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New Balance Athletics Inc vs Naveen Kumar Gupta, Trading As Star ... on 4 March, 2022

Author: Jyoti Singh

Bench: Jyoti Singh

                          $~18
                          *    IN THE HIGH COURT OF DELHI AT NEW DELHI
                          +     CS(COMM) 140/2022

                                NEW BALANCE ATHLETICS INC.            ..... Plaintiff
                                            Through: Mr. Dushyant Kumar Mahant and
                                                     Mr. Urfee Roomi, Advocates.
                                                   Versus
                                NAVEEN KUMAR GUPTA, TRADING
                                AS STAR ENTERPRISES                                   ..... Defendant
                                              Through:
                                CORAM:
                                HON'BLE MS. JUSTICE JYOTI SINGH
                                              ORDER

% 04.03.2022 I.A. 3525/2022 [U/o XI Rule 1(4) of the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015 r/w S. 151 CPC seeking leave to file additional documents]

1. Present application has been preferred on behalf of the Plaintiff seeking leave to file additional documents under the Commercial Courts Act, 2015.

2. 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, 2015.

3. Application is disposed of, accordingly.

I.A. 3526/2022 (for seeking exemption from filing clearer copies of documents and originals of relevant documents)

4. Allowed, subject to all just exceptions.

5. Plaintiff shall file the originals of documents, which are in its Signature Not Verified Digitally Signed By:KAMAL KUMAR CS(COMM) 140/2022 Page 1 of 9 Signing Date:11.05.2022 12:20:47 possession, within two weeks from today.

6. Accordingly, application stands disposed of. I.A. 3527/2022 [S. 12(A) of the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015 r/w S. 151 CPC seeking exemption from pre-litigation mediation]

7. For the reasons stated in the application, the requirement of pre- institution mediation is dispensed with.

8. Accordingly, the application is allowed and disposed of. I.A. 3529/2022 (seeking exemption from issuing advance notice to the Defendant)

9. For the reasons stated in the application and looking to the urgency of the interim relief claimed, the Court is issuing notice in the matter and hence the application has become infructuous.

10. Application is allowed and disposed of.

I.A. 3530/2022 (Exemption from filing apostilled power of attorney)

11. Subject to the Plaintiff filing apostilled Power of Attorney, authorising the Plaintiff to prosecute the present matter within 30 days from today, exemption is granted for the present.

12. Application is allowed and disposed of.

CS(COMM) 140/2022

13. Let the plaint be registered as a suit.

14. Upon filing of process fee, issue summons to the Defendant, through all permissible modes, returnable on 07.04.2022. Summons shall state that the written statement shall be filed by the Defendant within 30 days from the receipt of summons. Along with the written statement, Defendant shall also Signature Not Verified Digitally Signed By:KAMAL KUMAR CS(COMM) 140/2022 Page 2 of 9 Signing Date:11.05.2022 12:20:47 file an affidavit of admission/denial of the documents of the Plaintiff.

15. Replication be filed by the Plaintiff within 15 days of the receipt of the written statement. Along with the replication, an affidavit of admission/denial of documents filed by the Defendant, shall be filed by the Plaintiff. If any of the parties wish to seek inspection of any documents, the same shall be sought and given within the timelines.

16. List before the Joint Registrar for marking of exhibits on 23.03.2022.

17. List before the Court on 07.04.2022 for framing of issues. I.A. 3524/2022 (Under Order XXXIX Rules 1 & 2 CPC)

18. Issue notice to the Defendant, through all permissible modes, returnable on 07.04.2022.

19. Plaintiff is a Company incorporated under the laws of the State of Massachusetts, United States of America. Plaintiff had its beginning in the year 1906 in U.S.A. and today is engaged in the design, manufacture, marketing and sale of footwear, readymade clothing in over 120 countries, including India.

20. Plaintiff is the proprietor of various trademarks in India and around the world amongst which the most prominent marks are the letter combination NB, NB Device, variations of the Device mark and marks that incorporate the NB marks. The letter combination 'NB' was first used as a trademark on footwear and readymade clothing in U.S.A in the year 1974 and since then Plaintiff has used the said combination as a trademark in relation to retail services in numerous countries, including India. Owing to the long term and extensive use, Plaintiff's marks have acquired immense goodwill and reputation in the market. The net revenue owing to sale of goods bearing the Plaintiff's marks has shown Signature Not Verified Digitally Signed By:KAMAL KUMAR CS(COMM) 140/2022 Page 3 of 9 Signing Date:11.05.2022 12:20:47 an impressive and steady increase over the years as per the data reflected in the plaint. Plaintiff also claims to have promoted and advertised its goods and services bearing the marks around the world, on which it has spent enormous money and the figures in respect thereof have been furnished in the plaint. Plaintiff has expanded its reach on the World Wide Web by establishing official accounts on various social media websites, which are immensely popular with the consumers worldwide. Plaintiff also claims to have over the years sponsored various sports teams, leagues, etc. The Plaintiff's marks are stated to have acquired the status of well-known marks under Article 6bisof the Paris Convention.

21. Since 1986, Indian consumers, according to the Plaintiff, have purchased the footwear bearing the Plaintiff's marks on travelling to various countries, where the Plaintiff operates retail stores. Indian consumers have also purchased the footwear through various e- commerce platforms, such as Amazon.in, Flipkart.in, etc.

22. In 2016, Plaintiff entered into a Franchisee Agreement with a leading Indian party, authorising it to operate retail stores to sell the Plaintiff's goods, including footwear, in India and in the same year the Plaintiff's flagship store was opened in Noida, UP. Given the reputation of the Plaintiff's footwear etc., the goods have received wide media coverage as well as publicity through magazines, blogs etc.

23. Plaintiff owns valid and subsisting registration for its trademarks including in Class 25 (clothing, footwear, headgear) for footwear, for which the registration was granted on 18.05.1987.

24. Defendant, on the other hand, is engaged in business of manufacturing, marketing and wholesaling footwear, which bears the Signature Not Verified Digitally Signed By:KAMAL KUMAR CS(COMM) 140/2022 Page 4 of 9 Signing Date:11.05.2022 12:20:47 mark 'AB'. Defendant sells the footwear throughout the country including Delhi as well as on e-commerce platforms.

25. It is the case of the Plaintiff that in January, 2022, during a routine search on the Internet, Plaintiff's Indian representative found use of Defendant's mark on the footwear and alerted the Plaintiff of the illegal and unauthorised use. Subsequently, services of an Investigating Firm were engaged and the investigation revealed that the Defendant, in addition to using the mark on the footwear, uses the Defendant's mark on online marketing and promotional material. Accordingly, on 28.01.2022, Plaintiff's Indian representative sent a legal notice to the Defendant followed by a reminder on 07.02.2022, however, there was no response and the Defendant continues to use the mark, which is nearly identical to the Plaintiff's marks. For a comparison the two marks are scanned and placed below:

Defendant's Mark Plaintiff's Mark Signature Not Verified Digitally Signed By:KAMAL KUMAR CS(COMM) 140/2022 Page 5 of 9 Signing Date:11.05.2022 12:20:47

26. Learned counsel appearing for the Plaintiff contends that the Defendant's mark is nearly identical to the Plaintiff's marks NB, which is duly registered. Just like the Plaintiff's marks, the Defendant's mark features two capital letters with stylised horizontal lines. While the Defendant has replaced the letter N with letter A, the identity in the stylisation of the rival marks is wholly apparent. Moreover, the goods, namely, footwear, are identical and there is a likelihood of confusion in the public, which includes likelihood of association of the Defendant's mark with the Plaintiff and the Plaintiff's marks.

27. It is further contended that the illegal, fraudulent, unfair and dishonest acts of the Defendant amount to (i) infringement of the Plaintiff's trademark rights in the Plaintiff's marks; (ii) passing off; and

(iii) unfair competition. Defendant is completely aware of the Plaintiff's rights and reputation and has adopted and is using the mark to unlawfully benefit from the goodwill attached to the Plaintiff's marks. It is emphasised that both the Plaintiff and Defendant also sell their footwear through e-commerce portals that are directed towards the same consumers and therefore not only is the Defendant's mark nearly identical to the Plaintiff's marks but respective trade channels and the Signature Not Verified Digitally Signed By:KAMAL KUMAR CS(COMM) 140/2022 Page 6 of 9 Signing Date:11.05.2022 12:20:47 users are same.

28. In view of the above, Plaintiff has established a prima facie case in its favour for grant of ex-parte ad-interim injunction. The balance of convenience also lies in favour of the Plaintiff and irreparable loss shall be caused to the Plaintiff, in case an ex-parte interim injunction is not granted. Accordingly, till the next date of hearing, Defendant, his employees, agents, dealers, licensees, companies, retailers, wholesalers, distributors or any persons/entities that are under the control of the Defendant and all others, acting for and on behalf of the Defendant are:-

(a) restrained from manufacturing, offering for sale, selling, displaying, advertising, marketing, whether directly or indirectly, and whether on the Internet or otherwise, footwear and any other similar/related/allied/cognate goods bearing the Defendant's Mark, as scanned and referred to above, and Marks that incorporate the Defendant's Mark, or any other mark that is identical/deceptively similar to the Plaintiff's Marks (as referred to in para 2 of the present application).

29. Provisions of Order XXXIX Rule 3 CPC shall be complied with by the Plaintiff, within a period of five days from today.

I.A. 3528/2022 (for appointment of Local Commissioner)

30. Present application has been preferred by the Plaintiff under Order XXVI Rules 9 & 10 CPC and Order XXXIX Rule 7 read with Section 151 CPC, seeking appointment of a Local Commissioner.

31. Learned counsel for the Plaintiff prays for appointment of a Local Commissioner to visit the premises of the Defendant.

32. Upon hearing, the application is allowed.

33. Accordingly, Mr. Davesh Vashishtha, Advocate (Mobile No.9958445115) is appointed as a Local Commissioner, who shall visit the premises of the Defendant at the following addresses :-

                          (i).    J-3079,
                                  DSIIDC Industrial Complex,
                                  Narela, Delhi - 110040

                                        AND
                          (ii).   J-3237,
                                  Narela Industrial Area,
                                  DSIIDC, Delhi- 110040

                          34.     The Local Commissioner shall :-
                          (a).    Visit the aforesaid premises, search and take into custody, all the

offending/infringing material, as described above and any other incriminating material relating to the goods in question.

(b). Local Commissioner along with the Representative of the Plaintiff and/or its counsel shall be permitted to enter the premises of the Defendant, as aforementioned.

(c). Local Commissioner shall seize the infringing products and hand over the same to the Defendant on superdari, upon the Defendant furnishing an undertaking that it shall produce the goods, so seized, before the Court, as and when further directions are issued in this regard.

(d). Local Commissioner shall be permitted to take photographs/videos of the execution of the Commission. He shall also be entitled to seek police assistance or protection of the Local Police Station, if so required, for the purpose of execution of the order of this Court. The SHO of the concerned Police Station is directed to provide necessary assistance to the Local Commissioner, if sought for.

(e). In case the premises as aforementioned are found locked, the Local Commissioner is at liberty to break open the locks.

(f). Plaintiff shall serve a copy of this order upon the Defendant along with paper book of the suit at the time of execution of the proceedings.

35. Fee of the Local Commissioner is fixed at Rs.1,00,000/-, which shall be paid in advance by the Plaintiff.

36. Report of the Local Commissioner shall be filed within two weeks of the execution of the Commission.

37. Plaintiff shall inform the Registry about the execution of the proceedings by the Local Commissioner and only thereafter Registry shall issue summons of the suit to the Defendant.

38. Copy of this order be given to the learned counsel for the Plaintiff and to the Local Commissioner under the signatures of the Court Master.

39. This order shall not be uploaded on the website of this Court till execution of the Commission by the Local Commissioner.

40. Application is disposed of.

JYOTI SINGH, J MARCH 4, 2022 nn Signature Not Verified Digitally Signed By:KAMAL KUMAR CS(COMM) 140/2022 Page 9 of 9 Signing Date:11.05.2022 12:20:47