The hospitality services sector in India has always had its fair share of IP litigation. One of the more recent and most interesting cases revolves around the ‘Orchid’ trademark which is being litigated before no less than 3 forums – the Bombay High Court, the Intellectual Property Appellate Board (IPAB) and the Registrar of Trademarks at Chennai. (Image from here)
The litigation before all three forums were initiated by the Mumbai based, Kamat Hotels (India) Ltd. (KHI) against the Bangalore based Royal Orchid Hotels Ltd. (ROH) and is as set our below:
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Sr. No.
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Forum
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Proceedings
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Trademark involved
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Outcome
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1.
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Bombay High Court (Justice Chandradchud)
Order available over here.
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Infringement and Passing-Off.
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‘Orchid’ which was registered in Class 42 (service mark – hospitality etc.)
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Interim order restraining ROH from starting any new hotel with the ‘Orchid’ name. Existing hotels continue to function.
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2.
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IPAB (Justice Sridevan & S. Usha)
Order available over here.
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Rectification petition on grounds of non-use.
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‘Royal Orchid’ and ‘Royal Orchid Hotel’, registered in Class 16 (stationery used by ROH in its hotels.
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Petition dismissed as pre-mature. Also ROH found to be prior-user of the ‘Orchid’ mark.
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3.
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Trade Marks Registry (Mrs. Kasturi – later arrested on corruption charges)
Order available over here.
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Opposition petition against pending trademark registration.
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‘Royal Orchid’ and ‘Royal Orchid Hotel’ in Class 42.
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Opposition petitions are allowed and ROH’s trademark applications are dismissed.
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It’s impossible to get into the details of all the above litigation, so I’ll just focus on one aspect and that is the manner in which the same evidence was considered by three of the above judicial forums to arrive at completely different judgments. Before proceeding to this analysis let me first outline the basic factual dispute in all of these three cases:
(i) The KHI group had started a hotel by the name ‘Orchid’ in 1997 and had applied for TMs in various classes for the ‘Orchid’ mark. The Class 42 application for the word ‘Orchid’ was made in 2004 when service marks were allowed for the first time and this registration was granted in the year 2007.
(ii) The ROH group has claimed to be using the word ‘Orchid’ since 1990 for one of its banquet halls and the same has been advertised in 1990. As evidence of this fact the group filed several newsletters, correspondence from 1990 which referred to the ‘Orchid Banquet Halls’ at one of ROH’s hotel. In April 1996, the corporate predecessor of the ROH group obtained a confirmation, from the Registrar of Companies (ROC), on the availability of the term Royal Orchid Hotel Ltd. and the Board passed a resolution for change of name. This change of name was effected by the ROC in April 1997.
(iii) The basic factual dispute in this case revolved around which of these parties was the prior use of the trademark because this factor was going to decide all of the above cases. A prior user of a trademark has very strong rights regardless of whether he has secured registration under the law. In this particular case ROH had alleged that the KHI group had started functioning only in September, 1997 as was evidenced by a print-out from KHI’s own website. KHI disputes this by saying that pre-launch marketing had started in January, 1997 itself and filed an affidavit of its accountant to this effect. In its defense ROH argued that it was prior user not only because of the newsletters, correspondence predating 1997 but also the fact that the company had renamed itself as Royal Orchid Hotel in April, 1997 i.e. 5 months before KHI started its first hotel named ‘Orchid’.
Interpretation of the above evidence by the three forums:
In its judgment the IPAB was of the opinion that the evidence filed by ROH did indeed prove that it was the prior user from the nineties. Kasturi on the other hand went on the exactly opposite tangent. I’ve extracted, below, portions of the orders passed by Justice Sridevan at the IPAB and Ms. Kasturi. Just see the shocking contrast in both orders after consideration of the same evidence:
(i) Justice Sridevan: “Unless, it is proved that these documents are got up for the purpose of this case, we cannot reject them. We will see whether they are relevant.”
Mrs. Kasturi: “I have reason to doubt the authenticity and genuineness of the alleged documents of prior use furnished by the applicants which do not repose any confidence in me.” …… “It appears that the applicants have not come to this Tribunal with clean hands and do not deserve exercise of any discretion in their favour”. ….. “Thus on a thorough appreciation of the evidence adduced by the applicants in support of their claim there is no reliable and trustworthy document which could show use of the impugned mark prior to the opponent’s use of the trademark ORCHID.”
It boggles the mind as to how Kasturi comes to the conclusion that ROH’s documents are fake because as Justice Sridevan points out, it is necessary to prove that the document is not genuine and Kasturi’s order is completely silent on any such proof.
(ii) Justice Sridevan: “These documents prove that the respondent or their predecessors in interest or sister concerns used the word Orchid although only in connection with their Banquet Hall or services in 1992 long before the applicant established The Orchid Hotel, which is in 1997. We are not examining whether the applicant’s user dates from January 1997 or September 1997.”
“These documents cannot be disputed and therefore the resolution to change the name Royal Hotel Orchids Hotel Ltd is in 1996, before the alleged date of commencement of applicant’s business in January 1997.”
Mrs. Kasturi:”The applicants have not justified as to how and from where and why they adopted the impugned mark being similar to the opponent’s prior used trade mark.” “From the nature of the documents adduced by the opponents, it is evidentiary clear that the opponents are the first to adopt use the trade mark ORCHID.”
Since Justice Sridevan accepted that the ROH’s documents were genuine it was only logical to infer from the documents that ROH was the prior use. Kasturi however refused to accept that ROH was the prior user because she refused to even accept as proof the documents filed by ROH.
The above comparison just shows how absolutely important it is to properly appreciate documentary evidence in order to resolve factual disputes. While Justice Sridevan does a decent job, Mrs. Kasturi does an absolutely ridiculous job in appreciating any of the above evidence.
Apart from the two orders it may also be interesting to examine the order of Justice Chandrachud of the Bombay High Court. Unlike the other two proceedings the proceedings before the Bombay High Court were for interim orders (i.e. an interim injunction) and not final orders. The three requirements to secure an ‘interim injunction’ are (i) a prima faciecase (ii) balance of convenience and (iii) irreparable injury. Establishing a prima facie case requires a judge to ascertain, on the basis of documentary evidence, which party stands a better chance of winning at trial. In this particular case Justice Chandrachud concluded that there was a prima facie case of trademark infringement and also that the KMI group was the ‘prior user’. Surprisingly he conducts absolutely no analysis on how the conflicting marks would confuse the consumers.
Irrespective of ‘confusion’, this case is eventually going to be decided on the narrow point of ‘prior use’ and the facts and evidence on this evidence were keenly contested by both parties. In such cases where evidence is keenly contested the matter should be sent to trial. Justice Chandrachud however attempts to ascertain the basis of a prima facie case on the basis of keenly contested evidence. In the end the Royal Orchid group which was already running 11 hotels for over a decade has been ordered to stop using the name for its future hotels. What’s the hurry? Why not let the matter go to trial where both parties can cross-examine each other and settle the factual disputes?
In any case, Justice Chandrachud’s order has been appealed to a Division Bench. Similarly Kasturi’s order has also been appealed to the IPAB. And Justice Sridevan’s order has been appealed to the Madras High Court. We’ll keep you posted on any future updates in this matter.
Kasturi will think what clients want her to say… was she not the TM official that was founs with very dispropionate amounts of wealth?
Sumati, there is a confusion in point (ii).
Did ROH go for confirmation of its name to the registrar of companies? Because, I believe, at start up, the promoter is required to register with ROC and suggest the name for its incorporation (the promoter is also required to submit three more names in order of preference if the given name is not available). At that time, means in 1990, when ROH was formed, wasn’t it registered?
Besides, let it not be “trademarked” but we assume that it was registered. Then at the time of “Orchid hotels”, wasn’t V. Kamath told about the unavailability of that name? or was he told that already “Royal orchids” was in the list of registered companies and therefore was asked for any alternative? Thus he must have gone for only “orchids”? If that is so, then a promoter should approach for a certified search result from TM registry first to avoid such hassles.