This post was first published on 7th July, 2014.
Spillover reputation of trademarks is a subject matter of endless legal tussles. Indian Courts and Tribunals frequently deal with cases related to foreign entities challenging honest and bona fide use of a similar mark by Indian entities even in situations where such foreign entities are not using their marks in India. In this post, we will discuss the concept of Transborder reputation.
To claim Transborder reputation for a mark in India, the mark must be well known in at least one other country, but preferably several other countries. In addition to this, a substantial segment of consumers in India must know about the existence of the mark of the foreign entity. Such knowledge may come from free availability of the product to Indian consumers or extensive advertising, which reaches a substantial segment of Indian consumers because of extensive circulation of those advertisements in India.
However, proving Transborder reputation alone would not suffice to restrict an Indian company from using a similar mark, honestly adopted by them. Once Transborder reputation is proved, the foreign entity is required to prove likelihood of confusion of origin, detriment or unfair advantage. Indian Courts have repeatedly held that a foreign entity claiming well knownness must not be allowed to restrict the use of a similar mark, if the Indian company was the first in the Indian market, to honestly adopt the mark.
The Honourable Supreme Court in Milment Oftho Industries and Ors. v. Allergan Inc. 2004 (28) PTC 585 (SC), in para 8 held that:
“… Multinational corporations, who have no intention of coming to India or introducing their product in India should not be allowed to throttle an Indian Company by not permitting it to sell a product in India, if the Indian Company has genuinely adopted the mark and developed the product and is first in the market.”
The position of Indian Courts with respect to Transborder reputation can be summarized as follows:
- A mark must be well known in other countries, internationally, to claim transborder reputation in India;
- The reputation of the mark must reach a substantial segment of consumers in India through extensive use in India or through extensive advertising in international magazines, journals or other media, which have wide circulation among the substantial segment of relevant consumers in India;
- Merely publishing advertisements in foreign journals/media is not enough. The claimant of Transborder reputation must show that these journals have reached Indian consumers, thus giving rise to reputation among the substantial segment of consumers in India;
- Mere use in India at places like duty free shops and other limited access locations is not enough to claim Transborder reputation;
- First genuine adopter and user of a mark in India would be given importance over a multi-national company, entering the Indian market at a later stage;
- Burden of proving that a mark is well known and that the use of the mark by another person causes blurring, tarnishing or with unfair advantage, is on the person who requests the cancellation of a mark based on said grounds;
- Cogent and substantial evidence must be submitted to prove that a mark has Transborder reputation. While proving the well knownness of a mark, the applicant must provide evidence to show the advertisements in magazines and evidence to prove that the mark, otherwise has circulation in India among relevant consumers in the field, to deliver knowledge of the mark to them; and
- Date for determining whether a mark is well known in India, through transborder reputation, is the date of filing of the trademark application by the Indian company, which is, prima facie, proof of genuine adoption.
Therefore, for a foreign entity to claim Transborder reputation, it has to submit cogent, clear and convincing evidence to prove that its mark enjoys very high reputation in the relevant section of public and that the reputation has spilled over through continuous advertisement circulation in India.
