Societe Des Produits Nestle, Sa & ... vs Basant Alal Kokcha & Ors
2009 Latest Caselaw 4084 Del

*      IN THE HIGH COURT OF DELHI AT NEW DELHI

+                             CS(OS) 1411/2006

                                                                   Pronounced on 09.10.2009

SOCIETE DES PRODUITS NESTLE, SA & ANR                                      ..... Plaintiffs

               Through : Mamta Jha with Manish Mishra and Mr. Sumit Rajput

                                     versus

BASANT ALAL KOKCHA & ORS                                                   ..... Defendants

                                     Through : Nemo

CORAM:
HON'BLE MR. JUSTICE S. RAVINDRA BHAT
1.

     Whether the Reporters of local papers                Yes
       may be allowed to see the judgment?

2.     To be referred to Reporter or not?                   Yes

3.     Whether the judgment should be                       Yes
       reported in the Digest?

HON'BLE MR. JUSTICE S.RAVINDRA BHAT (Open Court)
%

1. The plaintiffs seek to restrain the defendants, their partners/ proprietors, assigns,

franchisees, licensees, distributors and agents from manufacturing, selling, offering for sale

advertising, directly or indirectly dealing in food products including pasta or any other culinary

products, under the trademarks MAGGI, MAGGI logo, NESTLE and NESTLE logo or any other

trade mark or logo as may be identical to or deceptively similar to that of the plaintiffs,

amounting to infringement of plaintiffs registered trademarks; further also restraining them from

using, reproducing, printing, importing, selling, offering for sale or dealing in infringing MAGGI

packaging bearing the impugned the impugned MAGGI or NESTLE logo or any other logo as

CS(OS) 1411/2002 Page 1 may be colourable imitation or substantial reproduction of the said logos of the plaintiffs in

respect of their colour combination, get up, lay out or arrangement of features, amounting to

infringement of copyright of plaintiffs therein. A decree for rendition of accounts and delivery-

up is also sought.

2. The brief facts of the case are that the second plaintiff is a company incorporated under

the Companies Act. The second plaintiff claims that it is part of a gigantic group, known as

Nestle, owning 479 factories and employing nearly 2,20,000 people. It is contended that Nestle's

products are known worldwide for their innovative nature, and excellence in quality. The mark

NESTLE is a house-mark of the Nestle group, and has been in existence for 125 years, since its

creation in 1866. The plaintiffs claim to be engaged in the business of manufacturing and selling,

amongst other products, various culinary products such as noodles, sauce, soups etc. under the

trade mark MAGGI in various international markets. All products bearing the mark MAGGI also

bear plaintiffs' house mark/ trade mark NESTLE and NESTLE logo (device of a nest with two

birds perched on it, in conjunction with the word mark NESTLE). As per the suit averments the

defendants are engaged in printing, procuring and sale of culinary products such as pasta in the

infringing and spurious MAGGI packagings.

3. By order dated 27.11.2008 the defendants were proceeded ex-parte, as no appearance had

been entered on their behalf since 24.09.2007, during which period the matter had been listed

before the Court on five occasions.

4. To establish their allegations and averments, the plaintiffs rely on the deposition of their

constituted Power of Attorney holder, Ms.Venita Gabriel (PW-1). The plaintiffs filed theirs

affidavit in evidence (Ex. PW-1/A) stating that the earliest use of MAGGI products dates back to

1886 in Switzerland; the first plaintiff has been manufacturing and selling variety of culinary

CS(OS) 1411/2002 Page 2 products in India under the trademark MAGGI since 1974. It is claimed that the "Reader's

Digest" magazine had identified MAGGI as a "super brand" in the year 2001 and the brand

MAGGI had been voted for the same magazine's highest award namely "platinum award". The

trademark MAGGI features into the publication titled "World's Greatest Brands" (year 1996

edition) published by "Inter Brands", which ranked MAGGI amongst world's top 50 brands.

5. It is stated the trademark MAGGI is a coined mark, which was derived from the surname

of Julius Maggie, founder of the business of the Nestle Group. It has no common parlance and is

not a dictionary word. The trademark MAGGI is used by the plaintiff in conjunction with a

unique and distinctive logo comprising a red coloured bubble device with the mark MAGGI

superimposed thereon in stylized font in yellow letterings. It is stated that the first plaintiff is the

proprietor of the trademark MAGGI, the MAGGI Logo, NESTLE and NESTLE Logo and the

second plaintiff is its licensee in India through license agreement dated, 11.10.1982. The distinct

and unique visual features of MAGGI logo constitute an original artistic work within the

meaning of section 2 (c) of the Copyright Act, 1957. The device MAGGI is also registered in

India in favour of the first plaintiff; the trademark registration certificates for trademark nos.

267814 in class 30, 267813 in class 29, 1056836 in class 30, 578342 in class 29, 253467 in class

30 and 578343 in class 30 are exhibited as Ex. PW-1/8 to PW-1/13. Apart from the proprietary

right under common law, the first plaintiff also enjoys statutory right to the exclusive use of the

trademark MAGGI internationally, as well as in India.

6. The trademark NESTLE has been extensively used by the "Nestle Group" since its

inception in the year 1866 and appears all on all the products manufactured and marketed by the

first plaintiff or its associates and/or allied companies. The goods bearing the trademark

NESTLE are available in more than 130 countries, including India. In India the first plaintiff had

CS(OS) 1411/2002 Page 3 obtained registrations of the trademark NESTLE and the NESTLE Logo in various classes; the

certificates of registration for trademark nos. 698372 in class 30, 944816 in class 31, 439733 in

class 05, 439736 in class 32, 440510 in class 05, 440511 in class 32, 440512 in class 30, 457240

in class 03, 439735 in class 30, 698371 in class 29 and 698374 in class 32 are exhibited as Ex.

PW-1/14 to PW-1/24. Registration certificates for the NESTLE Logo are exihited as Ex. PW-

1/25 and PW-1/26. It is claimed that these registrations are conclusively valid and renewed and

in force. The plaintiffs have also filed samples of MAGGI noodles pouches bearing MAGGI

Logo and the NESTLE Logo exhibited as EX. PW-1/27 (Colly.)

7. The plaintiffs claim to have extensively spent on brand building activities and advertising

their products with the trademark MAGGI. It is claimed that on account of prior adoption, long

and continuous use, extensive advertising, enormous sales and strict quality control MAGGI and

MAGGI Logo have acquired tremendous goodwill and reputation, and come about to be

identified and associated exclusively with the goods and business originating from the plaintiffs.

The plaintiffs' trademark MAGGI and the MAGGI Logo as well as the house-mark NESTLE

and the NESTLE Logo have acquired enviable goodwill and the reputation amongst the

members of the trade and have also become household brands, which connote the goods and/or

business of the plaintiffs exclusively. The sales figures for of the plaintiffs' products under the

trademark MAGGI and the expenditure on advertising for the same is reproduced as under:

                       Year         Sales         Advertising Expenditure
                                 (in Crores)            (in Crores)









CS(OS) 1411/2002                                                                           Page 4

8. It is alleged that the second plaintiff conducted an investigation in July, 2006 and an

investigation report, dated 05.07.2006 was submitted by one Greves Protection Management

(Ex. PW-1/30 (Colly.)) where it was mentioned that the defendants were engaged in printing and

procuring of spurious MAGGI packaging, label, as well as sale of culinary products such as

pasta in the said spurious packaging. It is alleged that the said spurious packaging of the

defendants bears the MAGGI and the NESTLE Logos, which are being sold in the open market

in a clandestine manner, as coming from the house of the plaintiffs, thereby committing a fraud

on the consumers.

9. An ex-parte ad interim injunction was passed against the defendants on 14.07.2007 and

Local Commissioners were appointed to visit the premises of the defendants no. 2, 3 and 4. On

the basis of the report of the Local Commissioner who visited the premises of the fourth

defendant, wherein it was stated that the fourth defendant has alleged that the first defendant was

supplying the offending material, another Local Commissioner was appointed by the Court on

19.07.2006 to visit the premises of the first defendant. A huge recovery of 845 packed and 50

unpacked MAGGI pasta packaging was made at the first defendant's premises. This Local

Commissioner's report also disclosed that packaging material for other brands like Horlicks,

Knorr and Sauce Blanche was also found at the first defendant's premises; samples and

photographs of the recovered material are filed. These reports of the Local Commissioners are

placed on record as Ex. PW-1/31 (Colly.). The plaintiffs allege that the conduct of the defendants

is malafide, dishonest, unethical and unlawful and solely motivated to en-cash upon the

plaintiffs' goodwill and reputation and earn profits by passing-off their goods/business for those

of plaintiffs. It is also stated that the confusion or deception is inevitable since these products are

purchased by an unwary class of customers including housewives, children etc. It is claimed that

CS(OS) 1411/2002 Page 5 the defendants have committed multiple offences under the provisions of the Trade Marks Act,

1999, the Copyright Act, 1957 as also under the provisions of the Prevention of Food

Adulteration Act, 1954.

10. Reliance was placed on Societe Des Produits Nestle S.A. v. Jai Ram,

ORA/2007/TM/DEL, a decision of the Intellectual Property Appellate Board, to say that the

trademark MAGGI has been held to be distinctive and well-known.

11. The plaintiffs also claim that the activities of the defendants have irreparably damaged

their (the plaintiffs') business, and they estimate the loss suffered by them at over Rs.

20,00,000/- and also state that the loss to goodwill and reputation cannot be assessed in monetary

terms. In light of the above, compensatory as well as punitive damages are sought.

12. The Court has considered the affidavit deposition by way of evidence filed on behalf of

the plaintiffs and the documents placed on the record. As the defendants were proceeded ex-

parte, only the facts urged by the plaintiffs and established through the evidence by way of

affidavit shall be considered for adjudication of the suit. The marks and logos (MAGGI and

NESTLE) being used on the pasta packaging are identical to those of the plaintiffs. The

averments made in the affidavit and the material placed on the record remains un-rebutted in the

absence of the defendants. Consequently, it is held that the plaintiffs have established before the

Court that it is the owner of the said trademark. On the basis of the evidence the plaintiffs have

also established that the defendants have infringed the registered trademark in respect of the

product in question; this activity does not have any explanation except that the defendants'

actions are deliberate and actuated with malafide, with the intention of exploiting the plaintiffs'

goodwill and reputation to cause confusion and deception in the minds of the public at large.

CS(OS) 1411/2002 Page 6

13. Insofar as the relief of rendition of accounts and a consequential decree on the basis of

the aforesaid accounts is concerned, since the defendants were proceeded against ex-parte, there

is no material on the record by way of production of books of accounts, ledgers, etc., to establish

the volume of sales of the infringing product or the profits earned by it under the said

trademarks. Having said so, the Court considers this to be a fit case for awarding some damages

in view of the huge quantities of the offending products and packaging material bearing the

marks in question. If damages are not awarded in favour of the plaintiffs, then the same would

amount to a premium on the conduct of the defendants. This Court held in The Heels v. V.K.

Abrol and Anr, CS (OS) No. 1385/2005:

"12. No doubt it is not possible to give an exact figure of damages on the basis of actual loss, but certain token amounts on the basis of the sales of the plaintiff can certainly be made. The plaintiff is unnecessarily dragged into litigation and the defendants must bear consequences thereof. In fact in such a case both compensatory and punitive damages ought to be granted apart from the costs incurred by the plaintiff on such litigation."

14. In view of the above, the suit is entitled to succeed. The plaintiffs are also entitled to

damages to the extent of Rs. 2,00,000/- to be paid by all defendants in equal proportions.

Accordingly the suit is decreed in terms of Para 37 (a), (b), (c), (d), (e) and (f) of the plaint. The

Counsel's fee and cost of proceedings is quantified at Rs. 50,000/-. The amounts shall be paid by

the defendants to the plaintiffs within four weeks from today.

                                                                      S. RAVINDRA BHAT, J
OCTOBER 09, 2009




CS(OS) 1411/2002                                                                              Page 7