We are pleased to bring to you this guest post on the statutory position and judicial interpretation of disclaimed marks in the Indian trademarks regime. The post is authored by Surabhi Katare who is a fifth year student at Hidayatullah National Law University, Raipur. Surabhi is interested in IPR, media, and tech laws and wants to pursue a career in IP and allied areas.
Disclaimed Trademarks: Protection or Usurpation
By Surabhi Katare
While the foundational principle of trademarks as a regulated intellectual property is to protect the identity and distinctiveness of goods and services of entities and trademark holders from dishonest adoption by others, it is to be noted that the law generally does not allow any entity to monopolize on the use of a certain word, which forms only a part of the trademark. The parts of the trademarks that contain a descriptive or a generic word are often disclaimed, meaning that it is established that the trademark proprietor holds right to exclusively use the trademark as a whole but cannot monopolize on the generic words that form part of the trademark.
A trademark disclaimer, for general understanding, is a statement in the records of the registered trademark that alludes to how a part of the said trademark, which may be generic or descriptive, cannot be claimed to be owned by the proprietor of such trademark. Disclaimers in trademark registrations assist to distinguish the goods and services of one proprietor from that of the other, without restricting others to describe their goods or services. This post assesses the statutory and judicial position regarding disclaimed marks in infringement cases and highlights the need of judicial clarity on the disclaimers in cases alleging passing off.
Statutory Recognition of Trademark Disclaimers
Section 17(b) of the Trade and Merchandise Act, 1958, the marginal note (explanation on the side of a provision) of which reads as “Registration of trade marks subject to disclaimers” enunciated the Tribunal could direct proprietors to make appropriate disclaimers if a trademark contained any matter which was ‘common’, or ‘otherwise of non-distinctive character’.
It is pertinent to mention that a similar provision was not codified in the subsequent legislation. However, Section 17(2)(b) of the Trade Marks Act, 1999 (the Act) provides that when a trademark “contains any matter which is common to the trade or is otherwise of a non-distinctive character, the registration thereof shall not confer any exclusive right in the matter forming only a part of the whole of the trade mark so registered”, thus providing the statutory sanction to disclaimers.
The Manual of Trademarks, in 2015 provided a clarification on the procedure of disclaiming trademarks by directing the Examiner of the Trademarks to attach a disclaimer to ‘clearly specify the rights of the proprietor’ and word the condition as follows: “Registration of the trademark shall give no right to the exclusive use of word……appearing in the mark” and the same be finally issued by the Registrar.
The following categories of words are typically subject to disclaimer in a trademark registration: generic, descriptive, non-distinctive, words with geographic indications, informational words, well-known symbols, laudatory words, etc. Many popular brands have parts of their widely known trademarks disclaimed, to give some instances, ‘coffee’ in Starbucks Coffee, ‘pizza’ in Dominoz Pizza, etc. are disclaimed.
Judicial Position of Trademarks with Disclaimers
Courts have furthered the objective of disclaimers, i.e. to avoid monopolization of words by the proprietor and to deter the proprietor from instituting infringement suits on the basis of disclaimed part of the trademarks, in various decisions.
The Supreme Court, in Registrar of Trade Marks v. Ashok Chandra Rakhit Ltd. held that the purpose of disclaimers is to reduce the possibility of unauthorized claims under the garb of registration. It stated that “real purpose of requiring a disclaimer is to define the rights of the proprietor under the registration so as to minimize, even if it cannot wholly eliminate, the possibility of extravagant and unauthorized claims being made on the score of registration of the trademarks”. The Court also held that the disclaimers are only for the purposes of registration under the Act, it does not affect the rights of the trademark holder outside of the statute.
The Ashok Chandra Rakhit decision became a torchbearer for the decisions to follow as it laid down the three-fold principle that: firstly, the object of disclaimers is to prevent misuse of registration, secondly, the disclaimer is a statutory tool only and, thirdly, no infringement can be claimed on that part of the mark, that has been disclaimed. The Court’s opinion on suits of passing off has been discussed below.
Courts have followed the decision in various judgements, of which the following two are worth mentioning. In Parakh Vanijya Private Limited v. Baroma Agro Products & Ors., in appeal before the Apex Court, the appellant/plaintiff had alleged infringement and passing off of their trademark Malabar Gold by the respondent/defendant in the trademark Malabar Baroma. The Court ruled that the respondent can pursue the registration application of their trademark with the word ‘Malabar’, for the word is generic and has been disclaimed in the appellant’s trade mark. The judgment is in lines with the ruling in the Ashok Chandra Rakhit case.
Moreover, the Delhi High Court, recently, in 2023, in Pernod Ricard India Private Limited v. AB Sugars Limited heard the dispute between Royal Stag and Indian Stag. The plaintiff alleged passing off and infringement of its registered trademark- Royal Stag, of which the word Royal was disclaimed. Reliance was placed on the decision of Ashok Chandra Rakhit and the suit was dismissed with the Court reiterating that disclaimer certifies non-exclusivity on use of the word Royal. The Court also observed that “disclaimed while granting registration to the plaintiff, that disclaimed part of the plaintiff’s mark could not constitute the basis to allege infringement. There can be no cavil with this proposition. Once part of a mark is disclaimed while obtaining registration, no plea of infringement can be predicated on that part of the mark, which stands disclaimed.”
It is to be, however, noted, that disclaimers are not intended to supersede the basic tenet of trademark law, i.e. impugned marks cannot be deceptively similar. In a dispute before the Delhi High Court, in Mount Shivalik Breweries Ltd. v. Gurmon Enterprises between trademarks Thunderbolt and Thunder Night, the court accepted the argument that Thunder in Thunderbolt (plaintiff’s label) has been disclaimed and thus, no exclusive right can be exercised over the same. However, the Court also considered that trademarks should not be deceptively similar and held that even though the plaintiff does not have an exclusive right over the word ‘Thunder’ the disputed marks are similar.
A similar holding was observed by the Delhi High Court in British School Society v. Sanjay Gandhi Educational School and Anr., the dispute between The British School of the plaintiff and The British School of the defendant was settled in the favour of the plaintiff even though the registration of their trademark was disclaimed for all the three words. The Court held that despite a disclaimer, the impugned trademark is deceptively similar to that of the plaintiff. Thus, the defendant was directed to change the names of their schools.
Further, the High Court of Bombay, in Pidilite Industries Ltd. v. Riya Chemy held that M-Seal and R-Seal, the rival marks in the dispute, are deceptively similar and despite the fact that the Plaintiff’s trademark is disclaimed, the defendant cannot be allowed to use the mark. This ruling was based on plaintiff’s claims of loss, damages and balance of convenience while considering the marks as a whole. The Court also observed that the defendant is claiming both the exclusive right to use the word Seal while also arguing that the word is generic, the court held that this is contradictory and does not establish a case in the favour of the defendant. It is therefore settled that disclaimers in trademarks do not grant exclusive right for monopolization, however, principles of trademark law apply to all disputed regardless of whether the impugned trademarks are disclaimed.
The Conundrum Around the Common Law Remedy of Passing Off
The objective of disclaimers is to ensure that no common or descriptive word is monopolized by a proprietor. However, if the remedy of passing off is available to proprietors whose registered trademarks have been disclaimed, such proprietors get the right to initiate legal proceedings against the use of disclaimed words and assert the right to exclusively use such words, denying other proprietors the right to use common, generic or descriptive words.
When answering the question of whether proprietors of registered trademarks that have been disclaimed have the right to initiate a claim of passing off, for it is a common law remedy, the courts have taken an affirmative stance. The Court in Ashok Chandra Rakhit judgement clarified that the disclaimers are strictly restricted to claiming rights under the Act, i.e. disclaimers are purely statutory and do not take away the common law remedy available to the proprietors. The Court observed that the remedy of passing off, offered under common law to all proprietors (irrespective of whether their trademark is registered or not) exists independent of the statutory rights created by registration under the Act.
Later, in the Parakh Vanijya case the Court relied on the judgement of the Ashok Chandra Rakhit case and held that no infringement can be claimed on that part of the mark that has been disclaimed.However, the judgment did not mention the position of claim of passing off in such cases, therefore the Ashok Chandra Rakhit ruling is being followed till date.
However, in the Ramdev Food Products case, the Supreme Court has held that passing off claims shall only subsist against trademarks that have been disclaimed if the marks are deceptively similar in terms of font, style, etc. The Court held that keeping in mind the possibility of proprietors misusing their right to claim remedy under common law. The Court also held that even though insertion of disclaimer in a trademark registration does not restrict the proprietor from claiming remedy under common law, the presence of disclaimers indicate that the word is generic or descriptive and thus, not for the sole use of the proprietor.
Conclusion
Thus, in conclusion, the courts’ interpretation of a number of cases pictures a regime wherein disclaimers aid in preventing monopolization of generic words, while the courts also ensure that there is an overall dissimilarity in rival trademarks despite disclaimers in place. The scope of disclaimers over the common law remedy of passing off is, however, not completely in line with the objectives of the Act thus, there is a need for a concrete interpretation of passing off claims in registered and disclaimed trademarks and the courts must be cautious to differentiate the cases of intentional deception.
