Honest Concurrent Use of Trade Mark
- What is a Trade Mark? Its uses and effects.
A Trade Mark is essentially a mark used to differentiate a certain entity, which may be categorized as goods or services provided by a person and/or business, from the rest. This mark may feature names, shapes, colours, icons, or a combination thereof, as well as any other graphical representation that distinguishes it from others.
- The need of Trade Mark. Why is it essential?
To answer this question, it is important to reflect upon the history behind the concept of Trade Marks and understand its origin.
According to chronicles, the sword-making Blacksmiths throughout the Roman Empire are thought to have been among the first to use the notion of Trade Marks. Evidently, the same can be said to be true, since swords often carry a distinctive mark engraved on their handle, making it easy to establish its authenticity and identify its maker. For the same reason, the makers of Japanese Katanas, dating back to those that are well over a thousand years old, have signatures engraved on the section of the blade known as the tang that is covered by the handle. Therefore, in order to establish its authenticity and identify its owner, a distinctive mark is essential; hence, the need for a Trade Mark.
- Laws governing Trade Marks
The oldest recorded legislation with respect to protecting Trade Marks was passed by the Parliament of England in the year 1266 under the reign of King Henry the third. The said legislation protected baker’s rights so that they can use a distinctive mark for the bread they sold. Whereas modern Trade Mark laws emerged around in the late 19th Century, wherein countries like France established its own Trade Marks law in 1857 called the “Manufacture and Goods Mark Act”, it was one of the earliest and most diverse legislation which aimed at both use-based and examination-based Trade Mark registration.
In India, however, the law relating specifically to Trade Marks was enacted after a long overdue in the christian year 1999 by the Parliament of India repealing the earlier legislation called the “Trade and Merchandise Marks Act” of 1958 that had replaced the original Trade Marks Act of 1940. This new Act is called the Trade Marks Act, 1999, aimed at providing for registration, better protection of Trade Marks for goods and services and to prevent the use of fraudulent marks. In furtherance, Trade Mark Rules 2002, a procedural law adopted to outline the procedural components of Trade Mark filing, examination, publication, opposition, registration, renewal, correction, and its removal.
- What is Honest Concurrent Use of Trade Mark?
An Honest Concurrent Use of a Trade Mark is said to exist where two distinct entities have coexisted for an extended period of time while honestly utilizing the same or a strikingly similar representation of the same name or mark that is registered. It is important to note that in India, even the unregistered Trade Marks have been given statutory protection by the virtue of Sections 34 and 35 of the Trade Marks Act, 1999.
Thus, the concept of honest concurrent use acts as a barrier of protection for those entities who have been honestly using such marks and/or names that are same or have a strikingly similar representation, thereby also allowing for the same to be registered as per S.12 of the Trade Marks Act, 1999, provided that it satisfies the Registrar that it is a result of special circumstance and not an ordinary case of infringement.
SCOPE OF HONEST CONCURRENT USE
It is common knowledge that the use of a Trade Mark that is deceptively similar to another’s constitutes infringement. Nevertheless, honest concurrent use can be utilized as a defense strategy in the event of infringement claims or proceedings. However, the person taking the defense of Honest Concurrent Use must not take actions that intensify uncertainty beyond what is unavoidable and so infringe upon the claimant’s goodwill. However, such defense strategies, if satisfied, can be used to register such Trade Marks as per S.12 of the Trade Marks Act, 1999, which provides for registration in cases of Honest Concurrent Use.
CONFUSION ARISING OUT OF RESEMBLANCE AND REMEDIES
Every time a product has a resemblance to another or is comparable to one in the market, there is a likelihood of the same creating confusion in the minds of the public. Thus, exploiting the more well-known brand’s reputation for one’s own advantage would be an infringement on the other’s Intellectual Property Rights. However, there are also instances when such confusion is due to Trade Marks that are deceptively similar to each other. Therefore, the Registrar must determine, based on the facts of the case, whether a specific Trade Mark is likely to mislead or create confusion.
Viewpoints of the Indian Courts on the subject matter:
- The Hon’ble Supreme Court of India in National Sewing Thread Co. Ltd., Chidambaram Vs. James Chadwick & Brothers Ltd.has observed that the burden of proof lies on the Applicant who seeks to register his Trade Mark, so as to prove that his mark is not likely to deceive or cause confusion in the minds of the public. Thus, the onus likes on him to satisfy the Registrar that his mark does not fall within the ambit of S.8 of the of the Trade Marks Act, 1940 and therefore, it should be registered. Moreover, in deciding whether a particular Trade Mark is likely to deceive or cause confusion, that duty is not discharged by merely comparing it with the Trade Mark that is already registered and whose proprietor is offering opposition to the registration of the said mark. The Hon’ble Apex Court further observed that in such cases, the real issue to be decided is how a purchaser, who must be perceived as an average man of average intelligence, would react to a particular Trade Mark, what associations he would form by looking at the Trade Mark, and how he would associate the Trade Mark with the goods he would be purchasing.
- The Hon’ble Supreme Court of India in Renaissance Hotel Holdings Inc. Vs. B. Vijaya Saihas provided clarity on the subject by observing the following:
- When the defendant’s mark is identical to the plaintiff’s registered Trade Mark, and the goods or services covered are similar to those covered by such a registered Trade Mark, it may be necessary to prove that it is likely to cause public confusion, or that it is likely to have an association with the registered Trade Mark.
- Similarly, when the Trade Mark of the plaintiff is similar to the registered Trade Mark of the defendant and the goods or services covered by such registered Trade Mark are identical or similar to the goods or services covered by such registered Trade Mark, it may again be necessary to establish that it is likely to cause confusion on the part of the public.
- However, when the Trade Mark of the defendant is identicalto the registered Trade Mark of the plaintiff and that the goods or services of the defendant are identical with the goods or services covered by registered Trade Mark, then the Court shall presume that it is likely to cause confusion on the part of the public.
Viewpoints of the foreign courts on the subject matter:
- The United States Court of Appeals for the Second Circuit in the matter of Polaroid Corporation vs. Polarad Electronics Corporationreferred to the Harold F. Ritchie, Inc. v. Chesebrough-Pond’s, Inc. case, wherein there was confusion as to the identical product, and the Avon Shoe Co., Inc. v. David Crystal, Inc. case, wherein the defendant had adopted its mark without knowledge of the plaintiff’s prior use, and observed that “where the products are different, the prior owner’s chance of success is a function of many variables, such as:
- the strength of his mark,
- the degree of similarity between the two marks,
- the proximity of the products,
- the likelihood that the prior owner will bridge the gap, actual confusion, and the reciprocal of the defendant’s good faith in adopting its own mark,
- the quality of defendant’s product, and
- the sophistication of the buyers.
However, even with this exhaustive list, the court may still need to explore other variables.”
- The Intellectual Property Enterprise Court (IPEC) of ENGLAND AND WALES in the matter of Gnat and Company Limited & anr. Vs. West Lake East Limited & anr.encountered a similar dispute arose wherein the Claimants have alleged Trade Mark infringement and passing off.
The facts of the case were such that since 2005, the Claimants’ group has operated its Cantonese restaurant at the Dorchester Hotel in London under the name “China Tang.” Whereas, from 2009, the Defendants have been operating a Chinese takeout restaurant in Barrow-in-Furness, also under the name “China Tang”. Therefore, In response, the Defendants asserted an Honest Concurrent Use defense on the grounds that the name “China Tang” was chosen without knowledge of the Claimants’ business and that they had been using the same name concurrently for a lengthy period of time. Thus, the court ruled in favour of the Claimants for Trade Mark infringement and noted that there is a likelihood of confusion in the minds of the public, given the fact that both businesses have a close visual similarity in respect of their signs, their aural identity and their respective services. Furthermore, with respect to the defense of Honest Concurrent Use by the Defendants, the court held that the Defendants did not even perform a basic Internet search prior to selecting a name for their restaurant. Had The court con that if they had done so, they would have discovered the Claimant’s website, or at the very least, its reviews and/or comments. Using a name without doing simple Internet searches would not be deemed “Honest Concurrent Use” in the age of easy Internet searches. Thereby striking off their defense.
FACTORS TO BE TAKEN INTO ACCOUNT FOR REGISTRATION
There are several factors to be taken into account in order to qualify for registration in case of Honest Concurrent Use:
- The parties under dispute must have coexisted for an extended length of time using the subject that forms the reason for the dispute.
- The party so registered or unregistered must have been in honest usage of the same and without any knowledge or intention to cause harm, loss or injury to the parties so claiming infringement.
- The party must convince the Registrar that it is a peculiar situation resulting from an exceptional occurrence of coexistence and not a simple case of infringement resulting from imitation.
- The party must establish beyond a reasonable doubt that the same was unforeseeable and unavoidable, and so beyond their control or imagination. In furtherance, the parties must also establish that they are not trying to or tried to trade upon and benefit from the reputation and goodwill acquired by the claimant.
- The party must also establish beyond a reasonable doubt that there is no confusion or deception arising in the mind of the public as a result, thereby showing that the adoption of the mark was honest and concurrent.
The decisions of the Hon’ble Courts cited in this article serve as a token of the various factors that are taken into consideration while evaluating “Honest Concurrent Use” in the context of a Trade Mark dispute. The following elements will be taken into consideration as part of this evaluation:
- Whether the mark is distinctive, both in its essence and in connection to the services it offers.
- Whether the Defendant in a dispute was aware of the existence of the Trade Mark and, if not, whether he conducted a reasonable search to find the existence of similar or identical Trade Marks.
- Whether misunderstanding is likely to occur in the minds of the general public with regard to the chosen Trade Mark.
- National Sewing Thread Co. Ltd., Chidambaram Vs. James Chadwick & Brothers Ltd. [AIR(SC)-1953-0-357].
- Renaissance Hotel Holdings Inc. Vs. B. Vijaya Sai [SCC-2022-5-1].
- Polaroid Corporation vs. Polarad Electronics Corporation [11 287 F.2d 492 (1961)].
- Harold F. Ritchie, Inc. v. Chesebrough-Pond’s, Inc. [2 Cir., 1960, 281 F.2d 755].
- Avon Shoe Co., Inc. v. David Crystal, Inc. [2 Cir., 1960, 279 F.2d 607].
- Gnat and Company Limited & anr. Vs. West Lake East Limited & anr. [2022 EWHC 319 (IPEC)].
- Law of Trade Marks and Passing off – by P. Narayan, Sixth Edition
- Trade Marks and Passing off – by Venkateswaran, Seventh Edition, Vol. 1.
BY ABHISHEK KUNCHIKOR