Trademark Infringement

Overview:

Nowadays, consumers are highly focused on brands, and using a deceptive name for a brand can significantly impact the original brand’s market presence. Brand owners seek remedies to protect their brand whenever its value is exploited without prior approval. Halting the unauthorized use of a trademark is as crucial as trademark registration. Therefore, the Trademarks Act, 1999, was introduced to safeguard trade names.

The primary objective of the Trademarks Act, 1999, is to grant exclusive rights to brand owners for the use of their brand names and to prevent unauthorized use by competitors or other entities. Consequently, to safeguard the brand name and its established value, brand logos and names are registered under this act. Moreover, if there is deceptive usage of the brand name or logo, the Act offers remedies for brand owners to take legal action against those using the brand name without permission.

Trademark infringement refers to the unauthorized use of a brand mark, and the Act provides remedies to address such infringements. In this article, we will delve into the meaning, types, and remedies available for trademark infringement.

Benefits of Trademark

Following are the benefits of trademark:

Recognizing the source: Trademarks help consumers identify the origin of products or services, associating them with a specific brand or company.

Determining quality: Trademarks also aid consumers in assessing the quality and reputation of products or services associated with a particular brand.

Making informed purchasing decisions: By recognizing trademarks, consumers can make informed decisions about which products or services to purchase based on their preferences and past experiences.

Protecting trademarks from misuse and infringement is crucial to preserving the integrity and value associated with them. This ensures that consumers can continue to rely on trademarks as indicators of quality and source when making purchasing decisions.

Taking action against trademark infringement, companies can protect their intellectual property rights and prevent competitors from capitalizing on their brand recognition. This can help to maintain consumer confidence and prevent damage to the company’s reputation.

Impact of Trademark Infringement on Business

Trademark infringement can have significant repercussions on businesses, affecting both their financial health and reputation:

Financial Losses: Utilizing another person’s registered trademark without authorization can lead to financial losses for both parties involved. The trademark owner may lose revenue as consumers may be drawn to the infringing goods or services due to the resemblance in branding. On the other hand, the infringing business may face legal penalties and fines, resulting in financial strain.

Reputation Damage: Trademark infringement can harm the reputation of both the trademark owner and the infringing business. Consumers may become confused or misled by the similar branding, leading to a loss of trust and credibility for the trademark owner. This damage to reputation can have long-lasting effects on customer loyalty and brand perception.

Legal Disputes: Resolving trademark infringement disputes often involves lengthy and expensive legal proceedings. Businesses may need to invest significant time and resources in defending their trademark rights in court. Small businesses, in particular, may struggle to afford the costs associated with legal disputes, putting them at a disadvantage.

Closure of Business: In severe cases, trademark infringement can lead to the forced closure of a business. If found guilty of violating a registered trademark, businesses may be required to cease operations and pay substantial penalties to the trademark owner. This can have devastating consequences for the infringing business, especially if they have invested heavily in developing their brand.

Requirements:

To establish trademark infringement, a company must prove that the third party’s use of the mark is likely to cause confusion among consumers. This can be done by showing that the mark is similar or identical to the company’s mark, that the goods or services offered under the mark are similar or related, and that the third party’s use of the mark is likely to cause confusion or deception among consumers.

Types of Trademark Infringement

Direct Infringement

Usage by an Unauthorized Person: Direct infringement occurs when an individual or entity not authorized by the trademark owner uses a registered trademark.

Identical or Deceptively Similar: The unauthorized use must involve a mark that is either identical or deceptively similar to the registered trademark. “Deceptively similar” implies that there is a likelihood of confusion among consumers, even if actual confusion may not have occurred.

Registered Trademark: Remedies under the Trademarks Act apply only to registered trademarks. Unregistered trademarks may be addressed through the common law of passing off.

Goods or Services Class: The unauthorized use must pertain to goods or services within the same category or class as those covered by the registered trademark.

Indirect Infringement

Vicarious Liability: Vicarious liability holds companies responsible for offenses committed under the Trademarks Act. This extends liability to all individuals associated with the company, except those who acted in good faith and without knowledge of the infringement.

Contributory Infringement: Contributory infringement occurs when an individual knowingly contributes to direct infringement by providing material support or inducing the primary infringer. Unlike vicarious liability, contributory infringement does not offer exceptions based on good faith.

Overall, trademark infringement encompasses both direct and indirect forms of unauthorized use of a registered trademark. Direct infringement involves unauthorized usage that is identical or deceptively similar to a registered trademark, while indirect infringement holds individuals or entities liable for facilitating or contributing to trademark infringement. These legal principles protect the exclusive rights of trademark owners and help maintain the integrity of brands in the marketplace.

Under the Trademarks Act, 1999, Section 30 outlines specific circumstances in which the use of a registered trademark will not be considered trademark infringement. These conditions serve as defenses that can be invoked by alleged infringers.

Following are the conditions specified under Section 30

Honest Practices: When the use of the registered trademark aligns with honest practices in commercial or industrial matters, it will not be considered infringement.

No Undue Advantage: If the use of a registered trademark does not seek to gain undue advantage or harm the distinctive character or reputation of the trademark, it will not constitute infringement.

Descriptive Use: When the registered trademark is used to describe the quality, kind, intended purpose, geographical origin, value, time of production, or other characteristics of goods and services, it may not be deemed infringement.

Identical or Similar Use: If two trademarks are used in a manner that they are identical or similar to each other, it may not amount to infringement under certain circumstances.

Accessories and Parts: When a trademark is used in relation to accessories and parts that are compatible with the original product, it may not be considered infringement.

Continued Permission: If the use of a trademark continues with the permission of the original owner of the registered trademark, and such consent has not been revoked, it may not constitute infringement.

Prescribed Limitations and Conditions: When the use of a trademark complies with the limitations and conditions specified at the time of registration with the Trademark Registry, it may not be regarded as infringement.

Overall, these conditions provide legal protections for certain uses of registered trademarks that do not unfairly exploit or dilute the rights of the trademark owner. They ensure a balance between trademark protection and legitimate commercial practices.

Documents Required:

To establish trademark infringement, a company may need to provide evidence such as:

• A copy of the company’s trademark registration
• Evidence of the third party’s use of the mark
• Evidence of confusion among consumers
• Any correspondence or communications with the third party regarding the use of the mark

Steps:

Following is the Procedure for Obtaining Remedies of Trademark Infringement:

1) Procedure Under Civil Law

Filing a Lawsuit: The trademark owner can file a case under Section 134 of the Trademark Act, 1999, in the District Court. The jurisdiction lies where the plaintiff’s head office is located or where the cause of action arose. Unlike other civil suits, Section 20 of the Civil Procedure Code (CPC) does not apply to trademark infringement cases.

Court Orders: 

Injunction: Issued under Order XXXIX of CPC or Section 36-42 of the Specific Relief Act, restraining the infringer from further using the trademark.

Damages or Accounts of Profits: Compensation for the losses suffered by the trademark owner or recovery of profits made by the infringing party.

Destruction or Erasure: The court may order the destruction or erasure of infringing labels.

2) Procedure Under Criminal Law

Filing an FIR: The aggrieved party can file a First Information Report (FIR) under Section 154 of the Criminal Procedure Code (CrPC). If the police refuse to file an FIR, the complainant can approach the Magistrate under Section 156(3) of CrPC.

Police Investigation: Upon registration of the FIR or order by the Magistrate, the police will initiate an investigation. This may involve the seizure and search of goods and services bearing the infringing trademark.

Initiating Proceedings Against Unknown Persons: The advantage of criminal remedy is that the victim can initiate proceedings against unknown persons. Sometimes, the identity of distributors and manufacturers may not be known, hindering the filing of a criminal complaint. Sections 93 and 94 of CrPC allow for seizure and search proceedings against unknown persons.

The procedures under civil and criminal law provide avenues for trademark owners to seek remedies against infringement. Civil proceedings focus on obtaining injunctions, damages, and destruction of infringing goods, while criminal proceedings allow for police investigations and actions against unknown infringers. These legal measures aim to protect the rights of trademark owners and deter unauthorized use of trademarks.