Trademark owner fails to prevent use of mark as part of trade name

India
In Raymond Limited v Raymond Pharmaceuticals Private Limited (Case 437/2006, July 13 2010), the Bombay High Court has rejected Raymond Limited's request for a permanent injunction preventing Raymond Pharmaceuticals Private Limited from using the registered trademark RAYMOND as part of its trade name.

Raymond Limited, one of India's largest textile companies, owns the registered trademark RAYMOND for textile goods in Class 25 of the Nice Classification. It also owns a registration for the word 'Raymond' written in a stylised manner under the Copyright Act 1957. Raymond Pharma, a Chennai-based pharmaceutical company, adopted the word 'Raymond' as part of its trade/business name. Raymond Limited approached the Bombay High Court in 2006, alleging that Raymond Pharma infringed its trademark. The single judge rejected the action in February 2007 (for further details please see "Section 29(4) famous mark protection discussed for the first time"). Raymond Limited moved the division bench of the Bombay High Court, seeking a permanent injunction restraining Raymond Pharma from using the RAYMOND mark as part of its trade name.

Before the court, Raymond Limited argued that:
  • the RAYMOND mark for textile products had built up a "formidable" reputation in India;
  • Raymond Pharma used the RAYMOND mark without due cause; and
  • use of the RAYMOND mark by Raymond Pharma resulted in dilution of the mark and amounted to infringement, even though the goods of both companies were dissimilar.
In its defence, Raymond Pharma argued that:
  • the nature of the parties' business was dissimilar and, therefore, there was no infringement;
  • it used the word 'Raymond' only as part of its business name, and not as a trademark to promote its goods and services; and
  • 'Raymond' is a common Christian name meaning 'mighty protection'.
The court first noted that Section 29 of the Trademarks Act 1999 sets forth the various situations in which there will be infringement of a registered trademark. In particular, Section 29(5) states as follows:

A registered trademark is infringed by a person if he uses such registered trademark as his trade name or as part of his trade name, or as a name for his business concern or as part of the name of his business concern for the same goods or services in respect of which the trademark is registered.”

Therefore, under Section 29(5), if a third party uses a registered trademark as part of its trade name, but for different goods or services, there will be no infringement.

The court also considered Section 159 of the act, which repealed the Trade and Merchandise Marks Act 1958. The court compared the provisions of the two acts, and pointed out that there was no provision corresponding to Section 29(5) in the Trade and Merchandise Marks Act. Section 29(5) was a new provision which was incorporated in the Trademarks Act to prevent a third party from adopting a registered trademark as a trade name, by explicitly providing that such action would constitute infringement under the act. The court also noted that Section 29(5) brought the act into line with the proposed amendments to Sections 20 and 22 of the Companies Act 1956. Under the amendments, an application for the registration of a company name may be rejected if such name is similar to a registered trademark.

Further, comparing the Trademarks Act and the Companies Act, the court observed that Section 29(5) was incorporated in the Trademarks Act for a definite purpose. Based on the legislative intent, the court observed that there will be trademark infringement only where the defendant adopts a registered trademark as part of its trade name and deals in goods that are similar to those for which the trademark is registered. In the present case, although Raymond Pharma adopted a trade name that was similar to Raymond Limited's trademark, it dealt in different goods and, therefore, there was no trademark infringement. Accordingly, the court refused to grant injunctive relief to Raymond Limited and dismissed the appeal.

The court did not find it necessary to consider Raymond Limited's arguments that:
  • its mark had a reputation in India;
  • use of the RAYMOND mark by Raymond Pharma as part of its trade name was without due cause; and
  • use of the RAYMOND mark by Raymond Pharma diluted the mark.
Prerak Hora, Nishith Desai Associates - Legal & Tax Counselling Worldwide, Mumbai

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