Trademark Registration is no defense in Passing off Action
Introduction:This case involves a trademark dispute between the appellant, Kiran Sehgal, and the respondent, Veena Aggarwal, concerning the alleged deceptive similarity between the trademarks "POWERMAN" and "POWERMEN." The Delhi High Court was tasked with determining whether the interim injunction granted by the trial court restraining the appellant from using the contested trademarks should be upheld.
Background:The respondent, Veena Aggarwal, is the proprietor of the trademark "POWERMAN," which has been in use since April 2000 for manufacturing and selling electrical goods. The trademark is registered as a label mark since February 13, 2008. The appellants, former distributors of the respondent, started using the trademarks "POWERMEN DLX" and "POWERMEN MAXX," leading to the present litigation.
Parties Involved:
Respondent: Veena Aggarwal, proprietor of Power Electro Controls.
Appellants: Kiran Sehgal and others, former exclusive distributors of the respondent’s products.
Dispute:The respondent alleged that the appellants adopted trademarks deceptively similar to "POWERMAN" with dishonest intent to ride on the goodwill of the respondent.
Trial Court Decision:The District Judge (Commercial) granted an interim injunction restraining the appellants from using "POWERMEN DLX" and "POWERMEN MAXX" until the final disposal of the suit.
Appeal:The appellants challenged the interim injunction before the Delhi High Court.
Issues Raised:Whether the trademarks "POWERMAN" and "POWERMEN" are deceptively similar.Whether the registration of the appellants’ trademarks provides a valid defense against the injunction.Whether the respondent's failure to act against other infringers undermines their case.Whether the alleged monetary claim by the appellants against the respondent is relevant to the dispute.
Appellants Submission:Claimed that "POWERMAN" and "POWERMEN" are distinct marks.Argued that their trademarks are registered, and thus, no injunction could be granted.Asserted that the respondent owes them money, and the suit was filed in retaliation.
Respondent's Submission:Asserted ownership of the "POWERMAN" trademark and alleged deceptive similarity with the appellants’ marks. Claimed that the appellants, as former distributors, were well aware of the respondent’s trademark and adopted similar marks dishonestly.
Judgments Referred:
S. Syed Mohideen v. P. Sulochana Bai (2016) 2 SCC 683:
Established that registration of a trademark does not preclude an injunction in a passing-off action.
Toyota Jidosha Kabushiki Kaisha v. Prius Auto Industries Ltd. (2018) 2 SCC 1:
Highlighted the principles for judging passing-off actions, including the significance of goodwill and deceptive similarity.
Pankaj Goel v. Dabur India Ltd. (2008 SCC OnLine Del 1744):
Emphasized that registration does not provide a defense against passing-off if deceptive similarity is established.
Amritdhara Pharmacy v. Satyadeo Gupta (1963):
Discussed the test of an unwary purchaser with imperfect recollection in determining deceptive similarity.
Reasoning of the Court:
Deceptive Similarity: The Court observed that "POWERMAN" and "POWERMEN" are phonetically and visually similar, with only a minor variation (changing "A" to "E").The addition of suffixes like "DLX" or "MAXX" did not negate the deceptive similarity.
Goodwill and Intent:The appellants were former distributors of the respondent, which indicated knowledge of the respondent’s trademark and suggested dishonest intent.
Registration of Appellants’ Marks:Registration does not protect a party from an injunction in a passing-off action, especially when the later adoption of the mark is dishonest.
Action Against Other Infringers:The respondent is not obligated to sue every infringer, particularly if the infringers are insignificant or do not pose a substantial threat.
Monetary Claims:The appellants’ claim of money owed by the respondent was deemed irrelevant to the trademark dispute.
Decision:The Delhi High Court dismissed the appeal and upheld the interim injunction, restraining the appellants from using the trademarks "POWERMEN DLX" and "POWERMEN MAXX." The Court emphasized that the observations were prima facie and would not affect the final decision in the suit.
Case Title: Kiran Sehgal vs. Veena Aggarwal
Date of Order: January 10, 2025
Case Number: FAO (COMM) 5/2025
Neutral Citation: 2025:DHC:153-DB
Court: High Court of Delhi
Bench: Hon’ble Mr. Justice Navin Chawla and Hon’ble Mr. Justice Ravinder Dudeja
Advocate Ajay Amitabh Suman
[Patent and Trademark Attorney]
High Court of Delhi
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