By Akshita Singh, Lex Maven

1. INTRODUCTION

Trademarks are a type of intellectual property. People can keep ownership of their inventive product by using intellectual property rights, as intellectual properties are created through the efforts of human labor, it is restricted by a multitude of registration and infringement fees. Types of intellectual property are Trademarks, Copyrights, Patents, Designs and Geographical Indication.

A trademark is a name, word, symbol, alphanumeric, numerals, combination of colors etc. that distinguishes any goods or services from those of other businesses. With a trademark, marketing of goods or services becomes considerably easier as product recognition is secured. It gives the owner the right to prevent a competitor from using his mark or symbol.

Example : Google, Apple, Tata, Yahoo, Facebook, Reliance etc.

2. TRADEMARKS AND BRANDING

In the field of Economics, trademarks were an unexplored arena, until the works of William Landes and Richard Posner came into the limelight, as the need for counteracting quality uncertainty arose in the market. Trademarks would act as a source of information for the consumers, as they are an assurance symbol for the quality of the goods and services availed by them. Therefore, codified Trademark laws bring uniformity and economic efficiency in the market.

However, as compared to patents and copyrights, trademarks were generally recognized as a benchmark for quality for any specific product or service, whereas patents and copyrights are associated with creativity and innovation. Trademarks are categorized as private goods, which assist the consumers in selecting from the wide range of goods and services that are offered in the market which effectively and efficiently meet their specific and general demands, and at the same time has also introduced certain new economic functions i.e. the establishment of identity and status for its consumers (Building a Brand).

In the earlier days, the term ‘Brand’ was used to distinguish someone’s property from that of another, by placing burn marks. With the industrial revolution, the merchants and businessmen realized that the goods that are being sold all around the globe needs to be recognized separately from one another.

In legal terms, a trademark is used to protect intellectual property that is linked to a company’s identity. A trademark, as previously said, is used to differentiate the merchandise of one company from that of  another and can take the shape of a slogan, term, logo, symbol, or other components. Any business needs this form of legal protection to preserve its rights, fundamental values, brand strategy, and identity, among other things. The only requirement for intellectual property protection is that the business stays original and that no market competitor can copy it. The capacity to distinguish one good from another is the trademark’s initial function, by building a unique identity for the enterprise and establishing it as a brand, by providing quality assurance.

The landmark case of DM Entertainment vs Baby Gift House & Ors, is a typical case of how trademarks acts as an exemplary case to showcase how trademarks acts as a catalyst in building brands. The plaintiff company was established to manage the escalating pop star from Punjab Daler Mahendi’s career, and the defendant company by the virtue of his success was making huge profits by selling dolls of the artist. Aggrieved by the same, the plaintiff company sought permanent injunction upon the sale of the dolls leading to passing off. Consequently, the plaintiff acquired all the rights and interests upon the artist’s personality along with the trademark Daler Mahendi, thus establishing him as a brand. This was the first lawsuit in India involving celebrity commercialization in which the artist’s publicity rights were given fair consideration.

It is evident from the above mentioned case, that establishing Daler Mahendi as a registered trademark, has established him as a brand and by getting it registered, has also protected it against infringement i.e. preventing a third party from deriving benefits out of the goodwill of the brand “Daler Mahendi”.

Below, we have discussed, how law protects trademarks and assists businesses in building brands in the market.

3. TRADEMARKS ACT, 1999

There was no specific law prior to the Act of 1940, to deal with the infringement of the registered and unregistered trademarks, therefore these issues were dealt according to the provisions of Specific Relief Act, 1877 and Indian Registration Act, 1908. With the major growth in trade and commerce, the need for protecting trademarks increased, which lead to the codification of the Act of 1940.

This Act got replaced by The Trademark and Merchandise Act of 1958, which was further replaced by the Trademarks Act, 1999 which was made in harmony with the provisions laid down in TRIPS (Trade related aspects of Intellectual Property Rights) as recommended by World trade Organization.

   3.1 REGISTRATION OF TRADEMARK

Section 28 of the Act of 1999 provides certain rights to the owner of the trademark upon its registration, which are as follows:-

1. The absolute/exclusive right to use the trademark.
2. To claim maintenance against the infringement of such registered trademark.
3. If there are more than one registered owners of a trademark, then each of those owners shall have the same absolute right to use such trademark.

In order to get a trademark registered, the owner of the trademark must apply in writing in the prescribed manner to the registrar, which shall then be examined by the appropriate authorities, satisfied by which registration shall be granted.

Section 9 provides the absolute grounds based on which the registration of a trademark can be rejected:-

1. It has the tendency to create confusion amongst the public.
2. It is obscene or scandalous.
3. It can hurt religious sentiments.
4. If the trademark is such that it is in the shape which forms the exact nature of the goods.
5. If the trademark is such that it is in the shape which forms the substantial value of the goods.

Section 11 provides for comparable grounds based on which the registration of a trademark can be rejected:-

1. If it is similar to an earlier registered trademark with similar goods and services.
2. If it is similar to an earlier registered trademark and has high probability of causing confusion among the general public.

As it was held by the Hon’ble Delhi High Court in the landmark case of Yahoo! Inc vs Akash Arora & Anr, that a domain name deserves to get the same protection under law as it also serves as a trademark. The defendant owned a domain name called ‘Yahoo India!’ that was very similar to the plaintiff’s trademark ‘Yahoo!’ The court determined that internet users would be mislead into thinking that both domain names came from the same source. The defendant claimed that it had posted a disclaimer on its website as a defense. However, it was noted that a simple notice was insufficient because the nature of the internet is such that the use of a similar domain name cannot be rectified by a disclaimer, regardless of whether ‘yahoo’ is a dictionary word. The plaintiff’s name has acquired distinction and uniqueness as a result of its association with him.

3.2 INFRINGEMENT OF TRADEMARK

A person who is not a registered proprietor or who uses a mark that is identical to or deceptively similar to the trademark in relation to goods or services for which the trademark is registered, is said to have infringed the trademark. Following infringement, the trademark owner can pursue civil legal action against the person who infringed on the registered trademark. In other words, trademark infringement is the unapproved use of a trademark in relation to products and advantages in a way that is likely to generate misunderstanding, difficulty, or possible benefits about the trader.

Section 27 of the Act provides that no remedy lies for the infringement of an unregistered trademark under the Act, but as far as the common law is concerned the owner such unregistered trademark can exercise the remedy of passing off.

 3.3 PASSING OFF

Passing off simply means to prevent any man or woman from utilizing any symbol, logo, picture etc which acts as an identification symbol for the products and services of some other person, as a means to sell their own products and services without an authorized access.

In the case of Honda Motors Co. Ltd. Vs Charanjit Singh & Ors wherein the plaintiff was the owner of the trademark ‘HONDA’ and is in the business of selling automobiles. The defendants began utilizing the mark ‘HONDA’ for marketing their pressure cookers, plaintiff pursued a lawsuit against the defendants for infringing the plaintiff’s trademark. It was decided that the defendants’ use of the mark “Honda” was dishonest in nature, and its application by the defendant is likely to provoke confusion amongst the public, hence, the plaintiff’s application for permanent injunction was granted.

4. CONCLUSION

As a result, trademarks can be considered to be a beneficial tool for encouraging economic growth because they help to generate value and surplus in the economy. Trademark legislation safeguarding a positive-image brand will result in high earnings and value addition, contributing to the country’s GDP. As a result of a well-established trademark legislation, as well as proper awareness and execution in the market, Indian industries have expanded not only domestically, but also worldwide. People nowadays associate every well-known brand with its sign or emblem, placing their trust in that company prior to engaging in any type of transaction. This benefits not just the company providing the goods and services, but it also helps others.