Delhi High Court - Orders
Alkem Laboratories Ltd vs Gujarat Terce Laboratories Limited on 20 October, 2023
Author: Prathiba M. Singh
Bench: Prathiba M. Singh
$~6
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ CS(COMM) 767/2023, I.A. 21074/2023, 21075/2023, 21076/2023
& 21077/2023
ALKEM LABORATORIES LTD ..... Plaintiff
Through: Mr. Sagar Chandra, Ms. Ishani
Chandra, Ms. Srijan Uppal, Mr.
Yashasvi Gupta and Mr. Sanket Singh
Sengar, Advs. (M. 9811970271)
versus
GUJARAT TERCE LABORATORIES LIMITED ..... Defendant
Through: Mr. J. Sai Deepak, Mr. Kunal Khanna,
Mr. Avinash, Mr. Zahid Shaikh, Mr.
Nilesh Nayak, Ms. Pooja Acharya,
Advs. (M. 9999757185).
CORAM:
JUSTICE PRATHIBA M. SINGH
ORDER
% 20.10.2023
1. This hearing has been done through hybrid mode. I.A._21075/2023 (for additional documents)
2. This is an application filed by the Plaintiff seeking leave to file additional documents under the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015 (hereinafter, 'Commercial Courts Act'). The Plaintiff, if it wishes to file additional documents at a later stage, shall do so strictly as per the provisions of the Commercial Courts Act and the DHC (Original Side) Rules, 2018.
3. Application is disposed of.
CS(COMM) 767/2023 Page 1 of 8This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 23/10/2023 at 21:33:12 I.A. 21077/2023 (u/S 12A of the Commercial Courts Act)
4. This is an application filed by the Plaintiff seeking exemption instituting pre-litigation mediation. In the present suit, the Plaintiff claims that prior to instituting the suit, the Plaintiff had attempted amicable resolution of disputes by sending a legal notice dated 17th April, 2023. As per the Plaintiff, the Defendant had filed a reply dated 9th May 2023 to the Legal Notice issued by the Plaintiff. However, in the said reply, the Defendant had claimed that it is an honest and prior adopter and disputed the claims of the Plaintiff. The Defendant is also stated to have filed Caveats against the Plaintiff before various Courts.
5. According to the Plaintiff, a rejoinder notice dated 23rd June, 2023 was also sent refuting the claims of the Defendant. However, it is submitted that the Defendant has not replied to the said rejoinder notice sent by the Plaintiff. It is claimed by the Plaintiff that the continuous use of the marks similar to its series of marks 'ZOCEF' would dilute the marks of the Plaintiff and cause erosion of goodwill, reputation and exclusivity of the marks of the Plaintiff. Finally, it is also claimed by the Plaintiff that the suit has been instituted to enforce its rights in certain brands of medicines marketed by the Plaintiffs and that it is of utmost importance to minimise the confusion in the mind of unwary customers as it could have grave and serious consequences.
6. In view of the same, the Plaintiff is seeking urgent interim relief and exemption from institution of Pre-Litigation Mediation in accordance with Section 12A of the Commercial Courts Act, 2015.
7. The Court has perused the application seeking exemption from institution of Pre-Litigation Mediation. The Supreme Court in Yamini Manohar v. TKD Keerthi, 2023 LiveLaw (SC) 906 has explicitly ruled that CS(COMM) 767/2023 Page 2 of 8 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 23/10/2023 at 21:33:12 in the absence of any statutory requirement or rules enacted by the Central Government, a Plaint need not be accompanied with a specific application to waive the process of pre-litigation mediation. The Court can decide whether an exemption from instituting of pre-litigation mediation should be granted or not. The said decision is to be made based on the facts and circumstances of each case as also the pleadings and oral submissions in the Court. The relevant extract of the decision in Yamini Manohar (supra) is set out below:
"3. This Court in "Patil Automation Private Limited and Ors. v. Rakheja Engineers Private Limited."
has held that Section 12A of the CC Act is mandatory. Pre-litigation mediation is necessary, unless the suit contemplates urgent interim relief.... Section 12A of the CC Act does not contemplate leave of the court, as is clear from the language and words used therein. Nor does the provision necessarily require an application seeking exemption. An application seeking wavier on account of urgent interim relief setting out grounds and reasons may allay a challenge and assist the court, but in the absence of any statutory mandate or rules made by the Central Government, an application per se is not a condition under Section 12A of the CC Act; pleadings on record and oral submissions would be sufficient. The words used in Section 12A of the CC Act are - "A suit which does not contemplate any urgent interim relief", wherein the word "contemplate" connotes to deliberate and consider. Further, the legal position that the plaint can be rejected and not entertained reflects application of mind by the court viz. the requirement of 'urgent interim relief'.
xxx xxx xxx
7. We are of the opinion that when a plaint is filed under the CC Act, with a prayer for an urgent interim CS(COMM) 767/2023 Page 3 of 8 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 23/10/2023 at 21:33:13 relief, the commercial court should examine the nature and the subject matter of the suit, the cause of action, and the prayer for interim relief. The prayer for urgent interim relief should not be a disguise or mask to wriggle out of and get over Section 12A of the CC Act...
xxx xxx xxx
8. Having stated so, it is difficult to agree with the proposition that the plaintiff has the absolute choice and right to paralyze Section 12A of the CC Act by making a prayer for urgent interim relief.
Camouflage and guise to bypass the statutory mandate of pre-litigation mediation should be checked when deception and falsity is apparent or established. The proposition that the commercial courts do have a role, albeit a limited one, should be accepted, otherwise it would be up to the plaintiff alone to decide whether to resort to the procedure under Section 12A of the CC Act. An 'absolute and unfettered right' approach is not justified if the pre- institution mediation under Section 12A of the CC Act is mandatory, as held by this Court in Patil Automation Private Limited (supra). The words 'contemplate any urgent interim relief' in Section 12A(1) of the CC Act, with reference to the suit, should be read as conferring power on the court to be satisfied. They suggest that the suit must "contemplate", which means the plaint, documents and facts should show and indicate the need for an urgent interim relief. This is the precise and limited exercise that the commercial courts will undertake, the contours of which have been explained in the earlier paragraph(s). This will be sufficient to keep in check and ensure that the legislative object/intent behind the enactment of section 12A of the CC Act is not defeated."
CS(COMM) 767/2023 Page 4 of 8This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 23/10/2023 at 21:33:13
8. In light of the above decision of the Supreme Court, the present application for exemption from instituting pre-litigation mediation is disposed of .
CS(COMM) 767/2023 and I.A._21074/2023, I.A. _21076/2023_
9. The Plaintiff is a leading pharmaceutical Company. It has filed the present suit seeking protection of its 'ZOCEF' marks which are registered in respect of pharmaceutical preparations. The mark is stated to have been adopted by the Plaintiff in 1988 and the Plaintiff started using the same since 2000. Today, the turnover of ZOCEF branded products is claimed to be more than 100 crores.
10. The Defendant's mark is 'OCEF' which is being used for pharmaceutical preparations of identical composition. The case of the Plaintiff is that due to the phonetic, visual and ocular similarities between the two marks the said mark is liable to be injuncted as the only difference between the marks is the letter Z. The Defendant, according to the Plaintiff, has derived the mark from the Plaintiff's well-known mark. It is submitted that the Defendant had applied for trade mark registration of OCEF on three occasions. The first mark of the application of the Defendant was opposed by the Plaintiff in 2004 and the application was abandoned. Thereafter, two further applications were also refused. The details of the same are at page 31 of the plaint.
11. Considering that these are pharmaceutical preparations, the threshold of confusion is lower in terms of the judgment in Cadila Healthcare vs. Cadila Pharma, (2001) 5 SCC 73. The Supreme Court in Cadila Healthcare vs. Cadila Pharma, (2001) 5 SCC 73 has specifically observed that strict measures need to be taken to ensure that similarity of marks of medicines is CS(COMM) 767/2023 Page 5 of 8 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 23/10/2023 at 21:33:13 avoided, particularly due to the varying medical infrastructure in the country. The relevant extract of the said judgement is set out below:
"34. As far as present case is concerned, although both the drugs are sold under prescription but this fact alone is not sufficient to prevent confusion which is otherwise likely to occur. In view of the varying infrastructure for supervision of physicians and pharmacists of medical profession in our country due to linguistic, urban, semi-urban and rural divide across the country and with high degree of possibility of even accidental negligence, strict measurers to prevent any confusion arising from similarity of marks among medicines are required to be taken."
12. A Coordinate Bench of this Court, in FDC Limited v. Nilrise Pharmaceuticals Pvt. Ltd., 2022:DHC:3839, has also referred to the said decision in Cadila Healthcare (Supra) and observed that tests to be applied for medicinal products need to be far stricter due to the possibility of confusion resulting in public injury. The relevant extracts of the said decision are extracted as under:
"41. The submission of the learned counsel for the defendant that they be permitted to use the impugned mark as they are using the prefix "ZOY"
also with respect to their other medicinal preparations, also cannot be accepted. Each mark of the defendant has to be tested on its own standing. Merely because the defendant uses the prefix "ZOY" for its other medicinal preparations, it cannot be allowed to use the impugned mark even though the same is found to be deceptively similar to an already registered mark with prior use.
42. Since the products in question are medicinal products, in my opinion, the test to be applied needs to be far stricter than the one applied to CS(COMM) 767/2023 Page 6 of 8 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 23/10/2023 at 21:33:13 other goods, as any confusion would result in public injury."
13. As per the above decision, clearly any chances of confusion have to be avoided. The Plaintiff has known of the Defendant since 2004. The Defendant has also known the Plaintiff since 2004 when it opposed the mark. The Defendant is also conscious of the Plaintiff's rights in the mark 'ZOCEF' which is a registered mark. In view thereof, since there is a possibility that the confusion between the marks of the Plaintiff and the Defendant would be detrimental to the interest of the patients and the medical community.
14. In light of the above discussion, this is a case where the urgent interim relief has sought would need to satisfy the Court that a case is made out for issuing summons despite Section 12A of the Commercial Courts Act, 2005. The Defendant has at adequate opportunity since 2004 to try amicably resolve the disputes with the Plaintiff. The Plaintiff has already sent a legal notice even in April of 2023 which was responded to in May 2023 where the Defendant did not agree to the requisitions of the Plaintiff.
15. However, considering the long period that has lapsed with the knowledge of the Defendant's use, this is fit case where the matter deserves to be referred to the mediation in a time bound manner.
16. Accordingly, the following directions are issued:-
i) Parties are referred to the Delhi High Court Mediation and Conciliation Centre for exploring amicable resolution of their disputes.
ii) Parties to appear before the Delhi High Court Mediation and Conciliation Centre on 31st October, 2023 at 3.00pm.CS(COMM) 767/2023 Page 7 of 8
This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 23/10/2023 at 21:33:13
iii) The mediation shall be conducted on a day to day basis by the ld. Sr. Mediator.
iv) Parties shall depute their competent officials, who are capable of taking decisions in the mediation proceedings. They may either join physically or virtually.
17. In the meantime, the Defendant shall also file its reply within four weeks. Rejoinder, if any, be filed within two weeks thereafter.
18. List on 5th December, 2023.
PRATHIBA M. SINGH, J.
OCTOBER 20, 2023 mr/am CS(COMM) 767/2023 Page 8 of 8 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 23/10/2023 at 21:33:13