[Recently, the Madhya Pradesh High Court passed a detailed order clarifying that a Registered Proprietor is not required to implead an Authorised User to institute GI infringement suits. SpicyIP intern Jyotpreet Kaur writes on this development. Jyotpreet is a third-year law student from the National Law University, Delhi who is interested in Intellectual Property Rights and Competition Law and looks to study their interaction with each other. Her previous post can be accessed here.]
On 18th December 2023, a 2 judge bench of the Madhya Pradesh High Court, in Scotch Whisky Association v. J.K. Enterprises, engaged in a thorough exercise of analysing the law relating to who can file an action for infringement of a registered Geographical Indications in India, more specifically concerning the relationship between ‘Registered Proprietors’ and ‘Authorised Users.’
The petitioner, a UK-incorporated company, is the “Registered Proprietor” of “Scotch Whisky” filed the case originally against the defendants (J.K. Enterprises) to prevent the infringement of their GI by restricting the defendants from using whisky that wasn’t Scotch Whisky under the mark ‘London Pride.’ The suit had originally been held to be non-maintainable owing to the non-joinder of the “Authorised User” per the requirements of Section 21 of the Geographical Indications of Goods (Registration and Protection) Act, 1999 (‘GI Act).
Discussion on TRIPS and the GI Act
In this easy-to-follow order, the MP HC invoked Articles 22 and 23 of the TRIPS, which provide for the ‘Protection of Geographical Indications’ and ‘Additional Protection for Spirits and Wines’ respectively, to give force to the legislative intent behind the GI Act and Rules thereof. The court also used the overall scheme of the Act in order to provide a purposive interpretation of Section 21(1), finally holding that the petitioner was entitled to take this action forward.
One of the questions that came up before the Court was whether the ‘Registered Proprietor’ could bring a suit individually before the Court or would have to necessarily be joined by the Authorised User(s) in order to make the suit maintainable under Section 21(1). Before going into the merits of this question, the Court briefly examined India’s association with the TRIPS and WTO and the need for a GI Act in pursuance of India’s treaty obligations. The Court therefore used the principle that Acts enacted in pursuance of India’s treaty obligations need to be given a purposive interpretation in light of the said treaty obligations. In this instance, the Court located India’s obligations under the TRIPS and sought to enforce the same by reading the GI Act more expansively in line with its objectives. This is a welcome move by the MP HC in consideration of the Supreme Court’s increasing reliance on International law norms and standards to interpret domestic law. Though not specifically mentioned in the order, this could be considered an excellent reliance on the principle of ‘pacta sunt servanda’ under which treaties are to be abided by in good faith.
Scheme of the GI Act
The GI Act defines the term ‘Registered Proprietors’ in Section 2(n) as “any association of persons or of producers or any organisation for the time being entered in the register as proprietor of the geographical indication”. On the other hand, an ‘Authorised User’, under Section 21(1)(b) has the exclusive right to use the GI in relation to the goods for which it has been registered. After having engaged itself with the TRIPS Agreement, the Court delved into the intricacies of India’sGI Act and Rules and analysed various provisions of the same separately to look at the role of the Registered Proprietors individually and that of the Registered Proprietors with Authorised Users, either conjunctively or disjunctively. The Court has done this to highlight the importance of the Registered Proprietor who initiates the process whereby a GI is granted. The role of the Registered Proprietor is also enhanced by looking at the requirement wherein they are required to be sent a notice every time a new Authorised User is added to the register. The Court engaged in this exercise to distinguish the scheme of the Act generally from Section 68 which specifically mandates the impleadment of the Authorised User with the Registered Proprietor in certain cases mentioned therein. The court concluded that if it were the intention of the legislature to mandate the impleadment of the Authorised User before initiating an action against infringement u/s 21, it would have done so as done in Section 68. This approach undertaken by the Court is well-rounded and gives effect to the scheme of the Act which seeks to better protect GIs.
The Court reached the conclusion that in various cases, the Registered Proprietor can institute actions regarding the GI without the Authorised User(s). The Court also held that, regardless, the GI Tag is granted on the basis of the application of the Registered Proprietor and (only) thereafter the Authorised Users are allowed to use the GI. Thus, the existence of the GI in itself is contingent on the Registered Proprietor. Thus, the Registered Proprietor is to be regarded as an entity independent of the Authorised User. As the Court then held, “the legislature could not have been presumed to have conferred exclusive rights on the AU to the exclusion of RP itself, the originator of the very existence of a right. On the principles of ubi jus ibi remedium, viz., if there is a right, there is a remedy, therefore, Registered Proprietor would also have a right to file a restraint suit for grant of injunction against any unauthorised user of GI tag.”
It is in light of these conclusions, that the Court interpreted Section 21(1)(a) which reads as follows:
“(1) Subject to the other provisions of this Act, the registration of a geographical indication shall, if valid, give,-
(a) to the registered proprietor of the geographical indication and the authorised user or users thereof the right to obtain relief in respect of infringement of the geographical indication in the manner provided by this Act”
The Court read the word “and” in sub-clause (a) to mean “or” in order to enforce the rights of the ‘Registered Proprietor” and not make their role subservient to that of the “Authorised User(s)”. Therefore, in toto, the Court held that in a case of GI infringement, it is both, the Registered Proprietor, as well as the Authorised User, who can file a suit individually. They may not necessarily have to be impleaded as parties together. This is something that is in pursuance of the scheme of the Act since it would have been logically irrelevant for the Legislature to have made an exception here without any reasoning which has been demonstrated meticulously by the Court in its analysis of the various provisions of the GI Act highlighting the relationship between the Registered Proprietors and Authorised Users.
In conclusion, the MP HC’s thorough analysis of the GI Act will have significant implications as it clarifies the rights of the various parties involved in GI litigation. This is because, notwithstanding the fact that the Authorised Users have the right to use/sell the product, there exists a risk of reputational harm to the Registered Proprietors in case of infringement of GIs. Thus, this order safeguards the rights of both RPs and AUs. The Court has differentiated between Registered Proprietors and Authorised Users and acknowledged the right of the Registered Proprietor to file suits independently of the Authorised Users in matters relating to GI infringement. This is not only in pursuance to India’s treaty obligations under the TRIPS but also a reasoned approach to the interpretation of section 21(1)(a) of the GI Act.
