@JUDGMENTTAG-ORDER
M. Jeyapaul, J.@mdashThis application is filed seeking an order of ad interim injunction restraining the respondents and their agents from passing off their services and business as and for the services and business of the applicant pending disposal of the suit.
2. The brief averment found in the application is as follows:
The applicant Future Logistics Private Limited is involved in the Logistics Services including freight forwarding, consolidation, warehousing and customs clearance. The applicant had coined and adopted the trade name/service mark Future Logistics in the year 2004 in respect of Logistics Services. Future Logistics is significantly distinct and uniquely identified by the trade and public who associate the mark with the applicant''s Logistics Services alone. The applicant has already filed an application seeking registration of the Trade Mark in Clause 39. Future Logistics has gained immense reputation and goodwill among various corporate houses and other commercial entities within and outside the Sate of Tamil Nadu. The applicant had substantial sales turnover for the last few years in respect of their Logistics Services. They have spent substantial sums of money every year towards advertisement and sales promotion activities. In December 2008, the applicant became aware that the respondent is running the business of providing logistics services under the trade name Future Logistics Solutions Private Limited. The use of the identical trade mark Future Logistics Solutions would confuse the patrons of the of the applicant and also other members of public. The slavish imitation attempted is nothing but a case of misrepresentation and amounts to unfair trade practice. The applicant is the prior adopter and continuous user of the trade name Future Logistics. The adoption of the mark Future Logistics by the respondent is dishonest. Hence, the prayer for the relief as sought for.
3. The averment in brief found in the counter of the respondent reads as follows:
The respondent group adopted the word Future in and around October 2005. It had incorporated around 27 Companies by using and adopting the trade name Future as a prefix. On 8.3.2006, the respondent Future Logistics Solutions Limited was incorporated as a Company under the said name. Prior use, per se, would not be sufficient for the purpose of establishing a reputation. The applicant''s date of incorporation is less than six months prior to respondent''s group adopting the word Future and calling itself "Future Group". The adoption of the said name by the respondent was honest and transparent. The turnover of the respondent during the year ending March 2007 and 2008 was Rs. 112.94 crores. The respondent has been carrying on business extensively and openly throughout India under the present name. In the absence of any deception, no action would lie for passing off. The respondent is one of the Companies that belong to the Future Group. The Company was primarily under the business of manufacturing and retailing of garments. It had diversified into other avenues of business. Prior to 2006, the business of Logistics was originally carried on by the Logistics Division of M/s.Pantaloon Retail (India) Limited. Since the business of the Logistics grew by leaps and bounds, the Future Group has set up and incorporated a Company to exclusively carry on the business of Logistics. Future Logistics have developed substantial goodwill and reputation and have come to be associated in the minds of the Indian public only with the Future Group led by its flagship company M/s.Pantaloon Retail. Therefore, the respondent would submit that the application deserves dismissal.
4. The applicant Company Future Logistics Private Limited was incorporated with the Registrar of Companies, Chennai on 16th December 2004. The respondent Company Future Logistics Solutions Limited was incorporated on 8.3.2006. There is no denial of the fact that the applicant is the prior user of the mark Future Logistics Private Limited. In fact, it is the admitted case of the respondent that the Future Group as such plunged head long into the business adopting the word Future and incorporated around 27 Companies by using and adopting the word/name Future as a prefix in October 2005.
5. It is submitted by the learned Counsel appearing for the applicant that the applicant, who is the prior user of the trade mark Future Logistics Private Limited is entitled to an order of interim injunction as it has prima facie shown that the applicant is the prior user.
6. Per contra, the learned Senior Counsel appearing for the respondent would contend that prior user of a trade mark, per se, cannot be the sole ground for granting an order of injunction as against the subsequent user of the mark.
7. The Supreme Court in
8. Shah, J of Bombay High Court in the celebrated case viz.,
To summarize, therefore, a trader acquires a right of property in a distinctive mark merely by using it upon or in connection with his goods irrespective of the length of such user and the extent of his trade. The trader who adopts such a mark is entitled to protection directly the article having assumed a vendible character is launched upon the market. As between two competitors who are each desirous of adopting such a mark, "it is, to use familiar language, entirely a question of who gets there first." Gaw Kan Lye v. Saw Kyone Saing AIR 1939 Rang 343 (FB). Registration under the statute does not confer any new right to the mark claimed or any greater right than what already existed at common law and at equity without registration. It does, however, facilitate a remedy which may be enforced and obtained throughout the State and it established the record of facts affecting the right to the mark. Registration itself does not create a trade mark. The trade mark exists independently of the registration which merely affords further protection under the statute. Common law rights are left wholly unaffected. Priority in adoption and use of a trade mark is superior to priority in registration.
9. It is important to note that irrespective of the extent of trade, the person, who gets into the business first in point of time, acquires right to use the trade mark. The registration of the trade mark does not confer any better right than that which already existed the prior user. It has been succinctly stated that priority in use of the trade mark is far superior to the priority in registration.
10. The applicant might have used the trade mark Future Logistics Private Limited just about two years prior to the use of the trade mark by the respondent. The volume of business of the applicant may not match with the volume of business of the respondent. The expenditure on promotion of the trade mark of the applicant may be less compared to the whopping expenditure spent by the respondent. But, the priority in use of the trade mark by the applicant will have to be recognized by the court when it is established prima facie.
11. Mahesh Chandra, J of Delhi High Court in Hindustan Radiators Company v. Hindustan Radiators Limited 1987 PTC 73 has detailed the broad principles governing the infringement of passing off as follows:
a) that plaintiff has been using its trading style and trade mark for quite a long period and continuously whereas the defendant has entered into the said field only recently,
b) that there has not been much delay in the filing of the suit for injunction by the plaintiff,
c) that the goods of the plaintiff have acquired a distinctiveness and are associated in the mind of the general public as goods of the plaintiff,
d) that nature of activity of the plaintiff and the defendant is same or similar,
e) that the goods of the parties to which the trade mark of the plaintiff is associated are same or similar,
f) that the user of the said trade mark or trade name by the defendant is likely to deceive and cause confusion in the public mind and injury to the business reputation of the plaintiff,
g) that the sphere of activity and the market of consumption of goods of the parties are the same,
h) that the customers of the plaintiff, inter alia, include uneducated, illiterate and wary customers who are capable of being deceived or confused or misled.
12. It is established by the respondent that the Future Group came into existence wayback in the year 2005 itself and the Future Logistics Solutions Limited, the respondent herein came to be incorporated on 8.3.2006. The applicant Company was incorporated in 2004 itself. For two long years, even prior to the establishment of a Company by the respondent, the applicant has been carrying on business in the identical trade mark Future Logistics Private Limited. The volume of business and sales promotion activities embarked upon by the applicant would go to show that the applicant''s business has acquired its own distinctiveness. Both the applicant and the respondent have started carrying on business in Logistics. There is similarity of business venture carried on by both. If such a trade mark of the applicant used right from the year 2004 is capitalised by the respondent, it will definitely lead to confusion among the customers of the applicant and there is a lot of scope for deception. Considering the sphere of activities of the applicant and the respondent, the court finds that both of them expect patronage from the same segment of customers.
13. In
The principles by which this case must be decided are well established. The fundamental principle is that a person shall not trade under a name so closely resembling that of the plaintiff as to be mistaken for it by the public: Hendriks v. Montagu (1881) 17 Ch.638; in other words, that a person shall not carry on his business in such a way as to represent that his business was the business of another person: Merchant Banking Company of London v. Merchants'' Joint Stock Bank (1878) 9 Ch. D.560, 563. The question to be determined in cases of this description is whether there is such a similarity between the two names as that the one is in the ordinary course of human affairs likely to be confounded with the other: Hendriks v. Montagu (1881) 17 Ch.D. 638, 645. It is not necessary to prove that the defendants in taking the name complained of by the plaintiffs had any fraudulent intend Ibid, p.651. It is enough if the plaintiffs prove that the act of the defendants in assuming the name complained of is an injury to the plaintiffs'' rights: North Cheshire and Manchester Brewery Company v. Monchester Brewery Company (1899) A.C. 83, 87, ON appeal, from S.C. In (1898) 1 Ch. 539. There is no question in such cases of property or monopoly in the name. The principle upon which the cases on this subject proceed is not that there is property in the word, but that it is a fraud on a person who has established a trade and carries it on under a given name with some other person who assumes the same name or the same name with a slight alteration in such a way as to induce persons to deal with him in the belief that they are dealing with the person who has given a reputation to the name. Lee v. Haley (1869) L.R. 5 Ch. App. 155, 161; 161; Hendriks v. Montagu (1881) 17 Ch. D. 638, 649.
14. Though this judgment was pronounced wayback on 3.8.1922, the relevance thereof has not yet been lost.
15. The Supreme Court in
88. In a case of this nature, the test for determination of the dispute would be the same where a cause of action for passing-off arises. The deceptively similar test, thus, would be applicable herein.
89. The doctrine of passing-off is a common law remedy whereby a person is prevented from trying to wrongfully utilise the reputation and goodwill of another by trying to deceive the public through "passing -off" his goods.
90. In Kerly''s Law of Trade Marks and Trade Names, supplement pp.42 and 43, para 16-02, the concept of passing-off is stated as under:
The law of passing-off can be summarised in one short general proposition that no man may pass off his goods as those of another. More specifically, it may be expressed in terms of the elements which the plaintiff in such an action has to prove in order to succeed. These are three in number.
Firstly, he must establish a goodwill or reputation attached to the goods or services which he supplies in the minds of the purchasing public by association with the identifying ''get-up'' (whether it consists simply of a brand name or a trade description, or the individual features of labelling or packaging) under which his particular goods or services or offered to the public, such that the get-up is recognised by the public as distinctive, specially of the plaintiff''s goods or services.
Secondly, he must demonstrate a misrepresentation by the defendant to the public (whether or not intentional) leading or likely to lead the public to a belief that the goods or services offered by him are the goods or services of the plaintiff.
Thirdly, he must demonstrate that he suffers or, in a quick time action, that he is likely to suffer damage by reason of the erroneous belief engendered by the defendant''s misrepresentation that the source of the defendant''s goods or service is the same as the source of those offered by the plaintiff.
16. The learned Counsel appearing for the applicant would submit that identical business is being carried on both by the applicant and the respondent in the same name of Future Logistics.
17. Per contra, the learned Senior Counsel appearing for the respondent would contend that the business activity of the respondent varies from the business venture of the applicant.
18. But, as already observed by this Court , considering the nature of business transacted by the applicant and the respondent, it is found that both of them are carrying on business in Logistics. There is similarity in business venture.
19. The respondent might have acquired reputation and goodwill for the word Future. But, it is demonstrated before the court that the applicant has built up a reputation and goodwill for their business in the name and style of Future Logistics Private Limited. Therefore, the respondent cannot simply add the word ''Solutions'' to the trade mark Future Logistics being used prior in point of time by the applicant. Future Logistics Private Limited is deceptively similar to the mark Future Logistics Solutions Private Limited. The respondent, who had started its business with the trade name Future might not have intended to cheat the applicant by using the trade mark Future Logistics Solutions Limited.
20. It is submitted effectively by the learned Senior Counsel appearing for the respondent that the Future Group, which has established as many as 27 Companies for diversifying their business activities, had to start a new Company to do Logistics business and therefore, the trade mark Future Logistics Solutions Limited was separately incorporated.
21. I find that there is sufficient force in the submission made by the learned Senior Counsel appearing for the respondent. There is no fraudulent intention on the part of the respondent in trading in business in Logistics in a deceptively similar trade mark of the applicant. There is unintentional misrepresentation on the part of the respondent in trading business in the name and style Future Logistics Solutions Limited which is quite similar to the trade name of the applicant. But, even if it has been unintentionally used, when the customers, who patronize Logistics business will definitely be confused on seeing the same trade mark.
22. I am in full agreement with the observation made by R.C.Lahoti, J (as He then was) in Smt. S. Charat Ram v. Usha Rectifier 1996 PTC (16) 610 . The following observation is made therein referring to the judgment of the very same Delhi High Court in
trading must not only be honest but must not even unintentionally unfair.
23. The respondent, of course, has named its Company doing Logistics business as Future Logistics Solutions Limited without any intention to cheat the applicant, but, there will be unfair advantage for the respondent if the respondent''s unintentional imitation persists.
24. It has been held in
25. It is contended by the learned Counsel appearing for the applicant that the respondent may be a big fish, but, they cannot be permitted to swallow the small fish. Further, the resourceful person cannot be permitted to enter into unfair competition.
26. Per contra, the learned Senior Counsel appearing for the respondent would submit that the applicant has not built up a reputation or goodwill whereas the respondent has acquired a name and reputation all over India. In this connection, it is useful to refer to the decision of the United States of Court of Appeals in Big O Tire Dealers, Inc., Plaintiff-Appellee v. The Goodyear Tire & Rubber Company, Defendant-Appellant 561 F.2d 1365 wherein it has been held as follows:
We are thus confronted with the question whether the law should apply differently to those who have the economic power to help themselves concurrently with the wrong than to those who must seek redress through the courts. Under the facts of this case we are convinced the answer must be No. Goodyear contends the recovery of advertising expenses should be limited to those actually incurred prior to trial. In this case the effect of such a rule would be to recognize the Big O has a right to the exclusive use of its trademark but has no remedy to be put in the position it was in prior to September 16, 1974, before Goodyear effectively usurped Big O''s trademark. The impact of Goodyear''s "Bigfoot" campaign was devastating. The infringing mark was seen repeatedly by millions of consumers. It is clear from the record that Goodyear deeply penetrated the public consciousness. Thus, Big O is entitled to recover a reasonable amount equivalent to that of a concurrent corrective advertising campaign.
27. The respondent may have lethal economic power in promoting their business and increasing their volume of business and the applicant may not match the respondent in spending whopping expenditure towards promotional activities. Yet, the applicant, who had plunged into the business with the trade name Future Logistics Private Limited, will have to be protected from the slavish imitation of the trade mark with the addition "solutions" by the respondent as otherwise, unfair trade practice will be encouraged.
28. The learned Counsel appearing for the applicant would submit that on the point of delay in approaching this Court seeking the order of injunction, the applicant cannot be shown the doors inasmuch as the applicant has come out with plausible explanation.
29. Per contra, the learned Senior Counsel appearing for the respondent would contend that for about three long years, the applicant has acquiesced the business activity of the respondent. When the business has grown leaps and bounds, the applicant has now come out with the present application seeking an order of injunction with a considerable amount of delay, it is submitted.
30. I fully agree with the observation of the High Court of Delhi in B.L. and Co. v. Pfizer Products Incl. 2001 PTC 797 (DEL) (DB) that the delay in institution of a suit for an action for passing off may not be vital , but, it is one of the important and relevant considerations before granting an ex parte interlocutory injunction.
31. The court will be on guard when there is a substantial delay in moving the application seeking an order of injunction ex parte and the court should tend to put the other side on notice beforeever an order of interim injunction is granted.
32. In Creative Travels Priate Limited v. Creative Tours and Travels Private Limited , it has been held that 25 years of delay in initiating action for passing off is vital.
33. Even if there is inordinate delay in approaching the court seeking the relief, the applicant can very well explain the delay to the satisfaction of the court. If the delay in approaching the court is found convincing, the question of rejecting the plea for interim injunction does not arise for consideration. In the instant case, it is found that the applicant has come to know of the same business with identical trade name carried on by the respondent only in the month of December 2008. The applicant has almost confined its sphere of activities within the State of Tamil Nadu whereas the respondent has got wide network of business throughout India. Therefore, there is every chance for the applicant to come to know of the Logistics business of the respondent in December 2008.
34. It is submitted by the learned Counsel appearing for the applicant that though the applicant has transacted lesser volume of business compared to the volume of business of the respondent, it has got remarkable patronage of customers who have started identifying the Logistics Services of the applicant with their trade name Future Logistics Private Limited.
35. Per contra, the learned Senior Counsel appearing for the respondent would contend that the very fact that the respondent has a wide network of customers all over India and has transacted business to the tune of 100 crores would go to establish that the customers have come to identify the Logistics Services of the respondent with the trade name Future Logistics Solutions Limited.
36. The Bombay High Court in
It follows, in my judgment, that two issues must always arise in a passing off action: First, has the name or description or make up, or whatever it may be, of the wrongful user of which the plaintiff complains, come to the associated in the public mind with the goods, business, or works of the plaintiff; secondly, is the defendant so describing, or getting up, his goods or whatever it may be, as to be likely to mislead the public into believing that they are acquiring the plaintiff''s goods, when in fact they are acquiring the defendants'' goods. As Lord Halsbury put it in (1896) A.C. 1997 the foundation of a passing off action is that nobody is entitled to represent his goods as the goods of somebody else.
37. A similar view was taken by the Andhra Pradesh High Court in
The scope of an action for passing off goods is now too well settled to require elaborate citation of authorities. It is a remedy against a false representation tending to deceive customers into believing that the goods which the defendant is selling are really the plaintiff''s. The false representation may be by statements or by conduct, i.e., by adopting the distinctive mark, name number, design, get-up or appearance of another''s goods. The plaintiff may prove either an intent to deceive or an actual damage and it is enough if he shows that the conduct of the defendant was calculated or likely to deceive or mislead public. On proof of these facts the plaintiff would be entitled to an injunction or damages. The onus is on the plaintiff to show that his goods acquired a reputation among the public by some distinctive mark, name, etc. The same principles which are applied in the case of an action for "passing off" the goods are applied where the name of a person''s business is imitated and passed off by another person as his own.
38. Similar view is also expressed by the Allahabad High Court in
In passing off actions, however, the plaintiff has to prove further that his trade name has by reputation and use, come to acquire a secondary meaning indicating distinctiveness and quality of the business being carried on by him.
39. Comparatively lesser volume of business and the lesser expenditure towards promotional activities will not necessarily lead to the conclusion that the Logistics Services of the applicant is not recognized by the customers with the trade name Future Logistics Private Limited and the Logistics Services of the respondent alone is associated with Future Logistics Solutions Limited. The applicant has been in the business right from the year 2004. The respondent is a new entrant as far as the Logistics business is concerned. Now, the respondent might have built up a business as far as the Logistics business is concerned. But, the prior user of the applicant and their continuous business activity in the field of Logistics and the customer patronage they have enjoyed shall not be belittled by the court as it will definitely lead to unfair trade practice. The court cannot bless the big fish who venture to swallow the little fish.
40. It does not appear to be a case of dishonest misrepresentation made by the respondent in trading in Logistics business in the name and style of Future Logistics Solutions Limited. The respondent might have acquired a secondary meaning for the mark "Future". But, they cannot use the mark "Future" with the combination of the word "Logistics" which combination have been used prior in point of time by the applicant and has created a vast customer base which has come to identify the services of the applicant with their trade name Future Logistics Private Limited. The customers will definitely be deceived on receiving confusing signals from the identical trade name used by the respondent.
41. In view of the above, the court finds that the applicant has established prima facie case. If the respondent is permitted to march over the prior user of the trade mark by the applicant, much hardship will be caused to the applicant. The customer base will receive confusing signal on coming to know that the similar trade mark is used by the respondent. The respondent is at liberty to use the word mark "Future" but not the trade mark "Future Logistics". The balance of convenience is also found in favour of the applicant.
42. Therefore, the order of injunction already granted is made absolute and the application stands allowed. No costs.
