Ciba-geigy Limited & Another v. Surinder Singh & Others

D.K. Jain, J.

1. This is a suit for: (i) permanent injunction restraining the defendants from using the trademark Cibaca or any other trade mark containing Ciba or the word Cibaca or any other trade mark deceptively similar to the trade mark Ciba or Cibaca; and (ii) rendition of accounts by the defendants to the plaintiffs for the profits made by them by the use of trade mark Cibaca.

2. Plaintiff No. 1 is a Swiss Company and the second plaintiff is an Indian Company duly incorporated under the Companies Act, 1956 in which the first plaintiff holds approximately 40 per cent of the equity share capital. The word Ciba forms part of the corporate name of both the plaintiffs. As per the plaint, the first plaintiff is a registered proprietor of the trade marks Ciba, Cibaca and various other trade marks, in which the syllable is the word Ciba, in respect of various items falling in different classes. The second plaintiff is a licensee and user of various trade marks, possessed and owned by the first plaintiff in relation to goods manufactured in accordance with the specifications provided by the first plaintiff. The word Cibaca was adopted by the plaintiffs and has been extensively used on all goods marketed by them in India. The second plaintiff claims to have used the trade mark Cibaca extensively as licensee ofthe first plaintiff and has additionally spent large sums of money in advertising the goods sold under the said trademarks; by virtue of the aforesaid use and the second plaintiffs sales promotion activities, various trade marks, including the mark Cibaca, mentioned in the plaint, are associated by the public as the trade marks of the plaintiffs and only with their goods; the word Ciba and Cibaca also form significant and distinguishing feature of the corporate names and trading styles respectively of the two plaintiffs; the second plaintiff has been trading in India for so long and so extensively that it is popularly known by the abbreviated form of its name i.e., Ciba and the public and the trade also associates all trade marks containing the work Cibaca with the goods only of the plaintiffs.

3. Defendant No. 1 and 2 are carrying on business in partnership under the name and style of M/s. Bhatia Sales Corporation. M/s. Link IndustriesDefendant No. 3, is a concern manufacturing filters for motor vehicles which are sold by M/s. Bhatia Sales Corporation. It is pleaded that on or about December, 1991 the second plaintiff learnt that the defendants were selling and offering for sale filters for motor vehicles bearing the trade mark Cibaca. On 16 March, 1992, plaintiffs Advocates addressed a letter to the defendants calling upon them to forthwith cease and desist from using the trade mark Cibaca. No reply was received from Defendant No. 3. However, M/s. Bhatia Sales Corporation, vide their letter dated 1 April, 1992, sought information about plaintiffs registrations for the trade marks Ciba and Cibaca which was duly furnished on 7 April, 1992. Thereafter, on 26 May, 1992 the plaintiffs received a letter on behalf of M/s. Bhatia Sales Corporation, admitting that the said concern was using the trade mark Cibaca but claimed that its use by the defendants was bona fide. Thus, the defendants did not give up the use of mark Cibaca on the automobile filters manufactured and marketed by them. It is alleged that the defendants have deliberately and fraudulently chosen plaintiffstrade mark in order to trade upon the reputation of the plaintiffs and to pass off their filters as the goods ofthe plaintiffs; they are representing to the public that their goods have some connection with the plaintiffs whereas no such connection whatever exists, and in this manner they are exploiting their goodwill passing off goods under the plaintiffs distinctive trade mark and causing damage to the plaintiffs reputation as manufacturers of high quality goods which cannot be compensated in terms of money and hence the present suit for a decree for permanent injunction in the aforenoted terms, along with an application under Order 39, Rules 1 and 2, read with Section 151, CPC for grant ofad interim injunction. On the said application, an ex parte ad interim injunction was issued on 9 March, 1994, restraining the defendants from offering either directly or indirectly or through their agents or servants for sale orselling goods bearing the trade mark Cibaca orany other mark deceptively similar thereto till the disposal of the suit.

4. The defendants have filed a common written statement, contesting the suit, on the pleas : (i) that the defendants have been using the trade mark Cibaca in respect of the filters for use in automobiles from 1987 and the said goods are neither cognate nor allied in nature tothe plaintiffs goods in respect whereof the plaintiffs are claiming their exclusive rights and, thus, there is no question ofany deception orconfusion in the mind of the public; (ii) the turnover of the defendants in the said goods under the trade mark Cibaca run into lacs of rupees and, thus, the mark Cibaca, insofar as automobile filters are concerned, is associated by the public at large with the goods of defendants only and, thus, there is no question of defendants passing offtheir goods as the goods of the plaintiffs, and (iii) the defendants had adopted the trade mark Cibaca since 1987 honestly knowing fully well that it was not being used by any one in respect of automobile filters and since then they have been using it openly without any interruption from any corner. There is inordinate delay on the part ofthe plaintiffs in initiating action against the defendant for perpetual injunction and thus on account ofinordinate delay, laches, waiver and acquiescence, the plaintiffs arenot entitled to any relief in the suit. In support of its stand that the defendants have been using the mark Cibaca since 1987, affidavits of some of their dealers, inter alia, affirming that their concerns have been purchasing filters under the trade mark Cibaca from the defendants have been filed.

5. The defendants remained unrepresented on a couple of dates. Consequently, on 9 March, 1994, they were directed tobe proceeded against ex parte and the plaintiffs were required to lead ex parte evidence by means of affidavits, which has been done.

6. An affidavit has been filed by the Company Secretary of plaintiff No. 2,affirming what has been stated in the plaint. Documents filed with the affidavit have been exhibited. Noformal issues have been settled.

7. I have heard Mr. S.S. Rana, learned Counsel for the plaintiff, who has taken me through the pleadings and the evidence led. Mr. Rana has stated at the Bar that he is not pressing for a decree for rendition of accounts by the defendants. Thus, the only question for consideration is whether the plaintiffs have acquired distinctiveness and goodwill in the mark Cibaca and is there any likelihood of confusion in the minds of the customers that the filters manufactured by the defendants with mark Cibaca are the goods of the plaintiffs

8. It is well-settled that in a passing off actiona tort to protect commercial goodwill and to ensure that business reputation of a person is not exploited, the plaintiff has to establish that his business or goods have acquired the reputation he is claiming by showing that his trade name has become distinctive of his goods and the purchasing public at large associates the plaintiffs name with them. But the plaintiff is not required to establish fraudulent intention on the part of the defendant. Even causing of actual confusion amongst the customers is also not to be proved by the plaintiff, what it is required to establish is the likelihood of deception or confusion in the minds of the public at large. The likelihood or probability of deception depends on a number of factors, which necessarily is a question of fact in the circumstances of each case. It is true that where two trades are not closely related and the goods are also not analogous, the risk of confusion or deception is far less as compared to a case where the plaintiff and the defendant have a common field of activity but at the same time it cannot be gainsaid that in a case involving non-competing goods, there is never a possibility of any confusion in the minds of a customer and, therefore, in such cases there is no question of passing off. There have been a catena of decisions wherein the right to use an established trade mark in respect of certain classes of goods has been held to extend to goods of a very different nature from the goods sold by the proprietor of the trade mark. For instance, in Daimler Benz Aktiegesellschaft and Anotherv. Hybo Hindustan, AIR 1994 Delhi 239, the two products involved were the cars and the undergarments but the defendant was injuncted from carrying on trade in any undergarments in the name of "Benz" and "three pointed Human beings in a Ring. It was held that the trade mark law is not intended to protect a person who deliberately sets out to take the benefit of somebody elses reputation with reference to goods, especially so when the reputation extends worldwide. It was observed that "Benz" as name of a car would be known to every family that has ever used a quality car; the said name as applied to a car has a unique place in the world and thus the defendants boxes, in which it was selling undergarments, showing thereon a man with his legs separately and hands joined together above his shoulders, all within a circle indicate the strong suggestion of the link between the three pointed stars of Mercedes Benz Car and the undergarments sold by the defendant of the above said symbol. It was further held that none should be continued to be allowed to use a world famous name to goods which have no connection with the type of goods which have generated world wide reputation. Similarly in Bata India Limitedv. Pyare Lal and Company, AIR 1985 Allahabad 242, the defendant using the mark "Bata Foam" on the mattresses, sofa cushions and other articles was injuncted from the user of the said mark on the ground that the name Bata was well-known in the market and the user of such a name was not only likely to cause deception in the mind of ordinary customer but could also cause injury to the plaintiff-Company and the fact that the plaintiff was not producing foam was not enough to hold that there could not be passing off action in respect of the user of the name Bata to the products marketed by the defendant.

9. In the light of these pronouncements, the abstract proposition of law pleaded by the defendant that since they are dealing in entirely different product, there is no likelihood of any confusion or deception in the mind of the consumer is stated to be rejected.

10. The basic question to be considered is whether the plaintiffs business or goods under the trade mark Cibaca has acquired such a goodwill and reputation that the mark Cibaca has become distinctive of their goods or business and the said mark has reputation attached to it and the defendants conduct is such as to tend to mislead the public to believe that the defendants business or goods are that of the plaintiff.

11. As noticed above, the word Ciba forms an important part of the corporate names of both the plaintiffs. The plaintiffs have been incorporated to carry on diverse business. The word Cibaca was adopted and has been extensively used in respect of the products manufactured by the plaintiffs. It is evident from the plaint that the plaintiffs are also registered proprietors of trade marks Ciba and Cibaca in respect of the products manufactured by them in different classes. The products manufactured by the plaintiffs are of national and international repute and standard. From the sale figures reflected in the annual reports for the years 1984-85 to 1989-90, Exhibits P-l to P-5, their gross sales range from 1,15,09 lacs to Rs. 2,55,48 lakhs. From the said annual accounts, it is evident that plaintiffs expenses on advertisement and publicity of their business or goods run into lacs of rupees inasmuch as for the year ended 31 March, 1990, the advertisement and publicity expenses were to the tune of Rs. 455 lakhs. Thus the extensive business of the second plaintiff stands established from Exhibits P-l to P-6. On the contrary the defendants have not given their sale figures in the written statement except for a vague assertion that their sale figures run into lacs of rupees. The only evidence placed on record by them is in the form of some affidavits of their dealers, indicating that they have been purchasing goods from the defendants from years 1987-88 worth a few thousands of rupees. It is significant to note that though copies of a number of invoices have been placed on record by the defendant starting from November, 1987 but the earliest invoices depicting the trade mark Cibaca are of December, 1990, thus belying the stand of the defendants that they have been using the said trade mark since June, 1987.

12. In my view, the plaintiffs have brought sufficient evidence on record to show that they have not only acquired distinctiveness and goodwill in the word Ciba but even in the word Cibaca. With the passage of time and the reputation acquired, the mark Cibaca has become a household word and is associated with the work Ciba which forms part of the trading name of both the plaintiffs. The mark Cibaca connotes distinctiveness, reputation, quality and goodwill acquired by the plaintiffs over a number of years and is understood by a common man as associated with the plaintiffs.

13. It is pertinent to note that in the written statement/affidavits the defendants have not even attempted to explain as to why out of tens of thousands of words in English language they happened to hit upon the word Cibaca. The answer is obvious. They wanted to derive benefit from the reputation and goodwill enjoyed by the plaintiffs and their products under the said mark, thereby perpetrating fraud and deception on the unwary customers by passing off their goods as those of the plaintiffs.

14. Thus I have no hesitation in coming to the conclusion that the defendants have adopted the mark Cibaca deliberately with an intention of creating a subtle association between their activity and that of the plaintiffs. Their user of the trade mark Cibaca cannot be said to be an honest concurrent user as claimed by them.

15. Before parting, I may also deal with the stand of the defendants that there is inordinate delay on the part of the plaintiffs in coming to the Court, which is fatal to the present action and as such they are not entitled to any relief. In the written statement, it is asserted that the defendants have been using the trade mark Cibaca since 1987 to plaintiffs knowledge but they took objection to such user only in December, 1991 and filed the present suit in the year 1992. The question for consideration is whether this period can be said to amount to consent, waiver or acquiescence on the part of the plaintiffs as alleged, so as to disentitle them to the relief of injunction against the defendants.

16. Apart from the fact that the question of delay is relevant in the matter of concurrent honest user (see: Apple Computer Inc.v. Apple Leasing & Industries,1992 (1) Arb.LR 93 (Delhi), which, as already held, is not the case here and mere lapse of time does not amount to laches. In Power Control Appliances & Ors.v. Sumeet Machines Pvt. Limited,1994 (2) SCC 448 [LQ/SC/1994/180] , it has been held that to avail of defence of acquiescence under Section 30(1)(b) of the Act, the acquiescence must be such as to lead to the inference of a licence sufficient to create a new right in the defendant. In the present case, there is nothing on record to derive an inference of a licence sufficient to create a new right in the defendant. Besides, as noticed above, the defendants have not placed on record any evidence in support of their stand that they have been using the trade mark Cibaca since 1987. As noted above, the invoices filed by them with the affidavits of their dealers show that the said trade mark was adopted by them only in December, 1991, as alleged by the plaintiffs and thus there is no delay on the part of the plaintiffs in approaching the Court. I reject this defence.

17. For all these reasons, I am satisfied that the plaintiffs have successfully established the likelihood of deception or confusion in the minds of public at large, if the defendants continue to use the trademark Cibaca on their automobile filters.

18. Accordingly, a decree for permanent injunction is passed in favour of the plaintiffs and against the defendants, restraining the defendants from using trade mark Cibaca or any other trade mark containing the word Ciba or the word Cibaca or any other trade mark deceptively similar to the trade marks Ciba or Cibaca. No costs.