Retail Royalty Company vs Pantaloons Fashion & Retail ...
2015 Latest Caselaw 7274 Del

*             IN THE HIGH COURT OF DELHI AT NEW DELHI

+                         CS(OS) No.2872/2015

%                                                     23rd September, 2015

RETAIL ROYALTY COMPANY                                         ..... Plaintiff
                 Through                 Mr. Sudhir Chandra, Sr. Adv. with
                                         Ms. Sujata Chaudhri, Advocate

                          versus

PANTALOONS FASHION & RETAIL LIMITED & ORS. ..... Defendants
                 Through  Mr. Ajay Sahani, Advocate with
                          Ms. Prerna Verma, Advocate

CORAM:
HON'BLE MR. JUSTICE VALMIKI J.MEHTA

To be referred to the Reporter or not?


VALMIKI J. MEHTA, J (ORAL)


CS(OS) No.2872/2015, I.A. No.19847/2015                    (Stay)    and    I.A.
No.19848/2015 (under Order XXVI Rule 9 CPC)


1.

When this case came up day before yesterday the following

Order was passed:-

"I.A. No.19849/2015 (exemption)

1. Exemption allowed subject to just exceptions.

I.A. stands disposed of.

CS(OS) No.2872/2015 and I.A. Nos.19847/2015 (stay) & 19848/2015 (under Order 26 Rule 9 CPC)

2. This Court was inclined to grant exparte interim orders today because prima facie it appears that defendants are trying to ride on the goodwill of the plaintiff created by the trademarks of the plaintiff "AMERICAN EAGLE OUTFITTERS/AMERICAN EAGLE". It may be noted that defendants are themselves one of the largest groups of industries in India and therefore they cannot claim ignorance with respect to the trademarks of the plaintiff much less for the same line of specialized goods being casual clothing. It is also noted that it is not as if the defendants are in the market for a long time and plaintiff has approached this Court with delay noting that Courts look at the issues differently where the defendants are producing goods for a reasonable long period of time as compared to a case where defendants have recently entered into the market or are yet to enter into the market.

3. Counsel for the defendants who appears without caveat is put to notice of the above aspects and that if the defendants seek to act fairly to ensure that their trademark should be such which would remove any scope of deceptive similarity with the trademarks of the plaintiff or that the defendants will not take advantage and ride upon the goodwill of the plaintiff.

4. List on 23rd September, 2015.

5. It is made clear that no adjournment shall be granted on the next date and if the defendants do not come to the Court by giving sufficient basis for their adoption of trademark "URBAN EAGLE AUTHENTIC OUTFITTERS", this Court in accordance with law will be inclined to grant exparte orders as prayed for by the plaintiff."

2. Defendants have appeared with instructions and during the

course of hearing counsel for the defendants, of course without prejudice to

the rights of the defendants, has suggested as under:-

(i) Though the defendants will not use the trade mark "URBAN EAGLE

AUTHENTIC OUTFITTERS" as it is, and will remove from its trade mark

the expression "AUTHENTIC OUTFITTERS" leaving only the expression

and trade mark "URBAN EAGLE";

(ii) With respect to the existing stocks bearing the trade mark "URBAN

EAGLE AUTHENTIC OUTFITTERS", the said stocks were requested to be

bifurcated in two parts, one part being the goods already lying in the retail

shops/stores and the second part being the goods lying in the

warehouses/godowns of the defendants. So far as the goods lying in the

retail shops/stores are concerned, it is stated on behalf of the defendants that

the word "AUTHENTIC OUTFITTERS" will be removed from the existing

stocks with retailers and such stocks with the existing device of eagle

remaining will be disposed of in a period of three months. So far as the

stocks in the godowns/warehouses are concerned, it was said that the labels

from the same would be removed by the defendants and only the word mark

"URBAN EAGLE" will be used and even the existing device of eagle will

be replaced with a new eagle device.

(iii) To ensure that there is no doubt or dispute as to the stocks lying with

the defendants or with the retailers or in the godowns/warehouses, Local

Commissioners can be appointed who would be given by the defendants the

details of the stocks with the retailers and in the godowns/warehouses so that

there is no scope for any misuse of the order by increasing the stocks of the

retailers;

(iv) So far as the future production by the defendants is concerned, the

defendants agree that they will only use the trade mark/word mark "URBAN

EAGLE" and that too with an eagle device/representation which would be

different from that being used by the defendants at present although even the

existing device of eagle used by the defendants is stated to be not

deceptively similar or identical to the device of the plaintiff.

3. In my opinion, the above stand of the defendants was indeed

very fair, though something could have been said originally about the

intention of the defendants in using the word "OUTFITTERS" in their trade

mark. The offer of the defendants is however not acceptable to the plaintiff

and it is stated by the plaintiff that the defendants must not use the eagle

device at all and defendants must not use the trade mark "URBAN EAGLE".

4. In my prima facie opinion, though the word "EAGLE" has been

adopted by the plaintiff with respect to clothing, however I refuse to allow

exclusive appropriation of the word "EAGLE" to the plaintiff, inasmuch as,

unfortunately there is not only one eagle in this world and eagle as a name

cannot be allowed to be appropriated exclusively by any one producer of any

type of goods similar to the position that a descriptive word mark cannot be

allowed to be exclusively appropriated by a manufacturer and/or a seller

vide Marico Limited Vs. Agro Tech Foods Limited, 2010 (174) DLT 279.

Also, during the course of trial it will be examined whether plaintiff has first

used the word "EAGLE" or there would be other persons who have already

used the word "EAGLE" with respect to their goods including clothing even

prior to the plaintiff. This is all the more so in view of the following

submissions made on behalf of the plaintiff itself before the Registrar of

Trade marks at the time of seeking registration of its trade marks:-

"With regard to the remaining citations- "Eagle" (device) under No.301346; "Eagle" under Nos.383665, 487768, 502740, 520267, 567176, 789654, & 1021087; "Eagle Blue" under No.400560; "Eagle Brand Agarbathies" under No.762782; "Eagle 80" under No. 762786; "Eagle One" under No. 800611; "Golden Eagle" (with earth and eagle device) under No.858616; "Eagle Women" (device) under No. 964386; "Pacific Eagle" under No. 717599; "Blue Eagle" under No. 849107; "Eagle 100" (label) under No. 1395844; "Device of Eagle on Globe" under No. 1325013; and "Eagle Toys" (device) under No.1337366, we wish to invite the learned Registrar's attention to the well-established judicial principle of entirety, which envisages that marks should not be segregated for the sake of unwarranted comparison. In consonance with this principle, while deciding the question of similarity between two marks, the marks have to be considered as wholes, and meticulous or fragmentary comparison is not the correct way. Thus, upon such consideration, the cited marks, when compared with the subject mark, are phonetically, visually, structurally, and conceptually dissimilar and distinguishable from the subject mark.

Therefore, although all the abovementioned cited marks and the subject mark share the common component "Eagle", it is the combining element "American" in the subject mark that helps the subject mark create a different and distinct overall impression from all the other marks."

xxx xxx xxx xxx As a concluding argument, we wish to submit that if so many marks comprising the element "eagle" can co-exist peacefully on the Register of Trade Marks (a fact that is apparent from the search report), then there is absolutely no reason why the subject mark shouldn't be allowed to proceed to registration."

(underlining added)

5. The aforesaid submissions made by the plaintiff before the

Registrar of Trade marks referred to by me are as per the documents which

have been filed before me today during the course of hearing on behalf of

the defendants, and which documents clearly show that even the plaintiff

claims exclusivity to its trade mark by use of the expression "American"

along with "Eagle" and not "Eagle" in itself.

6. Now, let me turn to the arguments which have been urged on

behalf of the plaintiff, inasmuch as, offer of the defendants is not acceptable

to the plaintiff and learned Senior Counsel for the plaintiff states that the

defendants be forthwith restrained from selling their goods/clothing with the

device of eagle which is being presently used by the defendants and also

with the trademark "URBAN EAGLE AUTHENTIC OUTFITTERS".

7. At this stage, before I turn to the reference to the word marks of

the respective parties, especially with respect to "Eagle", let me reproduce

below the device of the eagle as used by the plaintiff and the defendants, and

which are:-

Plaintiffs Marks Defendants' Marks

8. A reference to the aforesaid device marks shows that whereas

the device of the plaintiff is a swooping eagle showing an eagle going

towards earth, the device of the defendants is an eagle which is taking off or

flying higher or ascending. Obviously, there is bound to be some sort of

similarity between two devices which uses an eagle whereby there will

always be some sort of similarity, however, it cannot be said that the device

of the swooping eagle is identical or deceptively similar to an eagle which is

taking off or flying higher. These are of course prima facie observations

subject to further orders at the stage of arguments on the injunction

application after completion of pleadings and other procedural formalities of

the suit.

9. Now let me examine the word marks "AMERICAN EAGLE

OUTFITTERS" / "AMERICAN EAGLE" of the plaintiff on the one hand

and "URBAN EAGLE AUTHENTIC OUTFITTERS" of the defendants on

the other hand. I have already stated above, the aspect with respect to the

use of the word "EAGLE" in the respective trade marks, and therefore there

cannot be any illegality or lack of bona fides on the part of the defendants in

using the word "EAGLE" along with the expression "URBAN", more so

because plaintiff itself has claimed exclusivity of the word "EAGLE" along

with the expression of "AMERICAN" before the Registrar of Trade marks.

Therefore, there cannot be identity or deceptive similarity of the mark

"AMERICAN EAGLE" with "URBAN EAGLE", although the goods of

both the parties are same, more so as the word "EAGLE" cannot be

exclusively appropriated by the plaintiff.

10. That leads us to the aspect as to whether the defendants are

justified in using the expression "OUTFITTERS" in their trade marks.

Plaintiff also uses the word "OUTFITTERS" in one of their word marks i.e.

not in both the word marks of the plaintiff, inasmuch as, one word mark of

the plaintiff is "AMERICAN EAGLE" and which does not contain the word

"OUTFITTERS". I need not delve on this aspect unnecessarily, though

"OUTFITTERS" is really a description of the goods, since counsel for the

defendants has made a statement before this Court that they will

obliterate/remove the expression "AUTHENTIC OUTFITTERS" from even

their existing stocks whether in the retail shops/stores or

godowns/warehouses. It is accordingly directed that the defendants when

they sell their goods/clothing under the trade mark "URBAN EAGLE", they

will not use simultaneously the words "AUTHENTIC OUTFITTERS".

Needful in this regard be done by the defendants within a period of three

days from today.

11. Learned Senior Counsel for the plaintiff argued as under:-

(i) The defendants are guilty of infringement of the registered trade

marks of the plaintiff, and therefore injunction must follow inasmuch as

infringement is of the nature as specified under Sections 29(1) and 29(2)(b)

& (c) of The Trade Marks Act, 1999;

(ii) Deceptive similarity is an overall position and courts do not decide by

keeping the marks side by side and look at the differences in order to decide

the issue of identity or deceptive similarity;

(iii) Defendants have acted dishonestly and not innocently and when the

defendants designed their trade mark, they did so keeping in mind the trade

mark of the plaintiff and hence the defendants should not be allowed to take

benefit of their dishonest actions by passing off their goods as that of the

plaintiff;

(iv) Plaintiff has a copyright in the design of a swooping eagle and the

defendants therefore cannot be allowed to use any device/representation

which is identical or deceptively similar to the swooping eagle device of the

plaintiff.

(v) Reliance has been placed upon the judgments of the Supreme Court in

the cases of Laxmikant V. Patel Vs Chetanbhai Shah and Anr., 2002 (3)

SCC 65 and Midas Hygiene Industries P. Ltd. and Anr. Vs Sudhir Bhatia

and Ors., (2004) 3 SCC 90 to argue that courts must, once there is

infringement of trade marks and deceptive similarity, proceed to grant

injunctions as also appoint Local Commissioners for implementing the

injunction order.

12. In my opinion at this stage where the case is really coming up

almost at an ex parte stage with the defendants having not yet granted time

to file their written statement and replies on account of only two days notice

being given to the defendants, this Court will only have to take a prima facie

view of the matter as to whether there can be said to be infringement of the

trade mark of the plaintiff or any violation of copyright with respect to the

swooping eagle device of the plaintiff and whether non-grant of interim

injunction will defeat the reliefs claimed in the suit.

13. So far as the first argument urged on behalf of the plaintiff of

infringement of registered trade mark is concerned, it is seen that to establish

infringement there will have to be either identity of the trade mark or

deceptive similarity of the trade mark. It cannot be doubted that there is no

identity of the trade mark, inasmuch as, the plaintiff uses the word mark

"AMERICAN EAGLE" whereas, the defendants want to use "URBAN

EAGLE" without the expression "AUTHENTIC OUTFITTERS". There is

no identity or deceptive similarity between the marks "AMERICAN

EAGLE" and "URBAN EAGLE" and there is sufficient amount of

distinction between the two, more so keeping in mind as already stated

above that plaintiff itself claims exclusivity of the mark not on account of

use of the word "EAGLE" but because of the use of the word

"AMERICAN" along with the word "EAGLE" as is the case of the plaintiff

before the Registrar of the Trade marks. At this stage, it will not be possible

to hold that the trade mark of the defendants "URBAN EAGLE" will be

identical or deceptively similar to the trade mark "AMERICAN EAGLE" of

the plaintiff.

14. So far as dishonesty of the defendants is concerned, I need not

examine this aspect at this stage inasmuch as defendants for the present state

that they are not going to use the expression "AUTHENTIC

OUTFITTERS", and as already stated above.

15. Reliance upon the judgments of the Supreme Court in the cases

of Laxmikant V. Patel (supra) and Midas Hygiene Industries P. Ltd.

(supra) amounts to begging the question because the observation in these

two cases will apply only if firstly courts find existence of infringement or

passing off by use of identical trade mark or deceptive trade mark. Once the

opposing mark is not identical to the mark of the plaintiff, and is also not

deceptively similar, and as stated in detail above, there does not arise any

issue with respect to grant of injunction in terms of the judgments relied

upon by the plaintiff.

16. I may note that on behalf of the plaintiff an issue of public

interest was also argued, but in my opinion, once the defendants are only

using the word mark "URBAN EAGLE" by deleting the expression

"AUTHENTIC OUTFITTERS", public interest I do not think will be

affected in a case like this because "URBAN EAGLE" is sufficiently

distinguishable from "AMERICAN EAGLE", especially in view of the fact

that case of the plaintiff is also basically of combination of the word

"EAGLE" with "AMERICAN" and not "EAGLE" in itself. Also, public

interest in a case such as the present where the goods are only clothing, as

opposed to certain cases where grave public interest would be involved such

as the case of pharmaceutical goods or medicines, at this stage it cannot be

held that public interest is such that defendants must be restrained from

selling their goods/clothing with the trade mark "URBAN EAGLE".

17. Lastly, it was argued on behalf of the plaintiff that the plaintiff

has a copyright in their device of swooping eagle and the defendants

therefore cannot use its device of eagle. This argument on behalf of the

plaintiff is also misconceived because as already stated above, the device of

the eagle as used by the defendants is completely different from the device

of the plaintiff because plaintiff's representation is a swooping eagle and the

defendants' representation is of a taking off or a flying eagle. There is also

another reason for me to decline any claim of copyright in the device of the

swooping eagle claimed by the plaintiff inasmuch as Section 13 of the

Copyright Act, 1957 states that copyright is only with respect to an original

artistic work. Surely, a swooping eagle device cannot by any stretch of

imagination be said to be an original artistic work for the same to be a

subject matter of copyright claimed by the plaintiff.

18. Plaintiff also can be compensated by monies even if interim

orders are not granted and balance of convenience demands that the business

of the defendants be not stopped.

19. The plaintiff hence cannot be granted interim orders as prayed

for at this stage.

20. The aforesaid observations are only prima facie observations

limited to non-grant of interim injunction at this stage and parties will be

entitled to argue all aspects after completion of pleadings and at the stage of

decision of the interim application of the plaintiff.

21. Defendants will file the written statement within a period of six

weeks from today. Replication be filed within six weeks thereafter.

22. Both the parties will file original documents in their power and

possession and admission/denial of these documents will be done by filing

an affidavit attaching thereto an index of documents of the other side

containing an additional column of endorsement of admission/denial.

23. List before the Joint Registrar for completion of procedural

formalities of the suit and the interim applications on 15th December, 2015.

.

SEPTEMBER 23, 2015                                VALMIKI J. MEHTA, J.
nn