India: Trademarks Rights – Prove Use Or Lose!!!

Last Updated: 17 August 2013
Article by Srinjoy Banerjee

Unlike Patents or Designs, the law of Trademarks mandates the rule of use - the more you use a mark and make it distinctive, the better chances you have in securing and ultimately defending your registration.

This principle has been reiterated in the recent case of M/s. HAB Pharmaceuticals & Research Limited v/s.VEE EXCEL DRUGS & Pharmaceuticals Pvt. Ltd. [ORA/59/2005/TM/DEL] and VEE EXCEL DRUGS & Pharmaceuticals Pvt. Ltd. v/s. M/s. HAB Pharmaceuticals & Research Limited [ORA/155/2009/TM/MUM], both of these being cross rectification applications. [Order No. 169 of 2013].

While ORA 59/2005 was filed by HAB Pharmaceuticals & Research Limited to remove the mark "VEGA ASIA" bearing registration number 1079405 in Class 5 belonging to VEE EXCEL DRUGS & Pharmaceuticals Pvt. Ltd. from the Register; ORA 155/2009 was initiated by VEE EXCEL DRUGS & Pharmaceuticals Pvt. Ltd. to remove the mark "VEGAH TABLETS" of HAB Pharmaceuticals & Research Limited bearing Registration number 1098288 in Class 5 from the Register.

The IPAB decided that in terms of the mark VEGA v/s. VEGA ASIA, HAB Pharmaceuticals & Research Limited was able to prove usage for their mark VEGA from 2001 when it first manufactured its tablet under the trademark on August 17, 2001. VEE EXCEL DRUGS filed the mark "VEGA ASIA" on February 8, 2002 as a "proposed to use" application. The drug licence was obtained on September 12, 2002. Accordingly the IPAB held that the true use of the mark "VEGA ASIA" could only have taken place once the drugs were sold. Accordingly the prior user, being HAB Pharmaceuticals & Research Limited, had better right and thus the removal of the mark "VEGA ASIA" was ordered.

However, in ORA 155/2009, HAB Pharmaceuticals & Research Limited was unable to prove usage of the mark "VEGAH TABLETS". The application was filed on April 24, 2002 with a user date of April 1, 2002. The usage could not be proved by way of the documents. The removal of the registration for mark "VEGAH TABLETS" was accordingly ordered.

As evident, both parties lost their respective registrations only due to their inability to prove prior use. The stand taken by the IPAB above is in consonance with the practice at the Registry also. In the context of Trademarks, for the Registry, the user becomes sacrosanct. This has been dealt with in a plethora of cases. For example in the case of Titan Industries Limited v/s Registrar Of Trade Marks And Anr.[2007 (34) PTC 346 IPAB] it has been held that "..the well settled proposition of law in Trade Mark law is that the prior user of a trade mark has more valid rights in a mark than the registered proprietor".

This position is based on Section 34 of the Act which states as under:-

"Section 34. Saving for vested rights.- Nothing in this Act shall entitle the proprietor or a registered user of registered trade mark to interfere with or restrain the use by any person of a trade mark identical with or nearly resembling it in relation to goods o services in relation to which that person or a predecessor in title of his has continuously used that trade mark from a date prior-

(a) to the use of the first- mentioned trade mark in relation to those goods or services be the proprietor or a predecessor in title of his; or

(b) to the date of registration of the first- mentioned trade mark in respect of those goods or services in the name of the proprietor of a predecessor in title of his;

whichever is the earlier, and the Registrar shall not refuse (on such use being proved) to register the second mentioned trade mark by reason only of the registration of the first- mentioned trade mark."

The law in India therefore veers towards the concept of prior user trumping registration. Globally also various countries have dealt with this in various ways. Whereas the US follows a similar principle which gives precedence to prior use, France dumped the user based system in favour of a registration based system. The argument and the various advantages/disadvantages of each of the principles are reserved for a later debate.

However, one thing is for certain. A registration without use of the mark or using the mark but not securing registration, both are situations which are not ideal for any system. The ideal is the middle path, wherein the right holders secure their right of a legitimate and not reverse engineered descriptive mark and there is a genuine use of the same.

In India, with the coming of the Madrid Protocol, the principle of prior user will gain even more significance when International applications and registrations are enforced on the Indian Battlefield!!

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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Srinjoy Banerjee
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