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Exemplary/Punitive Damages awarded by Courts in cases of Dishonest Adoption of Trade Marks

56. In Whatman International Ltd. v. P. Mehta, 2019 (78) PTC 51 (Del), the plaintiff filed a suit for infringement of trade mark and passing off against Defendants for using the Plaintiff‟s registered trade mark WHATMAN in relation to filter paper, as well as colour combination of white background and blue script of the trade dress. The Plaintiff complained that the Defendants had a long history of infringing the Plaintiff‟s trade mark and were committing infringement in spite of giving undertaking. Criminal proceedings were also pending against some of the Defendants on account of such unauthorized use of the trade mark. After perusing the pleadings on record and the submissions made by the Defendants, the Court came to the conclusion that the Defendants had not W.P.(C) seriously contested the Plaintiff‟s rights in the trade mark WHATMAN or in the white and blue colour combination of the trade dress. The Defendants had also offered to pay token compensation. However, the Defendants had made a number of false pleadings such as " ...The Defendant No. 2 has never manufactured or sold filter paper under the trade mark WHATMAN...‖; ―...The defendant No. 5 has never manufactured or sold filter paper under the trade mark WHATMAN...‖. The Defendants also made false statements with respect to having no connection with each other‟s business. These statements were found to be false based on the material placed on record as well as testimony given during Defendants‟ cross- examination. Further, during pendency of the proceedings and in spite of injunction order, some of the Defendants were found to be selling the goods under the infringing marks subject matter of the suit. Noting the same, the Court recorded as under:

"64. The Defendants are clearly not coming clean with the Court. They are not only making false statements in their pleadings, but are also misleading the Court by trying to create a farcical cloak of independent businesses. The illegality of selling WHATMAN counterfeit paper and lookalike filter paper has continued since the time when the first FIR was registered in 1993. 


                     W.P.(C)






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71. Even in 2018, Defendant No. 3, Mr. Mohit Mehta and Defendant No. 7, M/s. Shri Maruti Chem Enterprise Ltd. had WHATMAN filter paper when the police searched the premises. There is no doubt whatsoever that throughout the period despite giving undertakings, and despite the interim injunction, the Defendants have jointly carried out business of counterfeit Whatman filter paper and lookalike filter paper. They are guilty of infringement and passing off. They are also liable for making false statements before Court, which results in impediment of the administration of justice. The violation of the orders of the Court and non-adherence to repeated undertakings given constitutes willful disobedience. First, the Defendants ought not to have manufactured/sold counterfeit WHATMAN filter paper. They also were clearly in the know when they started using similar get-up, colour combination and layout/arrangement for filter paper under their own marks, which were identical/similar to the WHATMAN filter paper. These are deliberate and conscious acts of the Defendants to pass off and earn monetary gain. The initial FIR in 1993 ought to have been sufficient to dissuade the Defendant Nos. 1 to 5 and 7 from using the WHATMAN mark and/or selling filter paper in an identical colour combination or get up. The said FIR obviously did not have its effect despite the complaint being closed after undertakings given by Mr. Bharat Patel, Mr. Jatin Parekh and Mrs. Jagruti P. Mehta. Mr. Paresh Mehta, through his wife and son started a new firm by the name M/s. Shri Maruti Chem Enterprise Pvt. Ltd. for doing business of identical/pass off filter papers. In 2018, when the FIR was registered, Mr. Mohit Mehta was even arrested. The modus operandi is clearly to hoodwink the authorities and over reach the Court process. Any W.P.(C) compassion shown to such persons would clearly send the wrong message.‖ (Emphasis supplied) In Whatman's case, this Court followed the standard for awarding punitive damages prescribed by Division Bench in Hindustan Unilever Ltd. v. Reckitt Benckiser India Ltd., ILR 2014 (57) PTC 495 (Del.) (DB) which holds that punitive damages can be awarded after calculation of compensatory damages and if the Court is satisfied that such compensatory damages are inadequate, and not otherwise. In view of the dishonest and brazen conduct on part of the Defendants, the Court awarded damages 1 Crore against the Defendant Nos. 1, 3 & 7 and Rs.25 Lakhs each against Defendant Nos. 2, 4, 5 and Rs.10 lakh against Defendant No. 8 apart from costs of Rs.14.55 Lakhs.