The Madras High Court recently adjudicated in the case of Eicher Motors Ltd. v. Nitin Service Point and Automobiles (C.S.(Comm.Div.) No.77 of 2023) pertaining to the mark "Royal Enfield".
The Royal Enfield brand extends its popularity beyond the motorcycle community to the general public. Originating in 1901 with the production of the first Royal Enfield motorcycle, its legacy has since evolved, gaining widespread acclaim. The motorcycles, recognized for their reliability, became a trusted mode of transit for the Indian Army early on, leading to increased manufacturing and demand. Furthermore, the appeal of Royal Enfield motorcycles has crossed international borders, with both motorcycles and accessories being exported to over 70 countries.
In the present case, the issue arose when the plaintiff, proprietors of the Royal Enfield mark, became aware of the defendant using the identical name "Royal Enfield" for its service centre, merely 4.7 kms from the plaintiff's showroom. The Plaintiff argued that they possessed an enviable reputation and goodwill amongst members of the trade and public.
The Plaintiff asserted its recognition for producing reliable, high-quality, and durable products. It has advanced manufacturing facilities and maintained active research and development units in India and the United Kingdom to adapt to changing market preferences. With a widespread presence, the Plaintiff had over 1000 authorized dealers in India, each maintaining a consistent Brand Retail Identity (BRI) through uniquely designed outlets reflecting distinctive features associated with the Plaintiff's goods and business. This branding effort was undertaken at a significant cost and effort, maintaining a uniform standard across various locations.
Key Issues Under Consideration
The issues stemming from the present facts extended beyond the aspect of infringement. The Court delineated five key issues, starting with the primary determination of whether the plaintiff owned the trademark ' Royal Enfield.'
This article focuses on delving into the second issue, specifically examining whether the plaintiff's trademark could be recognized as a well-known mark under Section 2(1)(zg) of the Trade Marks Act. The judgment offers valuable insights into the factors that courts consider when assessing the status of well-known marks. Additionally, the Court clarified its jurisdiction in recognizing a mark as well-known under trademark law.
The subsequent three issues, centered on evaluating the plaintiff's entitlement to damages, determining whether the defendant's use of the term "Royal Enfield" constituted trademark infringement and passing off, and finally, identifying any other legal remedies available to the plaintiff.
Trade Mark Ownership and Exclusive Rights
The registration certificates for the trademark "Royal Enfield" and its variants were presented as evidence by the Plaintiff. In addition to adopting the unique trademark "Royal Enfield" the Plaintiff maintained a consistent pattern for the interiors and exteriors of its authorized outlets. This standardized look aimed to facilitate easy identification by customers. Authorized outlets were distinct and exclusively associated with the plaintiff's offerings, including motorcycles, parts, fittings, servicing, and accessories. The plaintiff ensured that all appointed dealers adhered to the same standards and branding identity.
The documentary evidence submitted to the court established the plaintiff's proprietary rights over the trademark "Royal Enfield" and its variants. The registration under various classes affirmed the plaintiff's proprietary and registration-conferred rights.
Court's Authority to recognize a mark as "Well-Known"
The Court brought forth the question regarding allocation of concurrent powers to both the trademark registry and the Court for granting recognition to a specific trademark as a well-known mark. In 2017, the Trade Marks Rules underwent an amendment, conferring the trademark registry with the authority to recognize a trademark as a well-known mark under Section 2(1)(zg) of the Act. Importantly, the amendment did not exclude the Court from exercising this power as well. Before the 2017 amendment, only the Court had the authority to grant recognition to a trademark as a well-known mark. The amendment led to a question about whether, despite the amendment, its power to grant such recognition had been eliminated. To dispel this doubt, the provisions of Sections 11(6) and 2(1)(zg) of the Act were interpreted, along with the amended Trade Marks Rules of 2017, pertaining to the granting of recognition by the trademark registry for a trademark to be acknowledged as a well-known mark.
However, it was clarified that the inclusion of the Trade Marks Registry did not mean an exclusion of the court to have similar powers. Accordingly, concurrent powers rested with the Court to deem a trade mark as a "Well-Known" Mark. Accordingly, Rule 124 of the Trade Marks Rules 2017, clarifies that the trademark registry will have to give due consideration to a mark, which has been recognized as "Well-Known" by the Court, in consonance with Section 11(6) which states that "The Registrar shall, while determining whether a trade mark is a well-known trade mark, take into account any fact which he considers relevant for determining a trade mark as a well-known trade mark including the record of successful enforcement of the rights in that trade mark, in particular the extent to which the trade mark has been recognised as a well-known trade mark by any court or Registrar under that record."
Importantly, if the Court issues an order recognizing a mark as well-known, the trademark registry must duly consider this recognition when determining whether the applicant deserves such recognition for their trademark. Additionally, Section 11(6) of the Act outlines 10 factors to be considered in adjudicating whether a trademark qualifies as a well-known mark.
10-Factor Test for Determining Well-Known Marks
Recognition in relevant sector
Section 11 of the Trade Marks Act clarifies the various aspects that require analysis and substantiation before a mark is recognized as well-known. The first pertains to the recognition or knowledge of the trademark in the relevant section of the public owing to the promotions done for the trade mark. The Court noted that the promotions of the Royal Enfield mark have been significant ever since its inception, resulting in widespread recognition of the mark in India as well as abroad. To meet the first requirement, the Court must determine the number of current or potential consumers, persons involved in the distribution channels of the goods and services, and business groups associated with the goods or services related to the trademark.
Duration, Extent of Use and Promotion of the Mark
The duration, extent and geographical area of use of the Royal Enfield mark has been vast, spanning over almost 22 countries with export business to up to 70 countries. The ten factor test provides two distinct factors for extent of use, the first being the extent of products of services for which the mark is used, and the second being the geographical extent of operations where the mark is used.
The next factor relating to the duration, extent and geographical area of promotion of the trade mark was also satisfied by the Plaintiffs, as they had been using the same since 1955, across countries having close to over a 1000 dealers / retainers around the world. Thus, the volume of the goods and services being sold under the mark was seen as substantial.
Registrations and Enforcement
The duration as well as the geographical area of any registration of the trademark which reflects the use or recognition of the trade mark is another determinant. Along with this, a record of successful enforcement of the trade mark, including recognition of the mark as Well Known by any Court or Registrar factors in to the mark being deemed as Well Known. The Plaintiffs submitted the long list of registrations obtained by them for their mark and its variants.
Recognition of Royal Enfield as Well-Known
In view of the above, the Court concluded that the name "Royal Enfield" held immense significance for the plaintiff, and the public universally associated it exclusively with the plaintiff. This strong connection warranted the highest level of protection for the trademark. Consequently, the plaintiff's trademark qualified as a well-known mark under Section 2(1)(zg) of the Act, and thus merit protection as given to well known marks. Therefore, the Court recognized the trademark "Royal Enfield " as a well-known mark in the motorcycle industry.
Defendant's Unlawful Use of the Mark
The Court determined that the defendant not only copied the essential features of the plaintiff's authorized outlets but also used the registered trademark " Royal Enfield" without authorization to promote its service center. This deceptive use of the identical trademark, especially in the same geographical and business area, created confusion and deception among the general public, constituting an infringement of the plaintiff's registered trademark.
In conclusion, the present case sheds light on the evolving landscape of well-known marks and the legal safeguards essential for protecting popular brands like "Royal Enfield". This case not only reaffirms the well-established reputation and global recognition of the Royal Enfield brand but also introduces nuanced considerations for the recognition of well-known marks. The Court's emphasis on the comprehensive ten-factor test, covering aspects from recognition and duration to enforcement and promotions, provides a robust framework for assessing the status of well-known trademarks. It underscores the need for a holistic analysis that goes beyond mere popularity and delves into the various facets contributing to a mark's well-known status.
Furthermore, the Court's clarification on the concurrent powers of the Court and the trademark registry in recognizing well-known marks offers insights into the legal dynamics involved. While the registry plays a crucial role, the Court's authority to independently recognize and protect well-known marks remains intact. This reaffirmation reinforces the dual responsibility of both entities in preserving the integrity and exclusivity of well-known trademarks. In essence, the present case contributes not only to the jurisprudence surrounding the protection of well known marks but also prompts a deeper understanding of the considerations in determining well-known mark status.
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