Trademarks and prior use

 Section 2(1)(i)(viii)(zb) in The Trade Marks Act, 1999

 (zb) “trade mark” means a mark capable of being represented
graphically and which is capable of distinguishing the goods or
services of one person from those of others and may include
shape of goods, their packaging and combination of colours;
 Registered marks

Definition  Unregistered marks

  Passing off is making a representation that induces customers to
believe that a product originates from a particular manufacturer
without it originating from that manufacturer.
 It is required to be prevented:
1. To protects a trader’s property (goodwill)

What is Passing 2. Preventing confusion in the minds of the consumer.

off ? Test - “classical trinity”:

1. Existence of Reputation and Goodwill.
2. Existence of the Fact of Misrepresentation.
3. Possibility of Irreparable Injury.
  A trademark provides exclusive rights and various advantages
to its owners, such as an increase in sales, advertisement of the
product or service, establishing the reputation of the product or
service, etc.
 It is an established principle under the trademark law in India

Prior Use that whoever uses the trademark first will be considered the
owner or the creator of it.
 This principle is known as the doctrine of prior use.
 It is a judicial principle that states that the prior user of the
mark will have superior and exclusive rights against that of a
registered proprietor claiming for the such mark.
  Section 35 of the Trademarks Act, 1999 deals with transborder
or spillover reputation.
 It protects foreign trademarks based on their reputation at the
global level.
Section 35 of  By this Section, the Indian Courts have dropped the
the Trademarks conventional approach, which required the registration or use
of a trademark in India for establishing a case of passing off.
Act, 1999  By recognizing the ownership of a trademark by a foreigner
based on the reputation of their goods or services in a foreign
land, the concept of transborder reputation has been sown in the
trademark law of India. 
  Whether or not the action for passing off is maintainable
against the registered proprietor of a trademark by the
respondents who are not the registered proprietors of the
‘whirlpool’ trademark concerning washing machines?

Issues  Whether or not the respondent acquired a transborder

reputation?
 Whether such transborder reputation transcends the territorial
boundaries or not?
  The Court also stated that since the mark ‘whirlpool’ has
become synonymous with washing machines and other such
electrical appliances of the respondents, the people intending to
buy their goods will most likely be confused or deceived if the
appellants continue to sell their goods under the same
The Judgment mark ‘whirlpool’.
 If the appellant is allowed to sell his goods under the same
mark, then the respondents might suffer heavily as the goods
sold by the appellants are of inferior quality to that of the
respondents. 
  In a path-breaking development for Indian trademark law, the
Supreme Court in Toyota Jidosha Kabushiki Kaisha v. M/S
Prius Auto Industries Limited that IP rights are “territorial”
and not “global.”
 The court was deciding a matter involving “Prius,” the brand
Territorial rights under which Toyota sells its leading “hybrid” car.
 The court held that merely because Prius is well known outside
India does not mean that it enjoys a “reputation” in India as
well. 
  The Plaintiff (Toyota Jidosha Kabushiki Kaisha) sought to prevent the
Defendants (spare parts suppliers) from using the trademarks “Toyota”,
“Innova,” and “Prius”.
 The first two marks were registered trademarks of the Plaintiff, and the
lower courts had no difficulty in finding in favour of Toyota on this count.
The Defendants did not contest these findings before the Supreme Court.
 The contest only concerned the trademark “PRIUS”, which the plaintiff
claimed belonged exclusively to it. Interestingly, the plaintiff had no

Facts trademark registration for this mark, but the Defendant did (a registration
dating back to 2002).
 Toyota contested this registration by the defendants, claiming that it was the
first user of Prius (and began using this mark as early as 1997) and that the
Defendants had wrongly and dishonestly registered the same in India.
 As such, the only question before the Supreme court was: Despite the
defendants’ registration of Prius as a trademark, could the plaintiff still
claim that they have a stronger (passing off) claim to the said mark, being
prior adopters/users of the same?
 The court ruled in favor of the Defendants, noting that the
Plaintiff had not supplied enough proof of its “reputation” in
the Indian market. In other words, although trans-border
reputation was now very much a part of Indian law, such
reputation could not merely be asserted but must be proved.
And within the “territory” of India. The court notes:
 “…if the territoriality principle governs the matter, and we
have already held it should, there must be adequate evidence to
show that the plaintiff had acquired a substantial goodwill for
its car under the brand name ‘Prius’ in the Indian market
also..”
  In other words, although the mark may be very well known
abroad, that is not sufficient.
 Reputation in the local milieu must be proved as well.
 The court noted that in the year 2001(which, as per Plaintiff,
Cont… was the effective date on which a significant cross-section of
Indian consumers would have known of their mark), the
Internet was still not in widespread use, and therefore not many
would have learned of the mark:
  The court ruled as below:
 “All these should lead us to eventually agree with the
conclusion of the Division Bench of the High Court that the
brand name of the car Prius had not acquired the degree of

Judgement goodwill, reputation, and the market or popularity in the Indian

market to vest in the plaintiff the necessary attributes of the
right of a prior user to successfully maintain an action of
passing off even against the registered owner.”
  The court appears to lean towards the view that mere reputation
alone would not suffice for a passing-off action.

The new norm  Rather, one must also demonstrate local “goodwill,” which at
the bare minimum means that there must be some “customers”
within the local jurisdiction.