The case of Needle Industries (India) Ltd. v. Super Thread Industries & Ors 2007 (34) PTC 614 (IPAB) started when Super Thread Industries/Respondents filed an application in 1988 for registration of the mark "PONY" in class 23 in respect of yarns and threads. After examination the application was advertised before acceptance in 1997. Needle Industries/Appellants filed their notice of opposition objecting the registration under the provisions of Section 9, 11, 12, and 18 of the erstwhile Trade and Merchandise Marks Act, 1958.
After completion of opposition procedure, the Assistant Registrar of Trademarks set down the matter for hearing and found that the objections raised by Needle Industries were baseless. The Assistant Registrar did not considered Needle Industries’ registration of the impugned mark in Class 26 since 1971 and held that since Needle Industry’s application in Class 23, was pending registration wherein Needle Industries had claimed user only since 1995 that was subsequent to user of Super Thread, therefore, Needle Industries had no locus standi to raise the objections. The Assistant Registrar further held that as Super Industries being a genuine owner and prior user of the impugned mark, was entitled to have the mark registered in their name. However, based on the documents on record, the Assistant Registrar held that Needle Industries had acquired distinctiveness in the trademark "PONY" for the goods covered under Class 26 but also expressed his views that the distinctiveness acquired for goods in Class 26 cannot be availed for the goods in Class 23.
Aggrieved by the Order of the Assistant Registrar, Needle Industries preferred a statutory appeal before the Delhi High Court in the year 2000. Pending the disposal of appeal by the High Court, on 15th September 2003, the Trade Marks Act, 1999 repealed the Trade and Merchandise Marks Act, 1958. By virtue of section 100 of the new Trademarks Act, 1999, all cases of appeals against any order or decisions of the Registrar of Trademarks, pending before any High Court were transferred to the newly constituted Intellectual Property Appellate Board (IPAB). Accordingly, Needle Industries’ appeal against the Order of the Assistant Registrar was also transferred and heard by IPAB in 2006 during a Circuit hearing at New Delhi.
Needle Industries contented before IPAB that they had adopted and using the impugned mark "PONY" with the "PONY" device since 1963 and having registration of the said mark in Class 26 since 1971. Needle Industries also pointed out towards the affidavits filed by Super Thread claiming their adoption of the impugned mark only since 1987. It was also contended by Needle Industry that the impugned trademark had acquired distinctiveness in their favor by long use on the goods covered under Class 26. Further contention was raised that the goods falling in Class 23 and 26 were allied and cognate and the trade channel and consumers were one and the same. Accordingly, use of an identical mark by Super Thread in respect of allied and cognate goods in Class 23 would certainly cause confusion and deception. The reliance was placed the decision in Needle Industries (India) Ltd. v. Sanjay Jaiswal & Ors, 2002 (24) PTC 646 (DB) where it was held that deception and confusion was not a probability but was a certainty if the trade channels were similar even if the class of goods were different.
On the other hand Super Threads submitted that the impugned mark "PONY" was honestly adopted by them in respect of goods covered under Class 23 and that they had been using the mark since 1987 and applied for registration in 1988. They also contented that Needle Industries had not placed on record any evidence to prove that they had been using the mark since 1967. Super Thread countered the argument of Needle Industries was placing reliance on the decision in United Brothers v. United Traders 1997 (17) PTC 603 where it was held that the goods though were sold from the same counter but if they fell in different classes the question of deception or confusion did not arise.
After hearing the arguments of both parties, IPAB held that in order to qualify for registration, the mark should be distinctive and if not distinctive should be capable of distinguishing the goods of one from others. IPAB concluded that Super Thread had no capacity to acquire distinctiveness by using the impugned mark only for a period of eight months prior to the application. In order to acquire distinctiveness the mark should be in use for a considerable period of time. The IPAB further held that as the goods are sold from the same counter, there was every possibility of causing confusion and deception. With regard to honest concurrent use, the IPAB found that in view of the use of impugned mark by Needle Industries since 1967 in respect of Class 26 goods, Super Thread’s eight months use prior to their application could not be considered as honest concurrent use. On perusal of the documents, IPAB also found that the adoption of the impugned mark by Super Thread was not honest and bona fide. Accordingly, IPAB held that dishonesty itself disentitles Super Thread from the benefit of the claim of honest concurrent use. Otherwise also the IPAB held that the impugned mark had not acquired any distinctiveness to be claimed by Super Thread and thus, allowed the appeal.
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