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Wednesday, November 23, 2011

Territorial Jurisdiction Of Court Where The Trademark Application Is Applied For Registration

South African Breweries International (Finance) B.V. a company registered in Netherlands, along with its Indian joint venture company, promoted with SAB Group filed a suit for permanent injunction, rendition of accounts, damages and delivery up of the infringing packaging and material against Mohan Goldwater Breweries Ltd in year 2002 & Anr.

The trademark “CASTLE”, which was originally adopted and used by Charles Glass, doing business as Glass & Company in respect of “beer”, in the year 1884. In 1895, Glass & Company was taken over by the South African Breweries Limited, which assigned worldwide rights in the trademark CASTLE to Avalon International Incorporate, which subsequently changed its name to SABMARK International Incorporated. Subsequently, SABMARK International assigned those rights to South African Breweries International Holdings Inc., which, in turn, assigned them to South African Breweries International (Finance) B.V i.e. Plaintiff herein. It claimed registration of the trademark CASTLE and CASTLE label in respect of beer in a large number of countries and also claims sale of US$ 1billion. According to the them, the trademark CASTLE is a well-known mark in India and is well-recognized worldwide on account of its extensive availability in various countries and duty free shop of various airports. It also claimed to be sponsoring the South African Cricket team for past 10 years and claimed that on account of such wide publicity, Indians would be familiar with the trademark CASTLE. It was also alleged that they had been selling beer in India since 1974, under the trademark CASTLE. They also applied for registration of CASTLE (label) on 29th April, 1995 and the word mark CASTLE on 6th February, 1996. The registrations were granted during pendency of the suit.
The Mohan Goldwater Breweries Ltd i. e. Defendant no. 1 herein sent a notice dated 15th April, 2002 to South African Breweries International (Finance) B.V. i.e. plaintiff claiming ownership of the trademark CASTLE PILSNER in respect of beer. They also claimed that the trademark OLD CASTLE and CASTLE were registered in their favour on 30th May, 1972 and 22nd October, 1973 respectively and also claimed that the plaintiffs were passing off their goods as those originating from the defendants and, thereby infringing their registered trademark.
On enquiry, the plaintiffs came to know that the trademark registrations in favour of the defendants had been removed from the record of Registrar of Trademarks and in fact, the defendants never sold any product bearing the trademark CASTLE. The plaintiffs had sought an injunction, restraining the defendants from manufacturing, selling, offering for sale or advertising any beer or alcoholic beverages, using the trademark CASTLE. They also sought delivery up of all the goods, packaging material bearing the impugned mark besides damages of Rs 20,00,000/-.
The defendant no. 1 contested and filed a written statement taking a preliminary objection that since it was carrying on business of manufacture and sale of beer under the trademark CASTLE only in Uttar Pradesh, Delhi Court has no jurisdiction to try the suit. It is claimed that CASTLE is one of the oldest brands being used by defendant No. 1 to sell its beer and it has been selling bear using the trademarks CASTLE and OLD CASTLE since 1970-71. It is also alleged that registration of the trademark OLD CASTLE (label) was granted to defendant No. 1 on 30th May, 1972 vide Trade Mark No.280552, whereas registration of the trademark CASTLE PILSNER STRONG BEER label was granted w.e.f. 22nd October, 1973, vide Trade Mark Registration No. 291623. It was also claimed that the renewal of the aforesaid trademarks was applied by defendant No. 1 on 13th June, 2000 and 17th May, 2000 respectively. It was also claimed that since the trademark CASTLE is being used by defendant No. 1, the plaintiffs have no right to use the aforesaid mark.
There was also another defendant in the matter, but in 2010, The matter between the plaintiff and defendant No.2 was compromised vide settlement contained in IA No. 4700/2010. Under the settlement, the plaintiff acknowledged defendant No. 2 to be the proprietor of the trademark KING CASTLE in respect of whisky, whereas defendant No. 2 acknowledged the plaintiffs to be the proprietors of the trademark CASTLE in respect of beer and other non-alcoholic beverages falling under International Class 32 of the Trademarks Act. Defendant No. 2 undertook not to use the trademark CASTLE in respect of beer or any other goods falling in Class 32 of the Trademarks Act. It also undertook not to seek registration of the trademark CASTLE for any goods falling in Class 32 of Trademarks Act.

On the question of territorial jurisdiction, Plaintiff alleged that Defendant No.1 is a Company having offices in Lucknow as well as in Delhi. Delhi office of defendant No.1 was stated to be 4F, Hansalya, 15, Barakhamba Road, New Delhi. Reliance was placed on Section 20 of the Code of Civil Procedure, it provides that every suit shall be instituted in a Court within the local limits of whose jurisdiction, the defendant, at the time of the commencement of the suit, actually and voluntarily resides, or carries on business, or personally works for gain or in a Court within local limits of whose jurisdiction, the cause of action, wholly or in part, arises. The explanation to Section 20 provides that a corporation shall be deemed to carry on its business at its sole or principal office in India or in respect of any cause of action arising at any place where it has also a subordinate office, at such place. Therefore, if the cause of action either wholly or in part arose in the jurisdiction of this Court, it would have territorial jurisdiction to try the present suit. It was also alleged that defendant no. 2 has office in Delhi and products of the Defendant no. 1 were also sold in Delhi. The defendant no. 1 denied having any office in Delhi or selling any products in Delhi. It was further claimed that since the plaintiffs had learnt that the defendants had applied for registration of trade mark in Delhi, they could claim for injunction to prevent any sale of the infringing products in Delhi and in that case, Delhi Courts would have jurisdiction, whether any sale in Delhi has taken place or not.

The Court applied the ratio laid down by Supreme Court in Dhodha House and observed that in the opinion of this Court was that an advertisement by itself in a Trade Mark Journal would not confer jurisdiction on a Court within whose territorial limit the advertisement is published or is seen. In the opinion of this Court, if an application for registration of the impugned trade mark is made in the territorial jurisdiction of a Court that Court would have jurisdiction to try the suit relating to the particular trade mark. Since defendant No.1 applied for registration of the trade mark to the Registrar of Trade Marks at Delhi, as is evident from the advertisements, this Court would have jurisdiction to try the present suit.

The Court also relied on Exphar SA & Anr. v. Eupharma Laboratories Ltd. & Anr. AIR 2004 SC 1682, where a cease and desist notice was given to the plaintiff at its office in New Delhi alleging infringement of the copyright of defendant No.1 by the plaintiff. Supreme Court held that a cease and desist notice in a copyright action cannot, particularly in view of Section 60 of the Act, be termed as a mere notice which is not sufficient to confer jurisdiction and that such a threat may give rise to a right to institute a suit but counter such threat and ask for relief on the ground that the alleged infringement to which the threat related was in fact an infringement of any legal right of the person making such threat. Section 60 of the Copyright Act is identical to Section 142 of the Trademarks Act and therefore this judgment does support the proposition that if a cease and desist notice is received at Delhi, the Courts would have jurisdiction to entertain a suit at the instance of the person to whom such a notice is given.

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