Brands enjoy huge importance as consumers today prefer different brands differently at different times and hence brands have a unique value to the consumers. However, they are of value not just to the consumers, but also of value to the suppliers and proprietors of the mark. A well-known trademark status is one of the biggest quality justification that any mark may possess.
A well-known trademark status acts as a powerful safeguard from the risk of deceiving counterfeit products and thereby facilitates ease of doing business in India. It is in fact a proprietary asset for any company. A well-known trademark is defined as under Section 2(1)(zg) of the Trade Marks Act, 1999. This section provides that well-known trademark in relation to any goods or service refers to a mark which has got transformed into a substantial/relevant segment of the public and that the use of such a mark by any other person for any similar or other unrelated goods or service, is likely to indicate a connection in the course of trade for rendering of services between the said goods or service and a person using the mark in relation to the first mentioned good or services. Well-known trademarks hold exceptional proprietary rights and hence it absolutely prohibits registration and unauthorized usage of any identical or deceptively similar marks. That is the kind of wider protection possessed by any well-known trademark. At present there are around 97 well-known trademarks as per the latest list available on the Registry’s website .
There are three main reasons as to why well-known trademarks should be given or accorded with such a wider protection.
Firstly, it is to prevent unfair use of the reputation of the mark. As we know some marks do enjoy greater reputation than the others. And hence there is a chance that such a greater reputation can be misused by some others. One of the best example in this regard is the case Daimler Benz Akietgesellschaft v. Hybo Hindustan (1994) wherein which the counter parties used the Benz Tristar logo on undergarments which are totally unrelated goods. Hence, the Court therein held that the Benz Tristar logo has a great reputation worldwide and hence the Defendant’s act of taking unfair advantage of the same amounts to infringement of the well-known trademark.
Also, there is an economic justification for the wider protection of a well-known trademark. For getting any normal trademark registration, one can get that very easily if he/she merely fulfills the registration mandates, mark specification and so on. But with regard to the well-known trademarks the said brands would have had to invest a lot of effort, time and a substantial amount of money for creating the brand recognition and hence it would be really unfair if some third party simply loots or take undue advantage of the profit, the immense brand value and the vast reputation of the well-known mark without any authorization even if the company is not yet in use in commerce in the said country.
Hence the well-known trademark status acts as a weapon against such parties taking undue advantage of the immense reputation of the well-known/famous mark.
Secondly, the need for recognition of a well-known trademark is to prevent any harm to the reputation of the mark which might be caused due to dilution by blurring or dilution by tarnishment. Dilution by blurring occurs when the unauthorized use by several parties cause the reputation of the well-known trademark to blur. Then the proximity between the two marks becomes such that it gets difficult to identify and distinguish between both of them. Dilution by tarnishment occurs when the other party uses the famous trademark in a derogatory manner which might in turn harm the reputation of the well-known trademark. In simple words effect of this other mark is to degrade tarnish or dilute the reputation and distinctive quality established by the famous or well-known trademark.
Lastly, the need for recognition as a well-known trademark is in order to avoid confusion among the vast customer base. Once a mark is declared to be well-known, the protection so granted extends regardless of the differences in the goods or services (‘across all classes’) or the field of business etc. (Brahmos Aerospace Pvt Ltd v. FIITJEE Ltd. and Anr) i.e, a well-known mark will be protected even against any use in relation to dissimilar goods by any adversary.
There are many commercial aspects associated with a well-known trademark. A well-known mark brings enormous commercial value for proprietor/trademark owners. Hence, that is one of the prime reasons for the demand for an effective protection from the increased risk of being copied. A well-known mark status accords an overall brand protection. A mark to acquire the well-known trademark status it does not have to be necessarily used in India.
The Trade Marks Act, 1999 does not per se provide for any specific criteria as to the factors which the courts ought to consider while determining the well-known status of a mark. But the statute does provides for the criteria that the Hon’ble Registrar ought to take note of while determining the well-known status. As per Section 11(6) of the Trade Marks Act, 1999, there are mainly five guiding factors to determine whether a trademark is well-known. They are as follows:-
a) Firstly, the knowledge or recognition of the trade mark in the relevant section of the public, including knowledge in India obtained as a result of promotion of the trade mark. In the case of Rolex Sa v. Alex Jewelry Pvt. Ltd, the court propounded that the test of a well-known trademark is mainly based/dependent on the segment of the people who use it.
b) the duration, extent and geographical spread of use of the trade mark
c) the duration, extent and geographical spread of promotion of the trade mark including advertisements and other modes of publicity. In the case of Indian Shaving Products Ltd. v. Gift Pack (Duracell Ultra case), the court while restraining the defendants from the sale of batteries under the trademark ‘Ultra’ emphasized on the ‘transborder reputation’ as well as the great sales and the extent of promotion of the trademark via advertisements for the purpose of determining the well-known nature of the mark.
d) the duration and geographical spread of registration, or application for registration of the trade mark under the Act to the extent they reflect its use or recognition
e) the record of its successful enforcement of rights in that trademark, extent of its recognition as a well-known trade mark by the Court or Registrar.
Section 11(7) of the Trade Marks Act 1999 provides for the deciding criteria for what forms the “relevant section of the public”. It states that the number of potential/actual consumers of the said goods or services, number of persons involved in the distribution channels of the goods/services and business circles dealing with the goods/services forms the “relevant section of the public”.
Section 11(8) of the Trade Marks Act 1999 provides discretionary powers of court which states that ‘where a trade mark has been determined to be well-known in at least one relevant section of the public in India by any court or Registrar, the Registrar shall consider that trade mark as a well-known trade mark for registration under this Act.
Then Section 11(9) of the Trade Marks Act 1999 provides for few immaterial factors i.e, the conditions/factors that are not required while determining/considering the well-known nature of any trademark. This is more or less like a caution to the Registrar stating that the said factors ought not to be considered mandatory for the purpose of determining the well-known status.
- that it has been in use in India;
- that it has acquired a registration;
It is to be noted that there can be several marks that enjoy a vast and wider global reputation, but may not be necessarily in actual use in India. Such marks can be recognized as well-known trademark in India since ‘usage in India’ is not a prerequisite or criteria for determining a well-known trademark.
Similarly, there can be some other marks which though enjoy vast common law rights, but is not in turn registered in India. Such marks can also be recognized as well-known trademark in India since ‘registration in India’ too is also not a prerequisite or criteria for determining a well-known trademark. - that the trademark application has been filed in India or i.e, a well-known status can be acquired irrespective of any trademark application in India;
- that it is well-known/registered in any other jurisdiction other than India;
- that it is known by a public at large in India.
It is also to be noted that for determining the well-known nature of a mark, ‘knowledge of a relevant/substantial segment’ only is taken into consideration and not ‘knowledge of a public at large’.
Section 11(10) of the Trade Marks Act 1999 provides for the obligation of Registrar which is mainly to protect such a well-known trade mark against all or any identical or similar trademarks and also to take into due consideration of the bad faith involved either on the end of the applicant or the opponent which might in turn affect the overall right pertaining to the trade mark.
Section 11(11) of the Trade Marks Act 1999 provides for the exceptions to protection of a well-known trade mark. It states that prior use or registration of an identical/similar trademark which is done/made in ‘good faith’ will be granted protected against a well-known trademark.
As mentioned earlier there are no specific guidelines as such in the Trade Marks Act 1999 that the courts are supposed to follow while determining the well-known nature of a trademark. Even so the courts have over a span of time, developed certain principles that they consider while determining the well-known nature of a said mark. And it ought to be noted that these principles followed by the Courts are very much similar or in fact strikingly similar to the principles meant for the Registrar to follow as under the Trade Marks Act 1999.
The Delhi High Court in Tata Sons Ltd. v. Manoj Dodia laid down 10 factors to consider/determine whether a mark fits in the parameters of a well-known mark. They are as follows:
- the extent of knowledge of the mark to, and its recognition by the relevant public;
- the duration of the use of the mark;
- the extent of the products and services in relation to which the mark is being used;
- the method, frequency, extent and duration of advertising and promotion of the mark;
- the geographical extent of the trading area in which the mark is used;
- the state of registration of the mark;
- the volume of business of the goods or services sold under that mark;
- the nature and extent of the use of same or similar mark by other parties; It is to be specifically noted that the Courts have said that the ‘third party use’ of a trademark which is obviously unauthorized, may be relevant or considered relevant for determining whether a trademark is well-known or not in the first instance which in turn seems a bit contradictory to the concept of dilution by blurring which strictly prohibits unauthorized third party use of a well-known trademark.
- the extent to which the rights claimed in the mark have been successfully enforced, particularly before the Courts of law and trademark registry and
- actual or potential number of persons consuming goods or availing services being sold under that brand.”
To read about the recent developments and principles with respect to well-known trademarks in India click here.
About the Author
Authored and compiled by Divya S. (Intern, BananaIP Counsels), Consulting and Strategy Team
This post is brought to you by the Consulting/Strategy Divisions of BananaIP Counsels, a Top IP Firm in India. If you have any questions, or need any clarifications, please write to contact@bananaip.com with the subject: Trademark
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