Mankind Pharma v. Tiwari, Section 29(5), and Indian Trademark Law’s Trade Name Defence
Friday’s Delhi High Court decision in Mankind Pharma v. Tiwari has returned a non-infringement finding in favour of the Defendants’ trade name, upon review of a rarely applied provision under Indian trademark law.
Section 29(5) and the Ruling
Section 29(5) of India’s Trade Marks Act specifies the only two conditions under which a trade or business name, as distinct from a trademark, amounts to trademark infringement. The first is that the name must deal with the goods or services in respect of which the trademark is registered. The other is that infringement occurs if “[the Defendant] uses such registered trademark”, where the words “uses such” appears to be as open to being read in the same vein as “the same as” or “identical to” as not.
In rejecting Mankind Pharma’s claim for trademark infringement, Mr Justice Endlaw has permitted the Defendants to continue to do business under the name ‘Mercykind Pharmaceuticals Private Limited’. He does so principally for two reasons.
First, he resurrects the view that interim injunctions against trademark Defendants can be refused if, prima facie, the Claimant has argued in trademark prosecution that the use of certain parts of its trademark (such as common-word prefixes or suffixes) are indistinct, it cannot then found a trademark infringement claim on them against other trademarks that are guilty of no worse. Significantly, he finds that though this consideration faces the objection of amounting to estoppel against statute, it “certainly has weightage for the purposes of interim injunction, especially ex parte”. (A caveat here is necessary: the same judge has revisited his opinion on the subject in greater detail in Insecticides India v. Parijat Industries earlier today.)
Second, applying Section 29(5), he finds that the Defendants’ use of ‘MERCYKIND’ as part of their trade/business name does not fall within Mankind’s claim for infringement. In arriving at this conclusion, Mr Justice Endlaw endorses the Bombay High Court’s July 2010 decision in Raymond Pharmaceuticals, which had fastened a similarly constricted interpretation onto Section 29(5). He notes that he is “unable to find any other judgment addressing [the] interpretation of Section 29(5), save the dicta in [Raymond].”
Section 29(5) and the Cipla Cases
Indian case law on Section 29(5) post-Raymond encompasses, at a minimum, the July 2016 follow up to Raymond, the Bombay High Court’s April 2016 reference of the Section 29(5) question in Cipla, and March 2017’s three-judge Bombay decision answering the reference.
The sum of the Cipla deliberations had returned two points of note on Section 29(5), both of which may have offered Mr Justice Endlaw considerable grounds for hesitation had they been within his field of vision here.
First, the Cipla reference, perhaps coloured by the question before it, had left open the question of whether “uses such” requires identity or similarity to trigger it. Second, it had found that there was, indeed, a line in the sand between Section 29(5) on one hand, and Section 29(4) on the other, and that the defining difference between them was that the latter constitutes use in a trademarky sense, while the former does not.
Mr Justice Endlaw’s opinion here, weakened by the absence of these precedents, may merit reconsideration on this point alone.
In a discussion on the Cipla cases hosted on the SpicyIP blog, I had recorded my disagreement with the March 2017 answer to the Section 29(5) reference. An abridged version of that comment — as applicable to Mr Justice Endlaw’s opinion on Friday as to the Cipla opinion — is reproduced here:
[T]here are at least three problems with Cipla’s reading of Section 29(5) protection:
First, the trade or business name must be identical in whole or part to the Claimant’s trademark. Reading this strictly, a deceptively similar trademark [or indeed one with minimal variation designed specifically to escape the clutches of Section 29(5)] used as a trade or business name does not set up a pure Section 29(5) infringement action. Section 29(4) covers these cases if the Plaintiff can leverage distinctiveness in its favour.
Second, [the reference in para 32 of Cipla] to legislative history tags Section 29(5) with the Companies Act rectification procedure. This procedure addresses company names that run into conflict trouble with registered trademarks and are ‘identical with or too nearly resemble’ them.
Not only is this broader than Section 29(5) in terms of how close the trade or business name needs to be but the comparator is all companies, whether or not they are involved in trading the same goods or services. Again, it makes zero sense to not simply permit this under Section 29(4) to enable the same outcome under trademark law, unless the intention is to exclusively shepherd such causes of action to company name rectification petitions.
Third, even if this is the intention, it doe not cover trade or business names that are not company names (partnerships, proprietorships, family arrangements, unincorporated unions, and the like) that still fall to be determined exclusively under Section 29(5), per Cipla.
Assuming further still that this sort of split based on the manner of formal arrangement of potential Defendants is meaningful, there is no reason why this should not also apply, for instance, to domain names to the extent that they serve the same purpose. [I use domain name infringement here to allude to consistency issues alone, and in the sense that it is considered open and shut Section 29 infringement that has nothing to do with Section 29(5).]
From here on out, I can see two further lines in support of the Cipla view.
First, purely on legislative intent, the original version of Section 29(5) did not cover ‘dealing in goods or services in respect of which the trademark is registered’, that this was added later at the suggestion of the Committee and since, without these words, Section 29(5) protection would extend to dissimilar goods and services, their incorporation indicates a desire to exclude such goods and services. I am ambivalent on this because a pure legislative intent argument of this nature does not hold up on the back of the lack of material stitching together the Companies Act rectification provisions and Section 29(5).
Second, that since Section 29(5) is a contextless, no-fault provision, it should not be interpreted broadly because that would entrap potential Defendants who otherwise have a good shot at putting up an honest concurrent user or Section 34 defence (however much the latter has been neutered by the August 2014 Varun Gems Supreme Court judgment). Cipla does not join these dots but it does take the first half and tack it onto the back of its rejection of October 2013’s Delhi High Court decision in Bloomberg. Bloomberg itself, to the extent that it is relevant here, basically asks whether Section 29(4) can be read to cover cases which fall through the cracks of Section 29(5) but would otherwise generate infringementy outcomes.
It concludes that it can. This is fine, except that its relevance is slightly inflated by Cipla’s reluctance to engage with older precedent on this point (the one that immediately comes to mind is March 1995’s Delhi decision in Montari Overseas but there are several more that returned pro-Claimant verdicts). Bloomberg also insists that you can separate Section 29(5) from (1) to (4) because there is no requirement for an ex post consequence (like confusion, association, unfair advantage) to result from identity/similarity. This is difficult to accept after the legislative intent backstory that Cipla has laboured so much on, and I think it makes Bloomberg less persuasive, if not failing to move the needle entirely.
Looking ahead, I think what Cipla is most likely to do is place immense pressure on the extremely brittle characterization of ‘use in the trademarky sense’ that Justice Patel resurrected in April 2016’s Bombay decision in Gufic last year. I think there is plenty of room to suggest both possibilities from this point forward — that ‘use in the trademarky sense’ means ‘trademark versus mark’ cases or that it means ‘use in the course of trade’.
Given that one involves shutting out Section 29(4) from applying to cases where it certainly could extend and the other does not, it is not hard to read use as a trade or business name into ‘use in the course of trade’ especially since Section 29(6)(d) as near as damn it says so. However, Cipla creates the impression that it is absolutely essential for Claimants to win this characterization when, in fact, it really need not be so complicated. [I have hinted at it accidentally here but the bigger barrier in claiming cover under Section 29(4) really ought to be the difficulty in securing distinctive character/well-known mark status.]
To return a finding which can invite disagreement is understandable but to return just this finding when there was an opportunity to clarify so much more really rankles here.
Questions Abound
The Delhi High Court’s opinion in Mankind Pharma checks the boxes of these concerns almost to a tee.
It puts pressure on judges to correctly conclude whether the use of a company name and associated derivative/connected names of products can amount to “use in a trademarky sense”, when this inquiry is far from simple.
It fails to answer to the link that Section 29(5) directly seems to make with the Companies Act for company names that “identical with or too nearly resemble” the Claimant’s trademark.
It begs the question of why such trade/business use cannot be more broadly understood as “use in the course of trade”, leaving Section 29(4) — a provision blessed with far greater depth and equanimity than the sub-section succeeding it — to do the heavy lifting of balancing the rights of Claimants and Defendants in infringement actions.
Should Friday’s decision fructify into more work for the Delhi appeals court as appears imminent, it would, in effect, be the sixth attempt in the last eight years by a prominent Indian court to grapple with one of the simplest portions of India’s trademark infringement substructure. It is a substructure that, at the moment, offers more questions than answers.
