Delhi High Court
Country Inn Private Ltd. vs Country Inns And Suites By ... on 11 February, 2010
Author: Manmohan Singh
.
* HIGH COURT OF DELHI : NEW DELHI
+ I.A. No. 13146/2008 in CS(OS) No. 2264/2008
COUNTRY INN PRIVATE LTD. ...Plaintiff
Through : Mr. Vijay Pal Dalmia, Mr. Varun
Singh, Ms. Anubha Singh and
Mr. Saurav Bhasin, Advs.
Versus
COUNTRY INNS AND SUITES BY CARLSON, INC. & ANR.
....Defendants
Through : Mr. Vivek Dhokalia and Ms. Punita
Bhargava, Advs.
AND
+ I.A. Nos. 11437/2009 & 15398/2009 in CS(OS) No. 1652/2009
COUNTRY INNS AND SUITES BY CARLSON, INC. & ANR.
...Plaintiffs
Through : Mr. Vivek Dhokalia and Ms. Punita
Bhargava, Advs.
Versus
COUNTRY INN PRIVATE LTD. ....Defendant
Through : Mr. Vijay Pal Dalmia, Mr. Varun
Singh, Ms. Anubha Singh and
Mr. Vikas Mishra, Advs.
Decided on: February 11th, 2010
Coram:
HON'BLE MR. JUSTICE MANMOHAN SINGH
1. Whether the Reporters of local papers may
be allowed to see the judgment? Yes
2. To be referred to Reporter or not? Yes
3. Whether the judgment should be reported Yes
in the Digest?
CS (OS) No.2264/2008 & CS(OS) No.1652/2009 Page 1 of 30
MANMOHAN SINGH, J.
1. By this order I shall dispose of two interim applications
under Order XXXIX Rules 1 & 2 of the Code of Civil Procedure, 1908.
One is filed by Country Inn Private Limited being IA No. 13146/2008 in
the present matter being CS(OS) No.2264/2008 and the second is IA
No.11437/2009 filed by Country Inns & Suites By Carlson, Inc. in CS
(OS) 1652/2009, both being cross suits filed by the parties against each
other.
2. The facts in both the matters are common, therefore, as
agreed by the parties, both the interim applications be disposed of by the
single order. For the purpose of convenience, the Plaintiff in the present
suit M/s. Country Inn Private Limited shall be referred as "Plaintiff" and
M/s. Country Inns & Suites by Carlson, Inc. & Anr. as "Defendant".
3. The Plaintiff filed a suit i.e. C.S. (OS) 2264/2008, against the
Defendants for permanent injunction restraining the Defendants herein
from infringement of trademark, passing off, acts of unfair competition,
dilution, damages/rendition of accounts with respect to the registered
trade mark/corporate name of the Plaintiff being „Country Inn‟.
4. The case of Country Inn Pvt. Ltd., the Plaintiff in CS (OS)
No.2264/2008 and Defendant in CS(OS) No.1652/2009, is that the
Plaintiff company was incorporated on 13th July, 1993 under the
Companies Act, 1956 with the object of carrying on the business of
hotels, motels, restaurants etc. Subsequent to the incorporation, the
Plaintiff started its resort/hotel under the trade mark/name "Country
Inn" in 1993.
5. The Plaintiff adopted and began operations under the mark
and name "Country Inn" for its resorts in the year 1993 and since then
the Plaintiff has continuously, openly, uninterruptedly and extensively
been carrying on the aforesaid business activities.
6. As per the case of the Plaintiff, the Plaintiff is the prior user,
legal owner and lawful proprietor of the trade mark "Country Inn" in
India. The trade mark "Country Inn" is registered in India under the
provisions of the Trade Marks Act, 1999. Details of registration of trade
mark "Country Inn" in favour of the Plaintiff are given herein below:
S.No. Trade Mark Number Class Status of
Registration
1. COUNTRY INN 604933 32 Registered
(Logo form)
2. COUNTRY INN 604932 33 Registered
(Logo form)
3. COUNTRY INN 604934 30 Registered
(Logo form)
4. COUNTRY INN 604935 29 Registered
(Logo form)
7. As per plaintiff, it had permitted its other group companies
namely, Sarp Hotels Private Ltd., Forest Fern Resort Private Limited,
Forest Fern Hospitality Private Limited and Orphic Resorts Limited to
run resorts under the name of "COUNTRY INN" who are located at the
strategic places enumerated herein below:
(i) Jim Corbett
(ii) Bhimtal
(iii) Kosi
(iv) Mussoorie
(v) SATTAL
8. The Plaintiff has been popularizing the mark "Country Inn"
in relation to the hospitality industry since the Plaintiff adopted and
began operations.
9. The Plaintiff‟s resorts under the mark "Country Inn" cater to
a wide array of individual and corporate clients including Max, NIIT,
Ranbaxy Laboratories Limited, HP, HCL, Hero Honda, LG, Modern
School, Reliance, HLL, IBM and Apollo Tyres.
10. The case against the Defendant is that in the last week of
March 2008 it came to the notice of the Plaintiff that the hotel under the
name "COUNTRY INN" was being constructed in Sahibabad by the
Defendant No.1, which constituted unauthorised use of the Plaintiff‟s
registered trademark "COUNTRY INN".
11. The Plaintiff submits that a legal notice dated 4.4.2008 was
sent by one of the group companies of the Plaintiff to the Defendant
No.1 and one of its promoters. A reply to the said notice dated
15.5.2008 was received and from the reply it was evident that the
Defendant had tried to usurp the trademark and goodwill of the Plaintiff
as the Defendant No.1 is admittedly a subsequent user of the mark/name
"COUNTRY INN" in India.
12. It is the contention of the Plaintiff that Defendant No.1 with
mala fide intention, wants to take advantage and benefit of the
Plaintiff‟s trademark "COUNTRY INN" and is also causing dilution of
the Plaintiff‟s trademark with dishonest intention and such use of the
mark by the Defendant no. 1 being COUNTRY INN & SUITES BY
CARLSON INC., is causing confusion and deception in the mind of the
public as the said mark is deceptively similar to the mark of the Plaintiff
and the Defendant are passing off their business/services as that of the
Plaintiff and the said act of the Defendant constitutes unfair competition
and in fact the Defendant are diluting the distinctive and well-known
mark "COUNTRY INN" of the Plaintiff.
13. In support of its submission, the Plaintiff has filed the
following documents which will also prove the user since 1993:
a) Copies of the registration certificate of the Plaintiff for its
mark "COUNTRY INN" vide no.604932, 604933 and
604935.
b) Internet printout of the "Country Inn (Label)" vide
no.604934.
c) Internet printout of the status "Country Inn (Label)" in
Class 42 vide trade mark application no.1702292.
d) Official receipt of having filed for TRADE MARK-46 for
the trade marks registered vide no.604932, 604933,
604934 and 604935.
e) Copies of Pamphlets, brochures& promotional materials
of the Plaintiff for its resorts under the mark "COUNTRY
INN".
f) Certificate of Registration dated 21.04.1994.
g) Bill from the Department of Telecommunications dated
26.08.1994 in the name of Country Inn along with
Challan dated 04.07.1994.
h) Copy of Invoices of the Plaintiff Company‟s and its group
companies‟ resorts under the mark "COUNTRY INN"
from the year 1994 up to 2008.
i) Copies of promotional materials in magazines and print
media by the Plaintiff for its resorts under the Mark
"COUNTRY INN".
j) Copies of promotion by the Plaintiff in various hotel and
restaurant guides of the Plaintiff‟s resorts under the Mark
"COUNTRY INN".
k) Copy of the Certificate from the Registrar of domain
name www.countryinn.co.in in the name of Plaintiff.
l) Copy of Certificate of Incorporation of the Plaintiff
Company and Copy of Memorandum & Articles of
Association of the Plaintiff Company.
14. The case of the Defendant in Suit No. 2264/2008 is that the
Defendant is part of the well known Carlson Companies Inc./Carlson
Hotels Worldwide (hereinafter, „Carlson Group‟), an acknowledged
leader worldwide in the travel and hospitality industry. The Carlson
Group operates its hotels and resorts, spanning luxury to economy, in
over 150 countries of the world, under five well known and highly
popular international brands viz. „REGENT HOTELS & RESORTS‟,
„RADISSON HOTELS & RESORTS‟, „PARK PLAZA HOTELS &
RESORTS, „PARK INN‟, and „COUNTRY INN & SUITES BY
CARLSON‟ and its variants „COUNTRY INN BY CARLSON‟ and
„COUNTRY SUITES BY CARLSON‟.
15. As per the Defendant, with regard to its rights in India as far
as the disputed mark is concerned, it has registered its COUNTRY INN
and COUNTRY INN & SUITES BY CARLSON marks internationally.
The first registration took place in USA in 1986. In India, the mark
COUNTRY INN & SUITES BY CARLSON (word) is registered under
no. 1237378 in class 42 in the name of Defendant since 2003 (when
service mark registration became available).
16. In addition, the marks COUNTRY INN BY CARLSON
(device) and COUNTRY SUITES BY CARLSON (device) are
registered in class 16 since 1994 in the name of Defendant. Defendant‟s
marks COUNTRY INN & SUITES BY CARLSON (word) and Device
under which it operates its hotels worldwide including India are well-
known marks within the meaning of Section 11(6) of the Act and are
entitled to protection as such. The very first Indian hotel under the
COUNTRY IN & SUITES BY CARLSON name mark became fully
operational at Katra, Jammu and Kashmir on January 2002.
17. Since then other hotels under the COUNTRY INN &
SUITES BY CARLSON mark have been established in six other Indian
cities namely, Jaipur (in 2004), Paradeep (in 2004), Ludhiana (in 2005),
Jalandhar (in 2005), Haridwar (in 2005) and Goa (in 2007).
18. The COUNTRY INNS & SUITES BY CARLSON brand has
been the subject matter of media comments in newspapers such as
Economic Times, Financial Express etc. as well as in the electronic
media.
19. The Defendant has spent millions of dollars in the promotion,
protection and advertisement of its COUTNRY INN & SUITES BY
CARLSON marks, resulting in unparalleled reputation and goodwill so
that anyone who sees the said marks would associate the same with
Defendant alone.
20. Samples of print media coverage precedes the formal launch
of hotels in India under the COUNTRY INN & SUITES BY CARLSON
brand in 2001 and dates back at least to 1998 and the same are placed on
record.
21. The first application for a COUNTRY IN (device) mark, as
depicted below, was filed by a predecessor of the Defendant in the USA
on November 24, 1986 under Serial No. 73/632,243. The registration for
COUNTRY INN (device) mark was obtained by a predecessor of the
Defendant in 1988 (claim of use since 1987) and also issued under
registration no. 1,522,193 in class 42.
22. The first COUNTRY INN & SUITES BY CARLSON
(Device) registration was issued to a predecessor of Defendant in the
USA on July 9, 1990 (claim of use in 1992) and issued under
registration no. 1,747,925 in class 42. Since then, the Defendant has
obtained many other registrations for COUNTRY INN formative marks,
including COUNTRY INN BY CARLSON (word or design) and
COUNTRY INN & SUITES BY CARLSON (word or design), in about
55 jurisdictions.
23. According to the Defendant, its rights in the phrase
COUNTRY INN go back to 1987 when the mark was first devised and
adopted and put to use for its hotels in the USA by it. Between 1987-
1992 the mark COUNTRY INN evolved to COUNTRY HOSPITALITY
INN (device) and then to COUNTRY INN BY CARLSON (word and
device).
24. During this period, Defendant had around 30 hotels operating
under these and similar marks (around 20 in USA and 10 in Canada).
The COUNTRY INN mark evolved to COUNTRY INN & SUITES BY
CARLSON (word and device) in 1992. Since 1987, the COUNTRY
INN marks have been extensively used by Defendant both in USA and
internationally for and in relation to its hotels business.
25. It is submitted that the Defendant has spent millions of
dollars on promotion and advertisement of its COUNTRY INN &
SUITES BY CARLSON brand in USA and internationally. Certified
Marketing Funds spent in promoting the COUNTRY INN & SUITES
BY CARLSON brand internationally for the period 1989-2008 are filed
in these proceedings.
26. Over US $185 million have been spent by Defendant from
1992 to present in advertisement and promotion of the COUNTRY INN
& SUITES BY CARLSON brand on a worldwide basis through
electronic and print media including newspapers and magazine
publications and over the Internet.
27. It is averred that the Defendant owns numerous domain
names which incorporate the COUNTRY INN formative including
<countryinns.com>;<countryinns-suites.com>; <countryinnhotels.com>;
and several country specific and top level domains including
<countryinns.cc>; <countryinns.cn>; <countryinn.eu>;
<countryinns.at>; <countryinns.be>; <countryinns.co.hu>;
<countryinns.nl>; <countryinns.uk.com>; <countryinn.asia>;
<countryinns.travel>; <countryinns.mobi> etc. The very first domain
registration for the domain <countryinns-suites.com> was obtained on
6th November, 1996.
28. The Defendant also operates the website
www.countryinns.com which has been operational since June 1997.
The said website prominently features the COUNTRY INNS & SUITES
BY CARLSON mark of Defendant.
29. The marks have also been extensively promoted and
advertised internationally by the Defendant. As a result, as well as due
to the quality of services rendered by the Defendant‟s COUNTRY INN
and/or COUNTRY IN & SUITES BY CARLSON hotels, the marks
have acquired substantial repute, goodwill and have become well-
known both amongst the general public and more so amongst hospitality
personnel worldwide.
30. The hotels of the Defendant operate under the COUNTRY
INN & SUITES BY CARLSON (word and device) marks and are
popularly referred to as COUNTRY INN.
31. It is alleged that the COUNTRY INN & SUITES BY
CARLSON hotel chain of the Defendant is an industry leader in the
mid-scale hotel segment and is known internationally for its consistently
high quality accommodations and personnel and its warm hospitality.
All COUNTRY INN & SUITES BY CARLSON hotels worldwide have
a typical sloping roof in green or red, front porch, residential
architecture and home-like interior design with highlights that include
hardwood flooring and lobby fireplace.
32. It is further alleged that the COUNTRY INN & SUITES BY
CARLSON brand has achieved great fame worldwide through its
quality of service and marketing. Consequently, revenue attributable to
the COUNTRY INN & SUITES BY CARLSON brand runs into billions
of dollars. From 1992 through to the present, more than US $ 5 billion
dollars have been generated at COUNTRY IN & SUITES BY
CARLSON properties worldwide with guests having reserved hundreds
of millions of stays during the period.
33. The Defendant in support of their submission have filed the
following documents along with their list of documents:
i) Copy of Legal Proceeding Certificate for COUNTRY INNS
& SUITES BY CARLSON mark in class 42 in India.
ii) Copies of the Registration and Renewal Certificates of the
COUNTRY INN BY CARLSON (device) and COUNTRY
SUITES BY CARLSON (device) marks in class 16.
iii) Copy of India Directory of the COUNTRY INNS & SUITES
BY CARLSON hotels.
iv) Copies of photographs of the COUNTRY INNS & SUITES
BY CARLSON hotels in India reflecting typical features.
v) Copies of representative guest room amenities in the
COUNTRY INNS & SUITES BY CARLSON hotels in
India.
vi) Copies of representative invoices issued to guests who have
stayed in the various COUNTRY INNS & SUITES BY
CARLSON hotels in India.
vii) Certified revenue figures of operations under the COUNTRY
INNS & SUITES BY CARLSON brand in India since 2002.
viii) Copies of representative promotional, publicity and
sponsorship material relating to the COUNTRY INNS &
SUITES BY CARLSON brand in India.
ix) Copies of Articles on COUNTRY INNS & SUITES BY
CARLSON brand published in newspapers and magazines in
India including CDs containing electronic media coverage.
x) Representative communications received for business tie ups
under the COUNTRY INNS & SUITES BY CARLSON
brand in India.
xi) Copies of Certified Registration Certificates for the
COUNTRY INNS & SUITES BY CARLSON in certain
jurisdictions (outside India).
xii) Copy of certified Marketing Funds spent in promoting the
COUNTRY INNS & SUITES BY CARLSON brand
internationally for the period 1989 - 2008.
xiii) Copies of representative advertising and promotion material
relating to COUNTRY INNS & SUITES BY CARLSON
hotels (outside India).
xiv) Copy of Membership Rewards Catalogue 2007 of American
Express Bank Limited.
xv) Representative „Whois‟ Extracts for the domain names
incorporating the COUNTRY INN formative.
xvi) Extracts from the website www.countryinns.com.
xvii) Representative material relating to media comment on
Plaintiff No.1 and COUNTRY INNS & SUITES BY
CARLSON hotels (outside India).
xviii). True copy of the redacted version of the Master Franchise
Agreement between the Plaintiffs.
xix). Copy of invite sent to selected guests for complementary stay
at the COUNTRY INNS & SUITES BY CARLSON hotel at
Katra.
34. The Defendant has also filed Brochures on the Carlson
Group and Locations Directory for the group‟s hotels, copy of the
Certificate of Incorporation and other corporate documents of
Defendant, copies of photographs of typical features of COUNTRY
INNS & SUITES BY CARLSON hotels in USA, copies of Directory of
Accommodation for COUNTRY INNS & SUITES BY CARLSON
hotels for the years 1989-1992, 1997, 2001, 2005 and 2008, copy of
Certified Revenue Summary for the years 1987-2008 attributable to the
COUNTRY INNS & SUITES BY CARLSON hotels worldwide and
copy of the certified country wise Reservations Data for the years 2001-
2008 for guest reservations attributable to the COUNTRY INNS &
SUITES BY CARLSON hotels.
35. From the above said documents filed by the Defendant, it is
not in dispute that the Defendant is holding the registration of trademark
No.1237378 in Class 42 as a service mark in relation to Hotel and Motel
Services, Renting of Accommodation, Providing Recreational Facilities,
and Providing Meeting and Conference Facilities. The said registration
is granted from 16.9.2003. Earlier to the said registration the Defendant
has also got registration in Class 16 under No.637364B as of 18.8.1994
in respect of printed matters such as Stationery, Training Manuals,
Advertising and Promotional Material, Newsletters, Cards and Forms.
36. The contention of the learned counsel for the Defendant is
that since the Plaintiff‟s business is with respect to similar activities, the
case of infringement of trademark is made out. He further submits that
under Section 28 of the Trade Marks Act, 1999, the Defendant has also
got exclusive and statutory rights which are conferred in favour of the
defendant as the business of the plaintiff is same as that of the
defendant, thus Plaintiff is guilty of infringement of trademark within
the meaning of Section 29 of the Act.
37. Mr. Vivek Dhokalia, learned counsel for the Defendant has
not denied the fact that the Defendant has established its business in
India at a subsequent point of time than the Plaintiff, but in view of the
fact that the Defendant is the prior adopter and user of the mark in
question in overseas countries in view of the documents placed on
record, the said user is to be accepted on account of its trans-border
goodwill and reputation of the mark "COUNTRY INN" as the
Defendant has residual goodwill and reputation in the said name and
they are world renowned name pertinent to the mark COUNTRY INN.
In fact it is the Plaintiff who is passing off its business and services as
that of the Defendant and the Plaintiff is also infringing the registered
trademark no. 1237378 in Class 42 which belongs to the Defendant. He
submits that under no circumstances the Plaintiff is not entitled for an
injunction as prayed in I.A. No. 13146/2008. He argues that since the
Defendant was about to take action against the Plaintiff, the present suit
No. 2264/2008 has been filed by the Plaintiff.
38. The Defendant in order to protect its legal right has filed a
separate Suit being Suit No. 1652/2009 along with the interim
application i.e. I.A. 11437/2009 under Order XXXIX Rules 1 and 2 read
with Section 151 CPC for grant of an injunction against the Plaintiff
"COUNTRY INN PVT. LTD." restraining it from using the name/mark
"COUNTRY INN" in any manner.
39. Mr. Dalmia learned counsel for the Plaintiff has averred that
the Plaintiff is the prior user of the trademark "COUNTRY INN" and
despite the registration granted in favour of the Defendants, has got
better right of passing off under Section 27(2) of the Act and in support
of his submission he has referred to Yash Arora Vs. Tushar
Enterprises, 2008 (36) PTC 523 (Del). In this case the Court held as
under :
"11..... If prior user, as alleged by the Plaintiff
was established, the subsequent registration of
trade mark in favor of the Defendants would
have paled into insignificance in a passing off
action. Suffice it to say that the treatment
given by the learned single Judge to the
question of prior user does not appear to be
satisfactory. It is true that this Court could in
the present appeal examine the documents
being relied upon by the Plaintiff to find out
whether the Plaintiff-appellant had made out a
prima facie case for the grant of injunction
based on the plea of prior user of the trade
mark yet it is not necessary for this Court to
embark upon such exercise."
40. He has also referred the case of Cott Beverage Inc., A
Georgia Corporation Vs. Silvassa Bottling Company, 2004 (29) PTC
679 (Bom) wherein the Court observed as under :
"27...... The Plaintiffs have also not placed on
record a single advertisement published in
India on invoice prior to the adoption and use
by the Defendant-respondent to show that
there is substance of goodwill in this country.
There is, thus, in my view, no evidence to
show that the goods have achieved trans-
border reputation. In my view, principle what
was necessary for grant of temporary
injunction was; whether the Plaintiffs had
made out a prima facie case of use of mark
prior to commencement of its use by the
Defendant. In my view, the Plaintiffs have not
made out a prima facie case to show that in
December, 1999 the Plaintiff had established
reputation of goods in India. I am of the view
that the ratio laid down by this Court in a case
reported in the case of Cluett Peabody and Co.
Inc. v. Arrow Apparals (supra), is squarely
applicable to the facts of the present case."
41. In another case of Smithkline Beecham Plc. And Ors. Vs.
Hindustan Lever Limited and Ors., 1999 PTC 775, the Court
observed:
"17. The Plaintiffs have also not placed on
record any evidence of any use, reputation or
goodwill in the „S‟ bend feature of the
Plaintiff‟s tooth brush „FLEX‟ even
internationally prior to launch in India i.e. in
June, 1996. They have not even placed a
single advertisement published in India or
invoice prior to 1996 to show and indicate that
there is subsistence of any goodwill in this
country. In absence of any evidence of
goodwill or any reputation it cannot be
presumed that the Plaintiffs achieved a trans-
border reputation prior to the filing of the suit
in respect of their tooth brush, no injunction
could be granted in favour of the Plaintiff even
in respect of OZETTE manufactured and
marketed by the Defendants vis-a-vis
ACQUAFRESH FLEX. In the case of
Whirlpool reported in 1996 PTC 415 there was
voluminous evidence produced which were
circulated in India for several years and the
goods were sold to Embassies and in the
context of such evidence this court held that
the said product achieved trans-border
reputation. No such evidence has been placed
in the present case at least prior to 1996 and
even whatever evidence has been placed on
record after 1996 the same does not establish
that the Plaintiffs achieved a trans-border
reputation. In order to prove trans-border
goodwill and reputation the Plaintiffs have
relied upon materials published in the dental
journal which admittedly has very restricted
circulation. Mere publication of such
advertisement and materials in dental journal
cannot and would not establish a trans-border
reputation. Such reputation, if any, was
confined to a particular class of people i.e. the
persons subscribing to the said specialized
journals and cannot be said to be extended to
the general consumers. It could not be shown
that any advertisement was made by the
Plaintiffs prior to 1996 in any journal or
magazine having wide circulation. In absence
of same it is not possible to hold that the tooth
brush of the Plaintiff acquired any trans-border
reputation and goodwill."
42. He argues that in view of settled law, since the Defendant has
failed to produce any evidence before this Court in order to show that it
has been advertising or using the mark in India prior to 2002, therefore,
the Plaintiff is the prior user of the name "COUNTRY INN" which is
admittedly is being used since 1993 and therefore, the Plaintiff is
entitled to the injunction claimed for.
43. After having gone through the documents placed by the
Defendant, it appears that the Defendant has been using the name
"COUNTRY INN" with or without the prefix at least from the year 1986
in US and from the year 1990 internationally. There is sufficient
material produced on record by the Defendant that in year 1987 the first
COUNTRY INN hotel was started on 1.4.1987 in Coon Rapids,
Minnesota, USA.
44. In 1990 the Defendant‟s business went international at more
than in 40 locations as per the evidence produced by the Defendant.
The advertisement of the Defendant also appeared from the year 1990 in
leading US industry publication. In the year 1992 the advertising
expenditure of the Defendant was US $185 million.
45. The Defendant has obtained the registration mark
"COUNTRY INN & SUITES BY CARLSON (word) under No.1237378
in class 42 in India since the year 2003 when under the Trade Mark Act,
the registration of service mark was available. In addition, the marks
COUNTRY INN BY CARLSON (device) and COUNTRY SUITES BY
CARLSON (device) has been registered in class 16 since 1994.
46. From the documents filed by the Defendant it appears that in
fact the Defendant is the prior adopter and user of the trademark/name
"COUNTRY INN" in overseas countries. The name "COUNTRY INN"
of the Defendant has also appeared in the year 1987 in US which is prior
in time. The learned counsel for the Defendant has fairly not denied the
fact that as far as India is concerned, the Defendant has admittedly
started their operation in 2002.
47. The contention of Mr. Dhokalia learned counsel for the
Defendant is that in view of the well-known mark/name coupled with
the fact that the same was advertised in various international magazines,
the user in subsequent time in India is immaterial as the Defendant is the
prior adopter and user of the trademark in overseas countries and as per
the settled law the user of overseas countries has to be considered at the
time of disposing of the present application.
48. The following judgments were referred by learned counsel
for the Defendants :
In Milment Oftho Industries and Ors. Vs. Allergan Inc
2004 PTC 585 (SC), the Supreme Court stated that "the ultimate test
should be who is first in the market.....The mere fact that the
respondents have not been using the mark in India would be irrelevant
if they were first in the world market". Para 10 of the judgment reads as
under:
"10. In the present case, the marks are the
same. They are in respect of pharmaceutical
products. The mere fact that the Respondents
have not been using the mark in India would
be irrelevant if they were first in the world
market. The Division Bench had relied upon
material which prima-facie shows that the
Respondents product was advertised before the
Appellants entered the field. On the basis of
that material the Division Bench has
concluded that the Respondents were first to
adopt the mark. If that be so then no fault can
be found with the conclusion drawn by the
Division Bench."
In another case Austin Nichols & Co. & Anr. Vs. Arvind
Behl & Anr. reported in 2006 (32) PTC 133 (Del.) in relevant paras 41
and 47 of the judgment at page Nos. 146 and 149 of the judgment given
by Madan B. Lokur, J., this Court observed as under:
"41.....
„Blenders Pride‟ whisky manufactured by the
Plaintiffs had a worldwide reputation, being
available for sale in a large number of
countries since 1973 onwards. It cannot be
said that the product was unknown in India.
The predecessor in interest of the Plaintiffs
had an intention of directly exploiting the
Indian market. In fact, they had applied for
permission from the Government of India to
manufacture „Blenders Pride‟ whisky, which
was granted, and they have been
manufacturing „Blenders Pride‟ whisky in
India since 1995.
47. In view of the above decisions and
because of the huge advances made in
information and communication technology
over the years, I think it is too late for the
Defendants to seriously urge that the regular
sale of a product in one or more foreign
countries would be unknown to persons living
in India. I would, therefore, hold that the
Plaintiffs having come out with „Blenders
Pride‟ whisky first in the international market
were first past the post; even though the
Defendants were the first do so in India. The
fact that the product of the Plaintiffs was not
manufactured or sold in India from 1973
(when it first entered the market) till 1995
when it became freely available in India, is of
no consequence."
In Jolen Inc. Vs. Doctor and Company, (2002) PTC 29
(Del), the Court recognized the principle of repute outside the country of
origin in the following observation :
"21. It is not necessary that the association of
the plaintiff's mark with his goods should be
known in the countries other than its origin or
to every person in the area where it is known
best. Mere advertisement in other countries is
sufficient if the trademark has established its
reputation and goodwill in the country of its
origin and countries where it is registered.
22. In modern world, advertisements in the
newspapers travel beyond the country where
party is engaged in business through overseas
editions or otherwise. Even if it is assumed
that such advertisements or mark do not travel
beyond the borders of the countries where the
plaintiff has the business still it has a right to
protect its reputation and goodwill. It is more
so where the trade name has been pirated in
totality and not by way of having deceptive or
confusing similarity. We are living in a world
where there is enormous mobility. Well
travelled Indians and tourists cannot remain
unaware of international commodities.
Reputation always travels faster than men.
Whenever persons traveling abroad for
business or pleasure or any other purpose viz.
study or temporary postings come across an
article of a trade name of international
reputation they are bound to be confused as to
the source and quality if they happen to see
that commodity in their country where there is
no physical market. Mere likelihood of
confusion is sufficient."
49. Mr. Dhokalia has argued that no explanation at all has been
given by the Plaintiff as to how it came to adopt the „Country Inn‟ mark.
This is required in cases such the present as held in the case of Revlon
Inc. and Ors. Vs. Sarita Manufacturing Co., 1997 PTC 394:
"28. No satisfactory explanation has been
given by the defendants as to how they came
to adopt the trade marks which are registered
in the name of the plaintiffs. Word "Revlon"
does not appear in the dictionary. It cannot be
a mere co-incidence that the defendants had
adopted the same mark for their products
which was registered in the name of the
plaintiffs and which have a world wide market.
In my view, the adoption of marks registered
in the name of the plaintiffs by the defendants
for their products cannot be considered honest
and in such a case even the plea of delay and
laches, in my opinion, would be of no avail to
the defendants. In case, the defendants had
chosen to continue to use the trade marks
registered in the name of the plaintiffs, inspire
of plaintiffs' objection, they, in my view, had
been doing so at their own risk and they
cannot derive any advantage from such user.
From the record, I find that the defendants firm
had been describing itself as importers and
exporters of Region perfumes. It is not even
the case of the defendants that they had at any
time imported' these perfumes."
Infringement of Trademark
50. To decide the question as to whether the Registered-
Proprietor‟s right to a trademark has been infringed in the particular
case, the approach must not be the same as that in an action of passing
off of goods of the Defendant as and for those of Plaintiff. The action
for infringement is a statutory remedy. It is dependent upon the validity
of the registration. Both Sections 28 and 29 of the Trademark Act, 1999
provide that the registered proprietor of a mark has exclusive and
statutory rights to use the trademark in relation to the goods or services
in respect of which the trademark is registered and to obtain relief in
respect of infringement thereof.
51. In the present case admittedly, the Defendant is the registered
proprietor of the trademark "COUNTRY INN & SUITES BY
CARLSON under no.1237378 in Class 42 as well as in Class 16. There
is no registration in favour of the Plaintiff in Class 42, the Plaintiff has
registration of Class 29, 30, 32 and 33 which are in different Class of
goods other than the business carried on by the Plaintiff. The Defendant
has obtained the registrations in India after the year 2003 in Class-42
and the earlier registration in Class 16 in the year 1993, but by that time,
the Plaintiff had already incorporated its company name "COUNTRY
INN PVT. LTD.". Though prima facie the adoption of mark by the
Plaintiff does not appear to be bona fide but, in view of use of the name
of the Plaintiff "COUNTRY INN" in the year 1993, the contention of
the Defendant for infringement of the trade mark cannot be accepted in
light of the provision of section 34 of the Act.
52. As regards the question of passing off action is concerned, as
held earlier, admittedly the Defendants are the prior adopter and user of
the mark COUNTRY INN in overseas countries. The said user in these
countries has to be taken into consideration in this country as per settled
law.
53. It is settled law that a party can protect his goodwill in the
name of his hotel even he does carry on the hotel business within the
jurisdiction provided his business has some reputation in the country.
Before coming to any conclusion in this regard, let me
discuss the law wherein, the courts have, no doubt, considered the
prayer of interim order in the cases where the similar question had
arisen.
54. In Sheraton Corporation of America Vs. Sheraton Motels,
(1964) RPC 202 the Plaintiffs were the owners of a chain of hotels
called "Sheraton Hotels" in America and other foreign countries. They
had no hotel in the United Kingdom ("U.K. for brevity") but bookings
in their hotels abroad were made in U.K. through their own office in
London and through travel agencies. The Defendants proposed to
construct a hotel at Prestwick Airport. They contended that they derived
the name "Sheraton Motels Ld" from their offices at No. 1 Sheraton
Street, London. It was shown that this address did not exist as the
building was destroyed during the war. There was evidence of
confusion. Interlocutory injunction was granted to restrain the
Defendants from advertising in a way calculated to suggest association
with the Plaintiffs.
55. In Berkeley Hotel Vs. Berkeley International (Mayfair),
(1972) RPC 237, the plaintiffs were owners of a hotel under the name
"Berkeley Hotel" at Berkeley Street, London, which had acquired
reputation with clientele from all over the world. They sold the hotel
without the goodwill attached to it in 1968 which was demolished in
1969. They were to open a new hotel under the old name "Berkeley
Hotel" in Knightsbridge in 1971. The Defendants built a new hotel at
the Plaintiffs‟ old site and proposed to open it in 1972 under the name
"Berkeley International". Interlocutory injunction was granted although
it was admitted that the Defendants had no intention to deceive. There
was evidence on each side as to the circumstances in which confusion
might arise.
56. In Rainforest Cafe, Inc. Vs. Rain Forest Café, 2001 PTC
353 (Del) by Vikramajit Sen J. the plaintiff had registered the name
"Rain forest Cafe" and logo in a number of countries other than India in
respect of restaurant services and used the same extensively in many
foreign countries, though not in India and has acquired world wide
reputation. Defendant opened a restaurant under the name "Rain Forest
Cafe". He had copied the name logo and the slogan "A wild place to
eat" used by the Plaintiff. Defendants explanation for adoption of the
name was held to be unsatisfactory and the interim injunction was
granted.
57. In Taco Bell Corporation Vs. Taco Bell, 2000 PTC 554
(Bom) the plaintiffs were the owners of a chain of restaurants under the
name "TACO BELL" in many countries having trans-border reputation
in India. Defendants, who originally were running their restaurants
under the name "Dunhill Fast Food" later changed over to the name
TACO BELL. Affidavits from three persons who stated that they
thought that the Defendants business was a branch of the Plaintiff were
admitted as evidence and interim injunction was granted.
58. In Westin Hospitality Services Ltd. Vs. Caesar Park Hotels
& Resorts Inc., 1998 IPLR 189 (Mad.) the Plaintiff used WESTIN as a
service mark in relation to its hotel business in a number of countries
except India. Westin formed part of the corporate name of their
subsidiary which was doing similar business. The Defendants were
carrying on the business of consultancy services for hotel and resorts
and for providing an automatic Hotel reservation system since 1989.
Interim injunction refused as the materials produced by the Plaintiffs
were far from sufficient to make out a prima facie case that goodwill
had been established in India for the mark "Westin" in relation to hotels
and hospitality service. On appeal to the Supreme Court the interim
order passed by High Court was modified by which the Defendants were
permitted to use the word WESTINN as part of their corporate name
with the rider that in the letter heads and advertisements the words "No
connection whatsoever with Westin Hotels & Resorts" shall be added.
59. In Lyons Vs. G&K Restaurants (1955), 72 RPC 259 the
plaintiffs were the owners of a restaurant under the style "Egg and
Bacon". They had also registered a trade mark consisting of the device
of an egg and the head of a pig. Defendant started a restaurant in a
neighbouring street under the name "Egg and Bacon Broadway
Restaurant". They printed on their menu the device of an egg and a
pig‟s head. In an action for infringement and passing off the Defendant
offered to submit to an injunction regarding infringement and to change
the name to "Eggs and Bacon". It was held that this would sufficiently
protect the Plaintiffs.
60. Further, the plaintiff in its suit has specifically made
admission about the similarity of the mark COUNTRY INN as well as
confusion and deception in trade. Therefore, no doubt, the case of
passing off has been prima facie made out by the Defendant against the
Plaintiff in view of the cases referred by the Defendant i.e. Milment,
Blender pride and Jolen Inc. supra. Further on the question of trans-
border reputation in the country, the Division Bench of this Court has
been dealt with in the case of N.R. Dongre and Ors. Vs. Whirlpool
Corporation and Ors., AIR 1995 Delhi 300, the Court observed :
"14. The knowledge and awareness of a
trade mark in respect of the goods of a
trader is not necessarily restricted only to
the people of the country where such goods
arc freely available but the knowledge &
awareness of the same reaches even the
shores of those countries where the goods
have not been marketed. When a product is
launched and hits the market in one country,
the cognizance of the same is also taken by
the people in other countries almost at the
same time by getting acquainted with it
through advertisements in newspapers,
magazines, television, video films, cinema
etc. even though there may not be
availability of the product in those countries
because of import restrictions or other
factors. In today's world it cannot he said
that a product and the trade mark under
which it is sold abroad, does not have a
reputation or goodwill in countries where it
is not available. The knowledge and
awareness of it and its critical evaluation &
appraisal travels beyond the confines of the
geographical area in which it is sold. This
has been made possible by development of
communication systems which transmit &
disseminate the information as soon as it is
sent or beamed from one place to another.
Satellite Television is a major contributor of
the information explosion. Dissemination of
knowledge of a trade mark in respect of a
product through advertisement in media
amounts to use of the trade mark whether or
not the advertisement is coupled with the
actual existence of the product in the
market."
61. In view of the aforesaid reasons, it is clear that the Plaintiff
has failed to make out any case for grant of injunction against the
Defendant, in view of the earlier adoption and user of the mark in
question as well as decision referred in earlier paras of my order, thus
Plaintiff‟s application for injunction against the Defendant being IA
No.13146/2008 is dismissed.
62. Now the question before this Court is as to whether the
Defendant is entitled for an injunction as sought in the Interim
Application against the Plaintiff.
63. Though in the present case, no explanation at all has been
given by the plaintiff as to how it came to adopt the mark "COUNTRY
INN", but, the fact of the matter is that the Plaintiff has been carrying on
business of hotels, motels and restaurants since the year 1993 and there
are documents filed by the plaintiff as referred in para 13 of my
judgment about the said user, hence, it appears that there is a delay of
more than 16 years for bringing the action by the defendant against the
plaintiff.
64. It is settled law that the grant of injunction is a discretionary
relief. The exercise thereof is subject to the Court satisfying that:
(1) there is a serious disputed question to be tried
in the suit and that an act, on the facts before
the court, there is probability of his being
entitled to the relief asked for by the
plaintiff/defendant.
(2) The court‟s interference is necessary to protect
the party from the species of injury. In other
words, irreparable injury or damage would
ensue before the legal right would be
established at trial; and
(3) That the comparative hardship or mischief or
inconvenience which is likely to occur from
withholding the injunction will be greater than
that would be likely to arise from granting it.
65. In the case of Gujarat Bottling Co. Ltd. and Ors. Vs. Coca
Cola Co. and Ors., AIR 1995 SC 2372, the court observed:
"46. ...The object of the interlocutory
injunction is to protect the plaintiff against
injury by violation of his right for which he
could not be adequately compensated in
damages recoverable in the action if the
uncertainty were resolved in his favour at the
trial. The need for such protection has,
however, to be weighed against the
corresponding need of the defendant to be
protected against injury resulting from his
having been prevented from exercising his own
legal rights for which he could not be
adequately compensated. The court must weigh
one need against another and determine where
the 'balance of convenience' lies. See: Wander
Ltd. and Anr. v. Antox India P. Ltd.
MANU/SC/0595/1990. In order to protect the
defendant while granting an interlocutory
injunction in his favour the Court can require
the plaintiff to furnish an under taking so that
the defendant can be adequately compensated if
the uncertainty were resolved in his favour at
the trail."
66. For the aforesaid reasons and after considering the matter in
totality, this Court is of the considered view that at this stage no interim
order against the Plaintiff can be passed as the Plaintiff would suffer
irreparable loss and injury in case the business of the Plaintiff which is
17 years old is stopped. Therefore, the defendant‟s interim application is
disposed of with the following directions:
i) The Plaintiff shall maintain true accounts of its
business under the name COUNTRY INN and
shall file the statement every half yearly before
this Court. The first statement shall be filed
within four weeks from today by giving the
statement of turnover for the last six months
and the Plaintiff shall continue to file the same
without any failure;
ii) The Plaintiff is directed not to enter into any
agreement with a new franchisee or from
issuing fresh license allowed using the
mark/name COUNTRY INN during the
pendency of the suit;
iii) If any advertisement is issued in future bearing
the name COUNTRY INN by the Plaintiff in
any newspaper or in/through any other
medium, the Plaintiff will put the disclaimer
that it has no connection with the Defendants.
67. For the above mentioned directions, the application of the
Defendant being IA No.11437/2009 is disposed of.
68. It is needless to say that the prima facie view taken by me in
the present case and any observations made herein shall be treated as
tentative in nature and shall not constitute any expression of final
opinion on the issues involved in the matter and shall have no bearing
on the final outcome of the case.
IA No.15398/2009
69. Both the parties are agreeable that since the documents and
parties are common in the matters, the same may be consolidated
accordingly. As agreed, I.A. No.15398/2009 filed by the Plaintiff is
allowed. Issues would be framed in suit No.2264/2008 and the evidence
of the parties shall also be recorded in this suit only.
CS(OS) No. 2264/2008 & CS(OS) No. 1652/2009
70. List before the Joint Registrar for further directions on 5th
April, 2010.
MANMOHAN SINGH, J.
FEBRUARY 11, 2010
jk
