Vast price differential between the two products, held to be fatal against grant of interim injunction
Introduction
The case of M/S Gufic Ltd. & Another vs. Clinique Laboratories, LLC & Another is a trademark dispute adjudicated by the High Court of Delhi. This appeal arose from an interim order issued by a Single Judge, which granted an injunction in favor of Clinique Laboratories, LLC (Respondents/Plaintiffs) against Gufic Ltd. (Appellants/Defendants), restraining the use of the trademark "SKINCLINIQ." The Division Bench, in its judgment dated July 9, 2010, overturned the Single Judge's decision, focusing on the principles of trademark infringement under Section 29 of the Trade Marks Act, 1999. This case study examines the factual and procedural background, the issues involved, the parties' submissions, judicial precedents, the court's reasoning, and the legal principles settled.
Detailed Factual Background
The Respondents, Clinique Laboratories, LLC (Plaintiff No. 1), a U.S.-based company, are globally recognized for their cosmetic and skincare products under the trademark "CLINIQUE," registered in India since July 13, 1981, under Class 3 (cosmetics, creams, lotions, etc.). They also own a series of trademarks incorporating "CLINIQUE," such as "CLINIQUE WATER THERAPY" and "CLINIQUE SKIN SUPPLIES FOR MEN," registered since 1992, and "CLINIQUE & C DEVICE" since 1978. Clinique claimed worldwide use of "CLINIQUE" since 1968 and entry into the Indian market in 2007, asserting it as the distinguishing feature of their brand.
The Appellants, Gufic Ltd., an Indian company, are the registered proprietors of "SKINCLINIQ" and related marks, including "SKINCLINIQ STRETCH NIL," since 1998-1999 under Classes 3 and 5 (cosmetics and medicinal preparations). They market "SKINCLINIQ STRETCH NIL," an Ayurvedic herbal product for stretch mark removal, with sales evidenced since 1999. Clinique became aware of Gufic’s mark in September 2006 and initiated legal action, alleging infringement and deceptive similarity with "CLINIQUE."
The dispute centered on whether "SKINCLINIQ" infringed "CLINIQUE," given their use in overlapping product categories (cosmetics/skincare) and the alleged phonetic and structural similarity.
Detailed Procedural Background
The Respondents filed a suit (CS(OS) 2581/2008) before the Delhi High Court, seeking a permanent injunction against the Appellants for trademark infringement and passing off, along with damages. On December 16, 2008, the Single Judge granted an ex parte interim injunction (IA No. 15425/2008 under Order 39 Rules 1 and 2, CPC), restraining Gufic from using "SKINCLINIQ" or related marks.
The Appellants responded with IA No. 217/2009 (under Order 39 Rule 4, CPC) to vacate the injunction, while the Respondents filed IA No. 2769/2009 (under Section 124(1)(ii), Trade Marks Act, 1999) to stay the suit pending rectification proceedings against Gufic’s "SKINCLINIQ" registration. On April 9, 2009, the Single Judge disposed of all applications: the injunction was made absolute, Gufic’s application was dismissed, and the suit was stayed pending rectification, subject to no interference with those proceedings.Gufic appealed (FAO(OS) 251/2009) to the Division Bench, challenging the injunction and initially the Section 124 stay, though the latter issue was later dropped during arguments. The Division Bench, comprising Justices Badar Durrez Ahmed and Veena Birbal, delivered its judgment on July 9, 2010.
Issues Involved in the Case
The primary issue before the Division Bench was:
- Whether the Respondents made out a prima facie case for an interim injunction under Section 29(1) of the Trade Marks Act, 1999, based on the alleged deceptive similarity between "CLINIQUE" and "SKINCLINIQ."
- Sub-issues included:
- Are "CLINIQUE" and "SKINCLINIQ" deceptively similar in structure, phonetics, or idea?
- Does the use of "SKINCLINIQ" by the Appellants render it likely to be mistaken as "CLINIQUE"?
The court explicitly excluded considerations under Section 124 (stay) and Sections 28(3) and 30(2)(e) (registered mark defenses), focusing solely on infringement.
Detailed Submission of Parties
Appellants’ Submissions (Gufic Ltd.)
- dissimilarity of Marks: The Appellant argued that "SKINCLINIQ" and "CLINIQUE" are neither identical nor deceptively similar. "SKINCLINIQ" includes the prefix "SKIN," distinguishing it structurally and visually.
- Product Differences: "SKINCLINIQ STRETCH NIL" is an Ayurvedic herbal product for stretch marks, priced at Rs. 245 for 100 ml, while "CLINIQUE" products are non-Ayurvedic cosmetics, priced significantly higher (e.g., Rs. 1,200 for 15 ml). This price differential and product nature eliminate confusion.
- Trade Dress and Consumer Base: The style, color scheme, and packaging of "SKINCLINIQ" differ from "CLINIQUE," targeting distinct consumer classes.
- Established Use: Gufic has used "SKINCLINIQ" since 1999, evidenced by advertisements, negating mala fide intent.
- Test for Similarity: Since the marks are not identical, the infringement test mirrors passing off, requiring a likelihood of confusion, which Gufic argued was absent.
Respondents’ Submissions (Clinique Laboratories, LLC)
- Focus on Marks Alone: The Respondent contended that infringement under Section 29(1) hinges solely on comparing the marks, not price, trade dress, or product specifics.
- Deceptive Similarity: "SKINCLINIQ" is phonetically and structurally similar to "CLINIQUE," especially as "CLINIQ" mimics "CLINIQUE" (pronounced "KLINECK"). Viewed holistically, from a consumer’s perspective (average intelligence, imperfect recollection), confusion is likely.
- Common Idea: Both marks suggest treatment or skincare, reinforcing similarity.
- Established Reputation: Clinique’s long-standing global and Indian use of "CLINIQUE" supports its claim to exclusivity.
Detailed Discussion on Judgments Cited by Parties
- Ruston & Hornsby Ltd. v. Zamindara Engineering Co., (1969) 2 SCC 727
- Context: Compared "RUSTON" with "RUSTAM" and "RUSTAM INDIA."
- Relevance: The Supreme Court held "RUSTAM INDIA" infringed "RUSTON," rejecting the suffix "INDIA" as a differentiator. Gufic distinguished this, arguing "SKIN" in "SKINCLINIQ" is integral, not a mere suffix.
- Amritdhara Pharmacy v. Satya Deo Gupta, AIR 1963 SC 449
- Context: "AMRITDHARA" vs. "LAXMANDHARA."
- Relevance: The Supreme Court emphasized overall phonetic and structural similarity from a consumer’s perspective. Clinique relied on this for holistic comparison; Gufic countered that "SKIN" alters the overall impression.
- Kaviraj Pandit Durga Dutt Sharma v. Navaratna Pharmaceutical Laboratories, AIR 1965 SC 980
- Context: Distinguished infringement (statutory) from passing off (common law).
- Relevance: Clinique cited it to argue that close similarity negates the need for further evidence. Gufic used it to assert that broader context (e.g., trade dress) matters in non-identical mark cases.
- Corn Products Refining Co. v. Shangrila Food Products Ltd., AIR 1960 SC 142
- Context: "GLUCOVITA" vs. "GLUVITA."
- Relevance: The Supreme Court found similarity due to a common idea (glucose/vitamins) and minimal phonetic difference ("CO"). Clinique likened "CLINIQ" to "CLINIQUE"; Gufic argued "SKIN" creates a substantial distinction.
- Amar Singh Chawal Wala v. Shree Vardhman Rice and Genl. Mills, (2009) 159 DLT 267
- Context: "LAL QUILLA" vs. "HARA QUILLA."
- Relevance: The Delhi High Court protected "QUILLA" as the essential feature. Clinique argued "CLINIQUE" is its core; Gufic countered that "SKINCLINIQ" is a unified mark, not just "CLINIQ."
- Metropol India (P) Ltd. v. Praveen Industries India (Regd), 1997 PTC (17) 779 (DB)
- Context: "CLEANZO" vs. "CLEANJO."
- Relevance: The Delhi High Court found "CLEANJO" infringing due to confusion potential. Clinique cited this for phonetic similarity; Gufic distinguished it, noting "SKIN" alters the mark’s identity.
- Parle Products (P) Ltd. v. J.P. & Co., Mysore, (1972) 1 SCC 618
- Context: Compared biscuit wrappers with similar designs.
- Relevance: The Supreme Court emphasized overall similarity over minute differences. Clinique applied this to trade dress; Gufic argued their packaging and pricing differentiate the products.
Detailed Reasoning and Analysis of Judge
The Division Bench, led by Justice Badar Durrez Ahmed, analyzed the case under Section 29(1), assuming "SKINCLINIQ" as unregistered to focus solely on deceptive similarity:
- Legal Framework: Under Section 29(1), infringement occurs if a mark is identical or deceptively similar to a registered mark, used in a manner likely to be taken as a trademark. Since "CLINIQUE" and "SKINCLINIQ" are not identical, the court assessed deceptive similarity.
- Principles Applied: Drawing from precedents:
- Marks must be compared holistically, not split into parts (Amritdhara, Corn Products).
- The perspective is that of a consumer with average intelligence and imperfect recollection (Parle Products).
- Similarity includes structure, phonetics, and conveyed idea (Corn Products).
- Comparison of Marks:
- Phonetic Similarity: "CLINIQUE" (KLINECK) and "SKINCLINIQ" (SKIN-KLINIK) differ due to the prefix "SKIN," altering the pronunciation and sound.
- Structural Similarity: "SKINCLINIQ" is a single word with "SKIN" as an integral part, unlike "CLINIQUE." Splitting "SKINCLINIQ" into "SKIN" and "CLINIQ" (as the Single Judge did) was erroneous; the mark must be viewed as a whole.
- Visual Similarity: The addition of "SKIN" and distinct trade dress (color, style) differentiate the marks visually.
- Common Idea: Both suggest treatment/skincare, but this alone does not suffice without structural/phonetic similarity.
- Consumer Perception: A consumer would not confuse "SKINCLINIQ" with "CLINIQUE" due to the prefix "SKIN" and vast price differential (Rs. 245 vs. Rs. 1,200+), targeting different market segments.
- Single Judge’s Error: The Single Judge wrongly dissected "SKINCLINIQ" and compared "CLINIQ" with "CLINIQUE," ignoring the holistic test. The Bench found no prima facie infringement.
- Scope Limitation: The court avoided registration validity (pending rectification) and focused solely on injunction merits, per the parties’ agreement.
Final Decision
The Division Bench allowed the appeal on July 9, 2010, setting aside the Single Judge’s order granting the injunction (IA No. 15425/2008) and dismissing Gufic’s vacation application (IA No. 217/2009). The injunction was vacated, and parties bore their own costs.
Law Settled in This Case
- Holistic Comparison: In assessing deceptive similarity under Section 29(1), trademarks must be compared as a whole, not dissected into components, reinforcing Amritdhara and Corn Products.
- Consumer Perspective: The test hinges on a consumer of average intelligence and imperfect recollection, not expert analysis (Parle Products).
- Contextual Factors: While infringement focuses on marks, practical differences (e.g., price, trade dress) can inform the likelihood of confusion, though not decisive alone.
- Non-Identical Marks: Where marks differ, the infringement test aligns with passing off, requiring a clear likelihood of deception (Ruston & Hornsby).
- Price Difference Material:The price differential between the two products is so vast that no consumer of products of either the appellant or the respondent would confuse one for the other
Case Details
- Case Title: Gufic Ltd. Vs Clinique Laboratories
- Date of Order: July 9, 2010
- Case No.: FAO(OS) 251/2009
- Citation:2010 SCC OnLine Del 2322 :(2010) 43 PTC 788
- Name of Court: High Court of Delhi at New Delhi
- Name of Judges: Justice Badar Durrez Ahmed and Justice Veena Birbal
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