Interplay of Trademark Licensing and Public Trust Law
Introduction: This case arises from a contractual and trademark dispute between a corporate entity, Global IEEE Institute for Engineers, and a public charitable trust-cum-society, IEEE Mumbai Section Welfare Association. The dispute centered on the termination of two service agreements and the subsequent unauthorized use of the IEEE trademark by the defendant trust. The case presented a complex interplay between intellectual property rights, private contractual obligations, and statutory requirements under the Maharashtra Public Trusts Act, 1950 (MPT Act). The High Court of Karnataka’s decision in this case provides significant legal clarity on the applicability of MPT Act provisions to civil suits arising from private commercial arrangements.
Factual Background:The appellant, Global IEEE Institute for Engineers, is a private limited company registered in India and a second-tier subsidiary of IEEE Asia Pacific Limited and IEEE Worldwide Limited, both of which are not-for-profit entities wholly owned by the Institute of Electrical and Electronics Engineers Inc. (IEEE Inc.), a U.S.-based professional body incorporated in 1896. IEEE is known globally for its work in advancing technology and science through publications, standards, and conferences.
The respondent, IEEE Mumbai Section Welfare Association, was initially a geographical unit of IEEE Inc., formed in 1976 to promote IEEE activities in western and central India. In 2012, it was registered as a society under the Societies Registration Act, 1860, and later in 2013 as a public trust under the MPT Act.
In 2012 and 2013, the parties entered into two Service Assistance Agreements, under which the plaintiff (appellant) was to provide administrative and governance support services to the defendant (respondent), including coordination with IEEE Inc. and facilitating compliance with IEEE’s brand standards. The defendant was authorized to use the IEEE name, mark, and branding under these agreements. Following allegations of non-cooperation and failure to comply with financial reporting obligations by the defendant, the plaintiff issued a termination notice on 2 May 2024. Despite termination, the defendant allegedly continued to use the IEEE trademark and branding, prompting the plaintiff to initiate a commercial suit seeking declaratory relief, permanent injunction, and damages.
Procedural Background:Upon institution of the commercial suit by the plaintiff before the LXXXIV Additional City Civil and Sessions Judge, Bengaluru (Commercial Court), the defendant filed an application under Order VII Rule 11(a) and (d) of the Code of Civil Procedure, 1908, contending that the suit lacked cause of action and was barred by law, specifically under Sections 50 and 51 of the MPT Act.
The Commercial Court partly allowed the application. It held that the suit was barred under Order VII Rule 11(d) for want of prior consent from the Charity Commissioner as required under the MPT Act, but declined to reject it under Rule 11(a), observing that the existence of cause of action was a mixed question of law and fact. Aggrieved by the rejection under Rule 11(d), the plaintiff preferred Commercial Appeal No. 181/2025. The defendant cross-appealed under Commercial Appeal CR No. 3/2025 against the rejection of the plea under Rule 11(a).
Core Dispute: The primary legal issues in this case were whether the plaintiff, being a licensee of the IEEE trademark and not the registered proprietor, had the locus to seek injunctive and declaratory relief, and whether the suit was barred for want of prior consent of the Charity Commissioner under Sections 50 and 51 of the Maharashtra Public Trusts Act, 1950. The core of the dispute revolved around whether a private contractual claim involving a public trust mandates compliance with procedural bars under the MPT Act, and whether the continued use of a trademark post-termination gives rise to a private actionable claim by a licensee.
Discussion on Judgments: Multiple judgments were cited by both parties to support their claims regarding the bar under the MPT Act and locus standi in trademark law.
The appellant relied heavily on Sopan Sukhdeo Sable v. Assistant Charity Commissioner, (2004) 3 SCC 137, to emphasize that a suit which does not relate to trust administration, but instead concerns private disputes like tenancy or contractual breach, falls outside the scope of Sections 50 and 51 of the MPT Act.
The appellant also cited Vinayaka Dev Idagunji v. Shivaram, (2005) 6 SCC 641, where the Supreme Court held that a hereditary archak’s suit regarding private rights was outside the ambit of Section 50, which applies only to suits in representative capacity involving public interest.
Further reliance was placed on Trust of Shri Laxmi Narayan Dev Temple v. Ajendraprasadji Narendraprasadji Pande, 2013 SCC OnLine Guj 8716, and Shri Nijanand Jogani Abhiyan Trust v. Parshottam Narsinhbhai Patel, 2024 SCC OnLine Guj 3043, to demonstrate that not all suits involving public trusts require Charity Commissioner’s consent, especially those grounded in private contractual claims.
To address the trademark issue, the appellant referred to Gujarat Bottling Co. Ltd. v. Coca Cola Co., (1995) 5 SCC 545, which held that agreements relating to brand usage form the basis of private enforcement and are distinct from statutory rights.
The respondent, in contrast, invoked Church of North India v. Lavajibhai Ratanjibhai, (2005) 10 SCC 760, to argue that if a trust’s name, identity, or structure is challenged, the matter falls squarely within the trust administration, attracting the bar under Section 50 of the MPT Act.
To contest the plaintiff’s locus standi under trademark law, the respondent cited P.K. Sen v. Exxon Mobile Corporation, 2017 SCC OnLine Del 6393, and Ultratech Cement Ltd. v. Dalmia Cement (Bharat) Ltd., 2015 (2) ABR 496, arguing that only the registered proprietor or registered user under the Trade Marks Act, 1999, can sue for infringement.
Reasoning and Analysis of the Judge:The Court emphasized that only the plaint and accompanying documents are to be considered for Order VII Rule 11 applications, and not the defense or counter-documents. It held that the contractual dispute in question was between a corporate body and a trust regarding obligations under a terminated agreement, and did not relate to the internal affairs or public administration of the trust.
In interpreting Section 2(10) of the MPT Act, the Court noted that the plaintiff was not a trustee, member, or beneficiary of the defendant trust, and thus not a “person having interest.” Moreover, the agreements predated the trust registration and governed only certain aspects of administrative support and branding. The scope of services depended on the defendant’s request, further underscoring the limited nature of the contractual relationship.
The Court rejected the argument that the plaintiff’s action was effectively one for infringement. It observed that the reliefs sought arose from breach of contractual terms concerning trademark use, and thus were private in nature, even if touching upon IP issues. It emphasized that a licensee enforcing a contractual restraint clause is not seeking to enforce statutory rights under the Trade Marks Act, and hence is not barred under Section 53 of that Act.
The trial court’s approach was criticized for drawing an artificial distinction between “individual” and “institutional” private rights and for failing to analyze whether the reliefs sought related to trust administration.
Final Decision:The High Court set aside the Commercial Court’s rejection of the plaint under Order VII Rule 11(d) of the CPC and restored the suit for trial on merits. The Court held that the plaintiff was not required to obtain prior consent under Sections 50 and 51 of the MPT Act, as the suit pertained to private contractual rights. The defendant’s cross-appeal regarding absence of cause of action was also dismissed.
Law Settled in This Case: This case reaffirms that private contractual disputes involving a public trust do not attract the procedural bar under Sections 50 and 51 of the Maharashtra Public Trusts Act unless the suit relates to trust administration or involves a “person having interest” as defined under Section 2(10). Further, it clarifies that a licensee under a trademark agreement may sue for relief against unauthorized use post-termination, provided the action is rooted in contract and not based solely on statutory infringement rights. The decision underscores that Order VII Rule 11 applications must be confined to the plaint and its annexures without reference to the defendant's stand.
Case Title: Global IEEE Institute for Engineers v. IEEE Mumbai Section Welfare Association:Date of Order: 2nd July, 2025:Case Number: COMAP No. 181/2025:Name of Court: High Court of Karnataka at Bengaluru:Name of Judges: Hon’ble Mr. V. Kameswar Rao (Acting Chief Justice) and Hon’ble Mr. Justice C.M. Joshi
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Written By: Advocate Ajay Amitabh Suman, IP Adjutor [Patent and Trademark Attorney], High Court of Delhi
