Delhi High Court
M/S Maan Pharmaceuticals Ltd. vs M/S Mindwave Healthcare Pvt. Ltd. on 12 September, 2022
IN THE HIGH COURT OF DELHI AT NEW DELHI
% Judgment delivered on: 12.09.2022
+ FAO (COMM) 79/2022, CM APPL. 24555/2022 & CM
APPL. 30226/2022
M/S MAAN PHARMACEUTICALS LTD. ..... Appellant
versus
M/S MINDWAVE HEALTHCARE PVT. LTD. ..... Respondent
Advocates who appeared in this case:
For the Appellant : Mr. Saurabh Kirpal, Sr. Adv. with
Mr. Shailen Bhatia, Mr. Arnav Chatterjee
& Ms. Tanima Panigram, Advs.
For the Respondent : Mr. Shailen Bhatia, Mr. Arnav Chatterjee
& Mr. Ashok Shukla, Advs.
CORAM:
HON'BLE MR. JUSTICE VIBHU BAKHRU
HON'BLE MR. JUSTICE AMIT MAHAJAN
JUDGMENT
AMIT MAHAJAN, J
1. The appellant (hereafter 'MAAN') has filed the present appeal
impugning an order dated 23.03.2022 (hereafter 'the impugned
order') passed by the learned Commercial Court in CS (COMM)
194/21, whereby the application filed by the respondent (hereafter
'MINDWAVE') under Order XXXIX Rules 1 and 2 of the Code of
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Civil Procedure, 1908 (hereafter 'the CPC') was allowed and MAAN
was restrained from using the trademark 'BUPROEX'/'BUPROEX-N'.
BRIEF FACTS
2. MINDWAVE filed an application for registration of the
trademark 'BUPROEX-N' on 12.12.2012, which was published in the
Trade Mark Journal on 07.09.2015. The said trademark was
subsequently registered on 28.06.2016 under Class 5.
3. It is admitted by the parties that in the month of May 2013,
MINDWAVE engaged MAAN for manufacturing the drug with the
trademark 'BUPROEX-N'.
4. The packaging of the drug showing MAAN as the manufacturer
and MINDWAVE as the marketer of the said drug is admitted. Images
of the same are set out below:-
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5. Thereafter, MINDWAVE filed a suit claiming that it is the
registered proprietor of the said trademark and it had engaged the
services of MAAN only for the purpose of manufacturing the drug in
question. MINDWAVE further claimed that the drug was being
manufactured by MAAN till the year 2021 and after, it stopped placing
manufacturing orders, MAAN's intention turned dishonest and it not
only filed an application for rectification of MINDWAVE's registered
trademark but also took steps to launch the product under the trademark
'BUPROEX'. MINDWAVE relied upon various emails and the P to P
Agreement dated 01.08.2011, in support of its contention that MAAN
was only a third party manufacturer, who was paid for its services and
the trademark always belonged to MINDWAVE.
6. MAAN contended that it was manufacturing the drug in question
as the proprietor of the trademark and MINDWAVE was only selling
the said drug. MAAN further claimed that on becoming aware of the
registration of the trademark in favour of MINDWAVE, it approached
MINDWAVE for the assignment of the trademark, in its favour.
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7. MAAN also contended that in the normal course of business, the
trademark belongs to the manufacturer unless an agreement executed
by the parties states the contrary. It is, thus, contended that the
relationship between MAAN and MINDWAVE is that of a principal
and dealer.
8. MAAN further relied upon the 3rd PARTY Marketing and
Distribution Agreement dated 19.01.2016 to contend that MINDWAVE
had assigned the trademark, in its favour. MAAN claimed that the said
agreement is signed by one Mr. Praveen Sharma, who is the Director of
MINDWAVE.
9. MAAN also filed an application under Order VII Rules 10 & 11
of the CPC seeking return of the plaint. The said application was
dismissed by the learned Commercial Court by an order dated
07.12.2021. The said order was challenged in FAO(COMM) 78/2022,
which is dismissed by this Court by a separate judgment dated
12.09.2022. The facts and issues are not discussed in the present
judgment, as they are not relevant for the purpose of deciding the
present case.
10. By way of the impugned order, the learned Commercial Court
had dismissed the application filed by MAAN under Order XXXIX
Rule 4 of the CPC and allowed MINDWAVE's application under Order
XXXIX Rules 1 and 2, of the CPC. The relevant extract of the impugned
order is set out below:-
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"27. This court has considered the submissions advanced at
length and perused the material placed on record. This court would
prefer to be brief while deciding the application and leave the
disputed questions of facts for trial. At this stage what is to be seen
whether plaintiff has disclosed a prima-facie case i.e. the triable
issues which requires evidence to resolve the same and whether
irreparable loss and injury shall be caused to the plaintiff if interim
relief is declined and where does the balance of convenience lies.
xxxx xxxx xxxx
30. Vide a detailed order dated 07.12.2021, application U/o VII
Rule 10 & 11 CPC filed by the defendant was dismissed after
considering the rival contentions of the parties and few contentions
raised herein including the point of LPC raised by the Ld. Counsel
for defendant have already been dealt with which need not to be
repeated for the sake of brevity.
31. In short, case of the plaintiff is that, it is a dealing in the
business of marketing pharmaceutical and medicinal preparations.
On 17.10.2012, the trademark BUPROEX was coined by the
promoters of the company and to that effect, on 17.10.2012 the
promoter directors sent an e-mail to its counsel to take search and
to ensure that the aforesaid trademark BUPROEX with suffix 'N' is
available for adoption. Subsequently on 12.12.2012, plaintiff filed
the trademark registration application at the Trademark Registry
vide trademark No. 2441575. According to the plaintiff, in May,
2013, he contacted the defendant for third party manufacturing and
sent mail for cost for production of this pharmaceutical's
preparation under the trademark BUPROEX and BUPROEX- N.
The reply by mail dated 07.05. 2013 was received from the
defendant that they are working on the costing.
xxxx xxxx xxxx
36. In the present age, the e-mails and the meeting of mind of
parties through exchange of correspondence through e-mail are the
well recognized modes and the agreement can be formed through
such modes. It is also well settled that a person who is a registered
trademark proprietor has a preferable rights over the use of the said
trade as against the others and mere pendency of rectification
proceedings would not disentitle the plaintiff for seeking the relief
sought when he is the registered proprietor and the registered trade
mark is deemed to be the public user and registration dates back to
the dates of application. The relevant questions are that who
invented the word/mark and who owns the goodwill in the goods.
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37. In the present case, considering the two sets of evidence, the
draft agreement dated 01.08.2011, the mails dated 01.06.2013,
06.05.2013, 21.05.2013, 21.07.2016 on the one hand and agreement
dated 19.01.2016 on the other hand, at this stage which evidence is
to be accepted or not which evidence is to be rejected appears to be
a fact in issue which has to be considered after parties adduce
evidence and the evidenciary value of all the documents and whether
the alleged agreement dated 19.01.2016 was acted upon or not.
38. Having regard to the totality of circumstances, this court
finds no satisfactory grounds to vacate the interim order dated
15.07.2021. Application U/o XXXIX Rule 1 & 2 CPC, filed on behalf
of the plaintiff, is allowed and application U/s XXXIX Rule 4 CPC,
filed on behalf of the defendant, is dismissed. It is ordered that the
interim order dated 15.07.2021 shall continue till the disposal of the
suit. Nothing stated herein shall tentamount to be an expression on
the merits of the case. Both the applications stand disposed of
accordingly."
11. It is contended by the learned counsel appearing for MAAN
that the learned Commercial Court committed an error by ignoring
the Agreement dated 19.01.2016, which was signed by both the
parties. It is further contended that the alleged P to P Agreement dated
01.08.2011 was merely a draft and had never reached the stage of
finality and thus, should not have been relied upon by the learned
Commercial Court.
12. The learned counsel appearing for MINDWAVE, on the other
hand, supports the impugned order passed by the learned Commercial
Court and contends that the agreement between MAAN and
MINDWAVE was a typical third party manufacturing contract, wherein
MINDWAVE, being the proprietor of the trademark, was getting the
product manufactured from MAAN. It is further contended that the
alleged Agreement dated 19.01.2016 is, on the face, a forged and
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fabricated document since no party would assign a valuable asset
without consideration.
13. In the present case, there is no dispute about the registration of
the trademark or its validity. It is an admitted case that the mark is
registered in favour of MINDWAVE. The issue, therefore, to be
decided is whether the learned Commercial Court has rightly exercised
its discretionary jurisdiction by allowing the application filed by
MINDWAVE under Order XXXIX Rules 1 and 2 of the CPC, on the
basis of the pleadings and documents filed by the parties. The issue that
had been considered by the learned Commercial Court was whether the
plaintiff (MINDWAVE) had assigned the mark in favour of the
defendant (MAAN) and therefore, it was not entitled to injunct the
defendant from its use.
14. The law in relation to the scope and nature of appeals and the
limitations of the powers of an appellate court to substitute its own
discretion in an appeal preferred against a discretionary/interlocutory
order is well-settled. The Supreme Court in the case of Wander Ltd.
And Anr. vs Antox India P. Ltd.: 1990 Supp SCC 727, held as under:
"13. On a consideration of the matter, we are afraid, the appellate
bench fell into error on two important propositions. The first is a
misdirection in regard to the very scope and nature of the appeals
before it and the limitations on the powers of the appellate court to
substitute its own discretion in an appeal preferred against a
discretionary order. The second pertains to the infirmities in the
ratiocination as to the quality of Antox's alleged user of the
trademark on which the passing-off action is founded. We shall deal
with these two separately.
14. The appeals before the Division Bench were against the exercise
of discretion by the Single Judge. In such appeals, the appellate
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court will not interfere with the exercise of discretion of the court of
first instance and substitute its own discretion except where the
discretion has been shown to have been exercised arbitrarily, or
capriciously or perversely or where the court had ignored the settled
principles of law regulating grant or refusal of interlocutory
injunctions. An appeal against exercise of discretion is said to be an
appeal on principle. Appellate court will not reassess the material
and seek to reach a conclusion different from the one reached by the
court below if the one reached by that court was reasonably possible
on the material. The appellate court would normally not be justified
in interfering with the exercise of discretion under appeal solely on
the ground that if it had considered the matter at the trial stage it
would have come to a contrary conclusion. If the discretion has been
exercised by the trial court reasonably and in a judicial manner the
fact that the appellate court would have taken a different view may
not justify interference with the trial court's exercise of discretion.
After referring to these principles Gajendragadkar, J. in Printers
(Mysore) Private Ltd. v. Pothan Joseph [(1960) 3 SCR 713 : AIR
1960 SC 1156] : (SCR 721)
"... These principles are well established, but as has been
observed by Viscount Simon in Charles Osenton & Co. v.
Jhanaton [1942 AC 130] '...the law as to the reversal by
a court of appeal of an order made by a judge below in
the exercise of his discretion is well established, and any
difficulty that arises is due only to the application of well
settled principles in an individual case'."
The appellate judgment does not seem to defer to this principle."
15. The following emails and documents have also been relied upon
by the parties:-
DATE FROM TO WHOM CONTENT OF EMAIL
AND TIME WHOM
06.05.2013 MINDWAVE MAAN Dear Mr. Pushpak,
(11:52 a.m.)
As per the meeting with you on
3rd May, I request you to mail
the exact costing and required
documents for buprenorphine
third party mfg.
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07.05.2013 MAAN MINDWAVE Working on the costing. You
(11:09 a.m.) should have it latest between
Wednesday and Thursday.
Also list of documents and
contract should be ready by
weekend.
07.05.2013 MINDWAVE MAAN Ok.
(11:43 a.m.)
09.05.2013 MINDWAVE MAAN Dear Mr. Pushpak,
(6:43 p.m.)
This is just a soft reminder
regarding the below mentioned
query.
13.05.2013 MINDWAVE MAAN Dear Pushpak,
(3:14 p.m.)
Reminding you for below
mentioned query.
13.05.2013 MAAN MINDWAVE am in the hospital today. Will
(4:23 p.m.) send the costing tomo.
13.05.2013 MINDWAVE MAAN Ok. Hope everything is fine.
(4:26 p.m.) take care.
21.05.2013 MAAN MINDWAVE Dear Mr. Praveen,
(3:23 p.m.)
The 0.4 mg strength for 10x10
will cost Rs.200 ex factory
(without excise)
Regards
21.05.2013 MINDWAVE MAAN Dear Mr Pushpak,
(5:42 p.m.)
I am ok with the rates. You are
requested to mail the
requirements to place the P.O.
22.05.2013 MINDWAVE MAAN Dear Mr Pushpak,
(6:11 p.m.)
MRP for Tab. Buproex 0.4 mg
would be Rs. 8/Tab. and
batchsize would be two lacs
Tab.
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30.05.2013 MAAN MINDWAVE Please find the agreement for
(5:32 pm) your perusal.
Regards.
[ptop.doc
82K]
30.05.2013 MAAN MINDWAVE [2 attachments
(6:15 p.m.)
Buprenorphine Tablets
New.pdf
3456K
Buprox Tablets.pdf
1804K]
30.05.2013 MINDWAVE MAAN Designs are ok.
(6:25 pm)
01.06.2013 MINDWAVE MAAN Dear Pushpak,
(7:45 p.m.)
Few changes are required in the
agreement draft.
1. Buproex range is brand
of Mindwave
Healthcare Pvt. Ltd.
and Mindwave
(Fluvoxamine) range is
brand name of
Brainwave Healthcare
Pvt. Ltd. so two
different affidavits are
required for these
brands.
2. Kindly change MRP of
Buproex 0.4 mg to
rs 7.50/tab.
Rest is ok to me.
01.06.2013 MINDWAVE [email protected] [ptop.doc
(7:46 p.m.) mail.com
82K]
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28.06.2013 MINDWAVE Deepak Kumar ---Forwarded message---
(9:32 a.m.) <[email protected] From: Pushpak Ranka
com> <[email protected]
com >
Date: Thu, 30 May, 2013, 5:33
pm
Subject: agreement
To: Mindwave Healthcare
<[email protected]
com>
21.07.2016 MAAN MINDWAVE Praveenji
(6:15 p.m.)
Kindly find encl documents as
discussed with Pushpak.
---
Hemendra Patel
Maan Pharmaceuticals Ltd.
[3 attachments
AFFIDAVIT-ASSIGNOR.doc
40K
ASSIGNMENT DEED.doc
64K
RECEIPT OF
CONSIDERATION.docx
15K]
30.08.2016 MAAN MINDWAVE -------------------------------------
(4:25 p.m.) PHARMA (Parveen Sharma) [buproex update.doc
(Pushpak 84K]
Ranka)
30.08.2016 MINDWAVE VIMAL MEHTA Forwarded above email
(5:47 p.m.) (Parveen --------------------------------------
Sharma) -
[buproex update.doc
84K]
07.09.2016 MAAN MINDWAVE [4 attachments
(1:15 p.m.) (Parveen Sharma) ASSIGNMENT DEED.doc
64K
AFFIDAVIT-ASSIGNEE.doc
37K
AFFIDAVIT-ASSIGNOR.doc
39K
RECEIPT OF
CONSIDERATION.docx
15K]
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07.09.2016 MINDWAVE Ravinder AC ---Forwarded message---
(4:53 p.m.) (Parveen (Brainwave)
Sharma) From Pushpak (MAAN)
Subject: FW: ASSIGNMENT
OF TRADEMARK
To Parveen Sharma
(MINDWAVE)
[4 attachments
ASSIGNMENT DEED.doc
64K
AFFIDAVIT-ASSIGNEE.doc
37K
AFFIDAVIT-ASSIGNOR.doc
39K
RECEIPT OF
CONSIDERATION.docx
15K]
16. A perusal of the emails exchanged between the parties, prima
facie, shows that MINDWAVE had approached MAAN for the purpose
of third-party manufacturing. In the year 2013, MINDWAVE had
further followed up with MAAN regarding the costing of the product.
From the pleadings, it thus, appears that MAAN had thereafter, carried
out the manufacturing till the year 2016 and further, certain e-mails had
been exchanged between the parties, wherein some draft agreements
were exchanged. However, admittedly, the said draft agreements were
not agreed between the parties and were therefore, not signed.
17. The P to P Agreement exchanged between the parties in the year
2013, categorically, mentions that MINDWAVE is the registered brand
owning company for the product 'BUPROEX'. Even though MAAN
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has disputed the execution of the said agreement, the fact is that MAAN
was manufacturing the product with the trademark 'BUPROEX' as a
manufacturer. The factum of an agreement between the parties is not
only seen from the signed agreements but also from the conduct of the
parties. When the exchange of emails is accepted and the contents of
the draft agreement were acted upon, it prima facie, points to the
validity of the P to P Agreement. Some proposed assignment deeds
were also exchanged between the parties proposing the assignment of
the trademark in favour of MAAN, however, admittedly, the same was
not acted upon.
18. The reliance placed by MAAN on the alleged Agreement dated
19.01.2016, is also misplaced, for several reasons.
19. The reliance placed by MAAN on the Agreement dated
19.01.2016, which allegedly grants MINDWAVE an exclusive right to
market the product with the mark 'BUPROEX' and stipulates that
MAAN is the owner of the mark 'BUPROEX', is misplaced. It is an
admitted fact that the assignment deeds were sent by MAAN vide
emails dated 21.07.2016 and 07.09.2016. Had the Agreement dated
19.01.2016 been executed, there was, in fact, no requirement for signing
of the assignment deeds, as sent by MAAN in its emails dated
21.07.2016 and 07.09.2016. Therefore, the Agreement dated
19.01.2016, prima facie, does not inspire confidence. MAAN
admittedly continued to manufacture the drug in question up to the year
2021 as a manufacturer on the earlier terms and conditions.
20. The Agreement dated 19.01.2016 also does not inspire
confidence for the reason that no party would assign a valuable right in
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favour of another person, without any consideration. It also does not
mention or record as to how one Shri Praveen Sharma was authorised
to execute the said agreement. It is pointed out that Shri Praveen Sharma
was only holding 33% shares in MINDWAVE and could not have
signed the said agreement on behalf of the company.
21. In Poysha Power Generation Pvt. Ltd. v. Doctor Morepen
Limited & Anr.: 2006 SCC OnLine Del 1665, the plaintiff had claimed
assignment of a mark in its favour by the defendant, however, the
defendant had objected to the same by stating that a mark which was
bought by them for ₹8.95 crores could not have been assigned for only
₹20 Lakhs. After considering the rival submissions, a Single Bench of
this Court had held as under:-
"38. Since the details of the transaction entered into between The
Boots Company plc and Knoll AG in 1985 are not before me, it
wduld be inappropriate to comment on it. Moreover, there is nothing
to indicate, one way or another, why the trademark BURNOL was
assigned for as little as US $ 100/-. Quite clearly, there must be some
other consideration about which there is nothing on record. The
fact, however, remains that in December, 2001 Reckitt Piramal Ltd.
assigned the trademark to Dr. Morepen for Rs. 8.95 crores. It is
unthinkable that, all things being equal, Dr. Morepen should assign
that trademark barely 21/2 years later to Poysha for a paltry amount
of Rs. 20 lakhs. There is nothing on record that has been shown by
Poysha to suggest that the value of the trademark has crashed to
such an extent. The value of the trademark may not have been
increased to Rs. 12 crores as contended by learned counsel for Dr.
Morepen, but in the absence of any material to show that the value
had crashed, it must be assumed that the value of the trademark
BURNOL remained more or less steady between December, 2001
and April, 2004. If that assumption is correct (and there is nothing
to contradict that assumption) it does not stand to reason why Dr.
Morepen should assign the trademark to Poysha for only Rs. 20
lakhs."
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22. It is an admitted fact that the trademark 'BUPROEX' is registered
in favour of MINDWAVE, and no reason have been given by MAAN
as to why a proprietor of a trademark would allow another party to
appropriate the trademark without any consideration.
23. The defence that the mark 'BUPROEX' belongs to MAAN and
not MINDWAVE, therefore, prima facie, appears to be not genuine.
24. The learned Commercial Court rightly held that the veracity of
the document would be seen only after the evidence is led. However,
for the purpose of deciding an application under Order XXXIX Rules 1
and 2 of the CPC, documents relied upon by MAAN are not of such
nature, which inspire confidence and can be relied upon at this stage.
25. Various emails and documents filed by MINDWAVE along with
the suit, which were not denied, at least prima facie, show that MAAN
was manufacturing the drug on instructions from MINDWAVE and
was therefore, a third party manufacturer or a contract manufacturer on
the terms and conditions agreed between MAAN and MINDWAVE.
26. As discussed above, the emails and correspondence between the
parties, is a well-recognized mode to reach the conclusion that the
parties had agreed to act in a certain manner, in accordance with the said
agreement and MINDWAVE is a registered proprietor of the trademark
'BUPROEX' and has been continuously using the said trademark for
several years.
27. In view of the above, we find no infirmity with the reasoning
given by the learned Commercial Court. Thus, the present appeal is,
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accordingly, dismissed. All the pending applications are also disposed
of.
28. This Court has expressed a prima facie opinion and it is clarified
that nothing stated in this order shall be construed as an expression of
opinion on the merits of the case. All rights and contentions of the
parties are reserved.
AMIT MAHAJAN, J
VIBHU BAKHRU, J
SEPTEMBER 12, 2022
KDK
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