The Delhi High Court has come down heavily on the tactics of concealment of real defendants in Intellectual Property (IP) Infringement cases utilized by plaintiffs with the aim of obtaining ex-parte injunction. In a recent trademark infringement and passing off dispute between Bata India Limited vs Chawla Boot House & Anr, the Delhi High Court ruled that Plaintiff’s approach of impleading an unknown party as ‘Defendant No. 1’ was impermissible in law and directed stringent actions from the High Court Registry to control such misuse in all IP disputes.
The Court expressed its dismay over the non-compliance of the settled legal position and observed that this tactic has been adapted multiple times in IP infringement cases to obtain ex-parte injunctions in the initial hearing by making it very difficult for the main defendants to spot themselves in the cause list and appear in litigation concerning them.
Regarding the merits of the case, the court observed that Red Chief’s mark ‘POWER FLEX’ was infringing upon Bata’s trademark ‘POWER.’
Bata instituted a trademark infringement suit against Red Chief, a footwear brand owned by Leayan Global, for using ‘POWER FLEX’ and the tagline ‘THE POWER OF REAL LEATHER’. According to Bata, it had exclusive right over the mark “POWER” by virtue of long and continuous use as well as multiple trademark registrations. Before addressing the substantial part of the dispute i.e. trademark infringement, passing off, and unfair competition, the Court decided to address the way the Defendants were arrayed by the Plaintiff Company.
ARRAYING OF UNKNOWN PARTY AS THE MAIN DEFENDANT
Bata named Delhi-based retail outlet – Chawla Boot House, as the main defendant, whereas, the allegations were directed against the manufacturer company, Leayan Global. This hints at mala–fide intentions of the plaintiff to obtain ex-parte order against the main defendants by preventing them from detecting their names in the cause list by listing it as ‘Chawla Boot House & others’.
This practice was declared impermissible in law in the case of Micolube India Ltd. v. Maggon Auto Centre & Anr in which the plaintiff had arrayed Maggon Auto Centre as the main defendant whereas the principal party i.e. Motor Industries was arrayed at Defendant no. 2. It was further noted that such practices disentitle a plaintiff of any equitable relief since the plaintiff did not approach the court with clean hands. It was held in that:
“The very fact that the plaintiff has also indulged in this practice is an indicator that it did not want the counsel for the defendant No. 2 to appear on the first date on which the matter was taken up for consideration of the grant or non-grant of ad interim injunction.”
Despite the established legal position, plaintiffs continue to array parties unrelated to the dispute as to the main defendant. The Registry was therefore ordered by the High Court to ensure strict compliance with the ratio laid down in the Micolube India judgment. In addition, a circular has been issued directing plaintiffs in all IP cases where there are multiple defendants to furnish an affidavit to the Registry confirming the arraignment of the main contesting party in the suit as Defendant No. 1.
Image Credits: Photo by Tingey Injury Law Firm on Unsplash
Despite the established legal position, plaintiffs continue to array parties unrelated to the dispute as to the main defendant.
The Registry was therefore ordered by the High Court to ensure strict compliance with the ratio laid down in the Micolube India judgment.