Mittal Electronics v. Sujata Home Appliances: The Intra-Class Trade Defence Revisited

The July 2018 Supreme Court ruling in Nandhini Deluxe v. Karnataka Co-Operative Milk Producers Federation appeared to bring with it a sense of closure.

For one, it rounded out a long-standing private dispute. Equally, though, it seemed to address a long-standing snag in Indian trade mark law regarding the co-existence of similar trade marks within the same class of products. Multiple registrations in the same class of products are permissible, ruled the Supreme Court, so long as the specific products to which the trade marks are applied to operate in distinct lanes of trade.

An order by the Delhi High Court in Mittal Electronics v. Sujata Home Appliances this week shines a light on the Nandhini ruling once again.

In modifying an interim injunction granted ex parte against the Defendants regarding the use of the trade mark ‘SUJATA’ in relation to home appliances, the Court makes three points of interest.

First, it notes that, where two trade mark registrations in a wide class of products are in conflict, it is permissible to examine the specific products being traded under the trade marks. This is a salient issue in Mittal Electronics. Both registrations are in relation to the broad class of home appliances, but, specifically, the Claimants trade in juicers and mixer-grinders while the Defendants trade in water purification systems. Thus, the Claimants’ motion for interim injunction, in effect, seeks to restrain the use of a trade mark in relation to a category of products they have never manufactured. This has a telling influence on the outcome of the motion. The framing of the claim to include water purification systems, says the Court, “clearly shows the oblique manner in which the [initial ex parte interim] injunction was sought.”

Second, the Court illustrates an often overlooked aspect of the role of intra-class trade defences to mitigate a composite claim for trade mark infringement and passing off. Here, it is common ground that the Claimants are prior users of the trade mark in the market in relation to their products within the home appliances segment. In sequence, however, the Defendants’ trade mark registration, claiming their own sub-segment of products, arrives next, followed by the Claimants’ own trade mark application, followed, finally, by the Defendants’ opposition to the Claimants’ trade mark.

Ordinarily, prior use would set up a clear case for the Claimants. On these facts, however, the Defendants remain the first users of the trade mark in relation to water purification systems. In a motion to liberate this category of products from an injunction, the intra-class trade defence functions as a scalpel to cleave the relevant use from the scope of the injunction. This is significant. Though the home appliances of the parties “may fall into the same broad classification”, observes the Court, they “are different goods used for different purposes.”

Finally, the Mittal Electronics Court demonstrates a willingness to parlay a Nandhini-style intra-class defence into a broader finding on the non-disclosure of material facts by the Claimants. It concludes that the Claimants, at the ex parte stage, concealed the fact that the Defendants held a registration specific to water purification systems — a fact that could not reasonably have escaped due diligence in preparing the claim. (The oversight is, to be sure, an egregious one, since the Defendants opposed the Claimants’ own trade mark application in 2016, thus giving them pointed knowledge of their presence.)

This is an important extension of the ‘lanes of trade’ argument, since it prioritizes the effects of infringement over mere incidences of infringement. It requires Claimants to establish that Defendants they sue for infringement are, in fact, likely to confuse consumers of a specific product, and are not just users of the same trade mark. The burden on Claimants here is an equitable one. After all, the requirement is merely to be sufficiently precise with claim, and not interfere with rival businesses where there is reasonable scope for co-existence.

Mittal Electronics shows that, far from being static law, the intra-class trade defence remains a vibrant one, even post-Nandhini. The Court moots some interesting applications of this defence to trade mark infringement and passing off claims, en route to what is, on balance, a perfectly serviceable finding.

The sense remains, however, that there is much more to come from this segment of Indian trade mark law in the future.