Demystifying Trade Mark laws & what constitutes a Trade Mark infringement in India
Competition is part of almost every goods and service available in India and globally. But sometimes competition results in the competitors alleging unfair trade practices or deceptive trade practices, especially when they believe that the competitor is attempting to confuse the consumer with a similar packaged product and infringe its Trade Mark. Part 30 of the series of articles on Misleading Ads by Advocate Aazmeen Kasad, serves to demystify and provide an in-depth understanding of what our Trade Mark laws are, what constitutes a Trade Mark infringement, in India.
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India is one of the largest biscuit manufacturing countries in the world, after the US and China. India’s biscuit market stood at Rs 28,387 crore ($3.9 billion) in 2016, and is projected to grow at a compound annual growth rate (CAGR) of 11.27%, in value terms, between 2017 and 2022, to reach Rs 52,771 crore ($7.25 billion) by 2022. (Source: India Business Market Overview 2017-2023 Report). A market research conducted by BlueWeave Consulting estimated the Indian biscuits market to grow significantly by 2023, “owing to a change in consumer taste and preferences, increasing health-conscious consumers, and rising demand for convenience food”. The dominant organised players operating in the biscuit market of India are Britannia Industries Ltd (‘Britannia’), Parle Biscuits Pvt Ltd (‘Parle’), ITC Ltd (‘ITC’), Surya Food & Agro Ltd and Unibic Foods India Pvt Ltd.
Packaging plays a key role in attracting the eyeballs of the consumer. It is no wonder then that each player tries to differentiate its product from that of its competitor not only through different flavours, distinct brands, memorable advertising, but also through unique packaging designs.
There are a raft of judicial precedents stemming from cases filed by companies in India alleging Trade Mark infringement by competitors within the category. In the recent past, Britannia filed a case in the Delhi High Court, against ITC and others, seeking an injunction against ITC to restrain ITC from manufacturing or selling biscuits in the deceptively similar packaging for its biscuit.
On September 11, 2020, the Trademark Registry registered the following Trade Mark under Class 30 of the Trade Marks Rules, 2017 in favour of Britannia Industries, who manufactures and sells ‘Nutri Choice Digestive’ using the said Trade Mark in its packaging.
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Britannia was aggrieved by the fact that ITC are manufacturing and selling “Sunfeast Farmlite 5-Seed Digestive” biscuits in a packaging which, according to Britannia, is deceptively similar to the packing in which Britannia sells its “Nutri Choice Digestive” biscuits; and ITC have infringed the registered trademark of Britannia together with passing off their “Sunfeast Farmlite 5-Seed Digestive” biscuits as those of Britannia.
Britannia, in its petition made the following arguments in favour of the injunction against ITC:
- Britannia’s trademark was registered on September 11, 2020, and Britannia has been using the said trademark on its digestive biscuits since 2014.
- ITC do not have any registered trademark in respect of the impugned pack. ITC’s “Sunfeast”, “Sunfeast Farmlite” and “5-Seed Digestive” biscuits were launched under the impugned pack on September 28, 2020.
Prior to adopting the impugned packing, the defendants were marketing their “digestive” biscuits, including their “Sunfeast”, “Sunfeast Farmlite” and “5-Seed Digestive” biscuits in the following packs, which were not, in any manner, infringing Britannia’s pack and, in fact, uses this fact as a ground to contend that ITC deliberately changed their pack to deceptively resemble that of Britannia, to encash on Britannia’s goodwill and reputation:
The overall trade dress, colour combinations, colour scheme, arrangement of features, get-up and layout of the impugned pack of ITC were deceptively similar to that of Britannia, highlighting the following similarities:
- use of the colour scheme of red and yellow, with yellow on the left side of the pack and red on the right,
- depiction of the image of the biscuit on the right side,
- embossing of the brand name of the company and of the biscuit on the body of the biscuit in similar font and style,
- use of the word “Hi-Fibre”, below the name of the biscuit,
- depiction of the words “Nutri Choice” in the case of the plaintiff’s pack, and of the words “5-Seed Digestive” in the defendants’ pack, on a white background,
- depiction of two sheaves of wheat below the picture of the biscuit on the right side of the pack along with scattered grains of wheat,
- an orange shading at the intersection of the yellow and the red colour on the pack, and
- depiction of the word “digestive” in red lettering on the pack.
As the biscuits are normally stocked together in stores, there is also a clear aspect of “initial interest confusion”.
As Britannia and ITC’s biscuits are both digestive biscuits, the constituents or ingredients of the biscuits are immaterial.
In its defense, ITC made the following arguments:
- Britannia does not have any Trade Mark registration for the colour combinations “red and yellow”, though colour combinations are individually registrable as “marks” within the meaning of Section 2(m) of the Trademarks Act.
- There are any number of distinctive features on the pack of ITC’s products, which make the two packs so dissimilar as to obviate any possibility of confusion or deception.
- Britannia’s pack contained two colours, that is, red and yellow, whereas ITC’s pack contained red, yellow and saffron.
- Yellow is the predominant colour in Britannia’s pack, whereas red is the predominant colour in ITC’s pack.
- Britannia’s pack predominantly displays the brand name “Nutri Choice” in large green letters, whereas ITC brand name is “Farmlite” printed in brown letters on its pack.
- ITC’s pack contains a vertical curved band towards the centre of the pack, in which the seeds contained in the defendants’ biscuits are reflected from top to bottom under the head “Power Seeds”, with a picture of each seed, indicating, from top to bottom, flak seeds, chia seeds, watermelon seeds, sunflower seeds and pumpkin seeds; and
- ITC’s brand name “Sunfeast Farmlite Digestive” is predominantly displayed on the biscuits package.
Etching of the brand name of the biscuits on the body of the biscuits was a common industry practice and that, in fact, this feature would serve to discredit Britannia’s allegation of deceptive similarity, as ITC’s brand name and that of its biscuits are completely different from those of Britannia.
Representing wheat and grains on the pack of digestive biscuits, is also a matter of common practice, as these serve to emphasise the nutritional value of the biscuits and represent their ingredients. ITC’s pack also shows seeds, raisins and almonds, which are not present on Britannia’s pack.
The use of the word “Hi Fiber” was, again, a matter of common industry practice, as it represented the high fiber content in the biscuits, again emphasising their nutritional value. The lettering and the colour of the word “Hi Fiber” as contained on ITC’s pack, is different from that of Britannia.
The Principles of Law applied
Based on several quoted past Indian judicial precedents, the Court culled out the following principles:
In assessing deceptive similarity, the class of the customer who would purchase the product is relevant. The look/ appearance, and the sound of the trade marks, as well as the nature of the goods, are all relevant considerations. Surrounding circumstances are also relevant.
The onus of proof is on the plaintiff, who alleges passing off. As against this, in an opposition to the registration of a trademark, the onus to prove deceptive similarity is on the defendant who seeks non-registration, or removal of the trade mark from the register.
“Confusion” refers to the state of mind of the customer who, on seeing the mark, thinks that it differs from the mark on the goods, which he has previously bought, but is doubtful whether that impression is not due to imperfect recollection. The question is one of first impression.
This is especially true in the matter of phonetic similarity. A meticulous comparison of the words, syllable by syllable, is to be avoided. The possibility of careless pronunciation and speech, both on the part of the buyer walking into the shop, as well as the shop assistant, is also required to be factored into consideration.
The matter has to be examined from the point of view of a person of average intelligence and imperfect recollection. It has to be seen as to how such a purchaser would react to the trade mark, the association which he would form and how he would connect the trade marks with the goods he would be purchasing.
The Pianotist test, postulated over a century ago, has repeatedly been endorsed by the Supreme Court, as the definitive test to be adopted while comparing rival trademarks. According to this test, the Court is required to judge the rival trade marks by their look and sound, and consider, (a) the goods to which they are to be applied, (b) the nature and kind of customer who would be likely to buy those goods, (c) all surrounding circumstances, and (d) the consequences which would follow if each of the marks is used in the normal way as the trade mark for the goods of the respective owners. [(1906) 23 RPC 774]
The whole word/ mark is to be considered. An ordinary man would not split a word or name in a trade mark into its components, but would go by the overall structural and phonetic similarity of the marks at the nature of the goods previously purchased, or of which he has been told and which he wants to purchase. It has to be examined whether the totality of the trade mark of the defendant is likely to cause deception/ confusion or mistake in the minds of the persons accustomed to the existing trade mark of the plaintiff.
The resemblance may be phonetic, visual or in the basic idea represented by the plaintiff's mark. The Court is, however, required to apply both the phonetic and the visual tests. At times, ocular similarity may be sufficient to find possibility of confusion/ deception, even if the marks are visually dissimilar, though ocular similarity, by itself, may not, generally, be the decisive test. Where, however, (i) in all other respects, the marks of the plaintiff and defendant are different, (ii) the word/words, in the marks, which are phonetically similar, cannot be regarded as the dominant word, or essential feature, in the marks, and (iii) the surrounding circumstances also belie any possibility of confusion, it has been held that deceptive similarity cannot be found to exist merely on the basis of phonetic similarity or even identity. The matter, apparently, is always one of fact. The Court would have to decide, on a comparison of the two marks, and the parts thereof which are phonetically similar, as to whether such phonetic similarity is likely, considering all other circumstances, to confuse or deceive a purchaser of average intelligence and imperfect recollection, always bearing in mind the nature of the goods, and the degree of circumspection which would be expected of the purchasers who would purchase such goods.
The Court is required to examine whether the essential features of the plaintiff's mark are to be found in the mark of the defendant. Identification of the essential features is a question of fact, left to the discretion of the Court.
No objective standards are possible, regarding the degree of similarity which is likely to cause deception. It has to be seen from the viewpoint of the purchasers of the goods.
The test to be applied would depend on the facts of the case. Precedents are valuable only to the extent they specify tests for application, and not on facts.
On the issue of deceptive similarity, and especially with respect to the aspect of phonetic similarity, English cases are not of relevance. English cases are useful only to the extent they aid in understanding the essential features of trade mark law. The tests for deceptive similarity, which apply in other jurisdictions, may not always apply in India.
The Court based its decision on the basis of the following analysis:
The perception, whether in the case of infringement or passing off, is to be that of a person of average intelligence and imperfect recollection – not of an idiot, or an amnesiac. The average human mind has not been particularly conditioned to observe only similarities, and overlook dissimilarities. Section 29(1) uses the word “deceptive”, whereas Section 29(2) uses the expression “cause confusion”. Deception and confusion are both states of mind, of which no physically tangible evidence can ever be found. If similarities can cause deception or confusion, dissimilarities, if sufficient, can also obviate any suchpossibility. At the end of the day, the court is required to come to an opinion as to whether a person of average intelligence and imperfect recollection is likely be deceived, or to confuse the defendants’ marks (in the case of infringement) or the defendants’ product (in the case of passing off) with that of the plaintiff. If, therefore, between the rival marks, the points of dissimilarity are so stark that they shade or overweigh the points of similarity, the court may legitimately arrive at a conclusion that, irrespective of the points of similarity, no possibility of confusion or deception exists.
The points of similarity, between Britannia’s pack and ITC’s pack, cannot be gainsaid. At the same time, there are also stark and apparent points of dissimilarity which, immediately impress themselves on the mind, even of a person of average intelligence and imperfect recollection.
Even a person of average intelligence and imperfect recollection is bound to notice the absence, on ITC’s pack, the words “Nutri Choice”, which are contained on Britannia’s pack. The test, to reiterate, has to be that of the perception of a person of imperfect recollection, and not that of an amnesiac.
Digestive biscuits having watermelon seeds, Chia seeds, flax seeds, pumpkin seeds and sunflower seeds are, clearly, a species of digestive biscuits sui generis. There is no other manufacturer making Digestive biscuits with the 5 seeds. ITC has prominently displayed, on the package, the words “5-Seed Digestive”, apart from a clear pictorial representation of the five seeds contained in the biscuits. The words “5 Seed” are absent on Britannia’s pack.
The different brands of the biscuit and the different companies manufacturing the biscuits are, prominently displayed on the pack both of Britannia as well as of ITC. It is only, therefore, if the mythical gentleman of average intelligence and imperfect recollection does not recollect either the brand of the biscuit or the name of the company manufacturing the biscuit, or even the prominent features of the left side of the pack, that he is likely to confuse the “Farmlite 5-Seed Digestive” biscuit of ITC for the “Nutri Choice Digetive” biscuit of Britannia.
If the packs of Britannia and ITC’s biscuits are stored side by side, then, unless the customer is situated at so great a distance that he can see only the colours of the packs, and not the distinctive features thereof, he is unlikely to be confused between the two.
The Delhi High Court Judgement
The High Court rejected Britannia’s application for an injunction against ITC’s Farmlite packaging. ITC pack was held not to be confusingly similar to that Britannia’s. No case of infringement, therefore, exists, prima facie. When it comes to the question of passing off, additionally, the fact that the “Sunfeast” logo of ITC and the “Britannia” logo are clearly visible on the face of the rival packs, would also minimise the possibility of a consumer mistakenly purchasing the ITC product, assuming it to be that of Britannia’s.
The Court also gave its reasoned order for differing from the judgement provided in the case of Parle by the Supreme Court of India (1972 SCC (1) 618), which was relied on by Britannia.
The Court also pronounced its judgement in a separate but related case filed by Britannia against ITC in respect of the box pack of Britannia’s “Nutri Choice 5 Grain Digestive” biscuits, and ITC’s “SUnfeast Farmlite Veda Digestive” biscuits, dismissing the application on the grounds that it did not find deceptive similarity in the two product packs and a consequent infringement or passing off action by ITC.
In light of the above judgement, it is advisable for manufacturersto review the principles of the law cited by the Hon’ble Court in cases bordering on Trade Mark infringement or passing off. The ensuing Parts of the series will pertain to various aspects of what constitutes Misleading Advertising and key judicial precedents on the same.
Advocate Aazmeen Kasad is a practicing corporate advocate with over 20 years of experience, with a focus on the Media, Technology and Telecom industries. She is also a professor of law since 14 years. She is a member of the Consumer Complaints Council of the Advertising Standards Council of India. She is a speaker at several forums.