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Trademark Infringement: A Case Analysis Of Tata Sons v/s Hakunamatata Tata Founders

One of the saviours of the intellectual property (IP) is Trademark. Trademark is the security which an individual, trust or any firm can give to their goods or services. Trademark is a logo, design, colour, phrase, symbol or anything which can help people to distinguish it from the other products. It is a label which is given to establish originality and to avoid any sort of ambiguity which can arise among the consumers in search of their desired brands. It is considered as a great tool which can bring immense popularity to a particular product or any service.

The current controlling law for trademarks is the Trade Marks Act of 1999.
Basically, the trademark is either registered or unregistered.
As the name suggest registered trademark is registered with National Trademark office, which represents the company or the source of the product, whereas the other is not.

Tata Sons Private Limited vs Hakunamatata Tata Founders & Ors.
Recently the Delhi High Court dismissed the lawsuit by Tata Sons, the holding company of Tata Group and denied the demand for permanent injunction restraining Hakunamatata Tata Founders & others from using the trademark Tata as their name under cryptocurrency. Herein Tata Sons is the plaintiff and Hakunamatata Tata Founders & Ors are the defendants.

The plaintiff is a company incorporated in India. The defendant deals in cryptocurrency under the name TATA coin / $TATA. The Defendants in Lawsuit were companies based in the US and the UK and none of them have any outlet in India. It was highlighted that their Domain names were Tatabonus.com and Hakunamatata.

The first contention of the case was of the permanent injunction which was demanded by the plaintiff against the defendants.

To this it held that the defendants being outside India would be outside the reach of the Trademarks Act, 1999, as well as the Code of Civil Procedure, 1908(CPC).

The plaintiff argued that:
  • The defendant's crypto currency can be purchased by any person in India, from the defendants' website.
  • On the Twitter page of defendant 1 there were queries from various Indians asking about the purchase of "TATA coin/$ TATA" currency.
  • Each day there are about 50 visitors of India to the defendant 1's website www.hakunamatata.finance
  • India was second in the list of countries with highest internet traffic to the www.hakunamatata.finance website.
  • Defendant 1's telegram page indicated that there were several Indian followers / members.
  • The availability of the defendants' crypto currency, under the allegedly infringing marks "TATA coin/$TATA" had adversely affected the plaintiff's business.
In spite a lot of arguments by the plaintiff side, they were unable to convince their case and the damage which was caused by the defendant.

The mere fact that the defendants' cryptocurrency can be purchased by customers located in India and that, as a result, the plaintiff's brand value may be diluted, even seen cumulatively, cannot in my view justify this court interfering with the defendants' activities, or with its brand or mark, held Justice C Hari Shankar.

If at all they target customers, they target customers across the world, the judge observed.


Trademark Infringement

When one entity uses the logo, name or symbol of another entity which are deceptively similar and causes confusion in the minds of the consumers, then there is trademark infringement.
One could not be able to file a case for trademark infringement if the trademark has not been registered.

But there is an exception to this: Passing off is a concept which can help an entity in filing case against trademark infringement even if the trademark is not registered. In this there would be 3 conditions which needs to be fulfilled:
  1. Misrepresentation:
    There should be some proof showing that people actually get confuse between both the entity's products or services.
     
  2. Goodwill:
    The reputation attached with the goods or services which attracts the customers.
     
  3. Damages:
    Any Monetary damage or any damage to the reputation of an individual or firm which affects the plaintiff and proves as a disadvantage to them.
Sections 29 and 30 of the Act provide for the protection of a registered trademark in the event that it is infringed upon by a third party.
A registered trademark is infringed when an unregistered proprietor or licensee uses it for trade and business purposes, according to Section 29 of the Act.

Determination Of Trademark Infringement By The Courts

The 8 factors that the courts use to determine trademark infringement are:
  1. The closeness of both the company's goods and services.
  2. Plaintiff's strength of trademark.
  3. Channels used for marketing
  4. Care taken by the purchasers in selecting or choosing the goods.
  5. The intention of the defendant while selecting their trademark.
  6. Proof of the actual confusion.
  7. Similarity between the conflicting trademarks.
  8. The possibilities of expansion in product line.

Defenses Available Against Trademark Infringement

  1. Fair Use:
    Fair use is the use of trademark in good faith. There are two types of fair use:
    1. Normative Fair Use:
      The normative fair use argument protects the right to use a trademark related to the trademark owner or his goods or services for reporting, commentary, criticism or comparative advertising.
       
    2. Descriptive Fair Use:
      Descriptive fair use allows the user to use another's trademark to describe their products or services rather than as a trademark to locate the source of the goods or services.
       
  2. Prior Use:
    This enables a defendant to raise the objection if the defendant has used the trademark longer than the registered user and has made a name for himself in the trade.
     
  3. Non-Use Of The Mark:
    When the trademark has not been used for a longer period then it serves no economic benefit, hence, forbids the other entity from using that particular trademark.
     
  4. Delay:
    When the plaintiff delays in filing complaint against the infringement of their trademark for a long time and has the knowledge of the infringement then this becomes a good defence for the defendant.
     
  5. Invalidity:
    When the registered trademark itself is invalid.

Trademark Infringement Penalties

  1. Temporary injunction
  2. Monetary compensation
  3. Destruction of the infringed mark goods
  4. Cost of legal proceedings

To protect the trademark and to maintain its uniqueness, there is a need of registering trademark. But when a trademark is not registered there is a system called passing off by which the case of trademark infringement can be filed. There are also some defences which can save an individual or firm in the matters of trademark infringement. On the other hand, such infringement can lead to a lot many penalties. Written By: Preesha Vaswani

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