Pepsico, Inc & Anr. vs Cr Associates & Anr.
2015 Latest Caselaw 6321 Del

*      IN THE HIGH COURT OF DELHI AT NEW DELHI

%                                 Order delivered on: 26th August, 2015

+                              CS (OS) No.159/2013

       PEPSICO, INC & ANR.                             ..... Plaintiffs
                     Through          Mr. Rajiv Virmani, Sr. Adv. with
                                      Mr. Dheeraj Nair & Mr.Kunal
                                      Mimani ,Advs.


                         versus

       CR ASSOCIATES & ANR.                       ..... Defendants
                   Through            Defendants are ex-parte.


       CORAM:
       HON'BLE MR.JUSTICE MANMOHAN SINGH

MANMOHAN SINGH, J. (ORAL)

1. The plaintiffs have filed the present suit for permanent injunction restraining the violation and infringement of rights in the trademark/name/label "AQUAFINA", infringement of copyright, rendition of accounts, dilution, delivery-up etc. against the defendants.

2. By order dated 28th February, 2014 the defendants were proceeded ex parte. No written statement has been filed by the defendants.

3. PW-1 Nidhi Sudan, Manager Legal of plaintiff No.2 Company who is the authorized signatory of the plaintiffs has filed the evidence by way of affidavit as Ex.PW1/X.

4. Brief facts of the case as per plaint are that Plaintiff No.1 - PepsiCo, Inc. is a corporation existing under the laws of North Carolina, United States of America having its principal office at 700, Anderson Hill Road, Purchase New York, USA. Plaintiff No. 2 - PepsiCo India Holdings Limited is a fully owned subsidiary of plaintiff No. 1, and is fully authorized on behalf of plaintiff No.1. The plaintiff No. 1 authorized Elizabeth Bilus by way of Delegation of Authority dated 7th May, 2010, to authorize plaintiff No.2 to, inter alia, make, use of and protect, the various trademarks of the plaintiff No. 1 Company, including, inter alia, the trademark AQUAFINA. A copy of the Delegation of Authority dated 7th May, 2010 issued by plaintiff No.l authorizing Ms. Elizabeth Bilus to have signing authority has been exhibited as Exhibit PWl/1. A copy of the letter dated 7th August, 2006 issued by plaintiff No.l in favour of plaintiff No. 2 has been exhibited as Exhibit PWl/2.

5. The certified true copy of the Board Resolution executed by plaintiff No.2 dated 3rd June, 2014 has been exhibited as Exhibit PWl/3.

6. The plaintiffs are world renowned manufacturers and beverages under the trademarks PEPSI, MIRINDA, 7UP, MOUNTAIN DEW, among others. The plaintiffs through their various divisions all over the world are also the largest manufacturers and sellers of snack foods including the brands LAY'S, CHEETOS, TOSTITOS, DORITOS, LEHAR and KURKURE. One of the leading businesses of the plaintiffs is the manufacture and sale of packaged drinking water under the trademark/name/logo/label AQUAFINA.

7. The mark AQUAFINA is a unique word coined and adopted by the plaintiffs and has been exclusively used by plaintiffs since 1994. In fact, AQUAFINA drinking water is the brand with the highest market share among bottled drinking water in the United States. The word AQUAFINA having no obvious meaning, is an invented word and is entitled to the highest degree of protection. This mark is completely distinctive of the plaintiffs and their products.

8. The AQUAFINA product was launched in India as early as 1999. The AQUAFINA product is manufactured with a special reverse osmosis ultra purification system. In India, the bottling plant has been set up at Roha in Raigarh district of Maharashtra with an investment of over Rs.5 crores. Apart from the plant at Roha, the plaintiffs have also spent over Rs.50 crores in the setting up of 17 manufacturing plants for manufacturing AQUAFINA packaged drinking water in India. The water purification system adopted by the plaintiffs for AQUAFINA ensures the purity and quality of the said product. Since its launch, the plaintiffs have promoted the AQUAFINA brand with various tag lines like "AQUAFINA the purest part of you", "AQUAFINA pure water from PEPSI" etc., which have established an inseparable connection between AQUAFINA and the plaintiffs.

9. It is stated in the plaint that due to the extensive advertising and promotional campaigns which have been launched by the plaintiffs, the trademark AQUAFINA has gained enormous recognition and popularity in a short period of time and is today considered as one of the premium brands for bottled drinking water. Due to various safeguards which have been adopted by the plaintiffs to maintain the quality of water, the product under the mark/logo/label AQUAFINA

has been able to capture a substantial market share in India due to its quality, purity and freshness.

10. It is averred in the plaint that the AQUAFINA brand has become extremely well known and a mere mention of the brand immediately connects the plaintiffs and their businesses. The plaintiffs have applied for the registration of the trademark AQUAFINA, as also the label and logo design in numerous countries. The list of countries where the mark has proceeded to registration includes but is not limited to Algeria, Argentina, Armenia, Australia, Austria, Bahrain, Belarus, Benelux, Brazil, Bulgaria, Canada, Chile, China (People's Republic of), Colombia, Costa Rica, Cyprus, Czech Republic, Egypt, Estonia, Ethiopia, European Union, Finland, Germany, Greece, Honduras, Hong Kong, Hungary, Japan, Jordan, Kazakhstan, Kuwait, Latvia, Lebanon, Lithuania, Macao, Malaysia, Morocco, New Zealand, Nigeria, Oman, Pakistan, Panama, Philippines, Peru, Poland, Portugal, ,Qatar, Romania, Russian Federation, Saudi Arabia, Singapore, Slovak Republic, South Africa, South Korea, Taiwan, Thailand, Turkey, Ukraine, UAE, Venezuela, Vietnam and Yemen. Copies of few foreign registration certificates of the plaintiffs have been exhibited as Exhibit PW l/6. A list of worldwide registrations of plaintiff No. 1 for the mark/logo/label AQUAFINA has been exhibited as Exhibit PW l/7.

11. The mark AQUAFINA, in the unique writing style and the font and label, is a registered trademark of the plaintiffs. Details of the registration are as under:

12. The copies of the legal proceeding certificates of registration No. 774285 and 1129381 for AQUAFINA label have been exhibited as Exhibit PW 1/8 and Exhibit PW 1/9 respectively. Further, a printout from the Indian Trademark Registry website (www.ipindia.nic.in) depicting the trademark registration of the mark AQUAFINA NOVEAU (label mark) in favour of plaintiff No 1 along with Trademark Journal has been exhibited as Exhibit PW 1/10 (colly).

13. The AQUAFINA label is a registered mark under the Trade Marks Act, 1999. The plaintiffs are thus the exclusive owners and proprietors of the said label. The use of a deceptively similar label by the defendants constitutes infringement of the plaintiffs' rights in the AQUAFINA label.

14. The AQUAFINA label used for packaged drinking water is extremely distinctive and is identified with the plaintiffs. The logo of the product under the mark features AQUAFINA written in a stylized font, in white, with the first and last letters being taller and more elongated than the other letters and is extremely unique. The said

label has a blue color background with the distinctive artistic device wedged between the two ''A's" of the word AQUAFINA. The said label was created for and on behalf of the plaintiffs. The plaintiffs uses this label globally. Under Section 17 of the Copyright Act, all rights in the labels are owned by the plaintiffs. The said label is distinctive and is an original artistic work under Sec. 2 (c) of the Copyright Act and is entitled to the highest degree of protection.

15. It is claimed that AQUAFINA Label design is registered as a copyright in the United States Copyright Office under Registration No. VA-1-099-341. This registration is fully applicable, enforceable and protectable in India by virtue of it being a signatory to the Berne Convention and being a WTO country. A copy of the US copyright registration certificate has been exhibited as Exhibit PW l/11.

16. In India, the plaintiffs' AQUAFINA product is sold in two forms viz., bottled form and bulk form. The popularity of the product AQUAFINA is evident from the growing sales of the said product. The plaintiffs have spent enormous amount on advertising of AQUAFINA packaged water in India.

17. In fact worldwide AQUAFINA is the eighth largest beverage brand in the PepsiCo portfolio and has estimated worldwide retail sales of over 2 billion dollars (U.S.). Copies of publicity material pertaining to the mark/logo/label AQUAFINA have been exhibited as Exhibit PW 1/12 (colly). Copies of various press clippings, internet printouts of online articles/press releases for mark/label of AQUAFINA have been exhibited as Exhibit PW1/13 (colly).

18. The trademark AQUAFINA as well as the label AQUAFINA of the plaintiffs have been regularly protected against any act of

infringement and third party use as apparent from the following orders:-

 Sl. No.       Suit Number and Title           Impugned     Favourable order       Current
                                               Mark/label                        Status of the
                                                                                      suit.
 1.        Suit No.33/02 PepsiCo. Inc. v.     AQUAFINA      Ex-parte interim     Settled and
           Vijay Kumar                                      injunction granted   decreed
 2.        Suit No.748/2006 PepsiCo.          AQUANINE      Ex-parte interim     Settled and
           India Ltd. v. M/s Siri Springs &                 injunction granted   decreed
           Anr.
 3.        Suit No.941/2007 PepsiCo.          AQUAFINE      Ex-parte interim     Settled and
           Inc. v.Rajendra Gilda & Anr.                     injunction granted   decreed
 4.        Suit No.940/2007 PepsiCo.          AQUA'SAFINE   Ex-parte interim     Settled and
           Inc.    v.    Annamar       Aqua                 injunction granted   decreed
           Products
 5.        Suit No.2078/2007 PepsiCo.         AQUASAGAR     Ex-parte interim     Settled and
           Inc. v M/s Sagar Food &                          injunction granted   decreed
           Beverage & Ors.
 6         Suit No.2250/2009 PepsiCo.         AQUAFINE      Ex-parte interim     Settled and
           Inc.v. Pure Water Beverages &                    injunction granted   decreed
           Ors.
 7.        Suit No.2251/2009 PepsiCo.         AQUAINSTA     Ex-parte interim     Settled and
           Inc.v. A.T.P. Industries                         injunction granted   decreed
 8.        Suit No.2252/2009 PepsiCo.         AQUAFENA      Ex-parte interim     Decreed
           Inc. v. Madhusri Industries                      injunction granted
 9.        Suit No.260/2011 PepsiCo.          AQUADROP      Ex-parte interim     Pending
           Inc.& Ors. v. Balaji Enterprises                 injunction granted
 10        Suit No.259/2011 Pepsico.Inc.      ATTHARVA      Ex-parte interim     Settled and
           & Ors. v. Attarva Aqua             AQUA          injunction granted   decreed
 11.       Suit No.1516/2011 PepsiCo.         ARUN AQUA     Ex-parte interim     Settled and
           Inc. & Ors. v. KVM Beverages                     injunction granted   decreed
           & Aqua & Anr.
 12.       Suit No.1517/2011 PepsiCo.         AQUADHARA     Ex-parte interim     Settled and
           Inc. & Ors. v. Devi Aqua                         injunction granted   decreed
           Industries
 13.       Suit No.1518/2011 PepsiCo.         AQUAAFINE     Ex-parte interim     Settled and
           Inc & Ors.v. Shri Shiv Ganga                     injunction granted   decreed
           Industries
 14.       Suit No.3145/2012 PepsiCo.         AQUAFINE      Ex-parte interim     Settled and
           Inc & Anr. v. Siddivinayaka                      injunction granted   decreed
           Industries
 15        Suit No.3146/2012 PepsiCo.         AQUAFEENA     Ex-parte interim     Settled and
           Inc.& Anr. v. Aqua Pure                          injunction granted   decreed
           Packaged Drinking Water &
           Anr
 16.       Suit No.158/2013 PepsiCo.          AQUAFINE      Ex-parte interim     Pending
           Inc. & Anr. v.Aqua Mineral                       injunction granted
           (India) & Anr
 17.       Suit No.159/2013 PepsiCo.          AQUALENA      Ex-parte interim     Pending
           Inc. & Anr. v. CR Associates &                   injunction granted
           Anr
 18.       Suit No.608/2013 PepsiCo. Inc      AQUAFINE      Ex-parte interim     Settled and
           & Anr v. Shree Sheetal                           injunction granted   decreed




          Beverages & Ors.
 19.     Suit No.607/2013 PepsiCo. Inc   AQUA PIYA                         Pending
         & Anr v. Paraspar Developers
         Pvt.Ltd. & Ors.
 20.     Suit No.1607/2013 PepsiCo.      AQUAFIZZA    Ex-parte interim     Pending
         Inc. & Anr v. Vomara                         injunction granted
         Distributors & ors.
 21.     Suit No.2103/2013 PepsiCo.      AQUAMARINA   Ex-parte interim     Pending
         Ins & Anr v.M/s United Aqua                  injunction granted
         Tec. Salem & Ors.

The copies of the orders in above-mentioned matters have been exhibited as Exhibit PW-1/14 (Colly).

19. Thus, it is evident that the mark AQUAFINA is a "well-known mark" as the same has been protected by this Court as stated above within the meaning of Section 11(8) of Trade Marks Act, 1999. Due to extensive use and advertising, the same is exclusively associated with the plaintiffs. The stated brand of the plaintiffs is marketed and sold all over the country through vast business network and is therefore to be considered as a 'well-known mark" under Sections 11 (6) and 11 (7) of Trade Marks Act, 1999. The mark AQUAFINA is inherently distinctive and is so a well-known mark entitled to the highest level of protection. The use of the said mark or any other deceptively similar mark to that of the plaintiffs' by any other party in respect of any class of goods whatsoever, without the permission or authorization of the plaintiffs, constitutes passing off of such goods or business as that of the plaintiffs or that is connected with the plaintiffs.

20. Defendant No.1 is a proprietorship firm and defendant No.2 is the owner/proprietor of defendant No.1 and they are engaged in the manufacturing and marketing packaged drinking water and are trading under the brand, name and style AQUALENA.

21. It is averred that the defendants are using an identical and deceptively similar mark/label as that of the plaintiffs. A comparative view of the plaintiffs' product "AQUAFINA" and that of the defendants' product "AQUALENA" has been reproduced here as under:-

22. It is further averred that the defendants' mark "AQUALENA" is visually and deceptively similar to that of the plaintiffs' mark "AQUAFINA and the defendants have adopted the aforesaid mark "AQUALENA" for packaging their drinking water with malafide intention of riding on the goodwill of the plaintiffs so as to confuse the customers.

23. It is averred that the defendants have written the word AQUALENA with the first and last letters 'A' in a larger font than the

other letters which is exactly identical to the manner in which AQUAFINA is written on the plaintiffs' label. The defendants have also used the same get-up and colour combination for their label i.e. the colours blue with white printing etc. along with the orange coloured circular device between the wedges. Thus, the overall get up and look of the plaintiffs' product has been imitated by the defendants.

24. The present case relates to the trademark AQUAFINA and the adoption and use by the defendants of deceptively similar trademark/name/logo/label AQUALENA for packaged drinking water. Colored printouts of the AQUAFINA product label of the plaintiffs' and defendants' label AQUALENA have been exhibited as Exhibit PW l/4and Exhibit PWl/5 respectively.

25. It is argued by Mr.Virmani, learned Senior counsel appearing on behalf of the plaintiffs that the two rival marks are deceptively similar and the subsequent conduct is liable to pay punitive damages as the defendants were injuncted by this Court by way of an ex-parte ad interim order dated 29th January, 2013. Thereafter, vide the same order this Court appointed a local commissioner to visit the premises of the defendants with direction to make an inventory of all goods lying there with the mark/logo/label AQUALENA and seize the same.

26. In compliance of the direction of this Court the local commissioner visited the said defendants' premises on 6th February, 2013. On checking the premises, 299 cartons containing 12 bottles each with the labels/stickers AQUALENA were found. Also found were 58 cans (15 liters each) and 375 packing boxes and cartons.

27. TEST OF COMPARISON OF RIVAL MARKS

(i) In Pianotist Co. Ltd.'s application, 1906(23) R.P.C. 774, it was observed as follows :

"You must taken the two words. You must judge of them, both by their look and by their sound. You must consider the goods to which they are to be applied. You must consider the nature and kind of customer who would be likely to buy those goods. In fact, you must consider all the surrounding circumstances; and you must further consider what is likely to happen if each of those trade marks is used in a normal way as a trade mark for the goods of the respective owners of the marks. If, considering all those circumstances, you come to the conclusion that there will be a confusion-that is to say, not necessarily that one man will be injured and the other will gain illicit benefit, but that there will be a confusion in the mind of the public which will lead to confusion in the goods-then you may refuse the registration, or rather you must refuse the registration in that case."

(ii) In Parker Knoll Ltd. v. Knoll International Ltd., 1962 R.P.C. 265, Lord Denning explained the words "to deceive" and the phrase "to cause confusion" as follows:

"Secondly, 'to deceive' is one thing. To 'cause confusion' is another. The difference is this :

When you deceive a man, you tell him a lie. You make a false representation to him and thereby cause him to believe a thing to be true which is false. You may not do it knowingly, or intentionally, but still you do it, and so you deceive him. But you may cause confusion without telling him a lie at all, and without making any false representation to him. You may indeed tell him the truth, the whole truth and nothing but the truth, but still you may cause confusion in his mind, not by any fault of yours, but because he has not the knowledge or ability to distinguish it from the other

pieces of truth known to him or because he may not even take the trouble to do so."

(iii) In the case of Sandow Ltd.'s Application, 31 R.P.C. 205 it was clarified that among the surrounding circumstances to be taken into account, one of considerable importance is the imperfect recollection a person is likely to have of a mark with which he is only vaguely acquainted. While approving the above tests for comparison of the two word-marks, the Supreme Court held in F. Hoffmann-La Roche & Co. Ltd. Vs. Geoffrey Manner & Co. Pvt. Ltd. (1969) 2 SCC 716 that:

"It is also important that the marks must be compared as whole. It is not right to take a portion of the word and say that because that portion of the word differs from the corresponding portion of the word in the other case there is no sufficient similarity to cause confusion. The true test is whether the totality of the proposed trade mark is such that it is likely to cause deception or confusion or mistake in the minds of persons accustomed to the existing trade mark."

(iv) In Amritdhara Pharmacy vs. Satyadeo Gupta AIR 1963 SC 449 wherein it was held that the two marks 'Amritdhara' and 'Lakshmandhara' are closely similar.

(v) In Corn Products Refining Co. vs. Shangrila Food Products Ltd. AIR 1960 SC 142 it was held that the two marks Gluvita and Glucovita are deceptively similar.

28. Thus, in the present case, the plaintiffs have been able to prove close case of infringement of trademarks, copyright and passing off. The defendants have intentionally and deliberately adopted the similar mark, get up and design. It becomes more serious when the

product in question is of drinking water. The Courts should take more stringent action when the issue in hand pertaining to food, beverages and consumable articles are involved because the health and life of human being is involved.

29. Thus, a decree for permanent injunction is passed in terms of para 32(a) and (b) of the plaint in favour of the plaintiffs and against the defendants restraining them, their principal officers, family members, servants, agents, dealers, distributors and anyone acting for and on their behalf from using the impugned mark/logo/label/name AQUALENA or any other mark as a trademark, trade name, domain name or in any manner whatsoever which is identical or deceptively similar to the plaintiffs' registered trademark/logo/label/packaging in relation to their product "AQUAFINA".

Punitive damages

30. With regard to the relief of damages, this Court has previously granted both exemplary and punitive damages against the defendants in ex-parte matters of similar nature. In Time Incorporated Vs. Lokesh Srivastava & Anr., 2005 (30) PTC 3 (Del.) while awarding punitive damages of Rs. 5 lakhs in addition to compensatory damages also of Rs. 5 lakhs, Justice R.C. Chopra observed that "time has come when the Courts dealing in actions for infringement of trademarks, copyrights, patents etc., should not only grant compensatory damages but also award punitive damages with a view to discourage and dishearten law breakers who indulge in violation with impunity out of lust for money, so that they realise that in case they are caught, they would be liable not only to reimburse

the aggrieved party but would be liable to pay punitive damages also, which may spell financial disaster for them."

31. Further, this Court in Microsoft Corporation Vs. Rajendra Pawar & Anr., 2008 (36) PTC 697 (Del.) decided on 27th July, 2007 has held "Perhaps it has now become a trend of sorts, especially in matters pertaining to passing off, for the defending party to evade court proceedings in a systematic attempt to jettison the relief sought by the plaintiff. Such flagrancy of the Defendant's conduct is strictly deprecatory, and those who recklessly indulge in such shenanigans must do so at their peril, for it is now an inherited wisdom that evasion of court proceedings does not de facto tantamount to escape from liability. Judicial process has its own way of bringing to tasks such erring parties whilst at the same time ensuring that the aggrieved party who has knocked the doors of the court in anticipation of justice is afforded with adequate relief, both in law and in equity. It is here that the concept of awarding punitive damages comes into perspective."

32. Consequently, the suit of the plaintiffs is decreed against the defendants. In view of the facts of the present case, this Court is of the opinion that in the present case Rs.5 lac as punitive damages be granted in favour of the plaintiffs and against the defendants. Ordered accordingly.

33. The plaintiffs are also entitled for costs. Decree be drawn accordingly.

(MANMOHAN SINGH) JUDGE AUGUST 26, 2015