In HTC Corporation v/s Mr Lv Degao & Ors., the Delhi High Court held that if two trademarks are validly registered, both the registered owners can use their respective trademarks to the exclusivity of third parties but can’t assert their right against each other.
The Court further observed that- "When a challenge is raised to the registration, ordinarily till the Register is rectified and such registration is cancelled, both the proprietors would be entitled to claim a right to its use."
The Court also analysed the Trademarks Act, 1999 and summarised the legal position as:-
1. Two or more persons can have the same/similar trademark registered for different, similar and even identical goods. If they are validly registered, they can be used to the exclusivity of third parties but not against each other.
2. Although, the ‘later’ trademark be refused for registration or even cancelled if already registered owing to certain conditions provided under the law such as dishonest usage, subsequent usage without any cause, bad faith, delusion of the distinctiveness of the previously registered trademark.
3. This along with other factors such as the ‘good-will of the brand/trademark, or whether it's well known etc’ could be relevant factors in deciding whether or not the subsequent user should be restrained from using a trademark.
In the instant case, The Court noted that since both the Trade Marks were registered in the matter, all facts would have to be considered holistically to determine whether or not the plaintiff was entitled to interim protection and remarked that:-
“Before considering the cited case law, it may be useful to refer to the provisions of law. The rights conferred under Section 28 of the T.M. Act to the registered proprietor of a Trade Mark upon its registration, namely, the exclusive right to use it in relation to the goods and services in respect of which the Trade Mark is registered, is limited where there are two or more such registered proprietors, as they cannot claim exclusive use against each other, but have those rights against other persons."
The Court observed that in a case where two registered trademarks are involved and the plaintiff seeks protection against the usage of identical or similar trademarks, the court is free to delve into not just passing off but also decide on the question of infringement.