ARTICLE
5 November 2024

Burger King Corporation Vs Burger King Pune

AL
Anhad Law

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After a protracted legal battle spanning nearly 13 years, one would naturally expect a judgment in a trademark infringement case to delve deeply into intellectual property law, setting a
India Intellectual Property

After a protracted legal battle spanning nearly 13 years, one would naturally expect a judgment in a trademark infringement case to delve deeply into intellectual property law, setting a definitive precedent for future disputes. Yet, the outcome of the battle between Burger King Corporation (U.S.A) and Burger King Pune takes an unexpected turn. Rather than offering substantial commentary on trademark law, the judgment hinges largely on the intricacies of the Civil Procedure Code and the Evidence Act (presently known as Bharatiya Sakshya Adhiniyam). While this may seem anticlimactic, the ruling is poised to become a significant reference for cases dismissed on procedural grounds, at least until it is challenged or overturned.

Although this article aims to provide a concise overview of the entire judgment, it is important to highlight that the majority of facts regarding the usage and registration of the trademark by either party played little to no role in the final decision. However, for context and completeness, a brief outline of these facts is included below.

Plaintiff's Background and Trademark Registration: The plaintiff, Burger King, is incorporated under the laws of Florida. At the suit's initiation, Ms. Cecilia Dempsey was authorized to file and verify the plaint via a Power of Attorney dated February 12, 2009. This was later updated with a new Power of Attorney favoring Mr. Pankaj Pahuja.

Burger King has used the trademark and trade name "BURGER KING" since 1954, holding registrations in over 122 countries, including 22 in the Asia Pacific and South-East Asia regions. The trademark is recognized as a well-known mark for fast food services globally. The plaintiff possesses around 4,000 trademark and service mark applications and approximately 1,040 domain name registrations. The trademark "BURGER KING" consists of two arbitrary English words, with "Burger" being a shorthand for hamburger.

The trademark is registered in various jurisdictions, including India, where the plaintiff holds copyright registration no. VA/1348-438 for the BURGER KING and Crescent Design logo. The first Indian BURGER KING restaurant opened in New Delhi on November 9, 2014, receiving enthusiastic public response due to its beef-free menu tailored to Indian sensibilities.

Burger King has collaborated with the entertainment industry, featuring its products in popular Indian films. Its products are promoted through its website, http://www.burgerking.com, which was registered on November 14, 1994. The mark "BURGER KING" is inherently distinctive and not required by third parties for commercial use, having acquired high distinctiveness associated exclusively with the plaintiff.

Defendant's Actions and Legal objections: The plaintiff discovered the existence of defendant restaurants using the name "Burger King" in East Street, Camp, Cantonment, Pune, and Koregaon Park, Pune. Upon discovery, the plaintiff sent a cease-and-desist notice in June 2009 to resolve the matter amicably. The defendant's agent responded on July 3, 2009, denying the plaintiff's legal rights and asserting that the plaintiff's restaurants do not exist in India, thus negating any common law claims.

The defendants contested the suit by filing a written statement and counterclaim. They argued that the plaint was not properly instituted, citing that Burger King Corporation is a corporate entity run by directors, and the resolution to authorize Ms. Dempsey lacked proper signatures from the directors and the company seal, rendering it invalid under Indian law. They claimed that the Power of Attorney was improperly stamped and lacked legal sanction.

The defendants contended that the Trademarks Act, 1999, applies only to India, asserting that the plaintiff had not used any trademarks in relation to goods within India, thereby claiming that foreign use does not equate to usage under Indian law. They argued that there is no similarity between the plaintiff's trademark and their restaurant name, citing significant design differences and asserting that "BURGER KING" is descriptive, not distinctive

The defendants, a husband-and-wife team, claimed they have operated their restaurant since 1989 and have used the name "Burger King" since 1992 without any intent to deceive, having obtained various licenses from public departments that have been renewed annually. They argued there is no likelihood of customer confusion, as they have not displayed any association with the plaintiff's brand. They emphasized that the plaintiff lacks a reputation in India, as it has not commenced business there, and thus cannot claim prior usage of the trademark.

While the plaintiff holds a registered trademark in India, it does not operate a single franchise there. The plaintiff's trademark registration dates back to 1979 for paper products and was only recently expanded to cover sandwiches and burgers in May 2000. The defendants have been using the trade name since 1992, predating the plaintiff's registration for restaurant services. The plaintiff's pleadings did not demonstrate any customer confusion due to the defendant's use of the trademark.

The defendants argued that the plaintiff's requests for injunctive relief are indicative of their intent to monopolize various trademark classes. They highlighted that the plaintiff's application for the subclass of hamburgers was made on May 24, 2000, while the defendants have been selling burgers since 1992. The defendants noted that they do not sell raw meat, coffee, or beverages under the name "Burger King" and serve items distinct from the plaintiff's offerings, thus supporting their claim as bona fide prior users.

In light of the above facts, the ld. court framed 7 (seven) issues, of which the most pivotal, being whether Burger King Pune committed an infringement of the trademark owned by the Burger King Corporation or not, whether the suit in its present form is tenable or not. And that whether Plaintiff is entitled to a decree of permanent injunction against Defendant for its infringement of the registered trademark of Plaintiff

The plaintiff alleged that the defendants started their restaurant in 1992 and infringed upon the plaintiff's registered trademark. The defendants denied these allegations. To support its case, the plaintiff presented the testimony of Vincent Jose (PW-1), whose evidence affidavit was submitted. In this case, the critical turning point was the evidence affidavit, which became the focal point of the defendants' arguments. They contended that the verification of the affidavit was flawed, citing a breach of Order 19 Rule 3(1) of the Civil Procedure Code (CPC). The defendants argued that simply stating the affidavit is "true and correct to the best of my knowledge and based on information" is insufficient. They emphasized that the deponent must clearly distinguish between what is based on personal knowledge and what is based on information or belief, along with identifying the sources of such information.

Upon examining the verification of the affidavit, the ld. court found it to be non-compliant with Order 19 Rule 3(1) of the CPC. The defendants further argued that an affidavit failing to meet these verification standards could not be admitted as evidence. They supported their position by citing precedents such as Miraj Marketing Corporation vs. Vishaka Engineering (Delhi High Court, 2005), where the ld. court held that improper verification renders an affidavit inadmissible. Other cases, like A.K.K. Nambiar vs. Union of India (Supreme Court, 1970) and D. N. Gupta vs. Jaswant Singh (Delhi High Court, 1982), echoed this sentiment.

Agreeing with the defendants, the ld. court concluded that the plaintiff's affidavit did not satisfy the requirements of Order 19 Rule 3(1) of the CPC and, as a result, could not be accepted as evidence to support the plaintiff's claims. Furthermore, the ld. court noted that the suit was filed in 2011, while PW-1, Vincent Jose, only became associated with the plaintiff company in 2018. This significant gap in time raised, serious doubts about Vincent Jose's knowledge of the facts, circumstances, rights, and cause of action relevant to the suit. This, combined with his testimony, reinforced the ld. court's opinion that PW-1's affidavit could not be relied upon.

While the judgment has already outlined the key points from PW-1's cross-examination, a brief summary is provided here for clarity: PW-1's cross-examination revealed that he had not obtained information about the facts and circumstances of the suit from any competent person within the plaintiff's company, such as Cecilia Dempsey or Pankaj Pahuja. Consequently, the statements made by Vincent Jose in his affidavit lacked a credible source of information.

Given the discrediting of the evidence affidavit of PW-1, it is clear that the various documents submitted by the plaintiff to support or prove their case could not be substantiated either. Moreover, aside from Vincent Jose, no other witness was presented by the plaintiff to prove these documents. Although the ld. court's predecessor had, in an order dated January 13, 2020, allowed certain documents to be exhibited, it is a well-settled principle of law that merely exhibiting documents does not dispense with the need for their proof. This principle, as established in L.I.C. of India and another vs. Ram Pal Singh Bisen (AIR 2010 SC (SUPP) 753) and Sait Tarajee Khimchand and others vs. Yelamarti Satyam @ Satteyya and others (AIR 1971 SC 1865), underlines that the exhibition of documents is merely an administrative act for identification and does not equate to proving their contents.

In conclusion, the documents submitted by the plaintiff were not proven in accordance with the provisions of the Indian Evidence Act, and therefore, couldn't be relied upon or given any weightage in the present case.

The 3rd Issue which was framed by the Ld. Judge was regarding the whether the suit is tenable in the present form.

In addressing Issue No. 3, the learned advocate for the plaintiff argued that the plaint was duly signed and executed by Miss Cecilia Dempsey, the principal officer of the plaintiff corporation at the time of filing. He contended that this complied with Order 29 Rule 1 of the Civil Procedure Code (CPC), which permits a Secretary, Director, or other Principal Officer of a corporation to sign and verify the plaint. He further argued that authorization to sign may be express or implied, and even in the absence of formal documentary evidence, the court might infer authorization based on the facts presented. In support, he cited the Supreme Court case United Bank of India Vs. Naresh Kumar (1996) 6 SCC 660, which upheld the principle that a corporation can ratify the actions of its officers by implication, even if no formal resolution or power of attorney exists.

Despite these arguments, the ld. court found that the plaintiff had failed to prove that Cecilia Dempsey and Pankaj Pahuja were authorized to sign and verify the plaint through a Board resolution or power of attorney. Moreover, there was no evidence that they were recognized as Secretary, Director, or Principal Officers of the plaintiff company. Neither Cecilia Dempsey nor Pankaj Pahuja appeared as witnesses to clarify their authority, leading the ld. court to infer that the plaint could not be substantiated due to lack of proper authorization.

The ld. court also noted that while a person acquainted with the facts of a case can give evidence, as clarified in Central Bank of India Vs. Tarseema Compress Wood Manufacturing Company, this principle does not extend to authorizing the institution of a suit. The necessity of proper authorization for filing a suit, as distinct from giving evidence.

Given these points and relying on precedents like State Bank of Travancore Vs. M/s. Kingston Computers (I) Pvt. Ltd. (AIR 2011 SCW 786), the ld. court concluded that the suit was not instituted by an authorized person as required by Order 29 Rule 1 of the CPC. Consequently, the ld. court found Issue No. 3 against the plaintiff, declaring the suit not maintainable in its present form.

Once the ld. court's observations were concluded, on the above-mentioned issues, it became evident that no further issues required attention. The possibility of granting a permanent injunction hinged on the suit's maintainability. With the ld. court's determination that the suit was not maintainable and the evidence affidavit along with supporting documents were deemed inadmissible, the plaintiff's plea for a permanent injunction was inevitably denied due to the absence of credible supporting evidence.

As for the defendants' counterclaim, the ld. court noted that the evidence affidavit of DW-2 also failed to meet the standards set by Order 19 Rule 3(1), resulting in its dismissal. Furthermore, the testimony of DW-1 alone fell short of providing the necessary support for the counterclaim. Consequently, these issues were resolved unfavourably for the defendants, reinforcing the ld. court's decision.

Anhad Law's Perspective

The protracted legal struggle between Burger King Corporation and Burger King Pune concluded with a judgment that, while not groundbreaking in trademark jurisprudence, serves as a testament to the intricate interplay between procedural law and the art of cross-examination. The ld. court's determination that the affidavit of PW-1 did not meet the requisite standards for verification reveals the critical impact procedural accuracy can have on the outcome of a case. The meticulous cross-examination of PW-1 also exposed significant flaws in the plaintiff's position, illustrating how adept advocacy can shift the trajectory of any litigation, regardless of the size of opposition on the other side.

That being said the adopted approach of the Ld. court in the present matter, while rigorous in adhering to procedural norms, raises pertinent questions about the potential sustainability of the judgment on appeal. Regardless of the procedural deficiencies, it cannot be denied that the reliefs of the plaintiff have been denied without deeply getting into the substantive trademark issues. The general norm that is being adopted by most courts today is that minor technicalities are usually overlooked to ensure that justice is not hindered, but given the significant lapses and the acrimonious testimony, the judgment might perhaps sustain the rigors of the appellate court.

In essence, while this judgment may not redefine trademark law, it profoundly illustrates the importance of procedural correctness and strategic evidence presentation. It serves as a compelling reminder that in the maze of legal battles, even the most well-known brands must navigate the intricate web of procedural requirements with precision.

Originally published in Lexology

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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