Delhi High Court Grants Punitive Damages Ex-Parte in Two Cases

The Delhi High Court through J. Sistani delivered two judgements in trademark passing off and infringement suits that imposed punitive damages upon the defendants for their actions. In both situations the cases were decreed ex parte against the defendants. I shall deal with both of these disputes together in this post. Permanent injunctions were granted against the respective defendants in both cases.

1. Jockey International Inc. & Anr. v. R. Chandra Mohan & Ors.

[Text of the judgment]

Facts: The facts of this dispute are fairly simple. The plaintiffs had been carrying out the business of selling undergarments and other products across the world since the early 1900s. They had marketed their products with the trademark ‘Jockey’ for a long period of time and across many different countries. They had registered their marks in India under Class 25 in the year 2004. Defendant number 6 was in the business of inter alia the packaging and labelling of undergarments and they were utilising the marks ‘Jockey’ and ‘Jookey’ among others like ‘Polo’ and ‘Playboy’. The plaintiffs sued for infringement, passing off and dilution of goodwill.

Contentions of the parties: The plaintiffs argue that the activities of the defendant number 6 in utilising their registered trademark amounted to an act of infringement. They also argue that consumers might get deceived by the mark of the defendant, owing to the many similarities. They also argue that the mark ‘Jockey’ is a well-known mark and enjoyed significant goodwill and reputation in the market. The actions of the defendants would lead to a dilution of reputation and goodwill of their brand. The case was decided ex parte.

Decision of the Court: The court in ruling for the plaintiffs reasoned that it was evident that the plaintiffs had a validly registered mark and that the defendants were indeed using that mark on their products and this was very clearly an instance of infringement. The court reasoned that the defendants were using a mark that was identical and deceptively similar to the mark of the plaintiffs and therefore were infringing the plaintiffs’ mark. The court also ruled that the defendants by using an identical mark to that of the plaintiffs were passing off their goods as that of the plaintiffs’. This, in the court’s opinion was damaging the goodwill of the plaintiffs’ mark. The court also concluded that the plaintiffs’ mark was a well-known mark. It stated that owing to the long duration of use, wide geographical area of use, extensive promotion and sales and the numerous registrations in various countries, the mark had indeed acquired a “well-known” mark status. However, I fail to see how this has any bearing on the case and the ruling of the court since they had in any case concluded that there was infringement and passing off demonstrated. Perhaps the only reason that I can see for which the court ventured into this analysis is to ascertain the damage to the goodwill of the plaintiffs.

The court next dealt with the claim of damages. The court ruled that merely because a defendant stayed away from the proceedings, he should not be immune from liability on account of failure of to produce his account books. Doing so would disparage the defendant who does show up in court to contest the proceedings.

2. PepsiCo Inc., & Anr. v. PSI Ganesh Marketing & Anr.

[Text of the judgment]

Facts: Again, the dispute was fairly straightforward. The plaintiffs were the registered proprietors of the mark ‘Aquafina’. They had registered in India in Class 32 as early as 1997. They had also led evidence to the fact that they had carried out the business of bottled water in other countries under the same mark. Evidence was also led to demonstrate the large volume of sales of the product and also the extensive marketing campaign that the plaintiffs had undertaken. The defendants were selling bottled water under the mark ‘Aqua Fies’ with a similar artistic get up as that of the plaintiffs. The plaintiffs sued for infringement, passing off and copyright infringement in the label.

Contentions of the Parties: PepsiCo argued that the use of their registered trademark was infringement and this was damaging the goodwill of their mark. The use of a mark that was deceptively similar to the mark plaintiffs constituted passing off the business of the defendant as that of the Plaintiffs.

Decision of the Court: The court held that the use of an identical and deceptively similar mark as that of the plaintiffs amounted to infringement in the trademarks and copyright of the plaintiffs. The court relied on the test whether an “average person with imperfect recollection” would be confused by the marks in order to judge whether the marks were deceptively similar to each other. The court also stated that the marks must be compared as a whole. The court then went on to state that the defendants were also passing off their products as that of the plaintiffs by adopting such a deceptively similar mark and artistic labelling. They are encashing upon and eroding the goodwill of the plaintiffs.

Yet again, the court rules that just because a defendant stays away from the proceedings, he must not be given the benefit of this and punitive damages may be imposed even in the absence of their account books. In this decision however, the court deals with a brief analysis as to why punitive damages are necessary in the first place (the court did venture into a brief analysis of this reason in the Jockey case as well but this was just as an afterthought). The reasoning provided is that noting the rising instances of piracy in the country, these damages would “make up for the loss suffered by the plaintiff and deter a wrong doer and like-minded from indulging in such unlawful activities”.

What is curious however is that the damages awarded in this latter case is Rs. 5 lacs whereas in the former case (the Jockey case) it is only Rs. 3 lacs. In the absence of accounts of profit and noting that in both instances the brands involved were of nearly similar global appeal (in their respective markets, the court having declared both to be well known marks) I fail to see how the court could grant different sums as damages in what appears to be strikingly similar fact situations.