Biocodex And Anr vs Regalia Pharmaceuticals India ...
2017 Latest Caselaw 4049 Del

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*     IN THE HIGH COURT OF DELHI AT NEW DELHI
%                                         Reserved on: 28th July, 2017
                                     Pronounced on: 10th August, 2017

+     CS(OS) 3354/2014

      BIOCODEX AND ANR                                   ..... Plaintiffs
                   Through :         Mr.Surinder Singh, Advocate.

                            versus

      REGALIA PHARMACEUTICALS
      INDIA PVT LTD                              ..... Defendant
                    Through : None being ex parte.


CORAM:
HON'BLE MR. JUSTICE YOGESH KHANNA

YOGESH KHANNA, J.

1. This is a suit for permanent injunction, infringement of trademark, passing off, delivery up and damages filed by the plaintiff against the defendant.

2. The plaintiffs have alleged that plaintiff No.1 is an family owned French pharmaceutical company founded in the year 1953 having commercial presence in more than 100 countries worldwide including India. The plaintiff No.2 is a pharmaceutical company incorporated and existing under the laws of India and selling products of plaintiff No.1. The present suit concerns about the established, old and registered trademark ECONORM of the plaintiff No.1 adopted and used since the

year 1998 in relation to pharmaceutical and medicinal preparations worldwide, in India, through plaintiff No.2.

3. Plaintiffs have also alleged that they are the true owners and lawful proprietors of trade mark "ECONORM" in relation to the yeast „Saccharomyces boulardii‟ and said trade mark has been in use in India at least since the year 1998. The product of the Plaintiffs under the trade mark ECONORM is a pro-biotic drug for maintaining intestinal flora, is indicated for the treatment of acute gastroenteritis and is effective in reducing the duration of diarrhea as well as vomiting. That the trade mark ECONORM, is a coined/invented word, having no meaning or reference in any dictionary or pharmacopeia. It is claimed that the two packaging of the products under the trade mark ECONORM are artistic works within the meaning of Section 2(c) of the Copyright Act, 1957. The plaintiffs are registered proprietor of the trademark ECONORM under No.1486959 in class 05 and for the trade mark ECONORM CAPS under No.2073576 in class 05. The trade mark ECONORM has a source identifying significance and origin associated with the plaintiffs alone. In addition to the statutory rights, the plaintiffs have acquired common law rights through long, continuous and extensive use of the said trade mark. The plaintiffs have also alleged to have invested a considerable sum of money, labour, skill and energy on promoting and popularizing the products under the trade mark ECONORM and/or its variants. The Plaintiff has already spent over ₹1300 Lac since the year 2006 on business promotion of the mark ECONORM. During the year 2014, it has spent ₹314.91 Lac on business promotion of mark ECONORM along. The plaintiff has made sales worth of ₹18,827 Lac since 2006 and

during the year 2014 the plaintiff sold medicines worth of ₹3,236 Lac under trademark ECONORM. The trade mark ECONORM is associated with the plaintiffs alone amongst the members of the trade and the public at large. It is also submitted that the trade mark ECONORM and/or its variants are well-known and deserve to be protected. During, February 2014, the plaintiff noticed that the defendant has illegally adopted and started using the trademark "RECONORM" for medicinal products having formulation of „Saccharomyces Boulardii & Zinc', which is identical/deceptively similar to the plaintiffs registered trade mark ECONORM and in sachets identical / similar to the plaintiffs old sachets. The defendant‟s mark RECONORM is an imitation of the plaintiffs‟ prior adopted and used mark ECONORM for identical goods. The defendant has merely added the letter „R‟ to the well-known and registered trade mark ECONORM to arrive at its mark RECONORM. The RECONORM packaging of the defendant predominantly comprises all essential features of plaintiffs‟ packaging and nearly resembles the ECONORM packaging. The RECONORM packaging of the defendant comprises the mark RECONORM displayed prominently in red colour on white background in bold capital letters which is identical to the representation of the mark ECONORM on the plaintiffs packaging. There is a horizontal band, towards the middle, running across the sachets that show the generic name of the product "Saccharomyces Boulardii (Lyophilized)" in the plaintiffs‟ product and "Saccharomyces Boulardii & Zinc Sachet" in the defendant‟s product. The horizontal band in the plaintiffs‟ product is grey in colour whereas the band in the defendant‟s product is black in colour. The arrangement of features,

design and layout of the packaging of the defendant is identical to that of the plaintiffs‟ packaging.

4. It is apparent from the above said comparison that the adoption/use of the mark RECONORM and the packaging pertaining thereto by the Defendant is with the sole aim of riding piggyback on the enviable goodwill and reputation enjoyed by the plaintiffs and constitutes acts of infringement of copyright, infringement of trade mark, passing off and unfair competition. It is alleged that the user of the mark RECONORM is bound to cause irreparable prejudice, damage and injury to the goodwill/reputation that exists in the medicinal preparation ECONORM and its formative variants of the plaintiffs. Such activity of the defendant is causing and continues to cause irreparable damage and unquantifiable loss, beyond monetary compensation. Hence suit for injunction and damages have been filed against the defendant.

5. Pursuant to failure on part of the defendant to appear despite service, it was proceeded ex parte vide order dated 13.02.2015. Vide said order this Court also passed injunction in favour of the plaintiff and against the defendants from selling, manufacturing or dealing with the pharmaceutical products under the mark RECONORM or any other trade mark deceptively similar to the trade mark of the plaintiff i.e. ECONORM till the disposal of the accompanying suit. The plaintiff was directed to file ex parte evidence by way of affidavit.

6. The plaintiff has proved its case through its sole witness PW1 Sh.Vansi Krishna, its senior director who has proved his affidavit Ex.PW1/A and relied upon the documents Ex.PW1/1 to Ex.PW1/27.

The witness PW1 has proved the power of attorney dated 04.09.2015 as Ex.PW1/1; the copy of Board Resolution dated 09.04.2015 of plaintiff No.2 as Ex.PW1/2 and deposed that this suit was instituted by Mr.Suprio Dasgupta who was duly authorized to institute this suit and that PW1 identify the signatures of Mr.Dasgupta on the pleadings and also proved the true copy of the attorney and board resolution in favour of Mr.Dasgupta on behalf of plaintiff No.2 as Ex.PW1/3 and Ex.PW1/4 respectively. The witness reiterated the contents of the plaint and proved the registration certificate of establishment issued in favour of the plaintiff by the Government of NCT of Delhi as Ex.PW1/4. He deposed that the registered trademark ECONORM of plaintiff No.1 was adopted and used since the year 1998 and relates to pharmaceutical and medicinal preparations and that the plaintiff No.2 is marketing the product and both the plaintiffs have filed the present suit against the defendant who has illegally adopted the near identical trademark RECONORM for pharmaceutical and medicinal preparations bearing the identical formulations as stated above. He proved the packaging of the product of ECONORM available in the market till 2012 and the same is Ex.PW1/6. The packaging of the products of the plaintiffs‟ under the trade mark ECONORM are artistic works within the meaning of Section 2(c) of the Copyright Act, 1957. The packaging of the plaintiff introduced during the year 2012 for its product is Ex.PW1/7. The certificate for use and legal proceedings in relation to registration No.1486958 is Ex.PW1/8 and in relation to registration No.20735760 is Ex.PW1/9. The registrations which were secured and the applications filed in the name of the plaintiff No.2 have been assigned in favour of the plaintiff No.1. The true copy of

the Deed of the Assignment dated 20.01.2014 and the application on Form TM 20 before the Trademark Registry is Ex.PW1/10 collectively. The true copies of the print outs of online status of page No.519 of the Trademark Journal dated 01.10.2008 in relation to the application No.858556 is Ex.PW1/11 collectively. He also deposed that the plaintiff have invested a considerable sum of money, labour, skill and energy on promotion and popularization of the products under the trademark ECONORM and/or its variants. The sale figures are also proved vide certificate issued by the chartered accountant as Ex.PW1/14 and specimen copies of the invoices randomly selected from the year 2002 to the year 2013 evidencing sales of the plaintiffs' product ECONORM/ECONORM CAPS are Ex.PW1/5 to Ex.PW1/22.

7. He further deposed that the defendant is in the same business and is manufacturing and marketing its pharmaceutical products under the mark RECONORM for „Saccharomyces Boulardii & Zinc‟ which is identical/deceptively similar to the plaintiffs registered trade mark and its original packaging is Ex.PW1/23. The addresses of the defendant company are in the documents Ex.PW1/24 and Ex.PW1/25 and that the defendant has applied for registration of mark RECONORM under application No.2666316 dated 25.01.2014 in relation to the aforesaid substance in clause No.5 and its application is Ex.PW1/26. The print outs of the extracts which the plaintiff has taken from the website is duly supported by the statement of PW1 per Section 65B of the Indian Evidence Act, 1872 in para No.23 of the affidavit. He deposed that both the trademarks are identically and deceptively similar, structurally,

visually and phonetically as well as in terms of idea conveyed to the plaintiffs trademark ECONORM and that the defendant has merely added letter „R‟ to the trademark of the plaintiff.

8. I have also examined both the trademarks, packaging of the defendant product which comprises of white, black and red on the front panel which nearly resembles the ECONORM packaging of the plaintiffs and the colours used by the plaintiffs in relation to its earlier packaging. Even the mark RECONORM is predominantly comprises of white, black and red on the front panel which nearly resembles the ECONORM packaging of the plaintiffs and the colours used by the plaintiffs in relation to its earlier packaging. The arrangement of features, design and layout of the packaging of the defendant is identical to that of the packaging of the plaintiffs. The horizontal band towards the middle running across the sachets that show the generic name of the product "Saccharomyces Boulardii (Lyophilized)" in the plaintiffs product and "Saccharomyces Boulardii & Zinc Sachet" in the defendant's product. The horizontal band in the plaintiffs product is grey in colour whereas the band in the defendant's product is black in colour.

9. The plaintiff has proved the adoption/ use of the trademark RECONORM and packaging pertaining to thereof by the defendant is to ride on the goodwill and reputation enjoyed by the plaintiff since the trademark and packing is deceptively same and constitute an act of infringement of copyright/trademark/passing off and unfair competition. The consumers at large are likely to have legitimate expectations about

the level/standard and quality from RECONORM as that of the plaintiff product and hence it would cause ir-repairable prejudice, damage and injury to the goodwill and reputation of the plaintiff that exist in the medicinal preparation ECONROM and its variant of the plaintiff and hence the defendant needs to be injucted.

10. In Durga Dutt Sharma v. N.P. Laboratories AIR 1965 SC 980 it was held as under:-

"......When once the use by the defendant of the mark which is claimed to infringe the plaintiff's mark is shown to be "in the course of trade", the question whether there has been an infringement is to be decided by comparison of the two marks. Where the two marks are identical no further questions arise..."

11. In Win-Medicare Pvt Ltd. vs. Galpha Laboratories Ltd. 2016 (65) PTC 506 (Del) this Court held as under:-

"....The rationale of the anti-dissection rule is based upon this assumption: "An average purchaser does not retain all the details of a mark, but rather the mental impression of the mark creates in its totality. It has been held to be a violation of the anti-dissection rule to focus upon the "prominent" feature of a mark and decide likely confusion solely upon that feature, ignoring all other elements of the mark. Similarly, it is improper to find that one portion of a composite mark has no trademark significance, leading to a direct comparison between only that which remains."

12. The Apex Court in Cadila Health Care Ltd vs. Cadila Pharmaceuticals Ltd AIR 2001 SC 1952 held as under:-

"32. .....Public interest would support lesser degree of proof showing confusing similarity in the case of trade mark in respect of medicinal product as against other non-medicinal products. Drugs are poisons, not sweets. Confusion between medicinal products may, therefore, be life threatening, not merely inconvenient. Nothing the frailty of human nature and the pressures placed by society on doctors, there should be as many clear indicators as possible to distinguish two medicinal products from each other. It is not uncommon that in hospitals, drugs can be requested verbally and/or under critical/pressure situations. Many patients may be elderly, infirm or illiterate. They may not be in a position to differentiate between the medicine prescribed and bought which is ultimately handed over to them...."

13. In Milmet Oftho Industries & Another vs. Allergian Inc (2004) 12 SCC 624 it was observed as under:-

"....... Thus the ultimate test should be who is first in the market. 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....."

14. The plaintiffs being first in the market and for reasons aforesaid, I grant decree of permanent injunction in favour of the plaintiff restraining the defendant, its directors, servants, agents, representatives, employees, dealers, stockiest and all others acting on behalf of the defendant from manufacturing or causing the manufacture of, advertising, promoting, marketing, selling, offering for sale, directly or indirectly dealing in

pharmaceutical/ medicinal products or drugs or any other related product using the mark RECONORM or the packaging pertaining thereto or any other mark being identical and/or deceptively similar to the plaintiffs trade mark ECONORM / ECONORM CAPS or the packaging pertaining thereto and/or its variants amounting to infringement of registered trade mark Nos. 1486959 and 2073576.

15. The defendants are also restrained from manufacturing or causing the manufacture of, advertising, promoting, marketing, selling, offering for sale, directly or indirectly dealing in pharmaceutical/medicinal products or drugs or any other related products using the mark RECONORM or the packaging pertaining thereto or any other mark being identical and/or similar to the plaintiffs trade mark ECONORM/ ECONORM CAPS or the packaging pertaining thereto and/ or other variants thereof amounting to passing off the defendant's goods as those of the plaintiffs.

16. Further a decree of permanent injunction is also passed in favour of the plaintiff and against the defendant thereby restraining the defendant, its directors, servants, agents, representatives, employees, dealers, stockiest and all others acting on behalf of the Defendant from manufacturing or causing the manufacture of, advertising, promoting, marketing, selling, offering for sale, directly or indirectly dealing in pharmaceutical /medicinal products or drugs or any other related products in the impugned packaging or any other packaging that may be a colourable imitation or substantial reproduction of the plaintiffs ECONORM packaging in respect of colour combination, get up, layout,

overall impression and arrangement of features, amounting to infringement of copyright therein of the plaintiffs.

17. The decree is also passed in favour of plaintiff and against defendant directing the defendant to deliver up all infringing material including pouches, sachets, blisters, strips, foils, cartons, bearing the mark RECONORM or any other mark/s similar to the plaintiffs trade marks ECONORM and other variants thereof to the plaintiffs for destruction.

18. Besides the above the learned counsel for plaintiff has claimed the damages to the extent of `20,00,001/- be also awarded. The plaintiff is more concerned with the punitive damages and rely upon Time Incorporated vs. Lokesh Srivastava & Anr 116 (2005) DLT 599. The decision in Time Incorporated was relied upon by a Co-ordinate Bench of this Court in Jockey International Inc & Anr vs. R. Chandra Mohan & Ors 211 (2014) DLT 757 which read as under:-

"43. I am in agreement with the aforesaid submission of learned counsel for the plaintiff that damages in such cases must be awarded and a defendant, who chooses to stay away from the proceedings of the Court, should not be permitted to enjoy the benefits of evasion of court proceedings. Any view to the contrary would result in a situation where a defendant who appears in Court and submits its account books would be liable for damages, while another defendant who, chooses to stay away from court proceedings would escape the liability on account of failure of the availability of account books. A party who chooses not to participate in court proceedings and stays away must, thus, suffer the consequences

of damages as stated and set out by the plaintiffs. There is a larger public purpose involved to discourage such parties from indulging in such acts of deception and, thus, even if the same has a punitive element, it must be granted. R.C. Chopra, J. has very succinctly set out in Time Incorporated's case (supra) that punitive damages are founded on the philosophy of corrective justice."

19. The witness of plaintiff has deposed that damages ought to be imposed upon the defendant on account of infringement and passing off its mark ECONORM under the name RECONORM and its packaging by the defendant and such damages should be exemplary, compensatory and punitive. He has also deposed that plaintiff hold names in the field of the goods stated above and that the monetary value of the immense reputation and goodwill associated with its brands is though incalculable, however it claim `20,0,001/- so as to serve as a deterrent to the defendant and to discourage further infringement of the plaintiff trademark.

20. Thus, given the facts and circumstances of this case where the defendant reclused itself from the proceedings, cannot be permitted to enjoy the benefits of evasion or covert priorities as has been selling the goods and has been infringing the plaintiff‟s mark/packaging /trade dress certainly makes the defendant liable to pay the punitive damages to the plaintiff. Hence, a decree for a sum of `2,00,000/- in favour of the plaintiff and against defendant, is passed on account of infringing the registered marks/label/trade dress. The plaintiff shall also be entitled to interest @ 12% pa on the damages so awarded from the date of filing of

the suit till the date of realisation. Costs of the suit is also awarded to the plaintiff. Decree Sheet be drawn.

21. At last, in view of the nature of disputes between the parties, Registry is directed to re-number it as a Commercial Suit and while doing retain both the numbers. Needless to state the decree shall contain the number numbers.

YOGESH KHANNA, J AUGUST 10, 2017 M