Trademark

Guest Post: The iPhone v iFon conflict


spicyip_fellowship_ad_bannerOur Fellowship applicant series heats up with a surge of entries closer to our deadline of January 16th! In this post, Kiran Mary George, a 2nd year student at Indian Law Society’s Law College, Pune, brings us this interesting post looking through some of the issues that have arisen in Chennai based iVoice enterprise’s challenge to Apple’s iPhone trademark. This is Kiran’s first entry to our SpicyIP Fellowship applicant series. [Readers interested in finding out more details about our SpicyIP Fellowship applicant series can click here.]

The iPhone v iFon conflict

By: Kiran Mary George

Months after local Mexican firm iFone S.A. de C.V.’s victorious walk all over Apple Inc in the trademark infringement suit filed against the former, making it amply clear that home-grown trumps alien in Mexico – the battle of the brands has now taken centre stage in India, with a local firm challenging Apple’s popular world-over ‘iPhone’ moniker trademark in the country.

Chennai based iVoice Enterprises’ mobile venture, India Phone or ‘iFon’, received a rather destructive jolt right before it even started. Formed in 2007, iVoice had sought to launch an economical, feature loaded phone for the Indian market, and accordingly filed for registration of the brand and logo ‘iPhone’ in 2007 – just after the time the iPhone was first announced by Steve Jobs. iVoice was to outsource the manufacturing of iFon or ‘India Phone’ to Asian countries like China and Taiwan. However, in 2008, Vodafone announced its plans to bring the iPhone to India, and in pursuance to facilitating this, Apple filed a motion against iVoice’s ‘iFon’ trademark on the grounds of being phonetically similar to Apple’s own ‘iPhone’. The highly advertised iPhone 3GS was launched here only in 2009. Despite India Phone or ‘iFon’ being registered as a trademark in May 2007 itself, the fears of being caught in a longstanding legal wrangle resulted in both domestic and foreign investors backing out of the project, causing massive financial deficits to iVoice. Although the local firm prepared and filed a rectification suit against the Cupertino based Apple Inc’s iPhone with the Intellectual Property Appellate Board (IPAB) and filed a counter claim by 2010, the damage had already been done. The support and backing for iFon, had dipped and financial resources had dried up, courtesy Apple’s motion. The phone could not be launched, and Apple subsequently registered its own trademark in India.

iVoice filed a rectification petition before the IPAB, under Section 57 of the Trademarks Act, 1999, asking for removal of Apple’s ‘iPhone’ trademark from the registry, to which a counter was recently submitted by Apple.

Unlike the Mexico case, where Apple’s iPhone smart phone brand had a different target market as against that of the phonetically similar iFone, a telecommunications service provider, here both iVoice’s iFon and Apple’s iPhone constitute mobile phone product brands, with identical intended markets.

This post attempts at examining the iPhone’s position as a foreign, unregistered trademark vis-à-vis iFon.

Looks like it’s i-trouble

It is common knowledge that ever since Steve Jobs introduced the first ‘iMac computer to the world in 1997, the i-prefix has stuck with many of Apple’s products, the syllable acquiring a rather distinct association with Apple’s ventures, such that products beginning with the prefix are today are often inherently assumed to be another of Apple’s creations.

iVoice’s mobile venture was originally called the India Phone. When and why did it switch over to ‘iFon’? Was the premature, hurried registration another unoriginal attempt at living off the growing anticipation precluding iPhone’s launch in the country, and perhaps hoping to pass off its “feature rich” iFon, as Apple’s own?

Strike when the iron is hot, indeed.

Claim for passing off

The principle forming the very crux of passing off is that no individual/entity can be permitted to sell products/services by falsely insinuating them to be those of another, and thereby be benefitted by the labour of another. Apple’s iPhone trademark, being unregistered, whilst ineligible for statutory protection in India, can enforce its rights against iFon if it can successfully establish, in a claim for passing off:

  • Priority use
  • Reputation in India
  • Misrepresentation
  • Injury to goodwill

Priority Use

In a claim for passing off, it is essential that the plaintiff proves priority adoption and use of the trade mark, resulting in the plaintiff acquiring a certain degree of reputation and stature in the market. Here, iPhone’s global, wide-scale advertising and marketing activities had consumers all over the country desperately awaiting the India launch. In Consolidated Foods Corporation v. Brandon & company (AIR 1965 Bombay 35) , it was held, ”Priority in adoption and use of a trade mark is superior to priority in registration.” Further, it was stated that small volume experimental sales and marketing activities may be sufficient to establish a continuous prior use of the mark”.

Misrepresentation

The test here is not the intention to misrepresent, but the likelihood of consumer misconception and confusion resulting from such misrepresentation. In Rich Products Corporation v Indo Nippon Food Ltd (2010 (42) PTC 660 (Del)), the court held that the intention to deceive is not an essential ingredient to be proved, provided the consumer was deceived or likely to be deceived. The iFon, its possibly deliberate phonetic similarities with the iPhone aside, was introduced at a time when the hype and excitement surrounding the iPhone was at its pinnacle, offering ample opportunity for naive consumers to, amidst the entire Apple craze, mistake one for another. In Macleods Pharmaceuticals Ltd. vs Procare Laboratories Pvt. Ltd (CS(OS) 2107/2006) it was held that misrepresentation is established when “the Defendant adopts and starts using distinctive features identified with the Plaintiff or his goods to market his goods or services so as to take advantage of the reputation and goodwill of the Plaintiff”.

Injury to goodwill

Since the very inception of the company, Apple products have come to be associated with a high standard of quality. The use of a deceptively similar mark to the iPhone trademark in an attempt to trade on the goodwill of the name, resulting in actual or likely injury to such hard-acquired goodwill is primal to succeeding in a passing off-action. This must be established by proving that relevant consumers would associate the offending mark with the plaintiff’s mark, as held in ITC Ltd v Philip Morris Products SA (2010 (42) PTC 572 (Del).

Reputation in India

Proving a pre-existing reputation in the country with respect to the trademark so under dispute such that certain goods have come to be distinctively associated with it, is essential. The concepts of well known trademark (Section 2(1)(zg) of the Trademarks Act, 1999) and trans border reputation are significant in this regard. The principle of trans border reputation was first discussed by the Supreme Court in the landmark case of N. R. Dongre v. Whirlpool (1996) 5SCC 714 where the “WHIRLPOOL” trademark was held to have acquired goodwill in India – the brand name had come to be associated with a section of products in the minds of the public. Hence, the brand was held to have trans-border reputation, despite there being no evidence of actual sale in India.

The case is slated to have an exciting finish, and it remains to be seen whether this time, Apple emerges unscathed or meets the same fate as it did previously did in Mexico – where although iPhone was acquitted of all liabilities, the Mexican iFone’s trademark rights in the country over iPhone’s were upheld.

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