Delhi High Court
Dr. Reddys Laboratories Limited vs Laborate Pharmaceuticals India ... on 11 April, 2019
$~OS-19
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of decision 11.4.2019
+ CS(COMM) 545/2017
DR. REDDYS LABORATORIES LIMITED ..... Plaintiff
Through Mr. Ranjan Narula, Adv.
versus
LABORATE PHARMACEUTICALS INDIA LTD..... Defendant
Through Mr. Siddharth Bambha and
Mr.Shyam D. Nandan, Advs.
CORAM:
HON'BLE MR. JUSTICE JAYANT NATH
JAYANT NATH, J. (ORAL)
IA No. 5337/2019 (for condonation of delay in filing the accompanying
appeal)
For the reasons stated in the application, the delay in filing the
accompanying appeal is condoned.
The application stands disposed of.
O.A. No. 37/2019
1. This appeal is filed seeking to impugn the order dated 13.02.2019 by
which order the learned Joint Registrar has allowed the application filed by
the plaintiff being IA No. 5444/2018 (wrongly noted as IA No. 5442/2018 in
the impugned order) under Order 11 CPC seeking discovery and production
of documents.
2. The case of the plaintiff is that the plaintiff is engaged in the business
of manufacturing, marketing and selling, etc, pharmaceutical products. The
CS(COMM.)545/2017 Page 1
plaintiff has a trade mark OMEZ. The grievance of the plaintiff is that the
defendant is using deceptively similar carton and strip packaging bearing the
mark OMECAP. It is stated that the mark OMEZ and its distinctive
packaging is well known among the relevant class of customers, doctors and
other healthcare professionals. It is pleaded that copying the said packaging
by the defendant is an attempt to pass off OMECAP product as that of the
plaintiff's OMEZ. On 22.08.2017, this court passed an ex parte injunction
stating that a prima facie case is made out and restrained the defendant from
selling or offering for sale, etc. pharmaceutical preparations under the mark
OMEZ having identical/similar trade dress or packaging as that of the
plaintiff's OMEZ product.
3. On 12.02.2018 with the consent of the learned counsel for the parties,
the above interim order was confirmed.
4. Learned counsel for the defendant states that even prior to filing of the
suit the defendant had changed the trade dress/packaging and are not using
the impugned trade dress/packaging.
5. Learned counsel for the plaintiff however states that the defendant is a
well known company and would be liable to pay damages in view of the fact
that they knowingly passed off their product as that of the plaintiff.
6. In these circumstances, the plaintiff has filed the stated application
under Order 11 CPC which essentially seeks details of the sale made by the
defendant by trying to pass off its product in the impugned packaging
7. Learned counsel for the defendant/appellant has however stated that
the impugned order is erroneous. He relies upon a judgment of a Coordinate
Bench of this court in Titan Industries vs. Nitin P. Jain & Ors.,
126(2006)DLT 132 to contend that normally in a matter like the present
CS(COMM.)545/2017 Page 2
case, there would a spilt trial and first, this court should hear the matter only
pertaining as to whether there has been a case of passing off the product by
the defendant. It is only after recording such a finding this court would
proceed to assess the damages/issue of rendition of accounts. He submits
that presently, there has been no finding recorded by this court that the
defendant is guilty of passing off its product as that of the plaintiff.
8. The Coordinate Bench of this court in Titan Industries vs. Nitin P.
Jain & Ors.,(supra) held as follows:-
"14. The court also noted that with a view to savings of cost,
the practice has developed, in particular in intellectual property
cases, when it is practicable, to have a "split trial". The action is
divided into two stages. The first stage is the trial at which the
issue is limited to that of liability, i.e. whether the plaintiff's
rights have been infringed. The second stage, which is contingent
upon liability being established at the first stage, is concerned
with the question of assessment of damages and calculation of
profits. In this way, the costs of exploring the issue of damages
and profits is put off until it is clear that the defendant is liable
and the issue really arises and requires determination. As a
concomitant with this practice, there has likewise developed the
practice of limiting discovery at the first stage to documents
relevant to the issue of liability and excluding documents
relevant only to the second stage. In this way the burden of
discovery at the first stage is reduced, and the invasion of
confidence necessarily involved in discovery is postponed and if
liability is not established, entirely obviated: [see also Baldock
v.Addison [1995] 1 W.L.R.158.]
15. Learned counsel for the defendants tried to urge that there
is no practice of 'split trial' in this country and, therefore, the
aforesaid provision is not applicable. This submission of learned
counsel is reflective of ignorance on this part. The system of
'split trial' prevails in all those cases where relief of rendition of
accounts or damages/mesne profits is made. In the first stage the
CS(COMM.)545/2017 Page 3
court holds inquiry as to whether the right of the plaintiff is
infringed or not and once it is so held, a preliminary decree for
rendition of accounts is passed and at the second stage the
evidence is led on the question of assessment of damages.
xxx
17. The aforesaid principles laid down by the English Courts
on the claims for damages and/or account of profits are based on
common law principle applicable in torts. Section 106 of the Act
and its equivalent provision contained in Section 135 of the
Trade Marks Act, 1999, are nothing but the legislative mandate
to the aforesaid common law principles. Therefore, once this
provisions states that the plaintiff can claim relief either for
damages or relief for account of profits, reading the aforesaid
principles into this provision it is also to be held that both the
reliefs can be claimed in the alternative with right to the plaintiff
to make an informed election between damages and profits in the
course of trial in the light of information revealed on discovery
and the evidence at the trial."
9. I am not inclined to accept the contention of the learned counsel for
the appellant. Firstly, this court has already recorded a prima facie finding
that the impugned packaging was done by the defendant only for the
purpose of trying to pass off its products as that of the plaintiff.
10. Apart from the above, in 2018, the Delhi High Court (Original Sides)
Rules 2018 came into force. Admittedly, there is no procedure prescribed for
spilt trial.
11. I may also note that in this case, the plaintiff has only sought a decree
of damages of Rs. 1 crore. It has not sought rendition of accounts. Hence, it
is not a case where a preliminary decree for rendition of accounts would be
passed by the court under Order 20 Rule 16 CPC and it would be followed
CS(COMM.)545/2017 Page 4
by appropriate directions for rendition of accounts.
12. In my opinion, for assessment of damages, the interrogatories that
have been passed on to the defendant are in order and cannot be said to be
faulted.
13. However, a perusal of the interrogatories would show that in para 6,
the plaintiff seeks information on two aspects i.e. price quoted to the
stockists and manufacturing cost of the product under the impugned
packaging. Similar, interrogatory No. 7 seeks information on profit margin
of the products sold under the impugned packaging. In my opinion, these
two aspects, namely, manufacturing cost of the product and the profit
margin of the product are purely subjective. These can vary based on various
circumstances. The defendant may for the purpose of assessing the cost of
manufacturing and profit margin include in the manufacturing cost various
aspects on which the plaintiff may not agree. It would be appropriate that
these questions are deleted from the interrogatories. The appellant would
comply with the balance interrogatories in terms of the order of the learned
Joint Registrar.
14. The appeal stands disposed of.
JAYANT NATH, J
APRIL 11, 2019
rb
CS(COMM.)545/2017 Page 5
