Delhi District Court
Zino Davidoff Sa vs Charanjeet Singh on 30 September, 2020
IN THE COURT OF MS. NISHA SAXENA: DISTRICT JUDGE
(COMMERCIAL COURT)-04,CENTRAL , TIS HAZARI COURTS,
DELHI
CS (COMM) No.1839/19
ZINO DAVIDOFF SA
RUE FAUCIGNY 5
1700 FRIBOURG, SWITZERLAND
THROUGH MEENA BANSAL
CONSTITUTED ATTORNEY
96, SUKHDEV VIHAR, MATHURA ROAD
NEW DELHI-110025 ... PLAINTIFF
Vs.
CHARANJEET SINGH
SON OF SARDOOL SINGH
SHOP NO.18/3RD FLOOR,
13/34, WIMPY MOBILE PLAZA,
ARYA SAMAJ ROAD, KAROL BAGH
NEW DLEHI-110005 ....DEFENDANT
Date of filing of the suit : 10.07.2019
Date of reserving judgment : 25.09.2020
Date of judgment : 30.09.2020
Zino Davidoff SA Vs. Charanjeet Singh 1
JUDGMENT
1. This is a suit under section 134 and 135 of Trademarks Act, 1999, section 55 of Copyright Act and for permanent injunction restraining infringement, passing off, delivery up, rendition of accounts etc.
2. The plaintiff is a company duly organized and incorporated under the laws of Switzerland. Plaintiff bonafidely adopted the trademark DAVIDOFF in 1984 in respect of fragrances. The said trademark/label DAVIDOFF is used as essential part and in artistic manner also. The art work involved in the said DAVIDOFF trademark/label is an original artistic work and the plaintiff is the owner thereof. In the year 1988 the famous DAVIDOFF cool water fragrances was introduced. The DAVIDOFF cool water fragrances, colour combination/trade dress/packaging material have a unique get up, make up, colour scheme, lettering style, arrangement etc. The plaintiff is the registered proprietor of the trademarks/labels DAVIDOFF/DAVIDOFF COOL WATER. The various trademarks of the plaintiff are registered, valid and subsisting and have acquired worldwide and globally valuable trade, goodwill and reputation. It is stated that the artwork involved in the plaintiff's trademark/label DAVIDOFF/DAVIDOFF COOL WATER and other variants stylized Zino Davidoff SA Vs. Charanjeet Singh 2 and formative/bearing and labels are original artistic works and plaintiff holds copyright therein.
3. It is stated that the plaintiff's goods under the said trademark are sold in more than 100 countries of the world and across all continent and regions including India. Plaintiff's goods under the said trademark have been available in India through its website on the Domain name viz www.zinodavidoff.com.
4. It is also further stated that due to excellent quality and massive advertisement the said trademark has acquired extensive reputation and goodwill in India. Several renowned actors and models are brand ambassadors for the same.
5. It is also submitted that the said trademark and formative marks and DAVIDOFF COOL WATER are registered in India in various classes as detailed in para 13 of the plaint. The said trademarks/labels are also registered in all the major countries of the world and across all continents and regions. The said registration are legal, valid and subsisting.
6. It is alleged by the plaintiff that in the first week of May 2019 during the market survey plaintiff came to know that the defendant is engaged in the business of manufacturing, marketing, using, exporting, importing, soliciting and selling of perfumes, fragrances, Zino Davidoff SA Vs. Charanjeet Singh 3 lifestyle produces and other allied/related products under the impugned trademark/label DAVIDOFF/DAVIDOFF COOL WATER and other variants. It is alleged that the defendant's impugned packaging is deceptively identical and similar to the plaintiff's trademarks/labels in each and every respect including phonetically, visually, structurally, in its basic idea and in its essential features and that the defendant has been using the same in course of trade without the leave and license of the plaintiff.
7. It is also alleged that defendant has also infringed plaintiff's copyright involved in the said trademarks and is also using the same trade label. The defendant is also passing off their impugned goods and business as that of the plaintiff. He is using all kinds of false descriptions on its impugned goods to wrongly link the impugned goods with those of the plaintiff and mislead common people and customers. It is alleged that the defendant has adopted and started using the impugned trademark dishonestly, fraudulently and out of greed with a view to take advantage and to trade upon the establish goodwill, reputation and proprietary rights of the plaintiff in the plaintiff's said trademark/label.
8. The plaintiff has prayed for a decree of permanent injunction against the defendant, a restraint order against the defendant restraining the defendant from disposing off a dealing with their Zino Davidoff SA Vs. Charanjeet Singh 4 assets including their premises and stocks-in-trade, delivery up of finished and unfinished material and rendition of accounts of profits earned by the defendant by the impugned illegal trade activity.
9. The defendant appeared before the court along with his counsel on 23.10.2019. Counsel for the defendant also filed his vakalatnama. However defendant failed to file written statement within the limitation prescribed. The defence of the defendant was struck off on 05.03.2020.
10. On behalf of the plaintiff Ms. Meena Bansal filed her affidavit in evidence. The photograhs/representation of the trademark/label of the plaintiff is Ex.PW-1/1 (colly). The photographs of representation of the impugned trademark/label of the defendant is Ex.PW-1/2. Status report along with registration certification of plaintiff's trademarks/labels is Ex.PW-1/3 (colly). News reports related to the plaintiff is Ex.PW-1/4. Advertisement of the plaintiff's brand, screen shots from the plaintiff's website is Ex.PW-1/5 (colly). Documents showing the availability of plaintiff's books at Amazon, Delhi Duty free shop is Ex.PW-1/6 and copy of authorization letter in favour of Ms. Meena Bansal is Ex.PW-1/7.
Zino Davidoff SA Vs. Charanjeet Singh 5
11. I have heard Ld. Counsel Mr. Virender Kumar Sinha for the plaintiff at length and scrupulously and meticulously gone through the written submissions and rulings filed on record.
12. The testimony of the plaintiff through affidavit has gone unrebutted, unchallenged and uncontroverted and are substantiated from the record. I have no reason to disbelieve the same.
13. The plaintiff has also prayed for grant of damages. It has been argued on behalf of the plaintiff that damages must be awarded against the defendant as he has chosen to remain evasive. It is further argued that to discourage the defendant from indulging in acts of deception. The damages may be awarded to the plaintiff.
Ld. Counsel for the plaintiff has prayed the court for grant of punitive damages and has relied upon Super Cassettes Industries Vs. M/s. Rachna Television Pvt.Ltd. CS (OS) 1742/2009 decided on 13.05.2013 and Time Incorporated Vs. Lokesh Shrivastava and Another 116 (2005) DLT 599. However the aforesaid judgments have been over ruled by division bench of our own Hon'ble High Court in case titled as Hindustan Unilever Ltd. Vs. Reckitt Benckiser India Ltd. ILR (2014) II Delhi 1288, wherein it was held that, Zino Davidoff SA Vs. Charanjeet Singh 6 "65. As far as punitive damages are concerned, the learned Single Judge relied in Lokesh Srivastava and certain other rulings. Here, since the Court is dealing with a final decree - and a contested one at that (unlike in the case of trademark and intellectual property cases, where the courts, especially a large number of Single Judge decisions proceeded to grant such punitive damages in the absence of any award of general or quantified damages for infringement or passing off), it would be necessary to examine and re-state the governing principles.
66. Rookes v. Barnard, [1964] 1 All ER 367, is the seminal authority of the House of Lords, on the issue of when punitive or exemplary (or sometimes alluded to as "aggravated") damages can be granted. The House defined three categories of case in which such damages might be awarded.
These are:
RFA (OS) 50/2008 Page 59 a. Oppressive, arbitrary or unconstitutional action any the servants of the government; b. Wrongful conduct by the defendant which has been calculated by him for himself which may well exceed the compensation payable to the claimant; and c. Any case where exemplary damages are authorised by the statute.
The later decision in Cassell & Co. Ltd. v. Broome, 1972 AC 1027, upheld the categories for which exemplary damages could be awarded, but made important clarificatory observations. Those relevant for the present purpose are reproduced below:
Zino Davidoff SA Vs. Charanjeet Singh 7 "A judge should first rule whether evidence exists which entitles a jury to find facts bringing a case within the relevant categories, and, if it does not, the question of exemplary damages should be withdrawn from the jury‟s consideration. Even if it is not withdrawn from the jury, the judge‟s task is not complete. He should remind the jury: (i) that the burden of proof rests on the plaintiff to establish the facts necessary to bring the case within the categories. (ii) That the mere fact that the case falls within the categories does not of itself entitle the jury to award damages purely exemplary in character. They can and should award nothing unless
(iii) they are satisfied that the punitive or exemplary element is not sufficiently met within the figure which they have arrived at for the plaintiff‟s solatium in the sense I have explained and (iv) that, in assessing the total sum which the defendant should pay, the total figure awarded should be in substitution for and not in addition to the smaller figure which would have been treated as adequate solatium, that is to say, should be a round sum larger than the latter and satisfying the jury‟s idea of what the defendant ought to pay. (v) I would also deprecate, as did Lord Atkin in Ley v. Hamilton, 153 L.T. 384 the use of the word "fine" in connection with the punitive or exemplary element in damages, where it is appropriate. Damages remain a civil, not a criminal, remedy, RFA (OS) 50/2008 Page 60 even where an exemplary award is appropriate, and juries should not be encouraged to lose sight of the fact that in making such an award they are putting money into a plaintiff's pocket, and not contributing to the rates, or to the revenues of central government." (emphasis supplied).
Zino Davidoff SA Vs. Charanjeet Singh 8 The House of Lords, in its discussion, remarked crucially that there is a considerable subjective element in the award of damages in cases involving defamation and similar actions. Courts, it remarked, used terminology to reflect overlapping, and sometimes undesirable ideas underlining the considerations weighing grant of damages:
"In my view it is desirable to drop the use of the phrase "vindictive" damages altogether, despite its use by the county court judge in Williams v. Settle [1960] 1 W.L.R. 1072. Even when a purely punitive element is involved, vindictiveness is not a good motive for awarding punishment. In awarding "aggravated" damages the natural indignation of the court at the injury inflicted on the plaintiff is a perfectly legitimate motive in making a generous rather than a more moderate award to provide an adequate solatium. But that is because the injury to the plaintiff is actually greater and, as the result of the conduct exciting the indignation, demands a more generous solatium. Likewise the use of "retributory" is objectionable because it is ambiguous. It can be used to cover both aggravated damages to compensate the plaintiff and punitive or exemplary damages purely to punish the defendant or hold him up as an example. As between "punitive" or "exemplary," one should, I would suppose, choose one to the exclusion of the other, since it is never wise to use two quite interchangeable terms to denote the same thing. Speaking for myself, I prefer "exemplary," not because "punitive" is necessarily inaccurate, but "exemplary"
better expresses the policy of the law as expressed in the cases. It is intended to Zino Davidoff SA Vs. Charanjeet Singh 9 teach the defendant and others that "tort does not pay" by demonstrating what consequences the law inflicts rather than simply to make the defendant RFA (OS) 50/2008 Page 61 suffer an extra penalty for what he has done, although that does, of course, precisely describe its effect.
The expression "at large" should be used in general to cover all cases where awards of damages may include elements for loss of reputation, injured feelings, bad or good conduct by either party, or punishment, and where in consequence no precise limit can be set in extent. It would be convenient if, as the appellants‟ counsel did at the hearing. it could be extended to include damages for pain and suffering or loss of amenity. Lord Devlin uses the term in this sense in Rookes v. Barnard [1964] A.C. 1129, 1221, when he defines the phrase as meaning all cases where "the award is not limited to the pecuniary loss that can be specifically proved." But I suspect that he was there guilty of a neologism. If I am wrong, it is a convenient use and should be repeated.
Finally, it is worth pointing out, though I doubt if a change of terminology is desirable or necessary, that there is danger in hypostatising "compensatory," "punitive,"
"exemplary" or "aggravated" damages at all.
The epithets are all elements or considerations which may, but with the exception of the first need not, be taken into account in assessing a single sum. They are not separate heads to be added mathematically to one another."
67. In India, the Supreme Court has affirmed the principles in Rookes (supra) and Cassel Zino Davidoff SA Vs. Charanjeet Singh 10 (supra). Interestingly, however, the application in those cases has been in the context of abuse of authority leading to infringement of Constitutional rights or by public authorities (ref. Ghaziabad Development Authority v. Balbir Singh, (2004) 5 SCC 6; Lucknow Development Authority v. M.K. Gupta, 1994 SCC (1) 243). As yet, however, the Supreme Court has not indicated the standards which are to be applied while awarding punitive or exemplary damages in libel, tortuous claims with economic overtones such as slander of goods, or in respect of intellectual property matters. The peculiarities of such cases would be the courts‟ need to evolve proper RFA (OS) 50/2008 Page 62 standards to ensure proportionality in the award of such exemplary or punitive damages. The caution in Cassel that "[d]amages remain a civil, not a criminal, remedy, even where an exemplary award is appropriate, and juries should not be encouraged to lose sight of the fact that in making such an award they are putting money into a plaintiff‟s pocket...." can never be lost sight of. Furthermore - and perhaps most crucially -the punitive element of the damages should follow the damages assessed otherwise (or general) damages; exemplary damages can be awarded only if the Court is "satisfied that the punitive or exemplary element is not sufficiently met within the figure which they have arrived at for the plaintiff‟s solatium". In other words, punitive damages should invariably follow the award of general damages (by that the Court meant that it could be an element in the determination of damages, or a separate head altogether, but never completely without determination of general damages).
Zino Davidoff SA Vs. Charanjeet Singh 11
68. This court is of the opinion that the impugned judgment fell into error in relying on the decision in Times Incorporated v. Lokesh Srivastava 116 (2005) DLT 569. A Single Judge articulated, in his ex parte judgment in a trademark infringement action, as follows:
"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. reported in 347 F.3d 672 (7th Cir. 2003) the factors underlying the RFA (OS) 50/2008 Page 63 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 to tortfeasor is caught only half the time he commits torts, then when he is caught he should be punished 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 Zino Davidoff SA Vs. Charanjeet Singh 12 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 is 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."
With due respect, this Court is unable to subscribe to that reasoning, which flies on the face of the circumstances spelt out in Rookes and later affirmed in Cassel. Both those judgments have received approval by the Supreme Court and are the law of the land. The reasoning of the House of Lords in those decisions is categorical about the circumstances under which punitive damages can be awarded. An added difficulty in holding that every violation of statute can result in punitive damages and proceeding to apply it in cases involving economic or commercial causes, such as intellectual property and not in other such matters, would be that even though statutes might provide penalties, prison sentences and fines (like under the Trademarks Act, the Copyrights Act, Designs Act, etc) and such provisions invariably cap the amount of fine, sentence or statutory compensation, civil courts can nevertheless proceed unhindered, on the assumption that such causes involve RFA (OS) 50/2008 Page 64 criminal propensity, and award "punitive" damages despite the plaintiff‟s inability to prove any general damage. Further, the reasoning that Zino Davidoff SA Vs. Charanjeet Singh 13 "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" is plainly wrong, because where the law provides that a crime is committed, it indicates the punishment. No statute authorizes the punishment of anyone for a libel- or infringement of trademark with a huge monetary fine-which goes not to the public exchequer, but to private coffers. Moreover, penalties and offences wherever prescribed require the prosecution to prove them without reasonable doubt. Therefore, to say that civil alternative to an overloaded criminal justice system is in public interest would be in fact to sanction violation of the law. This can also lead to undesirable results such as casual and unprincipled and eventually disproportionate awards.
Consequently, this court declares that the reasoning and formulation of law enabling courts to determine punitive damages, based on the ruling in Lokesh Srivastava and Microsoft Corporation v. Yogesh Papat and Another, 2005 (30) PTC 245 (Del) is without authority. Those decisions are accordingly overruled. To award punitive damages, the courts should follow the categorization indicated in Rookes (supra) and further grant such damages only after being satisfied that the damages awarded for the wrongdoing is inadequate in the circumstances, having regard to the three categories in Rookes and also following the five principles in Cassel. The danger of not following this step by step reasoning would be ad hoc judge centric award of damages, without discussion of the extent of harm or injury suffered by the plaintiff, on a mere whim that the defendant‟s action is so wrong that it has a Zino Davidoff SA Vs. Charanjeet Singh 14 "criminal" propensity or the case RFA (OS) 50/2008 Page 65 merely falls in one of the three categories mentioned in Rookes (to quote Cassel again - such event "does not of itself entitle the jury to award damages purely exemplary in character").
14. Further on similar facts, in case titled as Super Cassettes Industries Pvt.Ltd. Vs. HRTN Cable Network, 2017 SCC online Delhi 10943, where the defendants were exparte and did not participate in the proceedings, counsel for the plaintiff sought punitive damages which was declined in view of the judgment of Hindustan Unilever Ltd.(supra). However, as per law laid down by Hon'ble Division Bench in case of Hindustan Unilever Ltd. (supra), it is needed to be seen whether the case of the plaintiff falls for exemplary damages. The local commissioner vide executing the commission seized the large quantity of infringed goods from the premises of the defendant in his presence and also handed over the same through the defendant on superdari. It is established that the defendant was selling/passing off the infringed goods bearing the trademark 'DAVIDOFF'. The total number of of DAVIDOFF (fragrances) product seized were 345. Further, if the infringed goods would have gone to the hands of consumer/general public, the reputation/goodwill of the plaintiff company would have been Zino Davidoff SA Vs. Charanjeet Singh 15 brought down in the eyes of consumer/general public. The Hon'ble Division Bench in the case of Hindustan Unilever Ltd.(supra) declined punitive damages, however granted exemplary damages as the contesting defendant persisted with the disparaging advertisement of the plaintiff's product and kept on contesting the issue. On the other hand, in the instant case the defendant did not show up and participate in the proceedings in order to deprive the plaintiff of the benefit of rendition of accounts and therefore, in the totality of the facts and circumstances, I am of the opinion that the plaintiff company is entitled to exemplary damages amounting to Rs.5,00,000.00.
15. The evidence brought on record proves that the adoption and use of the plaintiff's mark are bound to lead to confusion and deception amongst the purchasing public and trade which is an attempt by the defendant to take unfair advantage in business and is contrary to honest trade practices. The use of such marks by the defendants' shall cause damage and injury to the plaintiff's business and to its goodwill and reputation. The law on the subject is well settled. In case of infringement either of trademark or of copyright an injunction must follow, the grant of injunction is necessary as adoption of the mark by the defendant is dishonest.
Zino Davidoff SA Vs. Charanjeet Singh 16
16. In view of the facts and circumstances of the case, I pass a decree of permanent injunction restraining the defendants, their agents, servants, directors, partners, assigns, franchisees, distributors and proprietors from manufacturing, marketing, using, selling, soliciting, networking, displaying, advertising, importing, exporting (in any manner or through any port of India) or through online mediums/platform/social medias etc. or by any other mode or manner dealing with the impugned trademarks/labels 'DAVIDOFF', 'DAVIDOFF COOL WATER' or any other trademark/labels identical with or deceptively similar to the plaintiff's said trademarks/labels-'DAVIDOFF', 'DAVIDOFF COOL WATER', colour scheme, artistic features, copyright etc.in relation of the impugned goods and other allied and cognate goods or from doing any other acts or deeds amounting to infringement/passing off/dilution/infringement of the plaintiff's trademark and copyright in the said 'DAVIDOFF', 'DAVIDOFF COOL WATER'. Further suit is also decreed in favour of the plaintiff and against the defendant qua delivery up of all seized articles bearing the impugned and violative trademark/label of the plaintiff company and superdarinama is canceled. Further, the suit of the plaintiff is also decreed in favour of the plaintiff and against the defendant qua damages amounting to Rs.5,00,000.00.
Zino Davidoff SA Vs. Charanjeet Singh 1717. Suit is accordingly decreed in favour of the plaintiff and against the defendant with cost of the suit. Decree sheet be prepared after payment of deficit court fee. File be consigned to Record Room.
(NISHA SAXENA) District Judge(Commercial Court)-04 Central/Delhi Announced in open court On 30.09.2020 rt Zino Davidoff SA Vs. Charanjeet Singh 18