India: Past Actions Indicate Likelihood Of Future Infringement

Last Updated: 15 November 2018
Article by Sumathi Chandrashekaran

In a recent case before the Bombay High Court, although there appeared to be no infringing sale taking place at the time of the matter being decided, the court found enough indication in the past actions of the defendant company to suggest that infringement was sufficiently likely in the future so as to grant a temporary injunction. This case came up before the Commercial Division of the Bombay High Court (Super-Max Ipr Holdings AG vs Tigaksha Metallics Pvt Ltd., Comm. IP Suit (L) No.1476 OF 2018, Order dated 26 October, 2018).

Making out a successful case for an interim – or a temporary – injunction is not always easy for a rights owner. One has to convince the court that three circumstances exist: firstly, that a case is made out on the face of it, without delving into detail; secondly, that the balance of convenience exists in favour of the rights owner, and thirdly, that irreparable injury will be caused to the rights owner if the injunction were not granted. This becomes more challenging for the court when the defence is not available to present its position, as was the case (ex parte) here. And it becomes even more complicated when there is actually nothing on record to suggest that the infringement has already taken place. Can behaviour and conduct lead a court to presume that infringement was likely to take place in the future, and restrain parties accordingly? This is what appears to have transpired in the course of the case being discussed today.

The plaintiff-company was Super Max IPR Holdings AG, which is a part of the multi-national Supermax Group, in the business of the manufacture and sale of blades, razors and other shaving products. It owns over 30 trademarks in connection with these products. The defendant-company – Tigaksha Metallics Pvt. Ltd. – manufactured and sold goods bearing these trademarks, first as a licensee of the plaintiff (which was terminated), and later under a Job Work Agreement (which also expired in March 2018).

In the course of time, multiple disputes arose between the two sides, which led to arbitral proceedings between the parties, and orders being passed in early 2018 by an arbitral tribunal. Under these orders, the defendant company was directed not to use machinery to manufacture any products bearing the plaintiff's trademarks.

Super Max, the plaintiff company, later discovered that the defendant company was continuing to attempt to use, or intended to use, the trademarks in question. They discovered this through advertisements made by the defendant on a leading B2B/trade website, where the defendant allegedly offered goods using the trademarks for sale. To add to this, the plaintiff also received communications from their distributors and retailers that the defendants had solicited and approached them, on the basis that they were entitled to use the trademarks. All of these were presented in the court towards making its case.

Meanwhile, certain other developments took place. The arbitral tribunal's decision which restrained the defendant from using machines to manufacture products bearing the trademarks, was vacated by the tribunal on the ground that there were no reliefs claimed before it. As a result, the plaintiff claimed that after 31st October 2018, the date on which the restraint order was to be lifted, it would be left unprotected against any acts of trademark infringement by the defendant.

To buffer its case, the plaintiffs contended that the defendant's conduct (of advertising on trade websites, and contacting and soliciting business from distributors and retailers in the trade) was questionable. Among other things, it was argued, the defendant appeared to have already begun manufacturing products and packaging material bearing the marks, and it was or appeared to be in a complete state of readiness to launch the products bearing the trademarks immediately upon the expiry of the tribunal's restraint order.

Based on the documents produced, the court appeared satisfied that the plaintiffs were the rightful owners of the trademarks in question. There also appeared to be no contest regarding the termination of the license agreement between the two sides and the expiration of the job work agreement earlier this year.

In these circumstances, the court found that the defendant's past actions "[did] not inspire much confidence", and considering the past history between the parties, it was reasonable to believe that the defendant would flood the market with products bearing the plaintiff's trademarks. All three factors required for the grant of an interim injunction being met – i.e., a prima facie case made out; balance of convenience in favour of the rights holder; and irretrievable damage and injury likely – an interim injunction was granted.

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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