India: Delay In Instituting Passing Off Action Not Condonable

Last Updated: 21 March 2006
Article by Manisha Singh Nair

Macleods Pharmaceuticals Ltd., moved an ad-interim application for the action of passing off under the provisions of Trade and Merchandise Marks Act, 1999, wherein Macleods Pharmaceuticals sought an injunction from the court, to restrain the Tidal Laboratories from using the impugned trade mark "Rabemax" or any other mark bearing similarity to the Macleods Pharmaceuticals’s mark "Rabemac". In the prayer, they also sought for the appointment of the Court Receiver in respect of various materials, packages, cartons, articles and the dyes.

Macleods Pharmaceuticals claim to have a pending application for registration of ‘Rabemac’ under the Trade Marks Act. The Macleods Pharmaceuticals claim that the mark has been in use since March 2002, though the application produced by Macleods Pharmaceuticals as an exhibit purportedly indicated use since 2001. To this Macleods Pharmaceuticals stated in the plaint that though the mark was conceived in 2001, sale did not begin until October 2002. The sales figures presented with the plaint substantiated the statement.

Tidal Laboratories opposed the said application for passing off on various grounds. First, they contended that the Tidal Laboratories was already a proprietor of the said mark as they are the holders of the registered trade mark and that a registration certificate was also issued. It was contended that in view of the mark registered by the Tidal Laboratories, the Macleods Pharmaceuticals was not entitled to maintain the action of passing off. Tidal Laboratories also contended that both the parties were involved in the manufacture of a common molecule "Rabeprozale sodium", and that the prefix "Rabe" used by many parties had nothing special about the same insofar as Macleods Pharmaceuticals were concerned. Tidal also produced documents before the Court to show that the adoption of Mark by the Tidal Laboratories was not dishonest or with the intention to pass off goods as that of Macleods Pharmaceuticals’. It was further stated that in September 2002 Tidal Laboratories had filed a search application with the Trade Marks Registry to ascertain as to whether they could use the mark in respect of ‘Rabimac’ and after making such enquiries concluded to use the mark ‘Rabemax’. Further they said that the word Max was adopted in view of the maximum power of the said medication. They also contended that the Tidal Laboratories adopted the mark prior to the Macleods Pharmaceuticals launching its product in the market and hence the adoption of the mark being dishonest lacked bona fide.

Macleods Pharmaceuticals contended that registration of the mark was an irrelevant factor in a passing off action. Placing reliance on decided cases, they contended that mere registration of the mark by Macleods Pharmaceuticals is no ground for refusing the relief in a passing off action as the same was not a decisive factor.

The Court in this case held that Macleods Pharmaceuticals was not entitled to any ad-interim injunction. It held that for a passing off action, it was necessary to show that the perpetual injunction by the Tidal Laboratories is a dishonest adoption and it should be with the intention to pass off goods of the Macleods Pharmaceuticals. The Court also held that the test of prior user be applied. It was held that because both the parties had entered the market at about the same time, it could not be held stated that by virtue of any prior user, the Macleods Pharmaceuticalss had obtained such a reputation that the Tidal Laboratories had adopted the mark with dishonest intention to pass off his goods as that of the Macleods Pharmaceuticals.

The Court also held that Macleods Pharmaceuticals was not entitled to ad-interim injunction orders since the Tidal Laboratories had intimated to the Macleods Pharmaceuticals that they had filed an application for the registration of Rabemax. Neither was this application opposed nor did they file a suit for two years. The only explanation given in this regard was that the goods of the Macleods Pharmaceuticals were unavailable in the market for a period of about two years. The Court examined the sales records of the Tidal Laboratories for the period and pronouncing the use of the mark by the parties to be concurrent, dismissed the appeal for ad-interim injunction.

© Lex Orbis 2006

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