Toyota Jidosha Kabushiki Kaisha v. Prius Auto Insurance Ltd. & Ors.

Toyota Jidosha Kabushiki Kaisha v. Prius Auto Insurance Ltd. & Ors.

2018 (73) PTC 1 (SC)

(Image Credits: Kārlis Dambrāns from Latvia; Image and Creative Common License availalbe at: https://en.wikipedia.org/wiki/Toyota_Prius#/media/File:2016_Toyota_Prius_(ZVW50R)_Hybrid_liftback_(2016-04-02)_01.jpg)

Brief Facts:

Plaintiff, an automobile manufacturer was incorporated in Japan. Plaintiff had launched world’s first commercial hybrid car called ‘Prius’, in Japan, in the year 1997 and in other countries during the year 2000-2001 but not in India until 2009.

Defendant No. 1, constituted in 2001, was engaged in the manufacture of automobile spare parts of which Defendant No. 2 and Defendant No. 3 were partners.

In 2009, the Plaintiff got knowledge that the Defendants had been using the mark ‘Toyota’ and ‘Prius’ for auto parts and accessories. Plaintiff filed a civil suit for infringement of the mark ‘Toyota’  as well as passing off along with relief of passing off qua ‘Prius’ against the Defendants. After trial and many rounds of litigation, the matter was heard by the Supreme Court of India.

The Supreme Court chose not to express any view in the present matter as regards the mark ‘Toyota’ as it was of the view that the Defendants had virtually accepted a conditional order (at the time of interim relief) whereby it was asked to use the mark ‘Toyota’ only for identification purposes in a font different from the Plaintiff without using Plaintiff’s logo.

Hence, the present decision on merits dealt with the mark ‘Prius’ only.

Plaintiff’s Contentions:

• In India the car was displayed in shows in Delhi and Bangalore in 2009 but was formally launched in 2010.
• Various advertisements and news reports about the trademark and publications in car magazines in India and across the globe have made ‘Prius’ a well-known trademark.
• Plaintiff discovered in 2009 that Defendant had not only not only got the mark ‘Prius’ registered in the year 2002-2003 for all types of auto parts and accessories but also the fact that the Defendants had also been using the said trade mark in carrying out their trade in such auto parts and accessories.
• Recognition and reputation of a trade mark is not contingent upon the actual sale of goods in India. Advertisement and promotion of the mark through different forms of media is sufficient to establish reputation and goodwill within a particular geographical area. ‘Prius’ was widely publicized and advertised in leading newspapers and magazines with wide circulation all over the world since the year 1997.

Defendants’ contentions:

• Defendants had been using the mark ‘Prius’ since 2001.
• The Defendants had been constantly supplying spare automobile parts to companies like Hyundai Motors and General Motors.
• No car bearing the mark ‘Prius’ been sold in India to enable the Plaintiff to claim goodwill in respect of such car in India.Resultantly, it was impossible for the people in India to identify and recognize or associate the Defendants’ with Plaintiff.
• The documents of Plaintiff to establish goodwill and reputation are all post April, 2001.
• It is the Territoriality Principle as opposed to the Universality Doctrine which has been accepted by the courts all over the world as the correct test to determine goodwill and reputation within any particular jurisdiction.
• Positive evidence of spill over of reputation and goodwill of the Plaintiff’s mark ‘Prius’ to the Indian market, prior to April, 2001, is absent.

Supreme Court’s observations:

• All over the globe, the opinion is that the goodwill has to be determined on the basis of the territoriality principle, i,e. there should be goodwill in the country where passing off action has been filed.
• To determine the test above, the Hon’ble Court has to determine as to whether there is a spill over of the reputation and goodwill.
• ‘Prius’ had undoubtedly acquired a great deal of goodwill in other jurisdictions and that too much earlier to the use by the Defendants in India
• However, to succeed in the present case, there must be adequate evidence to show that the Plaintiff had acquired a substantial goodwill for its car under the brand name ‘Prius’ in the Indian market also.
• The advertisements in automobile magazines, international business magazines, availability of data in information-disseminating portals like Wikipedia and online Britannica dictionary and the information on the internet, even if accepted, will not be a safe basis to hold the existence of the necessary goodwill and reputation in the Indiat in 2001.
• The news items of the year 1997 relating to the launching of the product in Japan in the Economic Times also do not firmly establish the acquisition and existence of goodwill and reputation in India.
• There is no advertisement of the product in India prior to April, 2001.
• The above shows either lack of goodwill in the domestic market or lack of knowledge and information of the product amongst a significant Section of the Indian population.
• It may be correct that the population to whom such knowledge or information of the product should be available would be the Section of the public dealing with the product as distinguished from the general population. However, proof of such knowledge and information within the limited segment of the population is not prominent.
• If goodwill or reputation in the particular jurisdiction (in India) is not established by the Plaintiff, no other issue really would need any further examination to determine passing off.

Contribution by: Ms. Pragati Pachisia, JCCLC, Kolkata