendant nos.2 and
3 also became directors of the defendant no.5-company and applied for
the device mark for 'NUTRIEPIC' and the other mark in dispute, that is,
'UTTERCARE', both on 17.12.2021; again, while being in employment
of the plaintiffs. The defendant nos.1 to 3 also applied for and obtained a
drug license to market their products on or about January, 2022, that is,
whilst being in employment of the plaintiffs. The plaintiffs assert that the
above acts also prove mala fide of the defendants.
ii) Layercare v. Uttercare:
25. Coming to the other subject-matter of the dispute, it is asserted by
the plaintiffs, that the plaintiffs have also launched a 'dienogest'
medicine bearing the trade mark 'LAYERCARE' on 09.02.2022.
'LAYERCARE' is a combination of two words 'LAYER' and 'CARE'.
The trade mark- 'LAYERCARE' was formed keeping in mind the
nature of the product and its utility; being one to have alleviated the
problems of the endometriosis. Mr. Sameer Agarwal, the licensor of the
plaintiff no.1, has also filed a Trade Mark Application bearing
no.5158258 to protect the rights in the said mark. The application of this
mark is still pending before the Trade Marks Registry. The said mark has
been developed after extensive market research to create a mark that is
distinct as compared to other 'dienogest' medicines in the market. It was
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found that the names of other 'dienogest' medicines in the market include
either ''dieno'' or 'endo' as either a prefix or a suffix in their name. The
plaintiffs adopted the mark, which is in complete deviation from this
market practice.
26. The plaintiffs assert that the adoption of the mark 'UTTERCARE'
by the defendants for its 'dienogest' medicine amounts to passing off, as
the said mark is deceptively similar to the trade mark of the plaintiffs.
The plaintiffs assert that it has a 'family of marks' with the word 'CARE'
and, therefore, the use of a mark which includes the word 'CARE', by
the defendants is likely to cause deception and confusion, especially
keeping in mind their earlier association with the plaintiffs as their
employees. It is asserted that the defendants are getting their product
'UTTERCARE' manufactured from the same manufacturer, who has
been manufacturing the plaintiffs' medicine 'LAYERCARE', that is,
Akums Lifesciences Ltd. The defendant nos.1 to 3, while being employed
with the plaintiffs, used their resources to place an order with the said
manufacturer to manufacture their product 'UTTERCARE' in January,
2022, and were able to launch the product in March, 2022, within days
after their resignation.
27. Based on the above facts, the plaintiffs pray for an ad-interim
injunction against the defendants restraining the defendants from
manufacturing and/or marketing their pharmaceutical goods
'NUTRIEPIC' and under the trade mark 'UTTERCARE'.
CASE OF THE DEFENDANTS:
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28. On the other hand, the defendants assert that the plaintiffs are not
entitled to any relief inasmuch as they have concealed from this Court the
Examination/Hearing Notices dated 23.05.2022 and 29.08.2022 issued by
the Indian Patent Office, raising an objection on the application of the
plaintiffs seeking grant of a patent on the ground that the patent applied
for is not novel. They submit that the medicine of the plaintiffs, that is,
'TRIMACARE' does not involve any novel process and is based on the
already-available material in the market. The defendants have vast
experience in the field of medicine and, therefore, were able to launch
their medicine 'NUTRIEPIC' with the help of already-available non-
proprietary information in the market.
29. The defendants assert that they have not used any confidential
information obtained from the plaintiffs in the course of their
employment, as no such confidential information was ever shared with
them. The goods of the plaintiffs and the defendants are even otherwise
different. The defendants have highlighted these differences by way of
the following chart:
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30. On the use of the mark 'UTTERCARE', the defendants submit
that the plaintiffs have again concealed from this Court that the Registrar
of Trade Marks has raised objections under Section 11 of the Trade
Marks Act, 1999 (in short, 'the Act') on the registration of the mark of
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the plaintiffs, that is, 'LAYERCARE'. Even otherwise, the word
'CARE' is a generic and a common dictionary word used not only by the
defendants but also by many other manufacturers.
31. The defendants assert that the packaging of the two medicines, that
is, of the plaintiffs and the defendants, is also different and therefore,
there is absolutely no likelihood of any confusion being caused in the
mind of an unwary consumer.
SUBMISSIONS ON BEHALF OF THE LEARNED COUNSEL FOR THE
PLAINTIFFS
32. The learned counsel for the plaintiffs, while reiterating the facts as
stated hereinabove, submits that the plaintiffs, with extensive research
had developed the medicine 'TRIMACARE'. The medicine comprises
of combination of several vitamins, minerals, fatty acids, in a specific
proportion, which was worked out and arrived at after much trial and
error by the R&D Team at Deccan Healthcare. In such research, the
compatibility of the ingredients and their proportions were to be worked
out. It was further worked out as to which ingredient can be dispensed
with without affecting the efficacy of the product. All of this information
was confidential in nature and came in the hands of the defendant no.1 as
she was following up the patent application for the plaintiffs for the said
medicine. Similarly, such information also came in the hands of the
defendant nos.2 and 3 as being key members of the sales and marketing
team, who along with the team had to be trained to answer queries that
may be raised by the doctors regarding the ingredients and efficacy of the
said medicine.
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33. The learned counsel for the plaintiffs submits that but for the
knowledge gained by the defendants in the course of their employment,
the defendants would not have been able to launch their medicine
'NUTRIEPIC' immediately on leaving the employment of the plaintiffs.
She submits that the defendants are, therefore, not only guilty of violating
their terms of employment as contained in the Appointment Letter and
the Confidentiality Agreement executed by them, but even otherwise
have used the confidential information of the plaintiffs as a springboard
to launch their product. Placing reliance on the judgment of the High
Court of Justice-Chancery Division in Saltman Engineering Coy. Ld.,
Ferotec Ld. and Monarch Engineering Coy. (Mitcham) Ld. v.
Campbell Engineering Coy., Ltd. (1948) Vol. LXV RPC 203, she
submits that the use of the confidential information, even for coming out
with the so-called 'improved formulae' by the defendants amounts to a
breach of confidence and the defendants are liable to be restrained.
34. Placing reliance on the judgment in Cranleigh Precision
Engineering Ltd. v. Bryant, (1965) 1 W.L.R 1293, the learned counsel
for the plaintiffs submits that the defendants having acquired confidential
information are under a special disability in the field of competition in
order to ensure that they do not get an unfair start. The plea of the
defendants that the medicine 'TRIMACARE' is otherwise based on
generally available formulation, therefore, cannot assist the defendants in
their defence, inasmuch as, they were able to launch their medicinal
goods immediately on leaving their employment with the plaintiffs only
because they had received confidential information from the plaintiffs on
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the proportion of the ingredients, that would make the medicine
efficacious.
35. The learned counsel for the plaintiffs further places reliance on the
following judgments in support of her above submission:
- Terrapin Limited v. Builders' Supply Company (Hayes) Ltd. &
Ors. (1967) 15 RPC 375;
- Fairfest Media Ltd. v. ITE Group PLC & Ors. 2015 SCC OnLine
Cal 23; and
- Bombay Dyeing and Manufacturing Co. Ltd. v. Mehar Karan
Singh 2010 SCC OnLine Bom 1243
36. With respect to the mark 'LAYERCARE', the learned counsel for
the plaintiffs submits that the plaintiffs are the only ones who use word
'CARE' for their 'dienogest' product. The other manufacturers of
'dienogest' in the market use the words 'dieno' or 'endo' as either a
prefix or a suffix to name their medicine. The defendants have not given
any reason for the adoption of a deceptively similar mark containing the
word 'CARE'. She submits that this itself shows that the adoption of the
mark 'UTTERCARE' by the defendants is tainted and dishonest.
37. She submits that the two marks: 'LAYERCARE' and
'UTTERCARE' are deceptively similar as they convey the same idea,
fall in the same semantic field and convey the same or similar idea in the
mind of the person who is otherwise in know of the plaintiffs mark. She
submits that use of such a deceptively similar mark is liable to be
injuncted. In support, she places reliance on Make My Trip (India) Pvt.
Ltd. v. Make My Travel (India) Pvt. Ltd., 2019 SCC OnLine Del 10638.
38. She further submits that as the defendants, being ex-employees of
the plaintiffs, there is an even enhanced chance of deception due to the
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adoption of a similar mark by the defendants. In fact, the obligation on
the defendants to adopt a totally distinctive mark from the employer is
even higher. In support, she places reliance on the following judgments:
- Midas Hygiene Industries (P) Ltd. and Another v. Sudhir Bhatia
and Others, (2004) 3 SCC 90;
- Charan Dass & Veer Industries (India) v. Bombay Crockery
House, 1984 SCC OnLine Del 465;
- Cadila Healthcare Ltd. v. Uniza Healthcare LLP and Another.
2021 SCC OnLine Del 2330;
- The British India Corpn. Ltd. v. Kharaiti Ram & Others, 1999
SCC OnLine Del 1079;
- Shree Sainath Industries v. Sainath Auto Industries, 2004 SCC
OnLine Guj 25; and
- Nutrica Pusti Healthcare Pvt. Ltd. and Others v. Morepen
Laboratories Ltd., 2021 SCC OnLine Del 2631.
39. She submits that the plea of the defendants that the word 'CARE'
is common to trade, is liable to be rejected inasmuch as, the defendants
have also filed an application seeking registration of their mark
'UTTERCARE' before the Trade Marks Registry and are therefore,
estopped from contending that the word 'CARE' is generic. Further, the
defendants have placed on record only the internet print-outs of the
alleged other marks on record, without producing the actual products.
She submits that mere printouts from the internet cannot be evidence of
use of such marks by others. In support, she places reliance on the
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judgment of this Court in Pankaj Goel v. Dabur India Ltd., 2008 SCC
OnLine Del 1744.
40. She asserts that even otherwise, the marks cited by the defendants
are not used for 'dienogest' but for other goods and, therefore, are not
relevant to the facts of the present case. She submits that reliance of the
defendants on the availability of a 'dienogest' medicine by the mark
'DIENOCARE', is also liable to be rejected. She submits that not only
was this mark not pleaded by the defendants in their application under
Order XXXIX Rule 4 of the CPC, but also because to the best of the
knowledge of the plaintiffs, no such product is available in the market.
41. She further submits that the plea of the defendants that the
packaging of the products is different is also not relevant as the claim of
the plaintiffs is based on the adoption of a deceptively similar trade mark
by the defendants and no claim is made on the packaging of their product
by the defendants.
42. She further submits that the plea of the defendants that the
defendant no.1 in her previous employment with Jagsonpal
Pharmaceutical Ltd. had done extensive research which led the
defendants to launch their medicine 'NUTRIEPIC', cannot be accepted
as Jagsonpal Pharmaceutical Ltd. never launched a similar product. In
any case, the documents filed by the defendants from Jagsonpal
Pharmaceutical Ltd. itself shows that the defendant no.1 is in a habit of
retaining confidential documents/information of her employer.
SUBMISSIONS ON BEHALF OF THE LEARNED SENIOR COUNSEL FOR THE
DEFENDANTS
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43. On the other hand, the learned senior counsel for the defendants,
while reiterating the above submissions of the defendants, further submits
that the pharmaceutical product of the plaintiffs under the trade mark
'TRIMACARE' is different from the defendants' product under the
trade mark 'NUTRIEPIC'. While the plaintiffs' product is a
nutraceutical , the defendants' product has an active FSSAI license for
'food for special dietary uses other than infants [multivitamin,
multimineral with Choline Hydrogen Tartrate and Cranberry Extract
Tablet and Food for Special Dietary Use other than Infants [Calcium,
Magnesium and Vitamin D2 Tablet]'. Placing reliance on Section 22 of
the Food Safety and Standards Act, 2006 read with the Food Safety And
Standards (Health Supplements, Nutraceuticals, Food For Special Dietary
Use, Food For Special Medical Purpose, Functional Food And Novel
Food) Regulations, 2016, (in short, the 'Regulations'), he submits that the
two products are separately dealt with even by the statutory authority,
that is, the FSSAI, by issuing different licences.
44. He submits that even otherwise, the plaintiffs' good bearing the
mark 'TRIMACARE' is a morning/evening pill and is different for
different trimesters in the pregnancy, while the defendants' good bearing
the mark 'NUTRIEPIC' is a single multi-vitamin dose which is not
dependent on the pregnancy trimester.
45. Placing reliance on the comparative chart reproduced hereinabove,
he submits that there are other differences between the components of the
plaintiffs' and the defendants' medicine and therefore, it cannot be said
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that the defendants' product is in any manner based on the product of the
plaintiffs.
46. The learned senior counsel for the defendants submits that, in fact,
no proprietary right can be claimed by the plaintiffs in the formulation of
its medicine bearing the mark 'TRIMACARE', as the ingredients of
such medicine are publici juris and, in fact, also published as the
'Summary of RDA for Indians-ICMR-NIN, 2020'.
47. He submits that even the Indian Patent Office has not accepted the
plea of the plaintiffs of its medicine 'TRIMACARE' to be novel or to be
entitled to a grant of patent. In this regard, he draws my reference to the
Examination Reports dated 23.05.2022 and 29.08.2022 issued by the
Indian Patent Office. He submits that these have been intentionally
concealed by the plaintiffs from this Court and this itself is a sufficient
ground to reject the claim of the plaintiffs to the grant of discretionary
relief under Order XXXIX Rule 1 & 2 of the CPC.
48. He submits that the defendant no.1, being a doctor herself, has a
vast work experience. She had done extensive research on the product
while being in her employment with Jagsonpal Pharmaceutical Ltd.
during the period of 2014 to 2018, and even otherwise. He submits that
documents in this regard have been placed by the defendants along with
their application, to which he has drawn my attention.
49. Drawing my reference to the contents of the plaint, he submits that
it is the own case of the plaintiffs that the confidential information was
vested only with Deccan Healthcare, their R&D team, Ms. Surbhi Gupta
and Mr. Sameer Agarwal are the only ones who were aware of the
intricacies involved in the manufacture of 'TRIMACARE'. He submits
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that therefore, the plea of the plaintiffs that the defendant nos. 1 to 3 were
also privy to any confidential information regarding 'TRIMACARE' is
in contradiction to their own stand in the plaint.
50. He submits that the plea of the plaintiffs of any confidential
information being shared by them with the defendants is even otherwise
vague and unsubstantiated. He submits that it was obligatory on the part
of the plaintiffs, in terms of Order VI Rule 4 of the CPC, to clearly plead
the confidential information which they claim to have been misused by
the defendants. General assertions in this regard cannot suffice. In
support, he places reliance on Satish Kumar v. Khushboo Singh & Ors.
2019 LAWPACK (Del) 76874; and Star India Private Ltd. v. Laxmiraj
Seetharam Nayak, 2003 Lab IC 1618.
51. With respect to the use of the mark 'UTTERCARE' by the
defendants, he submits that the word 'CARE' is generic and there are
various other pharmaceutical products available in the market using the
word 'CARE' as a part of their trade mark. He further submits that even
the Registrar of Trade Marks has objected to the application of the
plaintiffs seeking registration of its mark 'LAYERCARE', and this fact
has been withheld by the plaintiffs in their plaint, again disentitling the
plaintiffs to any interim relief on account of concealment itself.
52. On the claim of the passing off made by the plaintiffs, the learned
senior counsel for the defendants submits that the plaintiffs' medicine
product was launched only one month prior to the launch of the medicine
of the defendants. It has neither gained any goodwill nor reputation in
the market; the packaging of the products of the plaintiffs' and the
defendants' is completely different; in fact, even the manner of using the
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word 'CARE' by the plaintiffs and the defendants is totally distinct, and,
therefore, there is no chance of any consumer being deceived by the use
of the mark 'UTTERCARE' by the defendants.
53. In this regard, he places reliance on the following judgments:
- M/s Praba's v. Care Health Clinic Pvt. Ltd. v. M/s I-Care
Aesthetic Clinic, 2021 SCC OnLine Mad 2695;
- Astrazeneca UK Ltd. v. Orchid Chemicals & Pharmaceuticals
Ltd., 2007 SCC OnLine Del 237;
- Schering Corporation & Ors. v. Alkem Laboratories Ltd., 2009
SCC OnLine Del 3886;
- Intex Technologies (India) Ltd. & Anr. v. M/s AZ Tech (India) &
Anr.,2017 SCC OnLine Del 7392; and
- Shreya Life Sciences Pvt. Ltd. v. Magna Biochem Pvt. Ltd., 2008
SCC OnLine Del 1668.
ANALYSIS AND FINDINGS
54. I have considered the submissions made by the learned counsels
for the parties.
55. It is not disputed that the defendant nos.1 to 3 were in employment
of the plaintiff no. 2 till 17.02.2022.
56. It is the case of the plaintiffs that in course of their employment,
the defendants acquired various confidential information of the plaintiffs,
especially with regard to its medicine 'TRIMACARE'. However, at the
same time, the plaintiffs in the plaint have asserted that the sales and
marketing and other teams of the plaintiffs did not interact with Deccan
Healthcare- with whom the plaintiffs had developed its pharmaceutical
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product- 'TRIMACARE', and that the process and formula for
preparation of 'TRIMACARE' was kept confidential and maintained as
such. It is further asserted in the plaint that such information regarding
the manufacture of the medicine 'TRIMACARE', including its
advantages were known only to Ms.Surbhi Gupta, Mr.Sameer Agarwal
and the R&D Team of Deccan Healthcare; no other person from the
plaintiffs-companies were aware of the aforesaid intricacies. In this
regard, paragraph nos. 27 and 32 of the plaint are important and
reproduced hereinbelow:
"27. It is submitted that since the Plaintiff is an
innovative company with innovative products it
has a separate R&D team to develop the products.
In particular, the product 'TRIMACARE' was
developed in collaboration with Deccan
Healthcare. The Plaintiff has executed a Non-
disclosure Agreement with Deccan Healthcare,
whereby Deccan Healthcare is not permitted to
disclose any information regarding the formula or
process of manufacture of TRIMACARE or any
disclose any information associated therewith to
any third party. The sales, marketing and other
teams of the Plaintiff do not interact with Deccan
Healthcare. Thus, the process and the formula for
preparation of TRIMACARE is kept confidential
and maintained as such. It is further submitted
that, since most of the products of the Plaintiff are
backed by innovation and require extensive
research, the R&D team is fully in charge of such
innovations. The Plaintiff in accordance with its
best practices has an agreement with every
scientist, so employed, obligating them not to
disclose any confidential or proprietary
information, including formula, plans, processes,
etc. to any person within the organisation or
outside of the organisation without the consent of
the Mr. Sameer Agarwal or Ms. Surbhi Gupta.
xxxxx
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32. It is further submitted that all the aforesaid
proprietary information regarding the
manufacture of the product TRIMACARE
including the advantages thereof was known only
to Ms. Surbhi Gupta, Mr. Sameer Agarwal and
R&D team. No other person from the Plaintiff was
aware of the aforesaid intricacies. The marketing/
sales personnel were extensive trained and
educated about the advantages of the product;
however, the aforesaid proprietary and
confidential information was not revealed to
them."
(Emphasis supplied)
57. The plaintiffs, despite the above categorical assertion, however,
further alleged that the defendant no.1, in her capacity as a Project
Manager, acquired confidential information regarding the medicine
'TRIMACARE' as she was the person in-charge for following up on the
filing of the Provisional Patent Application for the same. The plaintiffs
assert that working this closely for the filing of the Provisional Patent
Application, the defendant no.1 acquired confidential technical know-
how despite not being sanctioned to do so. However, I may note that the
defendant no.1 joined services of the plaintiff no.2 only on 01.07.2021,
that is, after the Provisional Patent Application seeking grant of the
patent for 'TRIMACARE' had already been filed and the product also
launched by the plaintiffs in January, 2021.
58. With regard to the patent claim for 'TRIMACARE', it is also
important to note that the Indian Patent Office, by way of the
Examination Report under Sections 12 and 13 of the Patents Act, 1970
dated 23.05.2022, has objected to the grant of patent inter alia stating that
the subject-matter of the claims made therein by the plaintiffs are obvious
and lack inventive steps. It may be true that this is not the final opinion of
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the Indian Patent Office, however, it was incumbent upon the plaintiffs to
have disclosed the same in the plaint, especially where they are seeking
an ex-parte ad-interim order of injunction against the defendants,
claiming that the process for the manufacture of 'TRIMACARE' was
novel and available only to the plaintiffs. The plaintiffs, in the plaint,
disclosed the filing of the Provisional Patent Application, however,
intentionally concealed from this Court the above Examination Report.
This concealment itself is sufficient to deny an ad-interim relief to the
plaintiffs. [Ref S.K. Sachdeva & Anr. v. Shri Educare Limited and
Another, 2016 SCC OnLine Del 6708; Mankind Pharma Ltd. v.
Chandra Mani Tiwari & Anr., 2018 SCC OnLine Del 9678; Poly
Medicure Limited v. Polybond India Pvt. Ltd., 2019 SCC OnLine Del
11967].
59. In fact, as pointed out by the learned senior counsel for the
defendants, even the modified claim of the plaintiffs for the grant of a
patent has been objected to by the Indian Patent Office by way of the
Examination Report dated 29.08.2022.
60. Apart from the above, it is the case of the defendants that the
product of the plaintiffs and the defendants is entirely different as:
a) While the plaintiff's medicine is a morning/evening pill and is
different for different trimesters of pregnancy; the defendants' is a
single dose product prescribed for the entire period of pregnancy;
b) While the plaintiffs' medicine is a nutraceutical; the
defendant's product is 'food for special dietary uses other than
infancts [multivitamin, multimineral with Choline Hydrogen
Tartrate and Cranberry Extract Tablet and Food for Special
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Dietary Use other than Infants [Calcium, Magnesium and Vitamin
D2 Tablet], dealt with separately under the Regulations.
61. The defendants have also relied upon the 'Summary of RDA for
Indians-ICMR-NIN, 2020', to show that even otherwise, the ingredients
of such multi-nutrient produced by the plaintiffs are publici juris. The
same is reproduced herein below:
62. A comparison of the defendants' medicine with the above
summary issued by the ICMR, prima facie, appears to lend support to the
submissions of the defendants that the medicine of the defendants is
based on information that is publici juris. Even otherwise, the claim of
the plaintiffs to the contrary, in my opinion, would require evidence to be
led by the parties.
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63. The only assertion of the plaintiffs is that the fact the defendants
were able to launch its medicine almost immediately on their leaving the
employment of the plaintiffs shows that the defendants have used the
knowledge gained by them in the course of their employment with the
plaintiffs. Though at first blush, such a claim appears attractive, but on a
deeper scrutiny, I do not find much merit in the same. The defendant no.
1 has pleaded her vast experience in the field of medicine. As noted
herein above, it is also the claim of the defendants that their product
'TRIMACARE' is based on information that is publici juris. The
medicines of the parties also appear different. It is a separate thing to say
that the defendants, by doing the ground work for launch of their
medicine while being in employment of the plaintiffs, are in breach of the
employment contract, than to say that they have used some
confidential/proprietary information of the plaintiff. For the breach of the
contract, the remedy of the plaintiffs would only be in a claim of
damages against the defendant nos. 1 to 3 and not to an order of
injunction as the defendant nos. 1 to 3 are no longer in employment of the
plaintiffs.
64. In Saltman Engineering (supra), the Court found that the
defendants therein had made the second set of tools using confidential
information contained in the original drawing. In the present case,
however, prima facie, the plaintiffs have been unable to show such use.
65. In Cranleigh Precision Engineering Ltd. (supra), again it was
found that the defendant was in possession of confidential information in
his capacity as Managing Director of the plaintiff-company. The
plaintiffs herein have not crossed this threshold.
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66. In Terrapin Limited (supra), it was held that even if the
confidential information is used as a starting point for a new design, the
same would amount to misuse of such confidential information. It was
held that a person who has obtained information on confidence is not
allowed to use it as a 'spring board' for activities detrimental to the
person whose confidential communication is used. It was held that this
prohibition shall also apply even when all the features have been
published or can be ascertained at actual inspection by any member of the
public. In the present case, however, the 'spring board' asserted appears
to be in the defendant nos.1 and 3 doing the ground work for launch of
their medicine- 'NUTRIEPIC' while being in employment of the
plaintiffs, for which, if proved, the plaintiffs would be entitled to claim
damages for breach of the contract of employment. As far as use of the
confidential information is concerned, for the reasons stated herein
above, in my prima facie opinion, the plaintiffs have failed to show any
such 'spring board' advantage to the defendants.
67. In Fairfest Media Ltd. (supra), the Court again found the
information supplied by the plaintiffs therein to the respondent no.1
therein to be confidential in nature, and the same to have been used by
the respondent no.2 therein. Having found the same, on the facts therein,
equities were balanced by granting of an injunction for a limited period.
In fact, applying the above yardstick, even if it is held that the defendant
nos.1 to 3 had any 'spring board' advantage because of their employment
with the plaintiffs, the balance of equity would demand that the
defendants, already having suffered an ex-parte ad-interim injunction for
a long period, should be freed from such shackles.
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68. As far as the defendant nos.2 and 3 are concerned, the confidential
information alleged to have been acquired by them is in relation to the
sales and marketing plan and strategy developed by the plaintiffs, data
pertaining to sales made /projections, data base of dealers, distributors,
among other sales tactics and information collected while conducting
market surveys. It is however, not shown as to how this information is
confidential in nature or is being misused by the defendants.
69. In Satish Kumar (supra), it was held that it is incumbent for the
plaintiff, in the plaint, to plead how the data in which confidentiality is
claimed is different from the data of any other entity engaged in such
business and what is the secret about the same. Mere mention of the
research process, financial/administrative and/or organizational matter or
transaction or affairs of the company or invention or discovery or patent
protection does not satisfy the requirements of the pleadings. It was held
as under:
"39. Confidentiality and secrecy is claimed in
the same works in which copyright is claimed viz.
data, information and trade secrets residing in the
electronic devices without again specifying the
particulars thereof or secrecy thereof. Mere
mention of research process, of
financial/administrative and/or organizational
matter or transaction or affairs of the company or
invention or discovery or patent protection does
not satisfy the requirements of pleadings. The
plaintiff as per its own admission is engaged in
the business of providing logistics and freight
forwarding services and is not engaged in any
research work, it was incumbent for the plaintiff
to, in the plaint, plead how the data etc. in which
confidentiality is claimed is different from data of
any other entity engaged in such business and
what is secret about the same and what steps
besides the clause aforesaid in the letters of
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appointment of defendants no.1 to 8 have been
taken by the plaintiff to maintain
secrecy/confidentiality thereof. The plaint in this
regard is vague and cannot be put to trial. The
whole purpose of pleadings in a civil suit is to let
the opponent know the case to be met and which
crystallizes ultimately in issues on which the
parties go to trial. If such rules of pleadings are
not to be adhered to, it will result in a fishing and
roving enquiry and enable a party to the suit to
secure a victory by springing a surprise during the
course of trial. Similarly, an injunction qua
confidentiality as sought, even if granted would be
vague and unenforceable as aforesaid. This Court
cannot pass such unenforceable order, the
meaning whereof is not clear. It cannot be known,
neither to the Court nor to the defendant as to
what the defendant is injuncted form doing."
70. In Bombay Dyeing and Manufacturing Co. Ltd. (supra), the
Court held that the information relating to strategic business plans,
product mix, square footage of construction, capital expenditure or
revenue budgets cannot be claimed to be matters of any confidential
nature which no other competitor would know. It was held that contract
rates and other ideas and condition could not be called trade secrets. In
fact, an illustration was given of a salesman who left the company but
could not be prevented from communicating with customers on the
premise that he acquired the skill by experience from the employment.
71. The plaintiffs would, therefore, have to show that the information
which is claimed to be confidential is of such nature that can be acquired
by the defendants only because of their employment with the plaintiffs.
Mere vague assertions of such information being related to sales and
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marketing plan and strategy developed, in my prima facie opinion,
cannot suffice.
72. In the present case, therefore, prima facie, the plaintiffs have been
unable to show vesting of any confidential information regarding
'TRIMACARE' with the defendant nos.1 to 3 only because of their
employment with the plaintiffs and/or use thereof, even as a 'spring
board' by the defendants for launch of their product 'NUTRIEPIC'.
The relief of temporary injunction in this regard, therefore, must fail.
73. As far as the claim based on the trade mark 'LAYERCARE' is
concerned, while there is no doubt that the test to be adopted in a case
where the defendant is an ex-employee or distributor or agent of the
plaintiffs is less strict, at the same time, the plaintiffs has to show their
right over a particular mark.
74. In the present case, the claim made by the plaintiffs is only of
passing off. It is trite law that for testing a claim of passing off, what is
to be seen is the similarity between the competing marks, goodwill and
reputation of the mark of the plaintiffs, and to determine whether there is
a likelihood of deception or confusion being caused by the use of the
complained mark.
75. In the present case, admittedly, the plaintiffs launched their
product 'LAYERCARE' only in February, 2022. The defendants had
left the employment of the plaintiffs on 17.02.2022. They had tendered
their resignation prior to the launch of the medicine of the plaintiffs-
'LAYERCARE'. Therefore, the special equities as are applicable in a
case of an ex-employee or any ex-director or ex-distributor would not be
available to the plaintiffs against the defendants.
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76. On the general principles of passing off, it is to be seen that the
word 'CARE' is a generic word over which the plaintiffs cannot claim
exclusiveness. The marks 'LAYERCARE' and 'UTTERCARE' also
cannot be held to be visually or phonetically similar. The packaging of
the two products, that is, of 'LAYERCARE' and 'UTTERCARE' is
also entirely different and in my prima facie opinion, is sufficient to allay
any claim of passing off. The same is reproduced hereinbelow:
77. From the above, it would be clear that the defendants' goods, in
fact, uses the alphabet 'C' in the word 'CARE' in a distinct form. There
are also other distinctive features which would allay any claim of
deceptive similarity between the two marks.
78. The claim of the plaintiffs of having a 'family of marks' with the
word 'CARE' also is ill-founded. This claim is based on only the two
marks, that is, 'TRIMACARE' and 'LAYERCARE'. As noted, launch
of both these medicines is recent and the plaintiff, at least prima-facie,
has been unable to show any goodwill and reputation in these marks so as
to claim exclusivity over the work 'CARE'.
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RELIEF
79. In view of the above, ex-parte ad-interim order dated 22.08.2022 is
vacated. The defendants shall, however, on an affidavit, on a bi-annual
basis, disclose the sales made by them for their medicinal product
'NUTRIEPIC'.
80. I.A. No.13093 of 2022 filed by the plaintiffs and I.A. No.16291 of
2022 filed by the defendants are disposed of with the above direction.
81. It is reiterated that the above observations are merely prima facie
in nature and shall not bind the Court while considering the merits of the
claim on the parties once they have led their respective evidence.
CS(COMM) 570/2022 and I.A. 16445/2022
82. List the suit and the pending application for completion of
pleadings before the Learned Joint Registrar (Judicial) on 9th February,
2023.
NAVIN CHAWLA, J.
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