*
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IN THE HIGH COURT OF DELHI AT
NEW DELHI
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CS (COMM) No. 772/2016
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CS(COMM) No. 570/2017
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CS(COMM) No.571/2017
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CS(COMM) No.780/2017
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CS(OS) No.2850/2014
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CS(OS) No.64/2016
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+
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CS (COMM) No.52/2018
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+
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CS (COMM) No.53/2018
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%
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8th February, 2018
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CS (COMM) No. 772/2016
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M/s
CROCS INC.USA
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..... Plaintiff
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Through:Mr. Akhil Sibal, Sr. Adv., Mr.
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Ajay Amitabh
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Suman,
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Mr.
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Pankaj Kumar, Mr. Kapil Giri,
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Mr. Vinay Shukla, Mr. Nikhil
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Chawla, Ms.
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Tanvi
Mishra
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Advocates.
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versus
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M/s
LIBERTY SHOES LTD
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..... Defendant
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Through:Mr.
Jayant Mehta, Mr.
Kapil
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Wadhwa, Ms.
Devyani
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Nath,
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Mr. Shubhankar,
Mr.
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Rahul
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Kukreja,
Advocates for D-1.
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CS(COMM) No. 570/2017
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M/s
CROCS INC. USA
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..... Plaintiff
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Through:Mr. Akhil Sibal, Sr. Adv., Mr.
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Ajay Amitabh
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Suman,
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Mr.
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Chawla, Ms. Tanvi Mishra
Advocates.
CS (COMM) No. 772/2016 and connected cases
Page 1 of 54
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versus
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M/s RELAXO
FOOTWEAR LTD.
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..... Defendant
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Through:
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None.
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+CS(COMM) No.
571/2017
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M/s
CROCS INC. USA
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..... Plaintiff
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Through:Mr.
Akhil Sibal, Sr. Adv., Mr.
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Ajay Amitabh
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Suman,
Mr.
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Pankaj
Kumar, Mr. Kapil Giri,
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Mr.
Vinay Shukla, Mr. Nikhil
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Chawla, Ms.
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Tanvi
Mishra
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Advocates.
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versus
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RELAXO
FOOTWEAR LTD. & ANR.
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..... Defendant
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Through:
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None.
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+
CS(COMM)
No. 780/2017 and I.A. No. 9971/2015 (for stay)
M/s
CROCS INC.USA
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..... Plaintiff
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Through:Mr. Akhil Sibal, Sr. Adv., Mr.
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Ajay Amitabh
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Suman,
Mr.
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Pankaj Kumar, Mr. Kapil Giri,
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Mr. Vinay Shukla, Mr. Nikhil
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Chawla, Ms.
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Tanvi
Mishra
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Advocates.
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versus
BIOWORLD
MERCHANDISING INDIA LTD.
.....
Defendant
Through: Mr. Anil Dutt and Ms. V.S.
Mani,
Advocates.
+
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CS(OS) No. 2850/2014
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M/s
CROCS INC. USA
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..... Plaintiff
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CS (COMM) No. 772/2016 and connected cases
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Page 2 of 54
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Through: Mr. Akhil Sibal, Sr. Adv., Mr.
Ajay Amitabh Suman, Mr.
Pankaj
Kumar, Mr. Kapil Giri,
Mr. Vinay
Shukla, Mr. Nikhil
Chawla, Ms. Tanvi Mishra
Advocates.
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versus
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M/s
BATA INDIA LTD & ORS.
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..... Defendants
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Through:Mr.
Neeraj Grover and
Ms.
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Ragini
Anand, Advocates.
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+
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CS(OS) No. 64/2016
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M/s
CROCS INC USA
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..... Plaintiff
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Through:Mr. Akhil Sibal, Sr. Adv., Mr.
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Ajay
Amitabh Suman, Mr.
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Pankaj Kumar, Mr. Kapil Giri,
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Mr. Vinay Shukla, Mr. Nikhil
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Chawla, Ms.
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Tanvi
Mishra
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Advocates.
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versus
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M/s
ACTION SHOES PVT. LTD. & ORS.
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..... Defendants
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Through: Mr. Kapil Wadhwa and Ms.
Devyani
Nath, Advocates.
+
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CS (COMM) No. 52/2018
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M/s
CROCS INC.USA
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..... Plaintiff
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Through:Mr. Akhil Sibal, Sr. Adv., Mr.
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Ajay Amitabh
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Suman,
Mr.
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Pankaj
Kumar, Mr. Kapil Giri,
Mr. Vinay
Shukla, Mr. Nikhil
CS (COMM) No. 772/2016 and
connected cases Page 3 of 54
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Chawla,
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Ms.
Tanvi Mishra
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Advocates.
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versus
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AQUALITE
INDIA LIMITED & ANR.
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..... Defendants
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Through:Mr.Sandeep
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Sethi,
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Sr.
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Advocate
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with
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Mr.
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C.A.
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Brijesh, Mr.
Rohan Seth, Mr.
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Dhruv
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Grover
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and
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Mr.
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Peeyoosh Kalra Advocates.
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+
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CS (COMM) No. 53/2018
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M/s CROCS INC.USA .....
Plaintiff
Through: Mr. Akhil Sibal, Sr. Adv., Mr. Ajay
Amitabh Suman, Mr. Pankaj Kumar, Mr. Kapil Giri, Mr. Vinay
Shukla, Mr. Nikhil Chawla, Ms. Tanvi
Mishra
Advocates.
versus
KIDZ
PALACE & ORS.
..... Defendants
Through: Mr. Anil Dutt and Ms. V.S.
Mani, Advocates for D-2 and 3.
CORAM:
HON’BLE MR. JUSTICE VALMIKI J.MEHTA
To be referred to the Reporter or not? YES
VALMIKI J. MEHTA, J (ORAL)
CS (COMM) No. 772/2016 and I.A. No. (to be
numbered) (under Order XXXIX Rules 1 & 2 CPC)
CS (COMM)
No.571/2017 and I.A. No. 6811/2015(under Order XXXIX Rules 1 & 2 CPC)
CS (COMM) No. 772/2016 and
connected cases Page 4 of 54
CS (COMM)
No. 780/2017 and I.A. No. 9971/2015 (under Order XXXIX Rules 1 & 2 CPC)
CS (COMM)
No. 2850/2014 and I.A. No. 19747/2014 (under Order XXXIX Rules 1 & 2 CPC)
& I.A. No. 24965/2014 (under Order XXXIX Rule 4 CPC)
CS (COMM)
52/2018 and I.A. No. 1791/2018(under Order XXXIX Rules 1 & 2 CPC) &
I.A. (to be numbered) under Order XXXIX Rule 4 CPC)
CS (COMM)
53/2018 and I.A. No. 1794/2018 (under Order XXXIX Rules 1 & 2 CPC)
1. By this order the injunction applications filed
by the plaintiff in the suit are being heard and disposed of. Simultaneously,
the applications under Order XXXIX Rule 4 CPC for vacating the interim order
granted in favour of the plaintiff in CS (COMM) No. 52/2018 and CS (COMM) No.
2850/2014 are also being disposed of. The interim application in CS (COMM) No.
772/2016 titled as Crocs Inc. USA Vs. Liberty Shoes Limited is
being taken as lead application and lead case and the discussion,
reasoning and conclusions of such interim applications mutatis mutandis will apply with respect to the injunction
applications filed in the other suits given in the heading of this order. It is
also noted that since some of the suits were filed in the District Court, and
which have thereafter been transferred to this Court, in these suits there are
no IA numbers to the interim applications. Plaintiffs have filed this suit for
permanent injunction seeking to restrain the defendant from infringing the
registered design
CS (COMM) No. 772/2016 and
connected cases Page 5 of 54
of the plaintiff bearing registration no. 197685
which is said to be valid up to 28.5.2019. The registered design of the
plaintiff is with respect to footwear. The registered design of the plaintiff
with respect to the subject footwear can be seen from the attachments to the
registration certificates of the plaintiff with respect to design no. 197685
and these pictorial representations/sketches of the plaintiff‘s footwear
registered as design are as under:-
CS (COMM) No. 772/2016 and
connected cases Page 6 of 54
CS (COMM) No. 772/2016 and
connected cases Page 7 of 54
2. In CS (COMM) No. 780/2017, the plaint is
essentially/mostly same as the plaint filed qua
registered design no. 197685. The plaintiff for seeking reliefs has relied upon
its registered design no. 197686. To complete the narration, the
sketches/pictorial representations of the footwear which is the subject matter
of the registered design no. 197686 of the plaintiff is as under:-
CS (COMM) No. 772/2016 and
connected cases Page 8 of 54
CS (COMM) No. 772/2016 and
connected cases Page 9 of 54
CS (COMM) No. 772/2016 and
connected cases Page 10 of 54
3. So that we also understand the issue of
violation of the registered design of the plaintiff, reproduced below are the
photographs of the footwear of the plaintiff in colour:-
CS (COMM) No. 772/2016 and
connected cases Page 11 of 54
4. The causes of action as pleaded by the plaintiff
in the suit plaints is that since the plaintiff is an owner of the registered
design nos. 197685 and 197686 with respect to footwear as depicted above, and
that since the defendants are imitating the design of the footwear of the
plaintiff, therefore the defendants are guilty of piracy of registered designs of
the plaintiff and hence the plaintiff is entitled to approach this Court for
reliefs in view of Section 22 of the Designs Act, 2000 (hereinafter referred to
as ‗the Act‘).
5.(i) By the suit CS (COMM) No. 772/2016 the following reliefs are
prayed:-
―(a) For a decree of permanent injunction
restraining the defendant by themselves as also through their individual
directors, proprietors/partners, agents, representatives, distributors,
assigns, heirs, successors, stockists and all other acting for and on their
behalf from manufacturing, marketing, supplying, using, selling, soliciting,
exporting, displaying, advertising by any other mode or manner the impugned
design or any other design which is deceptively similar to or is a fraudulent
and/or any obvious imitation of the Plaintiff‘s design covered by design registration
no. 197685 in relation to footwear and related/allied products and from doing
any other acts or deeds amounting to or likely to:
(i)
Piracy and/or infringement of
Plaintiff‘s registered design under no. 197685;
(ii)
Violating the Plaintiff‘s designs
covered by registration no. 197685.
(b)
For an order for delivery up of
all the impugned finished and unfinished material bearing the impugned and
violative design in relation to the impugned or any other deceptively similar
design including its blocks, moulds ad goods etc. to the plaintiff for the
purposes of destruction and erasure.
(c)
For an order for rendition of
accounts of profits earned by the defendant by their impugned illegal trade
activities and a decree for the amount so found in favour of the plaintiff on
such rendition of accounts.
CS (COMM) No. 772/2016 and
connected cases Page 12 of 54
(d)
Costs of the proceedings.
(e)
And for such other and further
reliefs as this Hon‘ble Court may deem fit and proper in the facts and
circumstances of the present case.‖
(ii)
Reliefs prayed for in the other
suits are also identical/more or less the same.
6. In terms of the prayers made in the plaint, the
interim applications have been filed by the plaintiff in the suits to seek pendente lite restraint against the
defendants from manufacturing, marketing,
supplying, selling etc the footwear of the defendants which footwear as per the
plaintiff have been manufactured and sold by infringing the registered designs
of the plaintiff.
7. In order to appreciate the issue completely it
will be relevant to reproduce the footwear which is being manufactured and sold
by the defendant in CS (COMM) No. 772/2016, noting that the footwear being
manufactured by the other defendants in the suits would be more or less same or
similar, of course with colour variations or other changes with respect to
placements of the perforations/open spaces/holes in the footwear or certain
other aspects for creating visual appeal. The footwear manufactured by the
defendants in CS (COMM) No. 772/2016 are depicted as under:-
CS (COMM) No. 772/2016 and
connected cases Page 13 of 54
CS (COMM) No. 772/2016 and
connected cases Page 14 of 54
8. Defendants in the suits have contested the claim
of the plaintiff seeking grant of interim/pendente
lite injunction. Defendants have denied that they are infringing the
registered designs of the plaintiff. Defendants argue that there cannot be
piracy of a registered design if the registration granted to the plaintiff with
respect to footwear itself is an invalid registration. It is argued that the
defendants, in a suit filed by the plaintiff of a registered design alleging
piracy of the registered design under Section 22 of the Act,
CS (COMM) No. 772/2016 and
connected cases Page 15 of 54
are entitled because of Sub-Section (4) of the said
Section 22 of the Act to argue that since the registration of the design
granted to the plaintiff is not valid hence no case can be made out of piracy
of the registered design of the plaintiff. In sum and substance, reliance is
placed by the defendants upon Sub-Section (4) of Section 22 of the Act which
provides that even if the registration of the design continues to exist as a
registered design under the Designs Act in favour of the plaintiff, yet the
defendants in a suit alleging infringement of a registered design can show that
the design which the plaintiff has got registration of was not one capable of
being given registration, and hence the plaintiff is not entitled to seek any
relief by filing of the suit. It is argued on behalf of the defendants that in
terms of Clauses (b) to
(d) of Sub-Section (1) of Section 19 of the Act in
case the plaintiff‘s registered design when registered was not a new or
original design or there was already existing prior publication of a registered
design i.e the design with respect to which plaintiff claims exclusive entitlement
was in public domain, then in such circumstances it makes no difference that
the plaintiff has been successful in getting the designs registered because
such registered designs on account of prior publication or lack of
newness/originality will not give any legal right
CS (COMM) No. 772/2016 and
connected cases Page 16 of 54
to the plaintiff to allege piracy of the registered design. The relevant
Sections of the Designs Act for the purpose of discussion in this order would
be Section 2(d), Section 4, Section 19 and Section 22, and which Sections are
reproduced in the latter part of this judgment.
9. The arguments urged by the parties can be broken
up under two heads. The first head is that whether the designs which have been
got registered by the plaintiff with respect to the footwear are or are not new
or original designs. The second head is that whether the registered designs of
the footwear of the plaintiff were in public domain prior to registration. In
case of lack of newness/originality or existence of the registered design in
public domain prior to registration, then there is disentitlement in the
plaintiff to seek reliefs, including interim reliefs, in the subject suits.
10. For the purpose of discussion in the present
judgment, the Sections of the Designs Act which would be relevant, would be
Sections 2(d), 4, 19 and 22 of the Act. These Sections read as under:-
―Section 2(d) “design” means
only the features of shape, configuration, pattern, ornament or composition of
lines or colours applied to any article whether in two dimensional or three
dimensional or in both forms, by any industrial process or means, whether
manual, mechanical or chemical, separate or combined, which in the finished
article appeal to and are judged solely by the eye; but does not include any
mode or principle of construction or anything which is in substance a mere
mechanical device, and does not include any trade mark as defined in clause (v)
of sub-section
CS (COMM) No. 772/2016 and
connected cases Page 17 of 54
(1)
of section 2 of the Trade and
Merchandise Marks Act, 1958 (43 of 1958) or property mark as defined in section
479 of the Indian Penal Code (45 of 1860) or any artistic work as defined in
clause (c) of section 2 of the Copyright Act, 1957 (14 of 1957);
Section 4. Prohibition of registration of certain
designs.- A design which –
(a) is not
new or original; or
(b)
has been disclosed to the public
anywhere in India or in any other country by publication in tangible form or by
use or in any other way prior to the filing date, or where applicable, the
priority date of the application for registration; or
(c)
is not significantly
distinguishable from known designs or combination of known designs; or
(d)
comprises or contains scandalous
or obscene matter shall not be registered.
shall not
be registered.
Section 19. Cancellation of
registration.-(1) Any person interested may present a petition for the
cancellation of the registration of a design at any time after the registration
of the design, to the Controller on any of the following grounds, namely:-
(a) that the
design has been previously registered in India; or
(b)
that it has been published in
India or in any other country prior to the date of registration; or
(c) that the
design is not a new or original design; or
(d) that the
design is not registerable under this Act; or
(e) it is not
a design as defined under clause (d) of section 2.
(2)
An appeal shall lie from any
order of the Controller under this section to the High Court, and the
Controller may at any time refer any such petition to the High Court, and the
High Court shall decide any petition so referred.
Section 22. Piracy of registered design.- (1) During the existence of copyright
in any design it shall not be lawful for any person-
(a)
for the purpose of sale to apply
or cause to be applied to any article in any class of articles in which the
design is registered, the design or any fraudulent or obvious imitation
thereof, except with the license or written consent of the registered
proprietor, or to do anything with a view to enable the design to be so
applied; or
(b)
to import for the purposes of
sale, without the consent of the registered proprietor, any article belonging
to the class in which the design has been registered, and having applied to it
the design or any fraudulent or obvious imitation thereof, or
(c)
knowing that the design or any
fraudulent or obvious imitation thereof has been applied to any article in any
class of articles in which the design is registered without the consent of the
registered proprietor, to publish or expose or cause to be published or exposed
for sale that article.
CS (COMM) No. 772/2016 and
connected cases Page 18 of 54
(2)
If any person acts in
contravention of this section, he shall be liable for every contravention-
(a)
to pay to the registered proprietor
of the design a sum not exceeding twenty-five thousand rupees recoverable as a
contract debt, or
(b)
if the proprietor elects to bring
a suit for the recovery of damages for any such contravention, and for an
injunction against the repetition thereof, to pay such damages as may be
awarded and to be restrained by injunction accordingly:
Provided that the total sum recoverable in respect of any one design
under clause (a) shall not exceed fifty thousand rupees:
Provided further that no suit or any other proceeding for relief under
this subsection shall be instituted in any court below the court of District
Judge.
(3)
In any suit or any other
proceeding for relief under subsection (2), ever ground on which the
registration of a design may be cancelled under section 19 shall be available
as a ground of defence.
(4)
Notwithstanding anything
contained in the second proviso to sub-Section (2), where any ground or which
the registration of a design may be cancelled under section 19 has been availed
of as a ground of defence and sub-section (3) in any suit or other proceeding
for relief under sub-section
(2), the suit or such other proceedings shall be transferred by the
Court in which the suit or such other proceeding is pending, to the High Court
for decision.
(5)
When the court makes a decree in
a suit under sub-section (2), it shall send a copy of the decree to the
Controller, who shall cause an entry thereof to be made in the register of
designs.‖
11. Now let us firstly turn to the aspect of prior
publication/public domain. A design which existed in public domain prior to
grant of registration under the Act is a ground for cancellation of the design
and this is very much clear from Section 19(b) and (d) read with Section 4(b)
of the Act. The factual issue is that has there taken place prior publication
of the design i.e whether the registered designs existed in public domain prior
to the registration being granted in favour of the plaintiff.
CS (COMM) No. 772/2016 and
connected cases Page 19 of 54
12. On behalf of the defendants reliance has been
placed upon internet downloaded pages from the website of the company Holey
Soles. This publication which is downloaded from the concerned website of Holey
Soles is said to be existing on the website of Holey Soles as on 10.12.2002.
Obviously the 'Holey' in the 'Holey Soles' is because of holes/spaces/gaps
existing in the footwear of this company. The footwear of Holey Soles as
published in the internet archive for Holey Soles as on 10.12.2002 is depicted
as under:-
CS (COMM) No. 772/2016 and
connected cases Page 20 of 54
13.
Similar depictions as shown above
also exist on the same website of Holey Soles as on 17.2.2003. Internet
downloads of Holey Soles on 17.2.2003 are filed as documents by the defendants.
The footwear shown on 17.2.2003 is same as on 10.12.2002 except that the
colours of the said footwear, which are sandals without a strap, are shown to
be of different colours than the reddish pink colour as on 10.12.2002. These
depictions dated 17.2.2003 are as under:-
CS (COMM) No. 772/2016 and
connected cases Page 21 of 54
14. The registration which is granted to the
plaintiff in India is effective from 28.5.2004. In U.S it is informed to this
Court on behalf of the plaintiff that the design was also registered on
28.5.2004 but that in terms of the provisions of the Designs Act as applicable
in U.S. the plaintiff will have benefit of registration for one year prior to
28.5.2004 i.e from 28.5.2003. Therefore, once the design of the footwear of the
plaintiff is found in the public domain as shown in website of Holey Shoes
prior to 28.5.2003 then clearly in view of
CS (COMM) No. 772/2016 and
connected cases Page 22 of 54
Section 4(b) read with Section 19 (d) of the Act
the registration granted to the plaintiff is clearly faulty and is liable to be
cancelled under Section 19 of the Act. In such scenario therefore plaintiff
cannot seek benefit of its registered design for seeking reliefs in the present
case.
15.(i) Learned senior counsel for the plaintiff
sought to argue that no doubt with respect to Holey Soles website as on
10.12.2002 and 17.2.2003 footwear similar to that of the plaintiff (of course
without the back strap) is shown, however it is argued that depiction in the
website is no guarantee that depiction of the footwear in question in fact took
place as on 10.12.2002 and 17.2.2003 as stated in the printouts downloaded and
filed by the defendants. It is argued that once no finality can be taken to a
design of the footwear which is found in the website of the Holey Soles, then
the observations of the Full Bench of this Court in the case of Reckitt
Benkiser India Ltd. Vs.
WYETH Ltd. AIR 2013 Delhi 101 (FB) will come into play that publication unless it has complete
clarity for being known what the same was, the same would not assist the
defendants to argue that those designs were available in public domain.
CS (COMM) No. 772/2016 and
connected cases Page 23 of 54
(ii)
In my opinion this argument urged
on behalf of the plaintiff is nothing but a desperate argument because this
Court has to take a
prima
facie view to come to a conclusion that
printouts downloaded from the website
of Holey Soles would have in fact shown the footwear design on 10.12.2002 and
17.2.2003 and the defendants have a prima
facie case because surely if what the plaintiff contends would have been
correct that these designs may not have been available on the website of Holey
Soles as on 17.2.2003, then what was the difficulty in the plaintiff filing its
copies of printout downloads of website of Holey Soles as on 10.12.2002 and
17.2.2003, and which the plaintiff has not. Therefore taking a prima facie view of the matter, since
the plaintiff has not filed its copies of print out downloaded from the website
of Holey Soles as on 10.12.2002 and 17.2.2003, this Court at this stage for
arriving at a prima facie view would
accept the factum that a design
similar to the design of the footwear of the plaintiff had already been
published and sold by M/s Holey Soles prior to 28.5.2003, and hence such design
having existed in public domain prior to plaintiff's registration, the
plaintiff therefore cannot claim exclusivity for its registered design merely
on the ground that
CS (COMM) No. 772/2016 and
connected cases Page 24 of 54
plaintiff‘s footwear/registrations does have a
strap at the back of its footwear.
16. The issue of prior publication has also to be
held against the plaintiff because plaintiff‘s entitlement to exclusivity of
its design of its footwear is from 28.5.2003, and that the defendants have
filed the printout downloads from the website of the plaintiff itself earlier
than 28.5.2003 i.e as on 16.10.2002, 24.11.2002, 25.11.2002, 28.11.2002 and
13.12.2002 showing as per these printout downloads that the subject designs are
clearly in the public domain w.e.f 16.10.2002, 24.11.2002, 25.11.2002,
28.11.2002 and 13.12.2002 i.e prior to the priority date of registrations of
the plaintiff w.e.f 28.5.2003. For the sake of convenience, these printout
downloads from the website of the plaintiff, are reproduced as under:-
CS (COMM) No. 772/2016 and
connected cases Page 25 of 54
CS (COMM) No. 772/2016 and
connected cases Page 26 of 54
CS (COMM) No. 772/2016 and
connected cases Page 27 of 54
CS (COMM) No. 772/2016 and
connected cases Page 28 of 54
CS (COMM) No. 772/2016 and
connected cases Page 29 of 54
17. On behalf of the plaintiff it could not be seriously disputed, and
nor it could have been, that the printouts filed by the defendants from the
website of the plaintiff itself show as on
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16.10.2002, 24.11.2002, 25.11.2002, 28.11.2002 and
13.12.2002 that the registered designs were in public domain as on those dates
which are prior to the date of priority of registration being 28.5.2003. In
case if the aforesaid printouts were not so then nothing prevented the
plaintiff from filing its own documents of its own website and only then it
would be shown that the documents as filed by the defendants being the
downloaded printouts of the website of the plaintiff of the different days
prior to 28.5.2003 were not those as filed by the defendants. In view of the
aforesaid publications of plaintiff itself existing in the public domain in the
website of the plaintiff much prior to 28.5.2003 showing the registered designs
footwear of the plaintiff, and that too repeatedly, the registered designs of
the plaintiff are to be held to be already existing in public domain prior to
28.5.2003 and consequently the registrations of the plaintiff are liable to be
cancelled in terms of Section 19(1)(b) read with Section 4(b) of the Act. In my
opinion therefore clearly the registered designs of the plaintiff were in the
public domain prior to priority date of 28.5.2003 and therefore registration
granted to the plaintiff with respect to registered designs which are subject
matter of the present suits will not afford any legal
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entitlement to the plaintiff to allege piracy of
the designs under Section 22 of the Act.
18. With respect to issue of prior publication,
certain aspects were argued on behalf of the defendants with respect to
proceedings in the Courts in European Union and counter arguments to the same
were urged on behalf of the plaintiff, however in my opinion this Court need
not refer to the same for the purpose of disposal of the injunction
applications because the injunction applications can be decided and have been
decided in terms of the aspects of existence of prior publication with respect
to registered designs of the plaintiff and lack of newness/originality and
which aspect is discussed hereinafter.
19. The issue next to be examined is that what is
the meaning of a design being new or original so that it becomes capable of
being registered under the Act and for plaintiff to claim relief alleging
piracy of the registered design under Section 22 of the Act and related to this
issue would be the factual issue as to whether in fact the registered designs
of the plaintiff are in fact new or original. The aspect of the registered
designs having newness or originality, is a sine
qua non requirement as per Section 4(a) of the Act, because it is clearly
provided in Section 4 of the Act that in case a design is such that it
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falls within any of the four Sub-Sections (a) to
(d) of Section 4 of the Act then such design would not be registered. Once the
design is registered but is such that it could not have been registered because
of the bars contained in the Sub-Sections of Section 4 of the Act, then Section
19(1)(d) of the Act comes into play providing that such a registered design is
liable to be cancelled. Once a registered design is such which may be
cancelled, then even if it is not cancelled, yet defences on the basis of which
registered design can be cancelled are valid defences to a suit alleging
infringement of the registered design/piracy in view of this being so
specifically stated in Sub-Section (4) of Section 22.
20. I have
recently in the judgment delivered in the case of
Pentel Kabushiki Kaisha & Anr. Vs. M/S Arora
Stationers & Ors., CS (COMM) No. 361/2017
decided on 8.1.2018 had an occasion to consider the meaning of newness or
originality which is the subject matter of Sub-Section (a) of Section 4 of the
Act. By referring to the ratios of the Division Bench judgment of this Court in
the case of M/s. B. Chawla & Sons Vs. M/s. Bright Auto
Industries AIR 1981 Delhi
95 and of the judgment of the Hon‘ble
Supreme Court in the case of
Bharat
Glass Tube Limited Vs. Gopal Glass Works Limited (2008)
CS (COMM) No. 772/2016 and
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10 SCC 657, this
Court has come to a conclusion that for a design to have entitlement of
grant and continuation of registration under the Designs Act it is required
that the design is such that it is an Intellectual Property Right. The
Intellectual Property Right comes into existence if there is spent sufficient
labour, effort, time, etc whereby it can be said that consequently a new
creation has come into existence i.e in essence there is required existence of
innovation which is an Intellectual Property Right. It is because an
Intellectual Property Right comes into existence that there is hence an
entitlement to protection thereof and so that the creator of the design is
granted monopoly with respect to use of the new/original design for a period of
ten years plus five years as provided in Section 11 of the Act. It has been
held by this Court in the case of Pentel Kabushiki Kaisha (supra) that
mere variations to existing products which do not result in requisite amount of
newness or originality cannot be considered as innovations having newness and
originality for being granted monopoly for fifteen years. It has been held by
this Court by reference to the Division Bench judgment of this Court and the
judgment of the Supreme Court as stated above that trade variations to existing
products will not entitle a person who has come out with a new product
containing only trade
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variations to contend that there is newness and
originality as required by Section 4(a) of the Act and that such products
therefore cannot be called new and original and cannot be given the designation
of an Intellectual Property Right and hence exclusivity for 15 years under the
Designs Act. At this stage let me reproduce the relevant paras of the said
judgment which read as under:-
―2. The cause of action as pleaded in the plaint is one under Section 22
of the Designs Act, 2000 (hereinafter referred to as ‗the Act‘) and which Section
provides that during the existence of the copyright in any design, no other
person shall use the registered design for commercial purposes, sale of the
article etc being a design which is identical or an imitation of the registered
design of the plaintiff. In the suit the following reliefs are claimed:-
―(a) A decree of permanent injunction restraining the Defendants, their
partners, agents, proprietors, servants and all those actively in concert with
them from manufacturing, selling, offering to sell, advertising, trading,
dealing, either directly or indirectly in pens that is identical duplication or
being obvious and/or fraudulent imitation to the Plaintiffs‘ copyright in the
registered design no 263172;
(b)
An order for delivery up to the
Plaintiffs by the Defendants of all the infringing products including blocks,
dyes, molds, any other material bearing the Plaintiffs‘ registered design
No.263172 or used for applying the Plaintiffs‘ registered design No.263172 for
purpose of erasure/destruction;
(c)
An order of rendition of accounts
of profits directly or indirectly earned by the Defendants from their
infringing activities and wrongful conduct and a decree for the amounts so
found due to be passed in favour of the Plaintiffs;
(d)
A sum of Rs.1,00,00,000/- as
decree of damages as valued for the purposes of this suit towards invasion of
rights, loss of sales, revenue, and overall business identified with the
Plaintiffs‘ registered design
No.263172
caused by the activities of the Defendants;
(e)
An order as to the costs of the present
proceedings; and
(f)
Any further order (s) as this Hon‘ble
Court may deem fit and proper in the facts and the circumstances of the present
case.‖
3.
In the interim injunction
application which is being disposed of in terms of the present order, the
following reliefs are prayed:-
―a. An order of exparte interim
injunction restraining the Defendants, their partners, agents, proprietors,
servants and all those actively in concert with them from manufacturing,
selling, offering to sell, advertising, trading, dealing, either directly or
indirectly in pens that
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are identical or obvious and fraudulent imitation to the Plaintiffs‘
copyright in the registered design no.263172 during the pendency of the suit.
b.
Any further order(s) as this Hon‘ble
Court may deem fit and proper in the facts and circumstances of the present
case.‖
xxxx xxxxx xxxxx
5.
Sub-Section (3) of Section 22 of
the Act provides that in spite of the fact that a design is a registered
design, whenever any suit is filed for the relief alleging piracy of the
registered design by the defendant in the suit, then in such a suit every ground
on which registration of a design may be cancelled under Section 19 of the Act
shall be available to the defendant as a ground of defence.
6.(i) A reading of Sections 19 and 4 of the Act,
shows that before a design is entitled to protection under the Act, the design
has to be a new or original design. If the design is not a new or original
design, then the registered design though registered is liable to be cancelled
in the proceedings under Section 19 of the Act. The pendency or otherwise of
the proceedings under Section 19 of the Act for cancellation of the registered
design will however not prevent a Court from deciding the issue of entitlement
of the plaintiff to grant of an interim injunction in a suit which is filed
under Section 22 of the Act by examining the defences that the registered
design is such which is liable to be cancelled, i.e no interim or final relief
can be granted to the plaintiff, and this is so specifically provided in
Sub-Section (3) of Section 22 of the Act. Therefore, this Court has to examine
that whether the design of the ball point pen of which the plaintiffs have
obtained registration is or is not a new or original design and which are
defences for cancellation of a registered design in proceedings under Section
19 of the Act. Defendants contend that design of the ball point pen of the
plaintiffs is not a new and original design, and hence not only the design
registered by the plaintiffs is liable to be cancelled in the proceedings
already initiated under Section 19 of the Act, even the subject application for
injunction is liable to be dismissed in view of Sub-Section (3) of Section 22
of the Act as defences under Section 19 of the Act are defences which are
available to the defendants in the suit to contest the allegations and cause of
action in the plaint of piracy of registered design.
(ii)
While on the subject, as to what
is new or original, this Court cannot lose sight of the what is stated in
Sub-Section (c) of Section 4 of the Act. Whereas Sub-Section (a) of Section 4
of the Act provides that a design which is not new or original cannot be
registered, Sub-Section (c) of Section 4 of the Act provides and clarifies that
a design cannot be registered if it is not significantly distinguishable from
known designs or combination of known designs. Sub-Section (c) of Section 4 of
the Act is therefore in a way explanatory or clarificatory of Sub-Section (a)
of Section 4 of the Act by stating that merely because there is some sort of
newness or originality in an article, but in case that newness or originality
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is however not such so as to significantly distinguish the new article
prepared from existing designs or combination of designs, then in such a case a
design cannot be registered. It is implicit in the requirement of a design
being new and original that there is creation by putting an effort. Since a
totally new product applying the design comes into existence as a result of lot
of labour and effort, consequently, this right is known as intellectual
property right and the effect of registering of the intellectual property right
called as design under the Act gives monopoly to the owner of the registered
design for a total period of ten plus five years. Therefore it is sine qua non that there is required
sufficient novelty and originality for a completely new creation to come into
existence of a design, and only thereafter would the design be said to be one
which is capable of being protected as a design under the Act. This aspect of novelty and creation as regards a design which can only
be protected has been dealt with by the Division Bench of this Court in the
case of M/s. B. Chawla & Sons Vs. M/s. Bright Auto Industries AIR
1981 Delhi 95. The relevant paras of this judgment which deal
with the aspect of newness or originality are paras 8 to 12 and these paras
read as under:-
―8. In Le May v. Welch (1884)
28 Ch. D, 24-, Bowen L. J. expressed the opinion:
"It is not every mere difference of cut"-he was speaking of
collars-"Every change of outline, every change of length, or breadth, or
configuration in a single and most familiar article of dress like this, which
constitutes novelty of design. To hold that would be no paralyse industry
"and to make the Patents, Designs and Trade Marks Act a trap to catch
honest traders. There must be, not a mere novelty of outline, but a substantial
novelty in the design having regard to the nature of the article."
And Fry
L.J. observed :
"It has been suggested by Mr. Swinfen Eady that unless a design
precisely similar, and in fact identical, has been used or been in existence
prior to the Act, the design will be novel or original. Such a conclusion would
be a very serious and alarming one, when it is borne in mind that the Act may
be applied to every possible thing which is the subject of human industry, and
not only to articles made by manufacturers, but to those made by families for
their own use. It appears to me that such a mode of interpreting the Act would
be highly unreasonable, and that the meaning of the words" novel or
original' is this, that the designs must either be substantially novel or
substantially original, having regard to the nature and character of the
subject matter to which it is to be applied."
9.
Similar view was expressed by
Buckley L.J. on the question of quantum of novelty in Simmons v. Mathieson and Cold (1911) 28 R.P.C.
486 at 494 in
these words:
"In order to render valid, the registration of a Design under the
Patents and Designs Act, 1907, there must be novelty and originality, it must
be a new or original design. To my mind, that means that there must be a mental
conception expressed in a physical form which has not existed before,
but has originated in the constructive
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brain of its proprietor and that must not be in a trivial or
infinitesimal degree, but in some substantial degree."
10.
In Phillips v. Harbro Rubber Company (1920) 37 R.P.C. 233, Lord
Moulton observed that while question of the meaning of design and of the fact
of its infringement are matters to be judged by the eye (sic), it is necessary
with regard to the question of infringement, and still more with regard to the
question of novelty or originality, that the eye should be that of an instructed
person, i.e. that he should know that was common trade knowledge and
usage in the class of articles to which the design applies. The introduction of
ordinary trade variants into an old design cannot make it new or original, He
went on to give the example saying, if it is common practice to have, or not to
have, spikes in the soles of running shoes a man does not make a new and
original design out of an old type of running shoes by putting spikes into the
soles. The working world, as well as the trade world, is entitled at its will
to take, in all cases, its choice of ordinary trade variants for use in
particular instance, and no patent and no registration of a design can prevent
an ordinary workman from using or not using trade knowledge of this kind. It was emphasized that it is the duly of the court to take special care that
no design is to be counted a "new and original design" unless it
distinguished from that previously existed by something essentially new or
original which is different from ordinary trade variants which have long been
common matters of taste workman who made a coat (of ordinary cut) for a
customer should be left in terror whether putting braid on the edges of the
coat in the ordinary way so common a few years ago, or increasing the number of
buttons or the like, would expose him for the prescribed years to an action for
having infringed a registered design. On final analysis, it was emphasized that the use of the words
"new or original" in the statute is intended to prevent this and that
the introduction or substitution of ordinary trade variants in a design is not
only insufficient to make the design "new or original" but that it
did not even contribute to give it a new or original character. If it is
not new or original without them the presence of them cannot render it so.
11.
The quintessence of the placitums
above is that distinction has to be drawn between usual trade variants on one
hand and novelty or originality on the other. For
drawing such distinction reliance has to be placed on popular impression for
which the eye would be the ultimate arbiter. However, the eye should be an
instructed eye, capable of seeing through to discern whether it is common trade
knowledge or a novelty so striking and substantial as to merit registration. A
balance has to be struck so that novelty and originality may receive the
statutory recognition and interest of trade and right of those engaged therein
to share common knowledge be also protected.
12.
Coming to the facts of the
instant case the design in question as a whole consists in almost rectangular
shape with rounded edges with sides curved or sloping with a further curve on
either side in the sloping upper length side. The respondent produced in
evidence Japan's Bicycle Guide, 1972, Vol. 22. At page Nos. 218 to 221, there
are standard models of back mirrors besides branded models numbering 36. Models
bearing Nos. 59-6, 62-1, 61-3, 66-1 and 70-1 would show back view mirrors
CS (COMM) No. 772/2016 and
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rectangular in shape with sloping widths or lengths. In some of these
models there is curve in the upper length side. We have mentioned this fact
simply to emphasise that back view mirrors resembling the one in question have
been in the market for a long time. The appellants' case is that further a
curve in the sloping upper length side makes their design new or original. We
have already noted that the extent and nature of novelty was not endorsed by
the appellants in the application for seeking registration and, Therefore, it
has to be taken only as regards the shape and configuration. In final analysis
the matter would boil down to whether addition of further curve on either side
makes the variation a striking one or a substantial so as to constitute a
novelty meriting for registration. The learned Single Judge after enunciating
the legal position correctly used his eye for discerning if there was in fact a
novelty and answered the question in the negative. We have once again gone
through the same exercise and come to the same opinion. We fail to see the
hard labour which the appellants claimed to have bestowed in creating
the design they got registered. It is devoid of newness and equally devoid of
originality. An addition of curve here or there in a shape which is well-recognised
shape of an article of common use in the market cannot make it an article new
or original in design. If it is made eligible for registration, it would
certainly hinder the progress of trade without there
being any justification, whatsoever.‖ (emphasis
added)
7. The emphasized portions of the aforesaid paras
of the Division Bench judgment of this Court leave no manner of doubt that
there is required substantial novelty of design and that any and every change
resulting in a new configuration will not necessarily constitute a novelty of
design. Mere novelty of outline or few changes here and there which are trade
variants would not result in creation of a new article on the design which
would entitle to protection as a design under the Act. The Division Bench has
time and again with reference to the different judgments of the courts of U.K.
emphasized the requirement of novelty or originality which is substantial
novelty and substantial originality with regard to the nature and character of the
article. In para 10 of the judgment in the case of M/s B.
Chawla and Sons (supra) while making reference to the
observations of Lord Moulton it is observed that special care has to be
taken that no design is counted as a new or original design unless it is
distinguished from what previously existed by something essentially new or
original which is different from ordinary trade variants. In para 11, the
Division Bench has concluded that quintessence is that distinction has to be
drawn between usual trade variants on the one hand and substantial novelty and
originality on the other hand otherwise there will be blockage of trade. Only
newness/originality entitles monopoly on account of registration of the design.
8. The Supreme Court in the case of Bharat
Glass Tube Limited Vs. Gopal Glass Works Limited (2008) 10 SCC 657 has
made
similar observations in para 26 and this para 26 reads as under:-
―26. In fact, the sole purpose of this Act is protection of the intellectual
property right of the original design for a period of ten years or whatever
further period extendable. The object behind this enactment
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is to benefit the person for his research and labour put in by him to
evolve the new and original design. This is the sole aim of enacting this Act.
It has also laid down that if design is not new or original or published
previously then such design should not be registered. It further lays down that
if it has been disclosed to the public anywhere in India or in any other
country by publication in tangible form or by use or in any other way prior to
the filing date, or where applicable, the priority date of the application for
registration then such design will not be registered or if it is found that it is not significantly
distinguishable from known designs
or combination of known designs, then such designs shall not be registered. It also provides that registration can be cancelled under Section 19 of
the Act if proper application is filed before the competent authority i.e. the
Controller that the design has been previously registered in India or published
in India or in any other country prior to the date of registration, or that the
design is not a new or original design or that the design is not registerable
under this Act or that it is not a design as defined in Clause (d) of Section
2. The Controller after hearing both the parties if satisfied that the design
is not new or original or that it has already been registered or if it is not
registerable, cancel such registration and aggrieved against that order, appeal
shall lie to the High Court. These prohibitions have been engrafted so as to
protect the original person who has designed a new one by virtue of his own efforts by researching
for a long time. The new and original design when registered is for a period of ten years. Such original design
which is new and which has not been available in the country or has not been
previously registered or has not been published in India or in any other country
prior to the date of registration shall be protected for a period of ten years.
therefore, it is in the nature of
protection of the intellectual property
right. This was the purpose
as is evident from the Statement Of
Objects And Reasons and from various provisions of the Act. In this background,
we have to examine whether the design which was registered on the application
filed by the respondent herein can be cancelled or not on the basis of the
application filed by the appellant. In this connection, the Law of Copyright
and Industrial Designs by P. Narayanan (Fourth Edition), Para 27.01 needs to be
quoted.
―27.01. Object of registration of
designs.- The protection given by the law relating to designs to those who
produce new and original designs, is primarily to advance industries, and keep
them at a high level of competitive progress.
''Those who wish to purchase an article for use are often influenced in
their choice not only by practical efficiency but the appearance. Common
experience shows that not all are influenced in the same way. Some look for
artistic merit. Some are attracted by a design which is a stranger or bizarre.
Many simply choose the article which catches their eye. Whatever the reason may
be one article with a particular design may sell better than one without it:
then it is profitable to use the design. And much thought, time and expense may
have been incurred in finding a design which will increase sales". The
object of design registration is to see that the originator of a profitable
design is not deprived of his reward by others applying it to their goods.
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The purpose of the Designs Act is to protect novel designs devised to be
applied to (or in other words, to govern the shape and configuration of)
particular articles to be manufactured and marketed commercially. It is not to
protect principles of operation or invention which, if profitable (sic
protectable) at all, ought to be made the subject- matter of a patent. Nor is
it to prevent the copying of the direct product of original artistic effort in
producing a drawing. Indeed the whole purpose of a design is that it shall not
stand on its own as an artistic work but shall be copied by embodiment in a
commercially produced artefact. Thus the primary concern, is what the finished
article is to look like and not with what it does and the monopoly provided for
the proprietor is effected by according not, as in the case of ordinary
copyright, a right to prevent direct reproduction of the image registered as
the design but the right, over a much more limited period, to prevent the
manufacture and sale of articles of a design not substantially different from
the registered design. The emphasis therefore is upon the visual image conveyed
by
the manufactured article.‖ (emphasis
added)
9.
A reference to the aforesaid para
26 of Bharat Glass Tube Limited's case (supra) shows that what
is stated by the Division Bench of this Court in the case of M/s
B. Chawla and Sons (supra) has been accepted and in sum and substance
it has been held by the Supreme Court that the object behind enactment of the
Act is to give benefit to a person for the research and labour put by him to
evolve the new and original design which is an intellectual property right.
Supreme Court has also observed that unless the design is not significantly
distinguishable from the known designs or combination of designs, then such a
design is not entitled to registration and hence monopoly of user for 15 years
under the
Act. ‖ (underlining
added)
21. In view of the law laid down by a Division
Bench of this Court as also by the Supreme Court as stated above, I am not
referring to the judgments which have been cited on behalf of the plaintiff
with respect to what should be the test of newness or originality inasmuch as
the judgments which have been cited on behalf of the plaintiff are of Single
Judges of the Bombay High Court or of the Chancery Division of U.K.
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22. In view of the aforesaid position of law
showing that it is necessary for protection of a registered design that the
registered design must be an Intellectual Property Right created after
application of sufficient time, labour, effort, etc, and that there must be
sufficient newness or originality i.e existence of requisite innovation and
that trade variations of known designs cannot result in newness and
originality, let us now therefore examine the facts of the present case by
applying the law as above stated to decide as to whether the registered designs
of the plaintiff can be said to have newness or originality for having been
validly granted registrations under the Act, and that even if registrations
have been granted, once there is lack of newness/originality, then such
registrations so granted are liable to cancellation in proceedings under
Section 19 of the Act and accordingly such defences are valid defences under
Section 22(4) of the Act for contesting the claim/reliefs by the plaintiff in
the subject suits including of interim injunction reliefs.
23. This Court has already reproduced above the sketches of the
registered designs of the plaintiff. This Court has also reproduced the
coloured photographs with respect to the footwear of the plaintiff
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pertaining to the registered designs. Can it be said that such footwear
of the registered designs have newness or originality.
24. On behalf of the plaintiff it has been argued
that the registered designs of the plaintiff have to be looked as a whole. It
has been argued that there are various features in the registered designs of
the plaintiff with respect to the placement, shape and size of the
perforations/gaps/open spaces, and the hump like protrusion at the front of the
footwear, and that there exists a mound above the joint portion of the limb of
the foot with the foot, and the designs of the soles are unique, and that when
such features are taken as a whole, they have that much amount of visual appeal
for the registered designs of the plaintiff‘s footwear to have that much
newness or originality for having been rightly granted registrations under the
Act. It is argued that once registrations have been granted, then this Court must
presume existence of newness and originality and that onus in such
circumstances must shift upon the defendants to show that there is no newness
or originality.
25. No doubt once the plaintiff has a registered
design in his favour then it is for the defendants to plead and establish that
the registered design is such which is liable to be cancelled under one or
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more Sub-Sections of Section 19(1) of the Act for
these aspects would be available as defences to the claim of reliefs by the
plaintiff (in view of Sub-Section (4) of Section 22 of the Act), but in sum and
substance, in the opinion of this Court, the issue still remains the same as to
whether the registered designs of the plaintiff have or have not sufficient
newness or originality or that much amount of innovation for being called an
Intellectual Property Right.
26. One need not labour hard, or even labour much,
to hold that footwear have existed and are known to mankind from in fact
prehistoric age. Obviously footwear was originally created for the sole purpose
to protect the feet. Footwear created over passage of time has differed because
of choices made by human beings. Type of footwear is also dependent on whether
the same are/were used by men or women. With respect to footwear of men there
were created/existed various variations and so too with respect to footwear of
women. Variations obviously are with respect to shape of the footwear, look of
the footwear, fashion statement as per the footwear and so on. Footwear also
when created had to take into account the convenience of the wearer of the
same. Besides the issue of convenience of the wearer of the same footwear also
was different depending on the place
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where it was worn or for the purpose for which it
was worn. In those areas where climatic conditions were on the colder side
obviously the footwear by its very nature had to be completely covered so that
besides giving protection to the feet against injury, the footwear also
provided warmth. In countries and areas where climatic conditions are hot or
humid obviously the footwear created were such that they would be comfortable
to wear in such climatic conditions being hot and humid. In these latter areas
footwear had openness or breathing spaces. So far as the purpose of manufacture
of footwear is concerned it can be noted that footwear for walking is of one
type, other type is for sports, then again there is footwear for horse riding,
or for mountaineering, or for office wear or formal wear, and so on. Even
within sports shoes the type varies as per the type of the sport. I dare say
that all the aforesaid aspects need not be established in a court of law and
this Court can take judicial notice of the aforesaid aspects with respect to
footwear.
27. Besides the aforesaid aspects, an important
aspect which will be relevant in the facts of the present case is that footwear
which has been created have also been broken up in two types of a formal
footwear and of a casual footwear. In the category of casual footwear,
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since long, sandals are known to exist in this
country. The concept of sandals is a slip on footwear. Footwear being sandal
called by any name will be a sandal and one of the forms of footwear. With
respect to sandals to give stability and firmness for the wearer there did
exist straps at the back portions of the sandals. Where the sandals are casuals,
and for being worn for short periods only, the straps at the back can be
missing. Straps at the back of the sandals also existed or were left out
depending on the purposes for which the same were worn. The existence of what
is known as ―Jootis‖ is well known in northern India especially in Punjab. ―Jootis‖
are fanciful sandals having multi-colours, with embellishments being fixed on
the ―Jootis‖ by means of fabrics of different colours. To give a further break
up and elucidation it is noted that there are variations with respect to the
sandals of men and women. Sandals of ladies, not unexpectedly were designed,
moulded, re-moulded and again re-moulded with respect to the aspect of shapes
and heights of the soles or the upper casing. To wit we have stilettos or flats
or the platforms and so on. Obviously what is being stated by this Court is
that save and except where a footwear design is an Intellectual Property Right,
footwear is a footwear is a footwear, shoe is a shoe is a shoe and sandal is a
sandal
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is a sandal. All the different footwear have
changed over different periods of time and also as per requirements as to who
were the persons wearing the same or of the particular climatic conditions
where they were worn or the footwear becoming fashion statements but ultimately
all the different types of footwear are variations of nothing else but a
footwear i.e foot plus wear i.e something that is worn on the feet. Really
therefore, it would take in the opinion of this Court an effort larger than an
ordinary effort to create a different footwear than the known types of
footwear, to be an innovation/creation having such requisite newness and
originality for that creation to become an Intellectual Property Right as a
design in terms of the Designs Act.
28.(i) With the aforesaid observations with respect
to what is the law of design pertaining to newness and originality, and the
concept of footwear itself being of different types, let us apply the aforesaid
discussion to the facts of the present case as regards the registered designs
of the plaintiff. In my opinion, one does not have to travel too far to
understand that footwear of the plaintiff is nothing but a sandal. Sandal with
open spaces are only trade variations of a sandal. Placing of the open spaces
or perforation or gaps, and sandals
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being with or without straps at the back, are in
the opinion of this Court merely only variations or trade variations of
footwear. Trade variations of footwear/sandals cannot be and should not be
given exclusive monopoly. Of course every manufacturer who has done variations
wants to earn maximum profit therefrom, and one of the ways to do so is by stifling
competition by stopping the production of similar type of footwear as being
manufactured by the plaintiff, however that eventuality does not mean that
courts will allow such a plaintiff/manufacturer to create a monopoly when the
law does not sanction the same. In my opinion the features which have been
argued on behalf of the plaintiff as existing in its sandals/footwear of mounds
or humps or straps (or lack of them) or soles designs or perforations/open
spaces etc etc, even when taken as a whole, or even individually for that
matter, cannot be said to result in innovation or creation of newness or
originality as is the intention of the legislature in terms of the Section 4(a)
of the Act read with Section 19(1)(d) of the Act. It is therefore held that the
registered design of the plaintiff with respect to its footwear, does not have
the necessary newness or originality for the same to be called a creation or
innovation or an Intellectual Property Right, and which must necessarily exist
as stated
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by the Supreme Court in the judgment in the case of
Gopal
Glass Works Limited (supra). In my opinion the registered
design of the plaintiff is such which is liable to be cancelled as per
Section 19(1)(d) of the Act read with Section 4(a) of the Act, and therefore
such factual defences entitles the defendants to succeed in view of Sub-Section
(4) of Section 22 of the Act to argue against grant of reliefs in the
injunction applications which are subject matter of the present order. On this
ground itself also therefore the interim applications of the plaintiff are
liable to be and are accordingly dismissed.
(ii)
Before concluding I must
incidentally note two aspects. The first is that the fifteen year period of
life of the registrations is soon to come to an end in the next few months i.e
on 27.5.2018. The issue of injunction thus is now limited. Second aspect is
that it has not been the case of the plaintiff argued before this Court that
plaintiff's footwear design has been got registered as a design on account of
creation of footwear of colours/colour combinations and with the fact of these
products having been made from resin/plastic, and that therefore for such
reasons the plaintiff's footwear has protection as a design. Though ofcourse
even if it would have so been, yet the prior
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publication of Holey Soles footwear (and by plaintiff itself) cannot be
wished away by the plaintiff.
29. In view of the aforesaid discussion, interim
injunction applications filed under Order XXXIX Rules 1 & 2 CPC in the
aforesaid seven suits would stand dismissed and the interim application filed
under Order XXXIX Rule 4 CPC filed by the defendant in CS(COMM) Nos.52/2018 and
2850/2014 would stand allowed.
30. Now the issue remains as to whether costs
should be awarded in favour of the defendants. The subject suits are commercial
suits and are governed by Commercial Courts, Commercial Division and Commercial
Appellate Division of High Courts Act, 2015. With respect to commercial suits,
the provision of costs under Section 35 CPC stands amended, and the provision
of costs with respect to commercial cases is now to be dealt with by the
commercial courts as per Section 35 of the CPC amended and as applicable to
commercial courts as under:-
“Section 35. Costs. (1) In relation to any commercial dispute, the Court, notwithstanding anything contained in
any other law for the time being in force or Rule, has the discretion to
determine:
(a) whether
costs are payable by one party to another;
(b) the
quantum of those costs; and
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(c) when
they are to be paid.
Explanation.—For the purpose of clause (a),
the expression ―costs‖ shall mean
reasonable costs relating to—
(i) the fees
and expenses of the witnesses incurred;
(ii) legal
fees and expenses incurred;
(iii) any other
expenses incurred in connection with the proceedings.
(2)
If the Court decides to make an
order for payment of costs, the general rule is that the unsuccessful party
shall be ordered to pay the costs of the successful party:
Provided that the Court may make an order deviating from the general
rule for reasons to be recorded in writing.
Illustration:
The Plaintiff, in his suit, seeks a money decree
for breach of contract, and damages.
The Court holds that the Plaintiff is entitled to the money decree. However, it
returns a finding that the claim for damages is frivolous and vexatious.
In such circumstances the Court
may impose costs on the Plaintiff, despite the Plaintiff being the successful
party, for having raised frivolous claims for damages.
(3)
In making an order for the
payment of costs, the Court shall have regard to the following circumstances,
including—
(a) the
conduct of the parties;
(b) whether a party has succeeded on part of its case, even if that
party has not been wholly successful;
(c) whether the party had made a frivolous counterclaim leading to delay
in the disposal of the case;
(d) whether any reasonable offer to settle is made by a party and
unreasonably refused by the other party; and
(e) whether the party had made a frivolous claim and instituted a
vexatious proceeding wasting the time of the Court.
(4)
The orders which the Court may
make under this provision include an order that a party must pay––
(a) a
proportion of another party‘s costs;
(b) a stated amount in respect of another party‘s costs; (c)
costs from or until a certain date;
(d) costs
incurred before proceedings have begun;
(e) costs
relating to particular steps taken in the proceedings;
(f) costs
relating to a distinct part of the proceedings; and
(g) interest
on costs from or until a certain date.‖
(underlining added)
31. A reading of Section 35 CPC as applicable to
commercial courts shows that costs can be imposed at different stages of the
suits including at the time of disposal of the interim applications. Costs
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awarded are under different heads as provided under
Sub-Section (4) of Section 35 CPC. In making an order of payment of costs
Courts have to take note of the conduct of the parties and the fact that
whether any reasonable offer is made by one party to settle the disputes and
which is refused by the other party. At this stage it is required to be noted
that after some arguments in the injunction applications, on behalf of the
defendants a suggestion was put to the plaintiff that judgment need not be
invited from this Court and plaintiff should simply agree to vacate the interim
injunctions granted in its favour and not press the injunction applications,
and in which circumstances no further relief could be asked for by the
defendants, but on behalf of the plaintiff after taking instructions, its
counsel stated that a judgment is invited from this Court.
32. In view of the aforesaid discussion, while
dismissing the injunction applications filed by the plaintiff in the suits, in
favour of the defendants in the suit each of the defendants costs are awarded being
costs incurred by them towards fees paid and payable till date by these
defendants to their counsels. In this regard, affidavits of fees and charges
paid and to be paid till date by the defendants to their counsels be filed by
filing affidavits within two weeks from today and
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which affidavits will be supported by the details
of the payments made by the defendants to their counsels. Such costs shall be
the costs in favour of the defendants and against the plaintiff with respect to
and till the stage of disposal of the interim injunction applications. Costs
shall be paid by the plaintiff to the defendants within a period of four weeks
of the affidavits of costs being filed by the defendants.
33. In addition to the awarding costs to be paid to
the defendants towards the legal costs as stated above, defendants in my
opinion are also entitled for the present to costs incurred by them which would
be towards time and man hours spent by these defendants for conducting their
defences in the present suits, and subject to final decision as to costs. On
behalf of the defendants it has been argued that they have also suffered losses
of profits running into lacs and lacs, and even crores of rupees, on account of
interim injunctions having been obtained by the plaintiff, and obdurately and
illegally continued by the plaintiff. Therefore, in addition to the actual
legal costs being granted to the defendants, each of the defendant is granted
for the present a sum of Rs. 2 lacs each subject to final decision towards
costs incurred for these proceedings except the head
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of legal costs. These costs will
be paid by the plaintiff to each of the
defendants
within a period of eight weeks from today.
CS (COMM)
No. 772/2016 CS(COMM) No. 570/2017, CS(COMM) No. 780/2017, CS(OS) No.
2850/2014, CS(OS) No. 64/2016
34. I may note that issues in the suits have already been framed and
matters are listed before the Local Commissioners for recording of evidence.
35. List for awaiting the proceedings for recording of evidence on 27th August, 2018.
CS(OS) Nos. 52/2018 & 53/2018
36. List for further proceedings on 28th April, 2018 when orders will be
passed with respect to procedural aspects of completion of pleadings and
admission/denial etc.
FEBRUARY 08, 2018 VALMIKI J. MEHTA, J
ib/godara/Ne/AK
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