SUN PHARMACEUTICALS INDUSTRIES LIMITED V. CIPLA LIMITED

Sun Pharmaceuticals Industries Ltd. v. Cipla Ltd.

2009 (39) PTC 347 (DEL)

Facts of the Case:

The trade mark ‘THEOBID’ was registered in the name of one Natco Fine Pharmaceuticals Private Limited for medicines. The said trade mark was assigned to the Plaintiff along with its goodwill vide a deed of assignment in 1998. Plaintiff made an application to the Registrar of Trade Marks in the year 2000, for entering the name of the Plaintiff as the subsequent proprietor of the said trade mark. The said application was pending till the Plaintiff filed the present suit.

Though the assignment was made in 1998, Plaintiff started using the mark in January 2008 only and as the suit was filed by the Plaintiff in 2008, Plaintiff had a very limited duration of use of the mark by itself.

The Defendant started using the mark ‘THEOBID-D’ for medicines. Plaintiff thus instituted the present suit for permanent injunction against the Defendant seeking to restraining the Defendant from infringement of trade mark ‘THEOBID’ as well as passing off. At the interim stage Plaintiff only argued it’s case for infringement and not for passing off.

Plaintiff’s Case:

• The marks are identical

• The Plaintiff is using the mark by itself since January, 2008 and is a prior user and registered proprietor of the mark by virtue of assignment deed of 1998.

Defendant’s Case:

• As per Section 2 (1) (v) of the Trade Marks Act, 1999 which defines ‘Registered Proprietor’ in relation to a trade mark, Plaintiff is not the registered proprietor as Plaintiff’s name has not been entered in the register as proprietor of the trade mark.

• Section 28 provides that the registered proprietor of the trade mark shall have the exclusive right to the use of the trade mark and to obtain relief in respect of infringement thereof. As Plaintiff is not the registered proprietor it cannot file the present suit.

• In Soundarapandian Match Works v. M. Jayarama; PTC (Suppl) (2) 145 (Mad), Madras High Court has held that having regard to the rigour of Section 44 of the Old Act(Trade & Merchandise Marks Act, 1958), as long as the registration of the assignment has not been completed, the assignee cannot seek to exercise any right.

• The essence of the mark is in use thereof and without the Plaintiff or anyone else using the trade mark, no injunction ought to be granted, especially when the Defendant has filed documents showing extensive use of the mark for the last several years.

Plaintiff’s Rejoinder:

• As per Modi Threads Ltd. v. Som Soot Gola Factory; AIR 1992 Delhi 4 and Grandlay Electricals (India) Ltd. v. Vidya Batra; 1998 PTC 646 even if the application for transfer of the registered trademark is pending, it does not debar the party from protecting the violation of the trademark. The title accrues on the execution of the assignment deed. All other follow up action which are required to be taken under the Trade Marks Act do not change the title already acquired in this respect.

• Moreover, if in spite of the party having applied to the Registrar of Trade Marks, no action is taken by the Registrar, the party cannot be blamed therefor.

Judgment and Observations made by the Hon’ble Court:

Whether the Plaintiff is the registered proprietor of the trade mark and entitled to maintain an action for infringement?

The Hon’ble Court relied on the Delhi High Court’s judgment in the case of Astrazeneca U.K. Ltd. v. Orchid Chemicals and Pharmaceuticals Ltd.; PTC 2006 733 wherein it was held that the rights in the trademark come on the basis of assignment deeds and held that the Plaintiff cannot be denied the rights in the trademark which he has got on the basis of the assignment deed in his favour on the ground that in the records of the Registrar of Trade Marks, the trademark is still shown in the name of the assignor.

The Madras High Court judgment in the case of T.I. Muhammad Zumoon Sahib v. Fathimunnissa; AIR 1960 Madras 80 was also discussed where the Hon’ble High Court held that the registration of an assignment is not a condition precedent to an action for infringement by the assignee.

The Hon’ble Court also held that ‘Registered Trademark’ is different from ‘Registered Proprietor’. Assignment of title in registered trade mark is complete on assignment within the meaning of Section 2(b), i.e., on writing between the assignor and the assignee. For assignment to be complete, the Registrar is not involved. The assignee acquires title to registered trade mark on assignment and not by registration. Registration is of the title acquired by assignment. The inquiry which a Registrar is to make before such registration of title acquired by assignment is of satisfaction of proof of title and as to disputes if any as to assignment. This inquiry is limited to this extent only in contradistinction to inquiry which the Registrar is to make before registering a trade mark. A dispute as to assignment can be raised by the assignor or by some person claiming prior assignment and not by strangers or by persons claiming adversely to the assignor.

If title in registered trade mark vests in assignee, who is entitled to exercise rights under Section 28 as a registered proprietor after assignment and before registration?

‘Registered Proprietor’ in Section 28 has to be interpreted as including a person having title as registered proprietor by way of assignment or transmission, which in the present case, is the Plaintiff. He had applied for registration as far back as in the year 2000. The Plaintiff cannot be made to suffer for the inactions of the Registrar. It is also noteworthy that the registration, if affected shall date back to the date of the application.

Whether a registered owner is disentitled to restrain an infringement by non-use of the trade mark?

Trade marks cannot be registered and held by persons as ‘investors’ only, with no intention whatsoever to use the same in connection with any goods and services. However, in the present case, there is sufficient trade connection between the registered trade mark and the business/activities of the Plaintiff and the Plaintiff cannot be termed as a mere trafficker in the trade mark.

The Plaintiff in the present case has claimed use and expressed intent to use and the correctness thereof is to be tested in trial and at this stage the rights of the registered owner are to be protected.

The Hon’ble Court relied on Polson Ltd. v Polson Dairy Ltd.; 56 (1994) DLT 102 to hold that a break in user of trade mark does not destroy its reputation and the mark if distinctive survives and that if the registration of the mark exists rightly or wrongly on the Register of trade marks, the court has no right to ignore the same.

Injunction was granted in favour of the Plaintiff.

Author: Aadhya, National Law University, Odisha