India: Intellectual Property & Pharamaceuticals

Proposal for online sale of drugs under consideration

The Ministry of Health and Family Welfare is considering a proposal for online sale of drugs, according to certain news reports.

This proposal comes subsequent to an FIR filed by the officials of the Maharashtra Food and Drug Administration against the dealers and distributors of the e-commerce entity, Snapdeal, for selling prescription drugs online for a violation of the Drugs and Cosmetics Act, 1940 and Drug and Magic Remedies Objectionable Advertisement Act, 1954. As per the Drugs and Cosmetics Act, 1940 the sale of Schedule H medicines without a medical prescription is prohibited.

The Pharmaceuticals Secretary said a committee has submitted its recommendations and the Department of Pharmaceuticals, Ministry of Health and Family Welfare is examining the same and would subsequently strategize on the subject.

In July, 2015 the Telangana Drug Control Administration instructed prominent online pharmacies in the state to stop the sale of all drugs online.

Ultratech Cement Limited and Ors v. Dalmia Cement Bharat Limited

The Ultratech Cement (the plaintiff) is a part of the Aditya Birla Group and together with the other plaintiffs are the registered proprietors of various trademarks, all containing the words 'UltraTech' or 'Ultra'. Dalmia Cement (the Defendant) had started using a mark containing the word 'Ultra' and their mark was identical with / deceptively similar to the 'UltraTech' trademarks of the plaintiff.

The Plaintiff contended that these words were essential and prominent features of the trademarks of the Plaintiffs and were distinctive of their goods. The Plaintiff approached the court that the use of the word 'Ultra' by the Defendant amounts to infringement and passing off. The plaintiff had combined the cause of action of infringement and the cause of action of passing off in the same suit. The Defendants objected stating that the Plaintiff, being the registered proprietor of the Trademarks, was entitled to file the suit for infringement and the Court did not have the jurisdiction to entertain the said suit with both the combined cause of action. However, the court held that the Court has jurisdiction to entertain the cause of action of infringement. The other cause of action, namely, the cause of action of passing off, being claimed on the same set of facts as in the case of the cause of action for infringement, the two causes of action can be conveniently combined and no prejudice is likely to be caused to the Defendant if they are so combined.

The issue of territorial jurisdiction was also raised in the present case. In this regard, the Court held that where one of many plaintiffs has the territorial jurisdiction, the matter may be tried for all of the plaintiffs.

Indchemie Health Specialties v. Intas Pharmaceuticals and Anr.

Indchemie Health Specialties (the Plaintiff), registered proprietors of the trademark 'CHERI' since May 14, 1987, manufacture and deal in pharmaceutical and medical preparations and marketing their products under various trademarks and trade dress. During the registration process, certain objections were raised and the Plaintiff was made to drop 'medicinal preparations' from the goods, in accordance with restrictions under Section 18(4) of the Trade Marks Act, 1999.

Intas Pharmaceuticals (the defendant) produces dietary supplements named 'Multi Cherry', a propriety food to be consumed on the advice of a dietician.

While deciding the case, the court analysed the relationship between Section 18, 28 and 29 of the Trade Marks Act. Section 28 gives the proprietor of a registered trademark the exclusive right to use it as per the classes of registration. In the present case, the classes of registration for the plaintiff were curtailed by the Registrar under Section 18. Further, Section 29 provides that in case of a likelihood of confusion due to the similarity of the trademarks and/or the goods and services, the same amounts to infringement of the trademark.

The court, while deciding the issue of infringement under Section 29, narrowly construed the term 'similar' and held that since the Plaintiff had the protection for a narrow class of goods, the balance of convenience is in favour of the Defendant. The Court concluded that the Defendant was not infringing the trademark of the Plaintiff, since the Plaintiff's trademark does not cover medicinal preparation.

IPRS v. Sanjay Dalia

In this case, the Plaintiff, with their registered office in Mumbai sued the Defendant, who owned theatres in Maharashtra for copyright infringement in Delhi. The issue regarding the jurisdiction arose in this case since the cause of action arose in Maharashtra.

The court laid down that in a copyright or trademark infringement case, the Plaintiff can sue and initiate proceedings either in the place of the registered office or where the cause of action arose, but not in an altogether different jurisdiction. The court observed that this is not the legislative intent behind the additional remedy of Section 62 of the Copyright Act, 1957 and Section 134 of the Trademarks Act, 1999 over Section 20 of the Code of Civil Procedure.

Industria De Diseno Textile SA v. Oriental Cuisines Pvt. Ltd. and Ors.

Industria De Diseno Textile ("the Plaintiff") is engaged in the business of manufacture, design and sale of fashion and lifestyle products and is the owner of the trademark 'ZARA' under various classes of the International classification of goods and services. The Plaintiff registered in India in 1993 under Class 25. The Plaintiff operated as a joint venture with Trent Limited, a concern of the Tata Group and under the name Inditex Trent Retail India Private Limited, although the first store in India was seen in 2010. Further Oriental Cuisines (the Defendant), a leading chain of restaurants, operates in the name of 'ZARA TAPAS BAR'. By the time the Defendant opened their first outlet, the Plaintiff already had stores in 44 different countries. The Plaintiff approached the court for an ad-interim injunction against the Defendant for passing off, dilution and infringement, by trading under the reputation and goodwill of the Plaintiff's trademark 'ZARA'.

On the issue of dishonest and/or fraudulent adoption of the trademark, despite various grounds taken by the Defendant, such as the meaning of the word in Hindi, Urdu, Arabic, etc., the court referred to their press note wherein they admitted to having taken the concept from Paris and accordingly concluded that the Defendants were in fact relying on the Plaintiff's reputation.

With regard to the question of the trademark 'ZARA' being publici juris, the court held in favour of the Plaintiff in light of the Defendant's inability to establish their mark as generic. The court also decided the acquiescence issue in favour of the Plaintiff as there was no bar in granting injunction in favour of the Plaintiff.

In relation to the final issue of injunction, the court held that the Plaintiff's trademark has trans-border reputation and is a well-known trademark and thus granted the injunction in favour of the Plaintiff restraining the Defendant from using the trade mark.

SRF Foundation & Anr. v. Ram Education Trust

SRF Foundation ("the Plaintiff") established their first school in 1988 under the name 'SHRI RAM' and over time the schools run by the Plaintiff were contended to have carved out a unique space. On the other hand, Ram Education Trust (the Defendant) opened their first school around 2011 by the name of 'SHRI RAM GLOBAL PRE SCHOOL' right next to the Plaintiff's school. Both the Plaintiff and Defendant were using this name / mark as it was their family name.

An interim application was filed by the plaintiff in order to restrain the Defendant from using the said name / mark. The Court, while hearing the matter observed that the 'essential feature' test was satisfied and thus the marks were deceptively similar and that the essentials of 'prior use' and 'claiming party to be proprietor' were satisfied, which are necessary for a passing off action. However, since surnames are protected, the Court held that the essential of confusion and deception was held to be not satisfied.

Despite there being a strong case in favour of the Plaintiff, the injunction, being an equitable remedy, was not granted by the Court in this case. It was observed that an injunction order would cause great hardship not only to the Defendant, but to the students already enrolled and their families who have paid the fees. The Court allowed the Defendants to use the mark 'SHRI RAM', subject to the disclaimer that they will run a notice on all their stationary items and signboard that they have no relation with the Plaintiff's school.

Shamnad Basheer v. Union of India

Shamnad Basheer ("the Petitioner") filed a writ before the Madras High Court to declare the establishment of Intellectual Property Appellate Board ('IPAB') as unconstitutional, contending that the criteria for qualification of the members consisted of the executive and was thus violative of the doctrine of separation of powers.

The Petitioner also contended that the procedure for selection, in absence of any statutory procedure, was in contravention to the decision in Union of India v. R Gandhi. The Court, upon hearing the parties and analysing the provisions and held that though the tribunal had judicial functions it consisted of executive members. Thus, the Court held that the Search-cum-Selection Committee should include Judges from higher judiciary.

Further, discussing the concerned provisions (Section 85) of the Trade Marks Act, 1999, in light of the principles laid down by various landmark judgments, the Court laid down the following broad qualifications for the IPAB members:

(i) Technical Member: Holding at least the post of Joint registrar. But now, also must have 12 years of practice in a State Judicial Service with a degree and law along with other qualifications.
(ii) Judicial Member: Cannot be exercised by any executive, how highsoever if he has no experience in Judiciary.
(iii) Vice-Chairman: Member of the Indian Legal Service, holding a post of Grade I or higher of that service, for at least for 5 years. Court struck it down as unconstitutional since they were being accorded a judicial function and reiterated the qualifications of the Technical member as laid down by the Court for this post.
(iv) Chairman: A Vice-Chairman could become a Chairman without any judicial qualification/experience as such. Now qualification for a post of Vice-Chairman to Chairman also requires same judicial qualifications at least, as laid down for the other lower posts by this Court. Also, the Court laid down that recommendation of the Chief Justice of India to the post of Chairman should be given due consideration by the Appointment Committee of the Cabinet and the process does not involve any 'approval'.

In this case, the Court held and declared Section 85(2)(b) and 85(3)(a) of the Trade Marks Act, 1999 to be unconstitutional and the qualifications mentioned under Section 85(4) were modified.

Havells v. Amritanshu

In this instant case before the Delhi High Court, the primary issue was whether an advertisement which compares one product with a similar rival product must necessarily compare all its features in order to be an honest advertisement.

This case was initiated against an advertisement by the Defendant for their 'Eveready LED Bulbs' with the tagline 'Switch to the brightest LEDs' and a chart that compared the brightness and price of the bulbs manufactured by Havells (the Plaintiff) with that of the competitors, including the Defendant's with the heading 'check lumens and price before you buy'. The Plaintiff contended that this heading made the consumers only consider these two factors for comparison and excluded all other significant factors and was thus not in lines of honest practices in industrial or commercial matters, as required by the rules laid down in the Advertising Standards Council of India Code as well as Section 29(8) and Section 30(1) of the Trade Marks Act, 1999. In this regard, the Defendant argued that limiting the comparison to only some features does not in itself amount to a misleading or dishonest advertisement.

The Court ruled that it is open to the advertiser to choose what feature to compare as long as it is true. While deciding the case, the Court analysed the tests of 'honest' advertising as per Section 29(8) and Section 30(1) of the Trade Marks Act, 1999; test of a 'misleading advertisement'; and the standard used in deciding a case of comparative advertisement and ruled that none of these mandated comparison of all the features of products in an advertisement, which is also not quite possible at times.

The Court thus ruled in negative and held 'in the opinion of this Court, it is open to an advertiser to highlight a special feature / characteristic of his product which sets it apart from its competitors and to make a comparison as long as it is true'.

Lupin Ltd. v. Johnson & Johnson

In this case, both Lupin Limited (the Plaintiff) and Johnson & Johnson (the Defendant) are engaged in manufacturing, marketing and selling of pharmaceutical products. The Plaintiff has a registered mark 'LUCYNTA' and has brought an action of infringement against the Defendant, who uses the mark 'NUCYNTA' for a drug sold worldwide.

The Defendant contended before the court that his mark was registered in several countries, much prior to the registration of the Plaintiff's mark in India. The Defendant further alleges that it is the plaintiff who has adopted a deceptively similar mark and hence should not be entitled to any relief.

The question before the Court was whether the Court can go into the question of the validity of the registration of the plaintiff's trade mark at an interlocutory stage when the defendant takes up the defence of invalidity of the registration of the plaintiffs trade mark in an infringement suit?

In this regard, the Court observed that the expression 'if valid' used in Section 28 of the Trade Marks Act, 1999 and the words 'prima facie evidence of validity of the trade mark' used in Section 31 of the Trade Marks Act, 1999 permit the Court to consider the Defendant's plea regarding invalidity of the registration of the Plaintiff's trade mark at the interlocutory stage. The court reasoned that the terms 'if valid' and 'prima facie' imply that the registration is not conclusive. The court noted that while a registered proprietor of a trade mark would ordinarily be entitled to a finding that the trade mark is prima facie valid, the jurisdiction of the Court is not barred from considering the plea of the Defendant at the interlocutory stage.

Thus, the Court concluded 'in cases where the registration of trade mark is ex facie illegal, fraudulent or shocks the conscience of the Court, the Court is not powerless to refuse to grant an injunction, but for establishing these grounds a very high threshold of prima facie proof is required. It is therefore, open to the Court to go into the question of validity of registration of plaintiff's trade mark for this limited purpose, to arrive at a prima facie finding.'

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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