S. RAVINDRA BHAT, J.

1. This application under order XXXIX Rules 1 & 2 read with section 151 of CPC & section 135 of the Trade Marks Act, 1999 is filed by the plaintiff seeking interim injunction restraining the defendants, their defendants/proprietors/partners, their principles, employees, agents, distributors, franchisees, representatives and assigns from using the trade mark NODDY (word and image) or any other trade mark(s), which may be deceptively or confusingly similar to the plaintiff’s registered trade mark NODDY.

2. The plaintiff claims to be the owner of the worldwide trademark rights in NODDY, including the NODDY name and character image. Further, it claims to have launched the popular NODDY (a fantasy character created by Ms. Enid Blyton in the 1940s, as a little wooden boy with a jingly blue hat who lived in Toy Land) story books and that it has expanded its use of the NODDY word and image mark through a range of merchandise in India. The history of the Author and her works, including NODDY, and their popularity is given on pages 2 to 8 of the application. To summarise, the details of media featuring NODDY includes, print media, television, internet, etc. and that the author is a well-known personality and the recipient of various accolades for her works in the field of literature. The plaintiff has introduced various books in the NODDY range, including classic stories, TV tie-in books (based on NODDY television series) and activity books. It is stated, these books are designed to help children develop through reading, colouring and other activities and are priced between Rs. 25 to Rs. 75. The said books are marketed from all gift and book shops, kids’ stores, supermarkets and malls across the country. The character of Noddy is depicted here:

IMAGE

3. The plaint avers that BBC Worldwide is the plaintiff’s licensing and marketing agent in India. The “Make Way For Noddy” television series was first broadcasted in India in 2002 and is still being broadcasted on the children’ channel POGO. In 2008, NODDY live shows were organized throughout India under a licensing deal with Media 5 Pvt. Ltd., including distribution of licensed merchandise such as clothing, picture frames, lushes, key chains and sticker. It is claimed that these live shows have been very successful. In order to protect its statutory rights in the said work, the plaintiff has registered a global trademark portfolio in various countries, including UK, USA, Japan, China, Hong Kong, Taiwan, Thailand, South Korea, India, Pakistan, Australia, New Zealand, South Africa, Malaysia, Singapore, France and Portugal, Latin America and the Middle East. The list of registrations is filed. Further, various applications by the plaintiff for registration of the said mark are pending in various parts of the world. Furthermore, the plaintiff has also applied for the registration of NODDY image in jurisdictions including Europe, United States of America, Japan, India, China, Taiwan and South Korea. The aforementioned registrations are renewed from time to time and are valid and subsisting. These registrations were originally granted in the name of Enid Blyton Limited (The Plaintiff’s predecessor in interest and title). The plaintiff further claims to be the owner of numerous NODDY domain names, including noddy.com, noddyshop.com, noddyshop.eu, noddy-shop.com, noddy-shop.co.uk, shopnoddy.com, shopnoddy.co.uk, joinnoddy.com, etc. The plaintiff claims to be using the trademark NODDY in several countries across the globe and that it has expended huge amounts. In para 18 of the application the plaintiff has shown the annual revenue generated by use of NODDY, between 2001 to 2008:

YEAR TOTAL (GBP)

(Global)

TOTAL (GBP)

(India)

2001 4,259,000

99,000 (including

74,000 TV income)

2002 2,927,000 25,000

2003 4,150,000 25,000

2004 5,085,000 25,000

2005 8,082,000 25,000

2006 8,256,000

64,000 (including

22,000 TV income)

2007 8,291,000 39,000

2008 7,882,000 30,000

4. In order to protect its rights, the plaintiff actively pursues the infringers both in India and abroad and continues to take appropriate measures across the world. It is claimed that the trademark NODDY has achieved distinctiveness and such degree of association with plaintiff that the use of identical or deceptively similar in relation to any goods and services is bound to be indicating a connection, in the course of trade or of rendering of services, between those goods or services and the persons using and having knowledge of the mark in relation to goods and services of the plaintiff under the NODDY mark. It is pertinent that a substantial number of parents and children in India exclusively with the plaintiff.

5. The suit alleges that the said trademark is a well-known mark in India and the unauthorized use of NODDY in relation to any goods or services of any nature is likely to dilute the distinctive character of the mark as well as passing off. The plaintiff submits that its statutory as well as common law rights in the mark NODDY are well established.

6. It is alleged that the first defendant is engaged in the in the manufacturing, selling and marketing of cheap and low quality readymade children’ apparel under the identical tradename NODDY in Delhi and NCR, the fourth defendant appears to be the wholesale distributor for Delhi and adjoining areas. The samples of the apparel were collected and it was discovered that it bore the label having the first defendant’s name, the packaging materials and the labels boldly proclaimed the term NODDY and encircled R, with the device of a boy’s head immediately over the letter Y in the mark. The packaging listed the name of first defendant’s website, i.e. www.ishanapparel.com, which too prominently used the trade name NODDY in close proximity to the stylized sinage- Welcome to Ishan Apparel. A web shot of the same is filed. Pursuant to this discovery, the plaintiff served a “cease and desist” notice to the defendant on 16.04.2008; a copy is filed. In response to this the counsel of the defendant wrote back to the plaintiff, claiming to be a successor in interest to one M/s Noddy Apparel, a partnership firm between the second and third defendants, which was dissolved in 1997 and later reconstituted as a proprietorship firm. The plaintiff states that it appears that the second and third defendants are closely related individuals and appear to be responsible for the affairs of the first defendant. Further, the letter stated that the first defendant had adopted the term NODDY as its trademark in the year 1991 and that the first defendant had in his own rights honestly, independently and bona fide acquired the valuable goodwill and reputation in the trademark NODDY. It was further claimed by the first defendant in its response that its activities are poles apart from that of the plaintiff, further it was also claime that NODDY is a fancy word, and was known as such in India, as such no exclusivity to it could be claimed. The defendant was silent in its response on the choice of NODDY as its tradename.

7. The plaintiff describes its prior history with M/s. Noddy Apparels stating that in the year 2000 its attention was drawn towards the publication of a trademark application in the name of the second and third defendants, trading as M/s. Noddy Apparels for the registration of NODDY trademark and device, filed with the Registrar of Trademarks, New Delhi under application no. 657547 in relation to readymade garments and other items included in class 25. The said application was published for opposition in the Trade Marks Journal no. 1229, dated 21.08.2000.

A notice of opposition was filed by the plaintiff to the said application, which was duly acknowledged. The plaintiff made inquiries in the market and found that there was no use of the said mark at that time, therefore, on legal advice, found it needless to approach the Court for an injunctive relief. However, despite pending opposition, the said trademark application got erroneously matured to registration, the plaintiff did not receive any notice Registrar’s office stating rejection of its opposition application. Thereafter, the plaintiff has continuously pursued remedial measures with the Trade Marks Registry, Mumbai to have the said registration certificate recalled/cancelled ant to have the opposition proceedings reactivated. The plaintiff has filed copies of correspondence with the Trade Marks Registry, Mumbai in this regard.

8. On 16.12.2008 the plaintiff’s counsel served a second notice to the first defendant and its counsel; the said letters were duly received. The plaintiff claims that in response to a RTI query regarding the status of the opposition filed against the trademark registration application, the plaintiff has received a response stating “as per computer data the status of TMA is registered in respect of No. 657547 in Class 25 and it is renewed upto 6/3/2015”. The defendant’s counsel responded to the second notice by the plaintiff on 07.02.2009 reiterating the response to the first notice. The plaintiff states that their businesses are not poles apart, as claimed by the defendant, as the defendants’ clothing items target the little children upto age 8 years, the same age group that reads plaintiffs books. It is apparent that the defendant has adopted the term NODDY as its choice of trade mark with the clear knowledge that the plaintiff’s character NODDY is extremely popular amongst children. The first defendant’s claim and continuing use of the NODDY mark is unlawful, dishonest and mala fide with a view to gain undue pecuniary advantage by riding on the goodwill of the plaintiff’s well-known mark. Further, the unauthorized use of plaintiff’s NODDY mark constitutes infringement of its registered mark, as well as passing off. The aforesaid acts are in bad faith and dilute the distinctive character of the plaintiff’s mark. Such use of plaintiff’s registered mark is causing irreparable harm and injury to the reputation and goodwill of the brand value of the said mark.

9. It is also contended by the plaintiff that though the defendant claims registered proprietorship of NODDY since 1995, in reality it is only an assignee, with effect from 2008, as the documents filed by the latter evidence. It is submitted that the assignment deed is dated 15th June, 2008, whereas the Trademark Office application for recording the event was made in July of that year. Chorian also argues that the earliest invoice of Ishan is of the year 1997, contrary to its assertion of use since 1991. On the other hand, argues Chorian’s counsel, the NODDY character was well known, thoroughout the country, among different generation of children and adults, who had read books by Enid Blyton, the creator of the character, who wrote about the fictional Toyland, in her books. Thus, argues Chorian, prior use stands established clearly; it is lastly submitted that the Court should in any case take notice of the fact that the sales, world wide, of NODDY books was over 200 million copies.

10. The defendants, in their reply to the plaintiff’s interim injunction application question the territorial jurisdiction of this Court to entertain the present suit stating that suit for infringement passing off can lie where the defendant is based, the first three defendants are admittedly in Mumbai and the fourth defendant is the dealer for defendant no. 1 and 2 (who the proprietor of defendant no. 1), besides no cause of action has arisen against the defendant with the territorial jurisdiction of this Court. The plaintiff has not filed any proof of sale of the impugned goods by the fourth defendant. The defendant does not deny that it has inherited business from its predecessor, M/s Noddy Apparels and that in 1995, the said word mark and device was applied for registration, to afford better protection. The defendants claim that it is a fanciful mark. As the said registration is valid and in force, the defendants are protected under section 28(3) of the Trade marks Act, 1999. The defendants also take recourse to section 30(2)(e) of the 1999 Act and say that their acts do not amount to infringement, so long as the mark is a registered one.

11. In 1997, M/s Ishan Apparel came into existence and the mark NODDY with the boy device along with goodwill and other assets and liabilities of the predecessor were assigned to the first defendant through a deed of assignment, dated 17.06.2008; the second defendant has applied to the Registrar of Trade Marks the subsequent proprietor of the mark, which is pending. Next, it is stated that the suit suffers from delay, laches and acquiescence. There is an admitted delay of 9 years, since the plaintiff states that it was aware of the defendant’s existence since the year 2000. The defendant claims to be a reputed company with its turnover in running in Crores, the defendant further claims to have created a niche in the market. The defendant cites another example of one Ms. Jyoti Gulati, who is running Noddy Play School in Kirti Nagar, New Delhi, and she too claims to be the registered proprietor of the trademark NODDY and has been using the same since 1989. The plaintiff has not used its NODDY mark for over 60 years in India, when the defendant’s predecessor adopted and put to use the NODDY mark in India in 1991. It is claimed that neither prior to that the Indian public was not aware if the plaintiff’s existence nor were the products available for sale. The defendant reiterates the contentions in its response to the plaintiff’s “cease and desist” notice, stating that its field of operation is completely distinct from that of the plaintiff and that there is no overlapping. Further, the suit of the plaintiff for infringement of copyright ought to be rejected, as the artworks being used by the plaintiff and the defendant are different.

12. The defendant claims that its predecessor had spent considerable sums of money to promote and popularize their goods under the impugned mark and in return generated huge sales of their products under the said mark. It is claimed that these products are much demanded on account of superior quality and excellent after sales service. Further, the consumers and members of the trade exclusively identify the products under the mark NODDY with the unique boy device as coming from the defendant and there is no question of confusion. The defendant places reliance on a certificate of participation in a Trade Fair in or about 1997-98. It is claimed that the plaintiff has no inclination to use the said mark in relation to garments or for any other goods or services except for printed matter or publications meant for children, the intention of the plaintiff is stated to be of licensing the use of the said mark for the purpose of identifying/promoting the said mark and that there is no real trade connection between the proprietor and licensees of the goods/services. The rest of the contentions in the application are denied in general.

13. Interestingly, the defendant denies that Ms. Enid Blyton was famous for creating the fictitious character of NODDY, as also that she was a famous children’ storlyteller of twentieth century. The defendant further submits that when its predecessor adopted the said mark there were restrictions on the import of foreign made goods articles to India and that actual liberalization started after India signed the TRIPS and GATT treaties in/around 1997.

14. The defendant emphasizes that it cannot be injuncted as it was clearly “first past the post” as far as the question of use of the NODDY character is involved. Reliance was placed on the decision reported as Austin Nichols & Co. and Anr. v. Arvind Behl, Director, Jagatjit Industries Ltd. and Anr., 2006 (32) PTC 133. [LQ/DelHC/2005/1883] It was further submitted that having objected to the registration application in 2000, and not pursued it, Chorian cannot say that Ishan’s use of the mark is unjustified; principles of laches and acquiescence clearly bar such a plea. Ishan’s counsel also submitted that what Chorian has been able to establish – at the most – is that it engages in the business of licensing, without any intention of directly marketing goods or products, which can only be the standard for judging trademark infringement and passing off. Reliance is placed on the judgment of the Supreme Court, reported as American Home Products v. Mac Laboratories, 1986 (1) SCC 465 [LQ/SC/1985/319] , where it was held, inter alia, that:

“37. As the registration of a trade mark confers such valuable rights upon the registered proprietor thereof, a person cannot be permitted to register a trade mark when he has not used it in relation to the goods in respect of which it is sought to be registered or does not intend to use it in relation to such goods. The reason for not permitting such trade marks to be registered was thus stated by Romer, J., in In re the Registered Trade Marks of John Batt & Co. and In re Carters Application for a Trade Mark (1898) 2 Ch 432, 436 : 15 RPC 262, 266) :

‘..... one cannot help seeing the evils that may result from allowing trade marks to be registered broadcast, if I may use the expression, there being no real intention of using them, or only an intention possibly of using them in respect of a few articles. The inconvenience it occasions, the cost it occasions, is very large, and beyond that I cannot help seeing that it would lead in some cases to absolute oppression, and to persons using the position they have obtained as registered owners of trade marks (which are not really bona fide trade marks) for the purpose of trafficking in them and using them as a weapon to obtain money from subsequent persons who may want to use bona fide trade marks in respect of some classes in respect of which they find those bogus trade marks registered.’ The judgment of Romer, J., in Batt case ((1898) 2 Ch D 432, 436 : 15 RPC 262, 266) was confirmed by the Court of Appeal ((1898) 2 Ch D 432, 439 and 442) and by the House of Lords sub nomine John Batt & Co. v. Dunnett (1899 AC 428 : 16 RPC 411).

38. To get a trade mark registered without any intention to use it in relation to any goods but merely to make money out of it by selling to others the right to use it would be trafficking in that trade mark. In Re American Greetings Corps Application ((1983) 2 All ER 609, 619), Dillon, L.J., said in the Court of Appeal :

‘Trafficking in a trade mark has from the outset been one of the cardinal sins of trade mark law. But there is no statutory definition of trafficking, and one may suspect that, as with usury in the Middle Ages, though it is known to be a deadly sin, it has become less and less clear, as economic circumstances have developed, what the sin actually comprehends.’

Trafficking must involve trading in or dealing with the trade mark for money or moneys worth, but it is not all dealing with a trade mark for money that is objectionable, since it has always been accepted that it is permissible to self a trade mark together with the goodwill of the business in the course of which the trade mark has been used.”

15. Both, the plaintiff and the defendant have secured registration in favour of their respective marks, which in case of the plaintiff comprises on the word NODDY and in case of the defendant comprises of the word NODDY alongwith the caricature of a boy device. As per the averments in the application the application for registration of the image of NODDY by the plaintiff is pending in India, while it is stated that the plaintiff is the owner of worldwide trademark rights in NODDY including the name and character image and that it has registered a global trademark portfolio in numerous jurisdictions, including India. The plaintiff claims to be having registration in its favour in various classes 16, 28, 25 and 09, the earliest of its registrations in India date back to 01.05.1997, whereas in case of the defendants the registration of the mark was granted with effect from sometime in 1995. Though the defendant asserts user in relation to apparel since 1991, the materials filed suggest that user can be assumed at best from 1995. As against this, the plaintiff’s claim for the mark is with effect from 1997; no sales have been shown as of that period. What the plaintiff has placed on record is the opposition filed against the defendant’s NODDY claim, made on 01.12.2000. Curiously, the plaintiff had opposed applications made by other claimants, for NODDY, and forced abandonment of such applications; copies of undertakings of such applicants, and orders recording their abandonment, made by the Trademark Registry are on the record, filed along with the suit. In these circumstances, the question which the Court has to consider is which of the parties is prior user of the NODDY mark.

16. In this case, what is asserted by the plaintiff is not a conventional mark used as a trademark, but the use of a fictional character as a trademark, or a trade name. In other words, the character’s potential to attract customers, on the basis of perceived attributes is the basis for its trademark exploitation. On this aspect the Bombay High Court, in Star India Private Limited v. Leo Burnett (India) Pvt. Ltd, 2003 (27) PTC 81 (Bom) [LQ/BomHC/2002/1230] explained the position thus:

“Character merchandising involves the exploitation of fictional characters or the fame of celebrities by licensing such famous fictional characters to others. The fictional characters are generally drawings in which copyright subsists, e.g., cartoon and celebrities are living beings who are otherwise very famous in any particular field, e.g.; film stars, sportsmen. It is necessary for character merchandising that the characters to be merchandised must have gained some public recognition, that is, achieved a form of independent life and public recognition for itself independently of the original product or independently of the milieu/area in which it appears. Only then can such character be moved into the area of character merchandising. This presumes that the character has independently acquired such reputation as to be a commodity in its own right independently of the goods or services to which it is attached or the field/area in which it originally appears”

17. The case at hand is clearly one involving character merchandising. The plaintiff has established its huge sales in India and abroad for the period during 2000 and 2008 but, unfortunately, it has failed to establish user of the mark prior to 1995. In fact, at best the user could be traced to 2001 for which the first sales figures are given or 2002 as it is stated in the “cease and desist” notice served upon the defendant that Egmont sold Noddy in India for the first time in 2002. Another aspect, which the Court cannot ignore is that the plaintiff did object to the defendant’s application for registration of the “Noddy” mark, but does not appear to have followed it up. This is strange, and out of character, because the materials on record suggests that such oppositions were in other instances vigorously pursued, and other applicants, compelled to give up claims for registration.

18. It is settled law in India, that when contesting parties hold trademark registrations, their rights are to be determined on the basis of principles applicable for passing off, the most important component of which is establishing prior use of the mark. The plaintiff has not adduced any evidence to show prior user in India, it is even not the prior registered owner of the said trademark in India. A claim of dilution cannot sustain against a registered owner of the trademark, as is clear from Section 29 (4). In this case the defendant has not only established prior user, at least from 1995, but also prior registration of the mark. While it may be true that some sections of the public, especially those exposed to a certain kind of education, and having access to imported books were aware of Noddy and were reading about his escapades in Toyland, so vividly created by Enid Blyton, (the author of this judgment being one such) and even retaining fond memories, yet the Court is not unmindful of the fact that there is not even a shred of evidence disclosing sales figures, as to importation of such books, authorized stockists, periodicity of such sales, advertisements, areas where such sales took place, and their volume, etc. There could have been stray cases of import of Noddy books, but evidence to that effect is also not placed before the Court. The plaintiff has not claimed that there were any exclusive or other licensees, or agents in India for the sale of NODDY prior to 1995, their best evidence dates back to 2002. NODDY could be copyrightable, yet the plaintiff has desisted from claiming copyright infringement. In these circumstances, the Court’s subjective perceptions – in the absence of objective materials, or even pleadings, cannot metamorphasize into “judicial notice”; such inferences would be dangerous, and undermine the process of judicial decision making. The court is not rendering any findings or observations about other allegations leveled by the defendant regarding Chorian’s so called “trafficking” in the trademark. No such findings, even of the prima facie kind, are called for, as the parties have to establish their relative strengths during the trial in the suit.

19. In view of the above discussion and on account of lack of evidence by the plaintiff, the Court does not find it appropriate to injunct the defendants from using their registered trademark, at this stage. I.A. No. 8042/2009 is, therefore, dismissed. No order as to costs.

CS (OS) 1154/2009

List for further proceedings on 01.09.2010.