Trademark Injunctions and Damages in India – Part Two

In my last post, I dealt with the first condition i.e. ‘prima facie case’ to be established when praying for a grant of temporary injunction. It is only when all the three conditions are fulfilled that the Court will take into consideration the prayer of temporary injunction. As in the case of prima facie, the other two conditions can be best explained with reference to principles and tests laid down by the Courts. However, there is no straight jacket formula to ascertain whether they exist or not and that is precisely why the Supreme Court has time and again stressed on sound judicial discretion by the lower Courts.

Trademark Injunctions

In general, balance of convenience is judged relatively, thereby meaning that the loss and hardship caused by one party should be greater than that of the other. Therefore, unless the balance tilts in favour of one party, the Court isn’t likely to be inclined to grant an injunction for the obvious reason that the other party is likely to suffer from such a directive of the Court. Irreparable injury is looked at from the viewpoint of the plaintiff to determine whether refusal to grant injunction is likely to cause irreparable injury or loss because in a suit relating to infringement and passing off it is necessary to ensure that no further damage is caused to a party that has established existence of a prima facie case and balance of convenience.

In Dalpat Kumar v. Prahlad Singh, the Supreme Court observed that irreparable injury doesn’t necessarily only physical possibility of injury but a material one that cannot be adequately compensated by way of damages. On weighing possibilities or probabilities of likelihood of injury, if the Court considers that the matter should be maintained in status quo, an injunction would be granted.

In cases where the remedy of passing off is sought, the Courts apply the Classical Trinity Test or in a case otherwise, the plaintiff has to satisfy the court of these conditions,

a)     reputation or goodwill of the plaintiff in the goods or trademark or trade name

b)    misrepresentation by defendants (intentional or unintentional)

c)     losses suffered or likely to be suffered by the plaintiff

However, the burden of proof in cases of infringement is relatively lesser than in the case of passing off. In American Home Products v. Mac Laboratories, the Supreme Court stated that one acquires valuable rights by reason of registration and that gives exclusive right to the use of the trade mark in connection with the goods in respect of which it is registered and if there is any invasion of this right by any other person using a mark which is the same or deceptively similar to the trade mark, one can protect the trade mark by an action for infringement in which an injunction can be obtained. Balance of convenience in cases of infringement tilts towards the plaintiff.

There are also cases where the mark by virtue of being a well-known mark or having trans-border reputation stands a chance of being granted injunction inspite of being unregistered. The Court adjudicates these matters on case to case basis but a few parameters would be usage or presence in India through advertisements, news articles or knowledge of mark by a class of persons. This has been discussed in detail in an earlier post. It may not be possible to establish trans-border reputation at the very outset while praying for temporary injunction, but it could be one the pillars to substantiate irreparable damage to reputation or goodwill likely to be caused by continued use of the mark by the defendant.

So if the plaintiff has been successful in getting an order for temporary injunction, the next course of action is to get a permanent injunction restraining the defendants from using the mark completely. Most often, aggrieved parties are not satisfied with just that after the long drawn ordeal and claim damages. What types of damages do Courts grant? What are the conditions to grant damages? Is there any limit on exemplary damages? I’ll be dealing with these questions and more in Part-Three of this post.

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