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Case comment: Starbucks Corporation v/s LOL Cafe, 2022 SCC OnLine Del 3878

Recently Delhi High Court passed a summary judgment in the favor of Starbucks Corporation for passing off and infringement of the registered trademark 'FRAPPUCCINO' and awarded surprising damage of 13 lakhs in favor of Starbucks Corporation against LOL CAF.

Starbucks Corporation (Plaintiff) is a lifestyle-brand company in the United States offering a variety of coffee, tea, and spices which was incorporated as Starbucks Corporation in 1985. They have Frappuccino blended beverages in a variety of flavors. In India, Starbucks Corporation is in existence since 2012 through the joint venture company Tata Starbucks Private Limited. It has obtained registration of the trademark 'Frappuccino' in India as well.

The LOL Caf (Defendant) is a caf/restaurant in Jaipur, Rajasthan. It was selling a beverage named 'Brownie Chips Frappuccino' and it was on their electric menu card and on portals like Zomato and EazyDiner.

So, Starbucks Corporation filed an application of summary judgment against that caf for infringing and/or passing off the registered trademark. Summary Judgements can be asked for those suits related to commercial disputes of specified value that had more or less a clear outcome based on merits.

On 1st December 2018 cease-and-desist letter was sent to stop the allegedly illegal usage of the trademark and on 8th January 2019 a reminder letter was sent to the defendant but there was no response. In a telephonic conversation, the director of the defendant confirmed that they will stop using the mark and update the electronic menu card on Zomato and EazyDiner. On 8th May 2019, another reminder was sent to comply with the just and fair requisition within 1 week. But there was no response.

On 23rd August 2019, an ex-parte ad-interim injunction from using the mark was granted against the defendants. On 26th February 2020, the defendants said that the dispute shall be settled between the parties and asked for time. On 22nd August 2022, the plaintiffs filed an application for summary judgments under Order XIII-A of the Code of Civil Procedure, 1908, and the defendants were granted 3 weeks' time to file their reply.

But they did not comply with that and the counsel of the defendant was also not present on 1st November 2022. The defendants were only present on 26th February 2020 and 22nd August 2022 and other notices were left with no reply.

Prayers of the suit:
  1. Decree of permanent injunction from infringing and/or passing off the plaintiff's registered trademark.
  2. Damages.
  3. Rendition of accounts of profits illegally earned.
  4. Delivery and handing over of all the goods, and menu cards containing the mark.

The word 'Frappuccino' has a worldwide reputation for being a product of Starbucks Corporation. The plaintiff has shown the records of revenue and a substantial amount of advertising expense under the Frappuccino mark. The plaintiff originally has Banana Java Chip Frappuccino and Mango Azuki Frappuccino. It has been proved that the defendant used the trademark with the prefix 'Brownie chip' to deceive the incautious customers and to take the reputation of the mark. Thus, adopting the alike mark is dishonest. It amounts to infringement and passing off of the mark.

As the plaintiff has shown an Advocate Fee Certificate of Rs. 13,38,917.85 charged by the counsel of Starbucks Corporation, Justice Navin Chawla awarded damages of the same amount including the court fee in favor of the Starbucks Corporation. In a similar case, Starbucks Corporation v. Teaquila A Fashion Cafe & Anr. (2022 SCC OnLine Del 1381) where Rs. 2,00,000/- was awarded as damages for the plaintiff.

Written By: Srijita Adak, 4th year of BBA LLB course from IFIM Law School.

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