1. The plaintiff instituted the present suit to restrain the defendants by a decree of permanent injunction from misrepresenting themselves as authorized distributors of the plaintiff and from trading as GE Dehumidifiers (Defendant No.3) or in any other deceptively similar trading style and also from importing, exporting, distributing, selling or dealing in Dehumidifiers or any other product of the plaintiff under the trademark GE or GENERAL ELECTRIC or the GE monogram or any other mark as may be deceptively similar to the plaintiff's trademark. The plaintiff also claimed damages in the sum of Rs.20 lacs and an order for delivery of all products of the plaintiff including Dehumidifiers and any other infringing material bearing the trademark of the plaintiff.
2. Vide ex-parte order dated 2nd June, 2006, the defendants, their partners, directors and agents were restrained from misrepresenting themselves as authorized distributors of the plaintiff and from trading as GE Dehumidifiers or from dealing in any product under the trademark GE or GENERAL ELECTRIC or GE monogram or any other mark deceptively similar thereto. Vide the same order, on an application of the plaintiff, a local commissioner was also appointed to visit the premises of the defendants and to inspect the Dehumidifiers and other electrical appliances bearing the trademarks of the plaintiff and also to determine if the same were "grey market" products or the infringing version of the plaintiff's products and to seize the grey market/infringing products and place them in superdari of the defendants subject to further directions of the court. The said commission was executed. As per the report of the commissioner filed before this court, the local commissioner found the defendant No.1 at the premises and identified himself as the proprietor of M/s Global Electronics. The commissioner found 23 unopened sealed boxes bearing the GE trademarks and describing the contents thereof as Dehumidifiers. The commissioner, as directed, seized the said boxes and after putting his signatures on the boxes placed the same in the superdari of the defendant No.1. A superdarinama of the defendant No.1 undertaking not to sell, dispose of or otherwise deal with the said goods and to produce the same as directed by the court has also been filed by the commissioner along with his report. The commissioner did not find any books of account in the premises but found two invoices in the said premises of the sale of two GE Dehumidifiers. The said invoices have also been filed along with the report. The said invoices are of GE Dehumidifiers, Mumbai and also bear the GE monogram with respect whereto the suit has been filed.
3. The defendant No.2 who was impleaded in the suit as the only other partner of the defendant No.1 carrying on business along with the defendant No.1 in the name and style of M/s GE Dehumidifiers (Defendant No.3) appeared before this court on 11th September, 2006 and stated that he was not connected with any of the activities of the defendant No.1 and the defendant No.3 and was as such also not connected with the reliefs claimed in the suit. On his said statement he was dropped from the array of parties.
4. The defendant No.1 for himself and as sole proprietor of defendant No.3 M/s GE Dehumidifiers filed a written statement.
5. The plaintiff had instituted the present suit objecting to the business in the name and style of GE Dehumidifiers being carried on for the reason of breach thereby of the registered trademark of the plaintiff and the defendants thereby passing themselves off as the authorized distributor or affiliate or having association with the plaintiff. It was also the case of the plaintiff that the defendants are illegally using the GE monogram of the plaintiff and of which the plaintiff is the registered proprietor. It was further the case of the plaintiff that the plaintiff though manufacturing and selling Dehumidifiers, was not marketing the same in India; that the defendants appeared to be acquiring the Dehumidifiers of the plaintiff from territories other than India and illegally marketing the same in India. It is the case of the plaintiff that such action of the defendants of importation of the genuine products of the plaintiff to territory for which they were not meant, amounted to the violation of the trademark of the plaintiff and caused loss to the plaintiff. It was the case of the plaintiff that the plaintiff for the reason of not marketing Dehumidifiers in India was neither giving any warranty nor any after sales service for the said Dehumidifiers in India and the illegal sale thereof by the defendant caused loss of reputation to the plaintiff in as much as the purchasers from the defendants on not being able to claim on the warranty and not being able to get the after sales service were likely to think ill of the plaintiff.
6. The defendants No.1&3 in their written statement while admitting to be carrying on business in the name and style of M/s GE Dehumidifiers explained the same as Global Enterprises and denied thereby infringing the trademark of the plaintiff; they denied that they were in any manner infringing the trademark of the plaintiff or passing themselves off as a distributor or associate or affiliate of the plaintiff; they further pleaded that the defendant was earlier in collaboration with M/s Godrej marketing Dehumidifiers in India and pleaded that they were in the business of purchasing old Dehumidifiers, repairing and re-selling the same. The written statement of the defendant is however conspicuously quiet as to the contents of the report of the local commissioner. The defendants No.1&3 also did not file any objections to the report of the local commissioner. The plaintiff filed a replication reiterating its stand.
7. The defendants No.1&3 also, after filing the written statement stopped appearing and were vide order dated 20th November, 2006 proceeded against ex-parte. The plaintiff has led ex-parte evidence by filing the affidavits by way of examination in chief of its constituted attorney Ms. Rubi Anand and of the Chartered Accountant Mr. Sanjeev Sharma. The defendants No.1&3 remain ex-parte and the evidence of the plaintiff remains unrebutted and unchallenged.
8. The witnesses of the plaintiff have proved the registrations of the trademark GE monogram, GENERAL ELECTRIC (GE), GE in class 1,2,3,6,7,9,10,11,12 &17 as Exhibit P-4 to Exhibit P-8. It has further been deposed and which deposition is believed and correct that the name/mark GENERAL ELECTRIC and the mark GE are as much a household word in India as some of the known Indian trademarks, owing to the involvement of the plaintiff with the growth of infrastructure and amenities in India; that the products of the plaintiff have been well received in India and the plaintiff has huge sales in this country; that the plaintiff is involved in a large range of electrical consumer and household goods and has a strong network of after sales service, back up support, sales promotion etc. in India and all of which adds to the good reputation being enjoyed by the plaintiff.
9. As far as the relief of permanent injunction is concerned, I have no hesitation whatsoever in holding the plaintiff entitled to the same. The name GE Dehumidifiers in which the defendant No.1 is carrying on business is suggestive of the defendant No.1&3 being an authorized distributor affiliate or associate of the plaintiff. The Dehumidifiers in which the said defendants are dealing are generally sold and marketed from same outlets from which electrical household goods viz. refrigerators, freezers, electric cookers, microwave, washer cookers, water systems, ventilation system etc. in which the plaintiff is admittedly dealing in India through various companies and subsidiaries and authorized distributors. The Dehumidifiers fall in the same class of goods in which the plaintiff is carrying on business in India. Even though the plaintiff is not carrying on business in Dehumidifiers in India for the present but the same would not come in the way of the plaintiff being entitled to the grant of injunctive relief in as much as a common man wanting to purchase/acquire a Dehumidifier is not likely to know that the plaintiff is not dealing in Dehumidifiers in India and is likely to believe that the Dehumidifiers being sold by the defendants No.1&3 are under authorization from the plaintiff. Such a consumer is further likely to expect the compliance of the warranty conditions and after sales service and support associated with the other products of the plaintiff in India and is definitely likely to blame the plaintiff and the esteem in which the plaintiff is held by the said consumer is likely to fall, upon such consumer not getting the same, in as much as the plaintiff has stated that it is not providing such services in India in relation to Dehumidifiers.
10. Though, the defendants sought to explain the trade name of GE Dehumidifiers adopted by it as Global Enterprises but the name Global Enterprises nowhere appears on the invoices seized by the local commissioner from the premises of the defendant. The report of the local commissioner, in the absence of any objection to the same is entitled to be read by this court. Had the intentions of the defendants been bonafide, nothing prevented them from using the name Global Enterprises for their business and which would have not led anyone to believe that the defendants had any association with the plaintiff, in as much as the plaintiff is equally well known as GENERAL ELECTRIC as it is as GE. However, the use by the defendants of GE instead of Global Electronics on its invoices can lead to only one assumption i.e. that the defendants thereby wanted to pass off their business and their products as that of the plaintiff and intended to confuse and deceive the customers and public at large. Not only so, the invoices seized by the commissioner also contain the GE monogram and which puts the matter beyond any pale of controversy. The defendants by using the said monogram clearly infringed the trademark of the plaintiff and sought to pass themselves off as the plaintiff.
11. The plea of the defendant of dealing in old/used legitimate Dehumidifiers of the plaintiff besides having been not substantiated by the defendants, is otherwise also not believable in the light of the report of the court commissioner. The court commissioner has reported brand new sealed boxes of Dehumidifiers of the plaintiff acquired from other countries being found in the premises of the defendants.
12. The present being an ex-parte matter, I, in this, do not deem it appropriate to deal with the issue of parallel importation and trademark infringement, with respect whereto a number of judgments of foreign courts/tribunals have been relied upon by the counsel for the plaintiff. This is also for the reason that I have found the plaintiff otherwise entitled to the relief claimed.
13. The next question which arises is of the claim of the plaintiff for damages. The Chartered Accountant engaged by the plaintiff by his unrebutted evidence assessed the loss caused to the plaintiff to be of Rs.25 lac. The claim for damages in the plaint was however confined to Rs.20 lac only. As aforesaid, 23 Dehumidifiers were seized by the court commissioner from the premises of the defendants and were left in the superdari of the defendant No.1. I direct the defendant No.1 in whose superdari the said Dehumidifiers were left by the court commissioner to deliver the same to the representative of the plaintiff. The defendant No.1 shall be liable for consequences, if fails to deliver the said Dehumidifiers to the plaintiff. However, mere delivery of the said Dehumidifiers to the plaintiff would not be a substitute for damages in as much as in the absence of the plaintiff carrying on business in Dehumidifiers in India, the same are likely to be of no use to the plaintiff. It is not clear as to what it would cost the plaintiff if the plaintiff was to export the said goods from India to other territories for which they were meant. The defendant has been found to be infringing the trademark of the plaintiff and passing off his business as that of the plaintiff. Although, there is no complaint of breach of interim order by the defendants but the defendants merely by remaining absent cannot escape the liability for damages. The evidence of the plaintiff shows that the defendant was selling each Dehumidifier for approximately Rs.25,000/-. The defendant avoided to show his books of accounts also. From large consignment of 23 Dehumidifiers seized from the premises of the defendants, it is apparent that the defendant No.1 was dealing in large volumes. The cost of the Dehumidifiers to the defendants has not been established but considering that in the last few years, the return on investments in stocks and mutual funds itself has been in excess of 15%, it can safely be assumed that the defendants would be carrying on business for returns in excess of return on investments in stocks and mutual funds. Following the said principle I assume that the defendants had a margin of 22 to 25% at least on each Dehumidifier i.e. of over Rs.5,000/- on each Dehumidifier. On this basis I consider the award of damages in the sum of Rs.10 lacs as appropriate.
14. This court in Microsoft Corporation Vs. Yogesh Papat 2005 (30) PTC 245 (Del) has held that the plaintiff would be entitled to damages for the reason that it would be futile to direct the defendants to render accounts for the reason of the defendants carrying on business surreptitiously. Similarly, in Time Incorporated Vs. Lokesh Srivastava 2005 (30) PTC 3 (Del) also it was held that where infringement is found, punitive damages should follow to discourage such law breakers.
15. The suit of the plaintiff is thus decreed against the defendants No.1&3 for the relief of permanent injunction restraining the defendants and their agents from misrepresenting themselves as authorized distributors of the plaintiff and from trading as GE Dehumidifiers or in any other name deceptively similar thereto and from importing, exporting, distributing, selling, advertising or dealing in Dehumidifiers or any other products as of the plaintiff, under the trademark GE or GENERAL ELECTRIC or GE monogram or marks deceptively similar thereto. A decree for recovery of Rs.10 lacs is also passed against the defendants No.1&3. A decree for delivery of the goods seized by local commissioner appointed on 2nd June, 2006 is also passed and the defendant No.1 in whose superdari the said goods were kept is directed to deliver the seized goods to the representatives of the plaintiff. The plaintiff shall also be entitled to costs against the said defendants. The decree sheet be drawn up.
RAJIV SAHAI ENDLAW (JUDGE) December 18, 2008