Importers Watch Out! Tag Heuer times out counterfeit watches

Facts

Tag Heuer S.A. filed a suit against Tinya International, the Commissioner of Customs, and the Central Board of Excise & Customs. Tag Heuer, a renowned Swiss luxury watchmaker, claimed that Tinya International imported counterfeit watches bearing its trademarks.

The consignment was seized by customs authorities in Mumbai, under the Intellectual Property Rights (Imported Goods) Enforcement Rules, 2007, on the grounds of infringing Tag Heuer’s trademarks. Tag Heuer sought relief including a permanent injunction, damages, and confiscation of the counterfeit goods.

Tag Heuer also alleged that the counterfeit products closely resembled its designs, causing harm to its business, reputation, and goodwill. Tinya International contended that it had no knowledge of the counterfeit nature of the products and argued the consignment did not match its placed order.

Analysis

1. Trademark Infringement & Injunction: The Court concluded that the plaintiff had successfully established its ownership of the trademarks and that the seized goods were indeed counterfeit. Tag Heuer’s evidence, including photographs, authentication reports, and trademark registration documents, demonstrated that the imported goods were not genuine products. Tinya International failed to provide any substantive defense or evidence. Tinya International even admitted, through mediation, that Tag Heuer’s trademarks were valid and that it had no right to use them.
2. Seizure and Confiscation of Goods: The Court directed that counterfeit goods should be confiscated and destroyed as per the procedure laid down in the IPR Enforcement Rules. Tinya International agreed to bear the cost of destruction during mediation, which was further affirmed in the final judgment.
3. Damages and Settlement: During mediation, Tinya International agreed to pay Rs. 5,00,000 in damages and costs to Tag Heuer. The Court also awarded an additional Rs. 1,22,253 (20% of the consignment’s value) to Tag Heuer as further damages.
4. Return of Security: The Court addressed the return of the security amount deposited by Tag Heuer during the seizure of the goods and directed that the security be refunded once the destruction process was completed.
5. Absence of Evidence from Defendant: Tinya International’s failure to provide any evidence to support its claim that it had no knowledge of the counterfeit nature of the goods weakened its defense. The Court drew adverse inferences from Tinya International’s absence from the proceedings after mediation.

Order

1. A permanent injunction was granted in favor of Tag Heuer, restraining Tinya International from using the ‘Tag Heuer’ trademark or any deceptively similar marks.
2. The Court ordered the customs authorities not to release the counterfeit goods and to proceed with their destruction, with the defendant bearing the cost.
3. Tag Heuer was awarded Rs. 5,00,000 in damages, as per the mediation settlement, and an additional Rs. 1,22,253 as further compensation.
4. The Court ordered that the security amount deposited by Tag Heuer be refunded after the destruction of the counterfeit goods.

Conclusion

The Court ruled in favour of Tag Heuer S.A., granting the requested permanent injunction and directing the destruction of the counterfeit goods. Tinya International was held liable for damages and the costs associated with the destruction of the goods.

Takeaways

• Importance of Trademark Protection:This case highlights the effectiveness of trademark registration and enforcement in protecting brand reputation.
• Burden of Proof Lies with Importer:The case emphasizes the importer’s liability to ensure the authenticity of goods being imported. Failure to provide sufficient evidence against infringement claims can lead to legal repercussions.
• Consequences of Counterfeiting:This case showcases the potential consequences of dealing in counterfeit goods, including permanent injunctions, confiscation of goods, damage awards, and legal costs.
• Benefits of Mediation:The case demonstrates how mediation can facilitate faster settlements and avoid lengthy court proceedings.

Citation: M/s Tag Heuer S.A. vs Tinya International and Ors., CS(COMM) No.: 59/2018, CNR No. DLND01-014703-2018, District District Judge (Commercial-03), Patiala House, New Delhi, 8^th August, 2024. Available at: https://indiankanoon.org/doc/5098810/

Authored by Kavya Sadashivan, IP Innovation, Consulting & Strategy Team, BananaIP Counsels.

Disclaimer

The case note/s in this blog post have been written by IP Attorneys at BananaIP Counsels based on their review and understanding of the Judgments. It may be noted that other IP attorneys and experts in the field may have different opinions about the cases or arrive at different conclusions therefrom. It is advisable to read the Judgments before making any decisions based on the case notes.

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