Toni & Guy Products Ltd. & Anr. Vs Shyam Sunder Nagpal

Toni & Guy Products Ltd. & Anr. Vs Shyam Sunder Nagpal: Ib Quia Timet Actions Damages could not be granted in the absence of actual infringement.

Case Title:Toni & Guy Products Ltd. & Anr. vs Shyam Sunder Nagpal

Date of Order:22 November 2013

Case No:CS(OS) No. 2224/2012

Citation: (2014) 57 PTC 159

Court:High Court of Delhi

Coram:Hon'ble Ms. Justice Mukta Gupta

Introduction:

The case of Toni & Guy Products Ltd. & Anr. vs Shyam Sunder Nagpal is a significant decision in Indian trade mark law, particularly regarding the applicability of Quia Timet actions—legal proceedings initiated to prevent an apprehended infringement or passing off before it actually occurs. The judgment analyzes the balance between protecting intellectual property rights and the pecuniary jurisdiction of courts, setting a precedent for similar disputes in the future.

Factual Background:

Plaintiffs (Toni & Guy Products Ltd. & Anr.): Both companies, incorporated under the laws of England, are engaged in the manufacturing, marketing, and operation of hair care products and salons under the globally recognized trade mark "TONI & GUY." The mark, coined in 1963 by Mascolo PLC, has gained international repute, including in India, where Toni & Guy operates 400 salons and enjoys substantial goodwill.

Defendant (Shyam Sunder Nagpal): Operating under the name SK Cosmetics, the defendant obtained registration for the mark "TONI & GIRL" in Class 3 (cosmetic and hair care products) in 2009, much after the plaintiffs’ usage and registration of "TONI & GUY."

Procedural Background:

Plaintiffs’ Suit (2012): Filed for permanent injunction against the defendant’s use of "TONI & GIRL," alleging deceptive similarity and potential passing off.

Defendant’s Applications: Sought rejection of the plaint under Order VII Rule 11 CPC for lack of cause of action, return of plaint for lack of pecuniary jurisdiction, and contended that no damages could be claimed as no infringement had occurred.

Issues Involved in the Case:

1. Whether a Quia Timet action can be sustained when the defendant has not commenced the use of the allegedly infringing mark.

2. Whether the suit is maintainable within the pecuniary jurisdiction of the Delhi High Court.

3. Whether damages can be claimed in a Quia Timet action where no actual infringement or passing off has occurred.

Submissions of Parties:

Plaintiffs:

Argued that the defendant’s registration of "TONI & GIRL" posed an imminent threat to their trade mark "TONI & GUY."

Emphasized that Quia Timet actions allow preventive relief even before actual damage occurs.

Claimed substantial goodwill in India and globally, with their mark "TONI & GUY" recognized as a "SUPER BRAND."

Defendant:

Contended that no cause of action existed as they had not used the mark "TONI & GIRL."

Asserted that merely obtaining registration cannot form the basis of a passing off suit.

Argued that the Delhi High Court lacked pecuniary jurisdiction as the only relief surviving was injunction, valued at Rs. 200 each, while damages (valued at Rs. 20 lakhs) were untenable without actual infringement.

Discussion on Judgments Cited:

K. Narayanan v. S. Murli, 2008 (38) PTC 22 (SC): Affirmed that mere registration without use does not automatically constitute infringement.

Mars Incorporated v. Kumar Krishna Mukherjee, 2003 (26) PTC 60 (Del): Established that Quia Timet actions are valid when there is an imminent threat of infringement.

Marks & Spencer Plc. v. One in a Million Ltd., (1998) FSR 265: Recognized that even registration of domain names with intent to misappropriate goodwill can be restrained through Quia Timet actions.

Reasoning and Analysis by the High Court:

Validity of Quia Timet Actions:

The Court, relying on Mars Incorporated, emphasized that Quia Timet actions serve to prevent potential infringement. It rejected the defendant’s contention that the absence of actual use nullifies the plaintiffs’ cause of action, holding that the threat itself suffices.

Legal Maxim Applied: Qui timet damnum — he who fears damage may take preventive action.

Pecuniary Jurisdiction Analysis:

While acknowledging the plaintiffs’ right to injunctive relief, the Court held that damages were not maintainable as no actual infringement occurred. Consequently, the suit, with injunction valued at Rs. 200 and damages at Rs. 20 lakhs, fell outside the pecuniary jurisdiction of the Delhi High Court.

Legal Maxim Applied: Ubi jus ibi remedium — where there is a right, there is a remedy, but jurisdictional limitations must be respected.

Final Decision:

The Delhi High Court concluded:

The suit was maintainable as a Quia Timet action but limited to injunctive relief.

Damages could not be granted in the absence of actual infringement.

The plaint was returned for filing before a court of competent pecuniary jurisdiction.

Conclusion:

The Toni & Guy case is pivotal in elucidating the scope of Quia Timet actions in trade mark law. It reinforces that intellectual property holders need not wait for actual infringement to seek preventive relief, particularly when their goodwill is at risk. However, it also clarifies that damages cannot be claimed in the absence of actual use, highlighting the importance of pecuniary jurisdiction in such matters.

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Written By: Advocate Ajay Amitabh Suman,IP Adjutor [Patent and Trademark Attorney] ,High Court of Delhi