As promised in my previous post, today’s post looks at the three defenses of functionality, novelty and two design registrations by the Plaintiff with minor modifications on the same day, which were urged by the Defendant in the matter of Whirlpool of India Ltd. v. Videocon Industries Ltd. It will also look at whether the issue of passing off in this case was rightly decided by the Court.
FUNCTIONALITY
The first defense urged by the Defendant was that of functionality wherein the Defendant attributed features of the Plaintiff’s design to the functional requirements of the products in question, namely, the semi-automatic washing machines. The Court however noted that the Plaintiff was claiming that the external features of the washing machine, namely, the shape and configuration were their original design and were not claiming monopoly on any of the internal features such as the drum and/or apparatus used for washing the clothes, which were also the functional elements of the washing machine. The Court stated in clear terms that for a defense of functionality to succeed, it was not sufficient that the form had some relevance to the function. For the defense to succeed, the design must be the only mode or option which was possible considering the functional requirements of the product in question. Even when the shape of the product contributes to its functionality, the Court held that the defense of functionality could not be raised if that is not the only shape in which the function can be performed. In the instant case, the Court ruled that the product in question was a semi-automatic washing machine whose functions can be performed by umpteen different external shapes as can be evidenced from the various models of washing machines currently sold in the market. Therefore, the Court held that the external shape of the Plaintiff’s washing machine had no bearing on the functionality of its product and disallowed this defense of the Defendant.
LACK OF NOVELTY
The next defense raised by the Defendant was the lack of novelty in the Plaintiff’s design. The Defendant claimed that the Plaintiff’s design was a combination of known designs and that there was no original, new or novel shape in the Plaintiff’s design. The Defendant relied on the Delhi High Court decision of M/s. B. Chawla & Sons v. Bright Auto Industries, wherein it was held that to be new or original, the design must be substantially new or original and not a mere trade variant. The Court dismissed this defense raised by the Defendant for the following two reasons.
The first reason given by the Court (and one that the author personally disagrees with) was that the factum of novelty and originality in the Plaintiff’s design was established by the fact that the Defendant who is in the field of manufacturing washing machines for the last many decades had not manufactured a model with a design similar to the Plaintiff’s. This reasoning is problematic in my opinion, as the novelty and originality of the Plaintiff’s design which is undoubtedly a matter of fact, has not been determined with reference to the market of washing machines or models by other manufacturers but solely in reference to the Defendant’s earlier models. The Defendant’s argument was that the Plaintiff’s design is not novel as it is a combination of known designs in the market and therefore, the appropriate reasoning would have been for the Court to determine substantial novelty and originality in the context of other models in the market and not merely in the context of the Defendant’s earlier models.
The second reason was that as the Defendant itself had registered a design identical to the Plaintiff’s, it cannot now contend that the Plaintiff’s design is not novel or original. This is in consonance with the decision of the Division Bench of the Bombay High Court in Asian Rubber Industries Ltd. v. Jasco Rubber, where the Court held that a Defendant which claims that its design has novelty cannot then contend that a prior identical design lacks novelty. The Defendant attempted to distinguish the Asian Rubber Industries Ltd. case on facts and on the ground that it was per incuriam. (para 42) Both of these submissions were rejected by the Court.
TWO REGISTRATIONS ON THE SAME DAY FOR PLAINTIFF’S DESIGN
The third and last defense urged by the Defendant was built on the fact that the Plaintiff had obtained, on the same day, registration of two designs which had only minor variations from each other. The Defendants contended that the Controller would have granted the two registrations only because he/ she had concluded that the minor variations in the second design were sufficient to make it substantially novel/ original from the first registered design. Therefore, the Defendant built an argument that “if the minor differences between the two designs of the Plaintiff were such that the latter can be regarded as a novel and/or original one, then a fortiori and/ or by logical deduction, the Defendant’s product, which contains far greater differences from the Plaintiff’s designs inter se, must also be regarded as containing sufficient novelty and/ or originality for the same not to be regarded as constituting infringement and/or piracy.”
While considering this argument of the Defendant, the Court considered the scheme of S. 6, Designs Act, particularly S.6(3) and 6(4) of the Act. The Court held that S.6 manifests a legislative scheme whereby when the registered proprietor and fresh applicant for registration are the same, registration can be granted of either the same design in relation to other articles in the same class or with minor modifications to the same article or other articles in the same class.That is, when there is no identity between the registered proprietor of a design and the fresh applicant for registration, an application for the registration of the same design for another article and for the same design with minor modifications to the same or another article will not be entertained. An exception however, is when the registered proprietor and the fresh applicant for registration are the same as recognized by S.6(3) and S.6(4) of the Designs Act. In such a circumstance, fresh application for registration of a design with minor modifications is permissible. Therefore, the Court held that the registration of the second design by the Plaintiff with minor modifications was permitted by the statutory framework and therefore, there was no requirement for novelty or originality of the second design for which registration was sought. Hence, the Court did not accept this argument of the Defendant as well.
PASSING OFF
The last matter to be discussed in this post is regarding the issue of passing off which the Plaintiff claimed against the Defendant. For the claim of passing off to be successful, two conditions need to be satisfied, first, the Plaintiff’s product must have goodwill and reputation among the public as a result of its shape and distinctive colour scheme, and secondly, the Defendant’s product must amount to a misrepresentation to the extent that potential consumers mistook the Defendant’s product for the Plaintiff’s product.
On the first ground, the Court, based on the evidence led by the Plaintiff regarding its sales, the novelty of the particular shape and colour scheme opted by the Plaintiff etc, came to the conclusion that substantial goodwill and reputation does inhere in the Plaintiff’s machines’ distinctive shape, get up, colour scheme and/ or overall appearance.
On the second ground, the Defendant made an interesting argument. They argued that consumers who buy washing machines do not buy them based on the external shape, configuration, colour scheme etc but based on the brand or the manufacturer of the washing machine. Therefore, it is unlikely that a consumer who wishes to purchase a Whirlpool semi-automatic washing machine would buy a Videocon one, even if their shape was similar because the deciding factor is the brand name which is prominently displayed and not the external shape and appearance. This argument is one that the author and perhaps many reading this post can whole-heartedly agree with, based on our personal experience. However, the Court disagreed with this argument. The Court stated that the product in question was semi-automatic washing machines which are at the bottom end of the spectrum of washing machines and are purchased by and I quote, “persons who are not as educated/ discerning as persons purchasing top end washing machines. …. The class of purchasers of such machines will not necessarily be educated persons in the cities but also include semi-literate or persons who are not literate in villages and/ or rural areas.”
The next paragraph of the judgment (para 54) also makes for interesting reading. The Court states:“A potential customer for such a washing machine will also include persons who had visited houses of others and have seen or heard reports about the Plaintiff’s products. These persons will more often than not only have had a fleeting glimpse or distinct (distant?) view of the Plaintiff’s product in another household but may have received very positive reports about the machine from the purchaser thereof without naming the brand. Such persons may have also seen the Plaintiff’s machine figure in advertisements or photographs and with the passage of time may have a fleeting recollection thereof, which are largely based on its distinctive shape and appearance. If such a person were to come across the Defendant’s washing machine, such a person would immediately believe that this is exactly the machine he or she saw either at the residence of somebody else or in the photographs or advertisements seen earlier. In such circumstances, such person would immediately assume that the Defendant’s products were what he or she had seen and/or heard so highly spoken about. Such a person would purchase the Defendant’s product on the belief that it was the Plaintiff’s product or was associated with the Plaintiff. This clearly constitutes passing off.” (Emphasis added by the author)
While the author has no locus to comment on this particular reasoning of the Court which is very fact-based, she hopes that this reasoning of the Court was based on the evidence led by the parties to the dispute regarding the consumers of their products and their behavioral traits. (The judgment unfortunately, does not give an indication on whether there was evidence for these particular facts, leading to confusion as to whether this was based on the personal knowledge and opinions of the Court or based on evidence adduced.)
The Defendant had also adduced evidence that the washing machines of the Defendant were purchased only after demonstrations to argue that there was no misrepresentation. The Court rightly dismissed this argument as even in the event that they are only sold after demonstrations, it is still possible that the ordinary potential customer with an imperfect or hazy recollection and who associates the Plaintiff’s product to its external shape and appearance will watch the demonstration of the Defendant’s product under the impression that it was the Plaintiff’s product. Therefore, the misrepresentation could continue to exist.
Therefore, these were the many issues considered by the Court in this matter of Whirlpool v. Videocon. Having covered it in elaborate detail over two posts, there isn’t much left to state. This is a judgment which went into details of maintainability, infringement of design and the defenses to it and passing off. It clarified some important aspects such as the scope of “any person” under S.22, Designs Act as well as the legislative scheme under S.6, Designs Act. However, on matters which required application of facts such as in the reasoning under the defense of novelty or the issue of passing off, there is lack of clarity of why the Court decided to go down the road it did.
An interesting aside, it appears that both the Plaintiff’s and the Defendant’s washing machines had been produced and kept in Court by the Plaintiff for the full duration of the hearing for the purpose of visual examination of the Court(as noted in para 33 line 5 of the judgment), in addition to comparative charts and the like. This was not only an excellent strategy by the Plaintiff’s lawyers, but also a source of slight amusement for the author early in the morning on her bus ride when she imagined the scenario!
very good set of posts that covered a very good decision