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Exemplary costs may be imposed on habitual offenders: A case analysis of Glenmark v/s Curetech

Intellectual Property Rights grant exclusive rights of ownership to their holders, along with the right to sue for any infringement by any other person in relation to the product or the business. In the cases of trademark infringement and passing off actions, it is very normal to impose costs and damages, ranging from nominal to exemplary, south by the plaintiff and if the court is satisfied that there is infringement. In India, it is very rarely seen that the damages surpass the mark of Rs. 1,00,00,000/-. However, in this case, a precedent was set y the Bombay High Court by imposing exemplary damages of Rs. 1,50,00,000/- on the ground of defendant being a Habitual Offender.

Glenmark Pharmaceuticals Ltd. v. Curetech Skincare and Galpha Laboratories Ltd.[i]
Citation: MANU/MH/2566/2018 - Court: Bombay High Court - Judges/Coram: S.J. Kathawalla, J.
Date of Judgment: 28th August, 2018

Case Facts
Glenmark Pharmaceuticals Ltd., the plaintiff in this case filed a suit against Curetech Skincare, the defendant, for using the mark Clodid-B (impugned mark) for their product which is deceptively similar to the mark of product of the Plaintiff Candid-B, a well-known anti-fungal cream in the market.

It was claimed by the defendant that mistakenly they have adopted the impugned mark and there was no intention of the defendant to cause any injury to the plaintiff. They were prepared to render accounts, submit to a decree and not to challenge the suit any further.

Court was satisfied by the case made by the plaintiff. However, in this case exceptional consideration was ascribed on the defendant to be a habitual offender as well as a habitual infringer. The learene single judge, Justice S.J. Kathawalla, on the basis of two things imposed exemplary damages on the defendant.

Issue(s)

  • Whether or not the defendant is a habitual offender and a habitual infringer.
  • Whether being a habitual offender makes defendant liable to pay exemplary damages?


Judgment
Even after the assurance given by the defendant company to abide by appropriate discipline in future, the Hon'ble High Court of Bombay imposed Rs. 1,50,00,000/- as the costs on the defendant. Habituated infringing done by the defendants and poor quality of medicines provided to the public which is a consequence of their negligence was stated as the reason behind the exemplary costs imposed by the Court. The Court ordered the defendant to immediately withdraw and destroy all the products of the defendant bearing the impugned mark, and also to apply for cancellation of further manufacturing permissions for Clodid products. The defendant was further ordered to strictly abide by the FDA rules and regulations; and resist from doing any of such activities in future with any pharmaceutical company.

The court ruled that:
It is clear that the Defendant No.2 is not only indulging in infringing activities by repeatedly copying brands of other companies but also appears to be in complete violation of the FDA regulations. The conduct of the Defendant No.2 shows that this Defendant has no regard or respect to the rule of law. The consumers and general public are being repeatedly cheated by the Defendant No.2.[ii]

Analysis
After analyzing the present case, it can be said that the second defendant, i.e., Galpha Laboratories was a habitual offender and had no respect for the rule of law prevailing in the country. It was observed by the learned single judge, Justice S.G. Kathawalla, that the impugned mark in the case was a systematic or blatant imitation of the mark of the plaintiff.

Almost everything, including the trade dress, art work, color scheme, font style and even manner of writing was deceptively similar to the mark of the plaintiff; it was a sham and copy. Though the defendants were ready to abide to the orders and decree which were passed by the court, the plaintiff brought kind attention of the court to the defendants past activities.

In the year 2003, the defendant number 2 copied the trademark of the plaintiff, 'ASCODIL', for which the former had sent a cease and desist order to the latter, the defendant tendered an unconditional apology for the same. The defendant was not only involved in copying the trademarks of the plaintiff, but also of the other leading companies like Cipla ltd., Smithkine Beecham PLC, Times Drugs and Pharmaceuticals, among many others. All these instances of infringement by the defendant were sufficient to label him as a habitual offender or a habitual infringer by the Delhi High Court [iii] in a case against the defendant number 2, who breaks the laws again and again.

In such cases of infringement, normal costs are imposed in the infringer, but this particular case broadened the scope of costs to be imposed on any infringer if he is habitual in infringing rights of others. In this case, heavy costs were imposed just because the defendant was a habitual infringer.

Apart from being a habitual infringer, there were numerous allegations against the defendants for non-compliance of the rules of FDI, and also there were a number of FDI investigations going on against the defendant. It was alleged that the products of the defendant were not up to the mark and lacked in standard and quality.

This makes it clear that the offender was not just a habitual infringer but also a habitual offender of law. Medicine plays a vital role in the life of any human being, so such negligence of law is considered to be of gross nature. Thus, the court decided to impose high costs on the habitual offender of Rs. 1,50,00,000/- in order to create fer against such detrimental infringing activities.

The decision pronounced by the Bombay High Court was based on the basic and general principles of law instead of the Trademarks Act, 1999, or any other statutory provision.

End-Notes:

  1. Glenmark Pharmaceuticals Ltd. v. Curetech Skincare and Galpha Laboratories Ltd., MANU/MH/2566/2018
  2. Id  15
  3. Win Medicare Pvt. Ltd. V. Galpha Laboratories & ors., MANU/DE/0051/2016

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