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Avis Internatioanal Ltd. v. Avi Footwear Industries
Delhi High Court
Aug 10, 1990
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Factual and Procedural Background
This opinion addresses two interim applications filed in Suit No. 18 of 1990. The plaintiffs sought an injunction restraining the defendants from using the trade mark "AEVIS" or any deceptively similar mark to the plaintiffs' registered trade mark "AVIS" in relation to shoes or footwear. The plaintiffs hold the registered mark AVIS (Registration No. 352018, class 25) for garments and footwear since 1-8-1979. The defendants filed an application to vacate the injunction granted by a prior order dated 10-1-1990, contending that the plaintiffs have not used the mark AVIS on footwear for over five years and have thus moved for rectification of the mark under the Trade & Merchandise Marks Act.
Legal Issues Presented
- Whether the plaintiffs are entitled to an injunction restraining the defendants from using the mark AEVIS or any deceptively similar mark to the registered mark AVIS in relation to footwear.
- Whether the existence of rectification proceedings based on alleged non-use of the registered trade mark AVIS by the plaintiffs bars the grant or continuation of the injunction.
- What is the appropriate balance of convenience at the interlocutory stage between the parties, given the competing claims of registered rights and alleged non-use.
Arguments of the Parties
Plaintiffs' Arguments
- The plaintiffs are the registered owners of the trade mark AVIS, having coined and registered it for garments and footwear.
- Registration confers exclusive rights under sections 28 and 31 of the Trade & Merchandise Marks Act, entitling them to an injunction against infringement.
- The defendants' use of AEVIS is deceptively similar and likely to cause confusion, constituting infringement.
- The plaintiffs assert continuous use of the mark AVIS on footwear, contrary to defendants' claims of non-use.
- The defendants falsely marked their goods as registered when their application was only pending, exposing them to liability for false marking.
- Violation of exclusive statutory rights is illegal activity and warrants injunction relief to prevent continuation.
- The balance of convenience favors the plaintiffs as registered owners of the mark, while defendants have no competing claim.
Defendants' Arguments
- The defendants filed an application for rectification of the registered mark AVIS on the ground that the plaintiffs have not used the mark on footwear for five years or more, under section 46(1)(b) of the Trade & Merchandise Marks Act.
- Due to the pendency of rectification proceedings, the plaintiffs are not entitled to an injunction restraining the defendants' use of AEVIS.
- No documentary evidence has been produced by the plaintiffs to prove use of AVIS on footwear during the alleged non-use period.
- Reliance on two judgments by Justice Dalip K. Kapur where injunctions were refused in similar rectification contexts, arguing that the existence of rectification proceedings should preclude injunction.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| American Home Products Corporation v. Mac Laboratories Pvt. Ltd. and another, AIR 1986 137 | Registration of a trade mark confers exclusive rights to use the mark in respect of registered goods and entitles the owner to injunctions against infringement. | The Court relied on this precedent to affirm that registration creates a prima facie right to injunction and that infringement of this right constitutes actionable wrong. |
| 1981 Patent & Trade Mark Cases 14 (Dalip K. Kapur, J.) | Refusal of injunction in a rectification proceeding without stated reasons. | The Court declined to follow this precedent as it lacked reasoning and was inconsistent with the Supreme Court’s principles in AIR 1986 137. |
| 1981 Patent & Trade Mark Cases 260 (Dalip K. Kapur, J.) | Refusal of injunction in a rectification proceeding without stated reasons. | The Court similarly declined to follow this precedent for the same reasons as above. |
| Kedar Nath v. Monga Perfumery & Flour Mills, AIR 1974 | Illegal activity cannot be permitted to continue; injunction is the appropriate remedy. | The Court cited this authority to support the proposition that violation of exclusive statutory rights is illegal and injunction is warranted. |
| Wearwell Cycle Co. (India) Limited v. Wearwell Industries & Another, 1969 | Balance of convenience applies where parties are on equal footing; registered mark owners have stronger claim. | The Court used this precedent to conclude that the balance of convenience favors the plaintiffs as registered owners. |
Court's Reasoning and Analysis
The Court began by recognizing the statutory rights conferred by registration of the trade mark AVIS under the Trade & Merchandise Marks Act, particularly sections 28 and 31. It noted that registration prima facie grants exclusive rights to use the mark on the registered goods, here including footwear, and entitles the owner to injunctive relief against infringement.
The defendants' contention rested on alleged non-use of the mark AVIS on footwear for over five years, justifying rectification under section 46(1)(b). However, at this interlocutory stage, the Court observed that the burden of proof lies on the party seeking removal of the mark and that the plaintiffs assert continued use. The Court found the evidence to be conflicting affidavits and chose to rely on the plaintiffs' contentions in light of the statutory provisions.
Phonetically, the defendant's mark "AEVIS" is very similar to "AVIS," and the defendants failed to explain the adoption of a non-dictionary word closely resembling the registered mark. The Court inferred a likelihood of confusion and potential infringement.
The Court also rejected the defendants' reliance on previous judgments refusing injunctions in rectification proceedings, as those decisions lacked reasoning and were inconsistent with binding Supreme Court authority.
Considering the balance of convenience, the Court held that the plaintiffs' statutory monopoly over the registered mark must take precedence at this interlocutory stage to prevent concurrent use that could prejudice the plaintiffs' rights. The Court suggested that defendants could adopt a different label to avoid confusion.
Finally, the Court noted that the defendants' false marking of their goods as registered when only an application was pending constituted illegal activity warranting injunction.
Holding and Implications
The Court confirmed the injunction previously granted restraining the defendants from using the mark AEVIS or any deceptively similar mark in relation to footwear. It dismissed the defendants' application to vacate the injunction (I.A No. 2266 of 1990) and allowed the plaintiffs' application for injunction (I.A No. 88 of 1990).
The direct effect is that the defendants are prohibited from using the mark AEVIS during the pendency of the suit, preserving the plaintiffs' exclusive statutory rights. The Court emphasized that this is a prima facie interlocutory order and does not determine the ultimate rights of the parties after trial. No new precedent beyond the application of existing statutory and case law principles was established.
Mahinder Narain, J.:— By this order I intend to deal with two interim applications bearing I.A No. 88 of 1990 and I.A No. 2266 of 1990, which have been filed in Suit No. 18 of 1990.
2. I.A No. 88 of 1990 is an application under order xxxix rules 1 & 2 of the code of civil procedure, whereby the plaintiffs seek to obtain an order of injunction restraining the defendants, their servants, agents, stockists, dealers and all other persons from using the trade mark AEVIS in respect of shoes or any other trade mark which is confusing or deceptively similar to the registered trade mark AVIS of the plaintiffs, bearing registration No. 352018 (in class 25). The plaintiffs state that they have got the said mark AVIS registered in respect of readymade garments, wearing apparels including jeans, jackets, shirts blouses, socks, hosiery, brassers and footwear, and that the mark is registered on 1-8-1979.
3. The other application bearing I.A No. 2266 of 1990, which I am going to deal with, is an application under Order XXXIX Rule 4 of the Code of Civil Procedure for vacating the order of injunction granted by this Court (A.B Saharya, J.) on 10-1-1990, whereby this Court had restrained the defendants, their servants, agents, stockists, dealers and all other persons on their behalf from using the trade mark AEVIS in respect of shoes or any other trade mark which is deceptively similar to the registered trade mark AVIS of the plaintiffs till the next date.
4. The case of the plaintiffs is that they are the registered owners of the word AVIS, having coined the same and got the word AVIS registered, as aforesaid, and being the registered owners of the word AVIS, they are entitled by virtue of the rights conferred by section 28 read with section 31 of the trade & merchandise marks act to injunction order, restraining the defendants from using the said mark or any other deceptively similar mark on goods, namely, footwear. The effect of registration of the mark has been succinctly stated by the Supreme Court in case American Home Products Corporation v. Mac Laboratories Pvt. Ltd. and another, reported as AIR 1986 137 at page 155 (1) as follows:—
When a person gets his trade mark registered, he acquites valuable rights by reason of such registration. Registration of his trade mark gives him the exclusive right to the use of the trade mark in connection with the goods in respect of which it is registered and if there is any invasion of this right by any other person using a mark which is the same or deceptively similar to his trade mark, he can protect his trade mark by an action for infringement in which he can obtain injunction, damages or an account of profits made by the other person”.
5. The plaintiffs, therefore, say that they are entitled to have the injunction confirmed.
6. The defendants, on the other hand, in their aforesaid application under Order XXXIX Rule 4 state that for the reason they have moved an application for rectification of the mark, the plaintiffs are not entitled to an injunction, which has been sought. It is asserted by the defendants that the plaintiff have not, for a period of five years, or more, used the mark AVIS with respect to footwear, by virtue of the provisions of section 46(1)(b) of the trade & merchandise marks act entitled to have the registered trade mark rectified and the mark AVIS with respect to footwears removed from the register.
7. It is contended that no document has been filed indicating that the mark AVIS has been used by the plaintiffs in connection with footwear during the last 5 years or more.
8. The further case of the defendants that in view of the fact that the rectification proceedings have been filed, it would not be appropriate to grant the injunction which has sought by the plaintiffs against the defendants, as prima facie the register is liable to be rectified. For this proposition, the defendants have referred to two judgments of this Court, both delivered by Dalip K. Kapur, J., which have been reported as 1981 Patent & Trade Mark Cases 14, and 1981 Patent & Trade Mark Cases 260.
9. The former case related to the use of the word RICO in connection with sewing machines. Justice Kapur while denying the relief of injunction, has not given any reasons why he was refusing the injunction, and as such I am not inclined to follow this judgment, especially in view of what has been stated in 1986 Supreme Court 137 at pages 154 and 155.
10. Similarly, in the case reported as 1981 Patent & Trade Mark Cases 260, in which the mark in question was CROWN with respect to over-lock and chain stitching machine, injunction was not granted by Justice Kapur. Even in this case he gave no reasons for the non-issue of the injunction.
11. In both the aforesaid cases, Justice Kapur appeared to have refused to grant injunction for the reason merely of the existence of the rectification proceedings. The Supreme Court in 1986 Supreme Court 137 at page 154 has made the following observations with respect to section 46(a) & (b) of the trade & merchandise marks act which deals with rectification of marks.
“Under both these clauses, the burden of proving that the facts which bring into play clause (a) or (b), as the case may be, exists is on the person who seeks to have the trade mark removed from the register. Thus, where there has been a non-user of the trade mark for a continuous period of five years and the application for taking off the trade mark from the Registered has been filed one month after the expiry of such period, the person seeking to have the trade mark removed from the Registered has only to prove such continuous non-user and has not to prove the lack of a bona fide intention on the part of the registered proprietor to use the trade mark at the date of the application for registration. Where, however, the non-user is for a period of less than five years, the person seeking to remove the trade mark from the Register has not only to prove non-user for the requisite period but has also to prove that the applicant for registration of the trade mark had not bona fide intention to use the trade mark when the application for registration was made.”
12. At the present stage there is only an assertion that there has been a non-user of the mark AVIS with respect to footwears for a period longer than the statutory period. The burden to prove, that in fact there has been non-user for the period required by the statute, is on the person who asserts it, and at the present stage the plaintiffs assert that they have been using the word AVIS upon the footwears.
13. At this stage of the case, we have one affidavit against another affidavit, and in view of the statutory provisions of sections 28 and 31 of the trade & merchandise marks act, it would be appropriate to rely upon contentions of the plaintiffs.
14. It is apparent that the word AEVI is not a commonly used word. The word is not in a dictionary. Its adoption by the defendants, therefore, needed to be explained, which the defendants have not explained in the pleadings before the Court.
15. Phonetically the word AVIS, which is registered mark for footwear, and the word AEVI's have to be pronounced identically. The business name of the defendants is known as AVI Footwear Industries Prima facie, if it was the intention of the defendants by affixing the label AEVI's on the footwear made by them was to indicate that the footwear carrying that label is made by the AVI Footwear Industries, then the mark they would have adopted, would have been AVI, but that they have not done. They have tried to bring their mark/label as close as possible phonetically to the registered mark AVIS.
16. In my view, the statutory monopoly which has been conferred upon the plaintiffs in connection with use of the mark AVIS for footwear, has to have primary precedence over any other consideration in relation to grant or non-grant of an injunction, especially when the matter is at an interlocutory stage and is yet to be tried and it cannot be foreseen as to whether the defendants who seek rectification of the plaintiffs' mark, on account of non-user would be able to prove their case. The statutory registration establishes prima facie case in favour of the plaintiffs.
17. In this view of the matter, I think that the balance of convenience would be in favour of the plaintiffs to ensure that by concurrent user, during the period of the trial, no other rights come into existence. In my view, it is very convenient, if the defendants are so minded, to adopt any other label that establishes a connection in the course of trade with respect to the footwear manufactured by them.
18. Mr. K.R Gupta also says that the mark AEVI'S was shown in the advertisements of the defendants as a registered mark, whereas it was only a mark for which registration is applied for. He contends that the defendants have, therefore, made themselves liable for action for false marking on goods.
19. Mr. K.R Gupta also referred to AIR 1974 Kedar Nath…Plaintiff; v. Monga Perfumery & Flour Mills. Delhi-6…Defendant.) (2) in which it has been stated that illegal activity cannot be permitted to be continued when the proper remedy is to grant injunction.
20. In my view violation of the exclusive statutory rights is illegal activity, to hold otherwise will negate the statutory provisions of the Trade & Merchandise Marks Act.
21. Mr. K.R Gupta also referred to 1969 Wearwell Cycle Co. (India) Limited…Petitioner v. Wearwell Industries & Another…S) (3) for the proposition that balance of convenience concept come into operation only where parties are on equal footings. He says that inasmuch as the plaintiffs are the owners of the registered mark, and the defendants have no such claim, balance of convenience is in the plaintiffs favour.
22. For all the aforesaid reasons, I am of the view that the injunction granted by this Court on 10-1-1990 ought to be confirmed, and the application for vacation of that order filed by the defendants (I.A No. 2266 of 1990) needs to be dismissed.
Ordered accordingly.
23. Before concluding, I must record that the opinion expressed herein is prima facie, and will not, in any manner, affect the ultimate result of the proceedings after the trial.
24. I.A No. 8 of 1990 is allowed and I.A No. 2266 of 1990 is dismissed. Suit be listed before the Deputy Registrar on 27-9-1990.
D.V Ordered accordingly.
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