Supreme Court Declines to Interfere with Revival of Crocs Inc. USA's Passing Off Suits Against Indian Footwear Manufacturers

 

Summary

The Supreme Court refused to entertain petitions filed by Bata India and Liberty Shoes challenging the Delhi High Court's July 2025 judgment that restored Crocs Inc. USA's passing off suits against several Indian footwear manufacturers, holding that the trial court must independently consider the cases without being influenced by appellate observations.

Background

The dispute stems from Crocs Inc. USA's longstanding litigation before the Delhi High Court alleging that multiple Indian footwear companies—including Bata, Liberty, Relaxo, Action Shoes, Aqualite, and Bioworld Merchandising—copied the shape, configuration, and perforated design of its popular foam clogs. Crocs contended that these elements constitute its trade dress or shape trademark, and that the Indian manufacturers were misleading consumers and benefiting from Crocs' global reputation by producing substantially similar footwear designs.

February 2019 Single Judge Order

In February 2019, a single judge of the Delhi High Court dismissed all six passing off suits at the threshold, holding that Crocs could not maintain passing off actions for the same product configuration that was already protected as a registered design under the Designs Act. The single judge held that allowing passing off protection would effectively extend monopoly rights over features that are governed exclusively by the Designs Act, which provides a limited 15-year term of protection. The judge concluded that once a design is registered, it cannot simultaneously be protected through passing off claims, as this would circumvent statutory limitations and allow indefinite protection of functional or ornamental features.

July 2025 Division Bench Reversal

In July 2025, a Division Bench comprising Justices C Hari Shankar and Ajay Digpaul reversed the single judge's decision, allowing the suits to proceed on the ground that the threshold dismissal required reconsideration. The Division Bench held that the single judge's order was premature and that the substantive merits of Crocs' passing off claims, including the validity of its trade dress rights, consumer confusion, and goodwill associated with the clog design, warranted full trial adjudication. This reversal prompted Bata India and Liberty Shoes to seek relief from the Supreme Court through Special Leave Petitions (SLPs).

Liberty's Arguments Before the Supreme Court

In its petition, Liberty Shoes contended that the Division Bench incorrectly interpreted the Full Bench judgment in Carlsberg Breweries A/S v. Som Distilleries and Breweries Ltd., which established that once a design has been registered under the Designs Act, its protected features cannot concurrently receive passing off protection unless the claimant establishes "something more"—such as trade dress elements extending beyond the registered design itself. Liberty argued that permitting Crocs' passing off suits to proceed would impermissibly create a "dual monopoly," conferring indefinite trademark-style protection on design features that Parliament intended to protect only for a statutorily limited duration under the Designs Act. Liberty further relied on the Full Bench ruling in Mohan Lal v. Sona Paint & Hardwares, which distinguished designs from trademarks by clarifying that designs constitute integral features of goods themselves, whereas trademarks serve as indicators of commercial origin. Importantly, Liberty emphasized that upon expiration of design registration, the protected features enter the public domain and become available for use by competitors, and allowing subsequent passing off claims would frustrate this legislative intent.

Supreme Court's Decision

The Supreme Court Bench comprising Justices Sanjay Kumar and Alok Aradhe dismissed the Special Leave Petitions, observing that the Delhi High Court's Division Bench had merely revived the suits for adjudication by the trial court and had not granted Crocs any substantive relief or made final determinations on the merits of the passing off claims. The Court emphasized judicial restraint, stating: "We are not inclined to entertain this plea. The Delhi High Court has merely restored the suits for consideration by the trial court. We, however, make it clear that the trial court or the learned single judge shall consider the matters uninfluenced by any observations made by the division bench or by the dismissal of these SLPs. Question of law kept open."

Significance

The Supreme Court's refusal to interfere preserves the opportunity for full adjudication of the substantive legal questions surrounding the intersection of design registration and passing off protection. The ruling leaves open critical questions of law, including whether registered designs can simultaneously be protected under passing off principles, the proper application of the "something more" doctrine from Carlsberg, the scope of trade dress protection for functional product features, and the balance between statutory design monopolies and common law rights in trade dress. The trial court must now independently examine these complex issues, including whether Crocs' clog design has acquired secondary meaning extending beyond the registered design, whether consumer confusion exists, and whether the Indian manufacturers' products constitute actionable passing off. This case will have significant implications for the footwear industry and broader IP jurisprudence on the interplay between statutory and common law intellectual property rights in India, particularly concerning the doctrine of dual protection and the public domain consequences of design registration expiry.