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Using Manufacturer Trademarks on Compatible Consumables

Written by: Poorvi Chothani, Esq. (LL.M.-University of Pennsylvania, USA, Qualified as a Solicitor in England and Wales. Admitted to the Bar Council of Maharashtra and Goa and the New York State Bar) is the founder of LawQuest, a general law firm headquartered in Mumbai, India
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As awareness of protecting the environment increases, recycling or reuse of goods and resources is also on the rise, which is highly beneficial to the environment. Consumers are not only accepting recycled products, which often are less expensive than new or unused products, but are actively seeking them out, often for the price advantage. One such example is in the resale of printing toner, a market which is expanding in direct proportion to the burgeoning usage of computers. Keeping in mind the exigency of global environmental concerns governments like the European Union have adopted policies that deal with waste related to electrical and electronic equipment.

Aside from this growing awareness a parallel industry has long been flourishing in computer peripheral consumables. Printer cartridges are often recycled and or new cartridges are produced by independent manufacturers that are compatible with branded printers produced by Original Equipment Manufacturers (OEMs). This article is focused only on the use of branded manufacturer’s trademarks on the consumable products. It does not consider other intellectual property issues pertaining to the recharging of cartridges.

The OEM spends a huge amount on research and quality of cartridges. The actual brand owners may not manufacture the cartridges but the technology to manufacture is generally owned by them and the end product (OEM Cartridges) is marketed by them. Then, there are third party vendors who are dedicated to recharging or recycling cartridges, which are usually sold at a fraction of the price of OEM Cartridges. This is usually done with a commercial objective but there is a benefit to the environment as the generation of electronic waste is reduced.

The process of recharging involves the refilling of the OEM Cartridges or similar products with toner or ink once cartridge is empty. In this process, the cartridge is not discarded but is reused by dismantling, cleaning and reassembling with requisite repairs and replacements. Such cartridges are then packaged with the third party vendor’s trademark and information. However, third party vendors will generally indicate on the package that the product is suitable for a particular OEM Cartridge or will print a series of numbers on the packaging and often include a small OEM’s trademark indicating compatibility with the OEM’s products. These numbers refer to the OEM printers and allude to compatibility. Subsequent to the emergence and growth of this parallel industry a question raised at the conference held earlier this year by Recharger Magazine in Mumbai was whether the use of manufacturer’s trademark on the recharged OEM Cartridges or the compatible cartridges was a violation.

A similar issue was raised in the Delhi High Court in the case of Hawkins Cookers Limited v M/s Murugan Enterprises. Hawkins Cookers Limited is the owner of the trademark “Hawkins” and uses it on several products including pressure cooker gaskets. The plaintiff claimed their gaskets were sold all over the country including rural as well as urban areas, the uneducated customers, being illiterate and having an imperfect recollection, identify Hawkins gaskets by their features and packing as well as their prominent Hawkins trademark.

On the other hand the defendant, Murugan Enterprises claimed that the use of the Hawkins trademark in respect of parts of pressure cookers had its own well-established trademark “Mayur” with a prominent peacock displayed on its product packaging. In addition, the front of the packaging of the Murugan Enterprises' product contained the words 'Suitable for: Hawkins Pressure Cookers’ albeit in small print. With reference to this the plaintiff claimed that the unauthorized use of the trademark Hawkins by the defendant on the packaging of their product/gasket is likely to cause confusion or deception with respect to trade connection or association between the goods and business of the defendant with that of the plaintiff. The plaintiff further claimed that the use of the trademark 'Hawkins' by the defendant is detrimental to the plaintiff's reputation since the plaintiff has no control or supervision over the quality of spare parts manufactured by the defendant. The plaintiffs rationale behind filing the suit against the defendant was due to the use of the plaintiffs trademark 'Hawkins' by the defendant is only with the intent of the defendant to gain advantage of the goodwill and reputation created by the trademark Hawkins of the plaintiff in the market and amongst the customers.

The Delhi High Court in this case held that no reasonable person or purchaser could assume a trade connection between the “Mayur” brand of gaskets and the “Hawkins” brand of pressure cookers. Further, the court opined that in this case the Murugan Enterprises neither sought to benefit from Hawkins’ trademark nor did it try to show a connection between the two. Additionally the court opined that the defendants’ use of the “Hawkins” mark was only to show the suitability of the product to be used as an ancillary product in a Hawkins pressure cooker and that such use would evidently fall within the exception carved out under Section 30 of the Trademarks Act, 1999 . Further, the use of the trademark in relation to the product is reasonably necessary to indicate the fitness of the gaskets for the “Hawkins” brand of pressure cookers. In addition to this, the court held that the said case satisfies the conditions of 'honest use'. The court opined that the deception should be such that customers would assume that the mark is indicative of the same being a trademark of the plaintiff.

Honesty for the purposes of infringement has to be judged by an objective standard and hence considering the facts of the said case, it would be essential to determine if the defendant’s act is honest or amounts to an honest practice. In view of this, the court held that the defendant had its own well established trademark and therefore one cannot interpret a commercial connection between the plaintiff and the Defendant. The court was of the opinion that the said case was not a case of ‘dilution of the value of the trademark of the plaintiff by unfair advantage being taken of its distinctive character or repute by the defendant’.
Consequently in the Hawkins case, Justice Kaul also pointed out that “The object of filing of the suit thus appears to be to create a monopoly over such (gaskets) ancillary items so that no third party is able to sell the same in the market.”

The judge also goes on to point out that the use of the “Hawkins” trademark on the gaskets packaging would have been infringing if it had been used as a trademark. Furthermore, commenting on whether the defendant was passing off the plaintiff’s goods as that of his own, the judge held that the mode and manner of the use merely indicates the purpose of the user and that there is no indication of any business connection between the two parties in dispute. In view of the fact that Murugan Enterprises’s use of the “Hawkins” mark was only indicative and is not being used as a trademark, there would be no question of infringement. Additionally the court concluded that since there was no infringement of passing off by the defendant, the aspect of quantification of damages would not arise in this case.

Applying the Hawkins case to the issue of printer cartridges, it appears that the use of OEM trademarks on the third party vendor cartridges would be covered by the exception under Section 30 of the Trademarks Act provided that the use of an OEM trademark is in accordance with honest practices in industrial or commercial matters and is not such as to take unfair advantage of or be detrimental to the distinctive character or repute of the OEM trademark. The third party use of an OEM trademark might also be covered by Section 30(2) (d) of the Trademark Act if such use is reasonably necessary in order to indicate that the goods or services are so adapted and the purpose and the effect of the use should not be to indicate a connection in the course of trade between any person and the goods or services.

The information is not a comprehensive consideration of the subjects discussed and is intended to provide general information. Readers should not conclusively rely on the information as legal advice and should seek independent counsel before any action is taken with respect to these or other specific issues.

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