The Bombay High Court has said that merely not using a deceptive name can't be a refuge for making and selling identical goods, in an observation that could have wider implications not just in the consumer products sector but also in e-commerce where companies often have similar names or designs.
The court’s observations came when it issued an interim order on a petition by consumer goods maker Colgate Palmolive Co. seeking to stop a manufacturer from selling a toothbrush that it said violated its intellectual property rights.
Colgate, the country's largest oral care brand, had approached the court against Mumbai-based Arun Vasant Narkar. Colgate alleged that Narkar was selling a toothbrush under the brand ‘Coolest Smart Flexi’, which was similar to the ‘Colgate Super Flexi’ toothbrush.
According to Colgate, it had launched the toothbrush in May 2013 and earned revenue of Rs 70 crore until December 2013. From January to July 2016, Colgate earned Rs 104 crore from the product.
The Indian unit of the US consumer goods giant said that it came to know in August this year that Narkar was making and selling toothbrush under the trademark ‘Coolest Smart Flexi’.
Narkar’s counsel, DA Bhalerao, argued in the court that they are not using the trademark ‘Colgate’ in any manner and so the company can’t accuse Narkar of infringing on their design or passing off his products as that of Colgate’s.
The court, however, didn’t agree with Bhalerao. “Prima facie, it appears that the defendant (Narkar) has adopted an identical design and artistic work; and deliberately adopted a deceptively confusing mark. The differences, if any, are so minor as to be utterly meaningless,†said Justice GS Patel. “The manner in which it uses the work ‘Coolest’ is clearly, deceptively and confusingly similar to the plaintiff’s registered trademark ‘Colgate’. There is prima facie case to be made out in both trademark infringement and passing off.â€
In a rare order, Patel also directed a court receiver to take charge of all goods manufactured by Narkar and asked him not to make or sell goods with the mark ‘Coolest Smart Flexi’ till the final judgement.
The court directed Narkar to file his response by 27 October and posted the matter for hearing on 18 November.
An email query to Colgate Palmolive did not elicit any response.
Suhas Tuljapurkar, founder of law firm Legasis Partners, the consequence of the interim order could be bringing back the agenda of clean IPRs to the forefront of digital as also the e-commerce segment where trademarks, designs and copyrights need an integrated view.
“This may further have two consequences. Valuations that are not focussed on clean IPRs would come under pressure and the risk of the court enjoining the business would result in the heightened business continuity risks,†Tuljapurkar said.
On a different note, Tina Jain Mehta, founder of Mumbai-based boutique branding and design agency Pineapple Consulting, said design per se—and not just product packaging or brand design—has become crucial than ever before as many products and businesses need to be redesigned in robotics, artificial intelligence, big data, digital and e-commerce. “A broader application of design thinking and design innovation is the need of the hour,†Mehta said.
“Earlier, the brand name and logo would be the key differentiator. However it would become increasingly important for the brands to create and establish a distinct brand identity system which creates a cohesive experience across various touch points, be it their packaging, website or office,†she added.
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