Hindustan Pencils (P) Ltd. v. India Stationery Products Co. and Anr.

Hindustan Pencils (P) Ltd. v. India Stationery Products Co. and Anr.

AIR 1990 Delhi 19

Plaintiff adopted the mark Nataraj with the device of dancing Nataraj in 1961 and got the same registered.

Plaintiff’s Case:

Plaintiff got to know somewhere in the middle of the year 1985 that the Defendants had registered a copyright similar to that of the Plaintiff’s label and consequently Plaintiff filed an application for cancellation of the Registration of Copyright.

Defendants have not only used the registered name of the Plaintiff but have also used the device of the dancing Nataraj which has been registered by the Plaintiff.

Defendants’ Case:

There has been an inordinate delay in filing the suit and on this ground alone no interim injunction should be granted to the Plaintiff.

The Plaintiff knew about the Defendants since 1982 and chose to approach the Court only in 1988.

Defendants conceded that if the Defendants’ defense of the Plaintiff being guilty of inordinate delay or acquiescence is not accepted then, in that case, interim injunction may have to be issued because there is, admittedly, an infringement by the Defendants of the Plaintiff’s registered trade mark.

Issue:

Whether the Plaintiff is entitled to the grant of an interim injunction in light of inordinate delay or laches or acquiescence, as alleged by the Defendants.

Observations:

• Delay by itself is not a sufficient defense to an action for interim injunction, but delay coupled with prejudice caused to the Defendant would amount to laches. It is for the Defendant to show that there has been prejudice caused by reason of the delay.

• Some Courts have declined to grant interim injunction, on ground of laches or acquiescence, while not refusing permanent injunction on the ground that:
“while laches may not be a sufficient bar to a permanent injunction, it may well be a bar to preliminary relief. The preliminary injunction is sought upon the theory that there is an urgent need for speedy action to protect the plaintiff’s rights. By sleeping on its rights a Plaintiff demonstrates the lack of need for speedy relief and cannot complain of the delay involved pending any final relief to which it may be entitled after a trial on all the issues.”

• It appears difficult to comprehend the distinction which the courts have sought to make between the grant of interim injunction and permanent injunction. If on the facts which are clearly discernible from the record it appears that after trial a permanent injunction is likely to be, granted, notwithstanding the delay on the part of the Plaintiff in approaching the Court, there appears to be no reason as to why temporary injunction should be refused.

• It is no doubt true that trade mark, copyright or a patent belongs to a registered owner and is his monopoly. Nevertheless, especially as far as trade marks are concerned, the said mark is also meant to distinguish the goods of the owner of the mark from that of the other manufacturers. This distinguishing mark is primarily, probably solely, for the benefit of the consumer. It is the duty of the courts to protect the interest of such unwary customers. It is no doubt true that giving protection to the consumer would necessarily amount to giving relief to the Plaintiff, even though Plaintiff may have slept over his right for a number of years.

• Even though there may be some doubt as to whether laches or acquiescence can deny the relief of permanent injunction, judicial opinion has been consistent in holding that if the Defendant acts fraudulently with the knowledge that he is violating the Plaintiff’s rights then in that case, even if there is an inordinate delay on the part of the Plaintiff in taking action against the Defendant, the relief of injunction is not denied.

• The defense of laches or inordinate delay is a defense in equity. In equity both the parties must come to the Court with clean hands. An equitable defense can be put up by a party who has acted fairly and honestly.

• If a party, for no apparent or valid reason, adopts a mark belonging to another, whether registered or not, it will be difficult for that party to avoid an order of injunction because the Court may rightly assume that such adoption of the mark by the party was not an honest one. The Court would be justified in concluding that the Defendant, in such an action, wanted to cash in on the Plaintiff’s name and reputation and that was the sole, primary or the real motive of the Defendant adopting such a mark.

• Where there is an honest concurrent user by the Defendant then inordinate delay or laches may defeat the claim of damages or rendition of accounts but the relief of injunction should not be refused.

• Where the Plaintiff, however, is guilty of acquiescence, there different considerations may apply. As already noted, acquiescence may mean an encouragement by the Plaintiff to the Defendant to use the infringing mark.

• It will be for the Defendant in such cases to prove acquiescence by the Plaintiff. Acquiescence cannot be inferred merely by reason of the fact that the Plaintiff has not taken any action against the infringement of its rights.

• Applying the aforesaid principles to the present case, an important factor which has to be seen is whether the user or adoption by the Defendants was honest or fraudulent. In the present case, the Defendants have used the same spelling for the word “Nataraj” as have been used by the Plaintiff. Not only this, the device of the dancing Nataraj has been copied by the Defendants. Therefore, the said defenses are not available to the Defendant.

• Acquiescence means encouragement, on the part of the Plaintiff to the Defendant. There should be a mistaken belief by the Defendant that there is no objection to the Plaintiff using its mark. In the present case the Plaintiff has taken action by applying to the Registrar of Copyright.

• No specific notice was sent to the Defendant. Such non-action may disentitle the Plaintiff for the award of damages or rendition of accounts, but such inaction does not show any consent or acquiescence on the part of the Plaintiff to the Defendant’s using the said mark. No overt act has been done by the Plaintiff which could, in any manner, amount to encouraging the Defendant to continue to use the infringing mark.

• Any infringer who uses or adopts some one else’s mark must be aware of the consequences which may follow. Any growth after notice is at the risk and peril of the Defendant. The Defendants certainly had notice of application of the Plaintiff having been filed against it in the year 1985 for cancellation of registration of the copyright. If the Defendants continued to do business by using the impugned mark. it did so at its own peril.

Held:

The application for interim injunction was allowed.