Document Fragment View

Matching Fragments

12. Submissions of Mr.Rishab Gupta, learned counsel, for MFC:-

The dispute with respect to MFC's exercise of quality control and MFC's license to TAFE to use the MF trademarks on the concerned products is a contractual issue that is governed by the terms of the individual agreements, namely, 1961 Technical Assistance Agreement, 1994 Trade Mark Registered Users Agreement, 2010 Intellectual Property License and Technical Assistance Agreement and 2012 Farm Machinery/Distributor Agreement. Even under the Trade Marks Act, 1999, the question of whether a licensor has prescribed, and complied https://www.mhc.tn.gov.in/judis O.A.Nos.744 of 2024 etc. with, quality control measures, is determined on the basis of the license agreement executed by it. Therefore, these disputes are to be resolved under the dispute resolution forum provided under those individual agreements in accordance with the terms of those individual agreements. In this regard, it is pertinent to note that FMDA arbitration is already underway in London under the ICC Rules between TAFE and MFC. Under the FMDA arbitration, the proceedings of the arbitration will reveal that TAFE and MFC have agreed to go for mediation to resolve quality control disputes between them. Courts have held that there is no necessity to file a separate application under Section 45 of the Arbitration and Conciliation Act, 1996, in case of international commercial arbitration, to refer the dispute to arbitration. DISCUSSION:

j) TAFE has through its Research and Development (R&D) activities launched over 30+ tractor models and 500+ tractor model variants over MF brands. TAFE has developed dealership network across the country and covers 95% of the Indian tractor market.

16. The suit in C.S(Comm.Div.)No.190 of 2024 has been filed by TAFE against MFC on the ground that MFC has abandoned its trademark 'MASSEY FERGUSON' in India, as they have not exercised quality control measures over TAFE, who has been using the MF brands continuously without any interruption from 1960 onwards. TAFE has therefore taken the plea of naked licensing. When a trademark licensor fails to supervise its licensee and allows the licensee to depart from the licensor's quality standards, it may be deemed 'naked licensing', that results in abandonment of the trademark.

m) The percentage of the licensee’s relevant inventory that is supplied by the licensor.
n) The licensor’s knowledge of the licensee’s quality control procedures.
o) Whether a “special relationship exists” between the parties; taking into account, among other factors, how close a working relationship the licensor and licensee have, whether the owners of the licensor and licensee are related in a familial sense, and whether and to what extent there is an overlap of ownership and/or management between the licensor and licensee.

https://www.mhc.tn.gov.in/judis O.A.Nos.744 of 2024 etc.

28. A determination as to whether or not a trademark owner/licensor maintains sufficient quality control over a licensee’s products or services is a fact-intensive analysis, which cannot be decided in these interlocutory applications, and it can be decided only after trial.