In an inexplicable move that will potentially have a devastating effect on thousands of trade mark owners and applicants and lakhs of trade marks, the Trade Marks Registry in India has deemed (if the reports are correct) about 5,00,000 Trade Mark applications as “abandoned”. This “bulk abandonment” or culling has come about in relation to the examination of applications to register trade marks.
As a matter of formal procedure per Rule 38 (4) of the Trade Marks Rules, 2002, examination reports (containing the Examiners objections / observations to a given application and trade mark in terms of registrability and shortcomings or conditions imposed, if any) are served by the Trademarks Office on the Applicant/Applicant’s Agent either through post or through their official e-mail id. Rule 38 (4) is reproduced below:
(4) If on consideration of an application for registration of a trade mark or on an application for an expedited examination of an application referred to in sub-rule (1) and any evidence of use or of distinctiveness or of any other matter which the applicant may or may be required to furnish, the Registrar has any objection to the acceptance of the application or proposes to accept it subject to such conditions, amendments, modifications or limitations as he may think right to impose under sub-section (4) of section 18, the Registrar shall communicate such objection or proposal in writing to the applicant.
Once the Examination Report is served, Rule 38 (5) provides the Applicant a 30 day period (which is extendible by 1 month on request) to file its reply with the consequence of noncompliance being the abandonment of the application. Rule 38 (5) is reproduced below:
(5) If within one month from the date of communication mentioned in sub-rule (4), the applicant fails to amend his application according to the proposal or fails to submit his observations to the Registrar or apply for a hearing or fails to attend the hearing, the application shall be deemed to have been abandoned.
As a matter of routine process, however, examination reports were uploaded by the Trade Marks Registry on its website while formal service on the Applicant/Applicant’s attorney was effected intermittently. This very quickly led to questions of when “knowledge” or “communication” of the examination report could have been deemed to have been accrued which predictably ended up for determination by the courts.
A Division Bench of the Bombay High Court in March 2013 in the case of Institute of Cost Accountants of India (ICAI) v. The Registrar of Trade Marks, Mumbai & the Registrar of Trade Marks Kolkata (AIR 2013 BOM 107) held that the mere publication/uploading of the Examination Report/letter on the website by the Trademarks Office would not constitute “communication to the applicant” for the trademark registration. The division bench also noted that the Trademarks Office failed to indicate the existence of any rule or practice by which the petitioner was legally bound to take notice of anything posted on the website. It was held that posting notices on the website does not constitute compliance with Rule 38(4). The court held that Rule 38(4) most certainly does not mandate an applicant for registration to inspect the respondent’s website. The court held that the mere posting of the letter does not constitute communication under Rule 38(4). Thus, the court held that the petitioner cannot be imputed with knowledge of the said letter on the date of posting the letter on the website.
In the current situation, the online status pages of the Registry’s website also now indicate the date of dispatch of the examination report. In essence the obvious claim being that the examination report was allegedly dispatched by post. It thus appears, without being flippant about the situation, that hundreds of thousands of examination report letters were (allegedly) dispatched by the Registry but never delivered!! My informal enquiries with multiple IP law firms reveals that in most cases letters have not been received.
Even more instructive is the settled position that Rule 38 (4) is a mandatory or directory Rule. In the case of Paras Natural Spring Water Private Ltd v. Registrar of Trade Marks Delhi and Ors the Delhi High Court held as follows:
“10. The next question which comes up for consideration in this regard is as to whether the provisions of the Rules are directory or mandatory. In this regard, a reference may be made to Section 101 of the Act which to the extent it is relevant provides that if the Registrar is satisfied that there is sufficient cause for extending the time for doing any act (not being a time expressly provided in the Act), he may extend the time even in the cases where the time so specified has expired. Thus, in appropriate cases, the Registrar is competent to extend the time fixed by sub-rule (2) of Rule 39 of the said Rules, for responding to the proposal or objection of the Registrar. A reference in this regard may also be made to Rule 106 which provides that an application for extension of time under Section 101 (not being a time expressly provided in the Act or prescribed by rule 81 of by sub-rule (4) of rule 82 or a time for the extension of which provision is made in the Rules) shall be made on Form TM-56…..Since the Registrar may is competent to extend the time in appropriate cases, it would be difficult to say that the provisions of sub-rule (2) are mandatory. On a conjoint reading of the aforesaid provisions of the Act and the Rules, I am of the view that in a case where an applicant does not amend his application according to the proposal of the Registrar sent to him in terms of sub-rule (1) or does not submit his observation or does not apply for hearing, the Registrar may, in appropriate cases, treat the application to have been abandoned…”
Is this overnight culling a result of the pressure from the World Intellectual Property Organisation on the Trade Mark Registry to speed up the examination process? Apparently the Registry had fallen behind and was not meeting the 18 month time period mandated for Madrid Applications. Whatever the motivation, surely the Registry can think of more conducive ways to streamline its processes rather than cull lakhs of applications and adversely affects the rights of trade mark applicants.