Transborder reputation of trademarks

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KRISHNAVENI.S
HEAD
-RESEARCH
TRANSBORER
REPUTATION OF
TRADEMARKS

CHENNAI
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
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COIMBATORE
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INTRODUCTION
A trade mark is a visual symbol applied to an
article with a view to indicate the trade source
from which it comes. It can be a word, device,
label, name, letter, numeral, brand, heading or
colors. The purpose of the trade mark is to
distinguish goods or services of one origin
from those of the others. It advertises the
product and creates an image for it. As the
trade mark creates a separate identity of a
product, it should be protected from
infringement and passing off.

CHENNAI
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BANGALORE
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ExTRA TERRITORIAl
Reputation is the knowledge and awareness
among the public about a product of
particular trade source or trade mark.
Reputation is the means by which a trade
mark is recognized. Traditionally,
reputation of a trade mark used to exist
within territory of the concerned country.
Thus, the trade mark was needed to be
registered in that country only. Reputation
of a trade mark is an important factor in
case of a passing off action

CHENNAI
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
Suite 920, Level 9,
Raheja Towers,
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COIMBATORE
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EFFECT OF E- COMMERCE
In this age of e-commerce, where physical boundaries between
countries have become virtually redundant, brand recognition is
considered the foundation for any successful business and probably
its most valuable asset. Brands no longer serve just the basic
function of guaranteeing the origin of a product or service but now
also hold the aura of attraction because of the reputation they
command.

CHENNAI
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
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COIMBATORE
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Tel: +91 - 422 – 6552921
EMAIL
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TRANS BORDER
REPUTATION
With the modern communication
technology like TV, internet, newspapers,
magazines, cinemas, the knowledge about
the products reach the other countries,
long before the actual availability of the
product. The reputation of a trade mark is
not limited to the country of its origin, but
has surpassed the geographical frontiers
and is nowadays spread all across the
world. This is known as trans border
reputation of a trade mark.

CHENNAI
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
Suite 920, Level 9,
Raheja Towers,
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COIMBATORE
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goodwill
On many occasions it comes as a shock for famous business houses
to learn that they are foreclosed from chartering into a new territory
as their brands have been completely misappropriated and owned
by third parties who have no connection with the brand whatsoever.
In such cases, in order to combat misuse of their trademarks,
foreign entities have to rely on their brand goodwill and prove,
under an action of passing-off, that their mark’s reputation has
spilled over in the territory of dispute.

CHENNAI
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
Tel: +91 - 80 - 6546 2400
COIMBATORE
BB1, Park Avenue,
Tel: +91 - 422 – 6552921
EMAIL
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WEBSITE
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Evolution
Trans border reputation has its genesis under the English law and
in Indian law the concept is embodied in Section 35 of the Trade
Mark Act, 1999 wherein the Indian courts have recognized action
by foreign plaintiff on the basis of passing off solely upon the
reputation of his goods/services on the foreign soil. Trans border
reputation has also evolved from the concept of “well known mark”
a concept which acquired statutory recognition in India after
amendments to the Trademarks Act in the year 1999 were carried
as a part of TRIPS compliance..

CHENNAI
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
Tel: +91 - 80 - 6546 2400
COIMBATORE
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Tel: +91 - 422 – 6552921
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ingrEdiEnts of
intErnational rEputation
• A foreign trader having no place of business can maintain an
action of passing off in India on fulfilling the following condition.
 The goods and services are of International reputation
 Indian travelers have purchased or brought such goods to India in
the form of importation
 Such goods and services are marketed or sold on a large scale in
India
 Advertised in international Journal or magazine , which has
circulation in India and many customers or potential consumers or
subscribers of the said journal.
 The defendant has failed to give a satisfactory explanation for
adoption of the said mark.

CHENNAI
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
Tel: +91 - 80 - 6546 2400
COIMBATORE
BB1, Park Avenue,
Tel: +91 - 422 – 6552921
EMAIL
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WEBSITE
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indian JurisprudEncE
There is a long line of cases in India that have established
that despite not being marketed in India, trademarks that
acquire trans-border reputation will enjoy protection in
India irrespective of its actual user or registration in India.
In Kamal Trading Co., v. Gillette, UK Ltd., [1988 PTC 1]
of the Bombay High Court. the Bombay High Court
restrained Kamal Trading from using the mark 7’O
CLOCK on toothbrushes. It held that the plaintiff had
acquired an extensive reputation all over the world –
including in India – by using the mark 7 O CLOCK on
razors and shaving creams. Therefore, use of an identical
mark by the defendant would lead to customer confusion.
This goodwill is not limited to countries where goods are
freely available because they are nonetheless widely
advertized in the media of countries where they are not
available

CHENNAI
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
Tel: +91 - 80 - 6546 2400
COIMBATORE
BB1, Park Avenue,
Tel: +91 - 422 – 6552921
EMAIL
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WEBSITE
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trinitY—
wHirlpool , MilMEt&
BlEndErs pridE
The Supreme Court in NR Dongre Vs Whirlpool Corporation was
concerned with passing off action brought by Whirlpool
Corporation to restrain the Appellants from manufacturing, selling,
advertising or in any way using the trade mark Whirlpool . The
claim was based on prior user and a trans-border reputation
indicating that any goods marketed with the use of the mark gave
the impression of it being a good marketed by it. The Court
accepted that Whirlpools’ trans-border reputation extended to India.

CHENNAI
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
Tel: +91 - 80 - 6546 2400
COIMBATORE
BB1, Park Avenue,
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EMAIL
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WEBSITE
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TRINITY…
The decision of the Supreme Court in Milmet
Oftho Industries v. Allergen Inc. [(2004)
further consolidates the position. Both an Indian
pharmaceutical company and a foreign company
were manufacturing Ocuflox – a medicine for
eyes. The foreign company first used the mark in
1992 after which it marketed the product in
countries around the world. However, it was yet
to enter the Indian market. When the Indian
company applied for registration of the mark in
1993, the foreign company filed a suit for
injunction for passing off against the Indian
manufacturer. The Court held that the non-use of
the mark in India by the foreign company would
be irrelevant if they had entered the world
marker first.

CHENNAI
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
Tel: +91 - 80 - 6546 2400
COIMBATORE
BB1, Park Avenue,
Tel: +91 - 422 – 6552921
EMAIL
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WEBSITE
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TRINITY…
In Austin Nichols and Co. v. Arvind Behl
(or the Blenders Pride case, 2005), the
court, while upholding the foreign
claimant’s rights in he mark “Blenders
Pride” in relation to alcoholic beverages,
held that although actual commercial
operations may not have commenced,
active promotion of the brand would
constitute use of mark, even if such
marketing predates actual existence of the
promoted article in the market

CHENNAI
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
Tel: +91 - 80 - 6546 2400
COIMBATORE
BB1, Park Avenue,
Tel: +91 - 422 – 6552921
EMAIL
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WEBSITE
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Recently, the IPAB ruled in favour of
Nestlé and dismissed an appeal by
Kolkata-based Kit Kat Food
Products to be allowed to use the
same trademark 'Kit Kat'. A
Kolkata based company by the
name Kit Kat Food
Products claimed proprietary
rights over the mark and argued
that the name 'Kit Kat' was
derived from the word 'chit chat‘ .
Nestlé's rights have to be
protected as it was the first in
the world market to use the Kit
Kat mark. The tribunal noted
"The mark was in use since
1935 outside India and the
company got it registered in
1942. The Kolkata firm has
admitted that it had adopted the
mark only in 1991. The marks
are identical, the products are
also similar and they are mainly
bought by small children. The
courts accepted the prior use of
the mark

CHENNAI
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
Tel: +91 - 80 - 6546 2400
COIMBATORE
BB1, Park Avenue,
Tel: +91 - 422 – 6552921
EMAIL
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WEBSITE
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GuIdING pRINcIples
• Companies who have no intention of coming to India or
introducing their products here 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;
• Dissemination of knowledge of a trademark in respect of a product
through advertising in the media amounts to ‘use’ of the trademark
whether or not the advertisement is coupled with the actual
existence of the product on the market.
• that the world has to be viewed as one common market;
• the existence of a merchant on web pages which are of foreign
origin and social media are sufficient to show the transborder
nature of reputation without having any activity in India at the
relevant time;

CHENNAI
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
Tel: +91 - 80 - 6546 2400
COIMBATORE
BB1, Park Avenue,
Tel: +91 - 422 – 6552921
EMAIL
info@altacit.com
WEBSITE
www.altacit.com
eXcepTIONs
A natural corollary is that trans border
reputation is not an independent ground for
protection of trademark unless accompanied
hand in hand with evidence of use of
trademark in the territory where such relief is
being sought. Demonstration of this use is a
question of fact and would vary with the
circumstances of the matter in hand.
For instance, the presence OF
ADVERTISEMENTS IN FOREIGN
LANGUAGE MAGAZINES (Spanish and
French) without any proof of circulation in
India was regarded by the Delhi High Court,
in Roca Sanitario SA v Naresh Kumar Gupta
(2009), as being unlikely to be accessible to
probable consumers of the product.
Consequently, the requirement of usage failed
to be discharged.

CHENNAI
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
Tel: +91 - 80 - 6546 2400
COIMBATORE
BB1, Park Avenue,
Tel: +91 - 422 – 6552921
EMAIL
info@altacit.com
WEBSITE
www.altacit.com
ACQUISIENCE
If a foreign claimant has gained
knowledge of misappropriation of its
marks in India he should within a
reasonable amount of time, initiate
court proceedings. Delay sometimes
can be fatal for the rightful claims of a
foreign entity even in the most blatant
cases of trademark violation. This can
be inferred from the case of Khoday
Distilleries Ltd. v. Scotch Whisky
Association wherein the Scottish
claimant failed in its passing-off action
against the use of the mark ‘PETER
SCOT’ in relation to Scotch Whisky
despite the fact that the claimant had
been previously successful in a number
of similar cases before Indian courts.

CHENNAI
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
Tel: +91 - 80 - 6546 2400
COIMBATORE
BB1, Park Avenue,
Tel: +91 - 422 – 6552921
EMAIL
info@altacit.com
WEBSITE
www.altacit.com
WIth DISClAImEr
• In Country Inn Pvt Ltd., Vs
Country Inn And Suites By Carlsons
Inc and Another considering the
trans-border reputation of the
Defendants and also the use of the
Trademark by the Plaintiffs for a
long time and prior to Defendant in
India, the Delhi High Court allowed
both parties to continue to use the
trade name in question. However the
Plaintiff Indian Company was
mandated to make a disclaimer that
it has no connection with the
Defendant Company in future
advertisements made by them.

CHENNAI
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
Tel: +91 - 80 - 6546 2400
COIMBATORE
BB1, Park Avenue,
Tel: +91 - 422 – 6552921
EMAIL
info@altacit.com
WEBSITE
www.altacit.com
PoSItIoN IN US
• US courts have strictly enforced the territorial nature of trade marks. A
prime example is a case involving ITC and its BUKHARA mark. In this
case, a New York court held that ITC could not stop a local BUKHARA
restaurant (set up by ex-employees of its famous Bukhara restaurant in
India) because ITC did not use its BUKHARA mark in the United States.
As per the Court, although the United States is a signatory to the Paris
Convention, the Paris Convention is not self-executing. Accordingly
Article 6bis of the Convention could not be read into US trade mark law. .

CHENNAI
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
Tel: +91 - 80 - 6546 2400
COIMBATORE
BB1, Park Avenue,
Tel: +91 - 422 – 6552921
EMAIL
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WEBSITE
www.altacit.com
rEmEDIES AVAIlABlE For trANSBorDEr
rEPUtAtIoN INFrINGEmENt
• Trans-border reputation can be established only by letting in
evidence before the Registrar of Trade Marks that the mark is so
well-known or familiar in India and most of the general public is
fully aware of such mark connecting the trade mark.
• Since such a remedy is available against the registered user of a
trade mark, an interim injunction restraining him to use the mark
can also be granted to make the remedy effective.
• The protection afforded to unregistered marks is also extended to
foreign marks, which have a reputation in India on the basis of
extensive advertisements and publicity.
• Indian courts, too, recognize the existence of transborder reputation
and grant injunction in cases where one tries to derive economic
benefit from the reputation established in a particular trade by
another[

CHENNAI
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
Tel: +91 - 80 - 6546 2400
COIMBATORE
BB1, Park Avenue,
Tel: +91 - 422 – 6552921
EMAIL
info@altacit.com
WEBSITE
www.altacit.com
CoNClUSIoN
• The rapid growth in international trade makes it imperative
that IP rights are properly recognised in different countries.
The Courts in India are increasingly recognizing trans border
reputation of the trademarks and have, rightly, frequently
protected trans border reputation – even where the mark has
not been used in India – and been concerned to prevent the
misappropriation of foreign marks. However it is crucial for
the foreign right holders to act proactively for enforcing the
goodwill established internationally by registration of
trademarks and institution of timely and appropriate
proceedings for enforcement.

Transborder reputation of trademarks

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