Monthly Archives: November 2013

Cadbury Loses Trade Mark Battle

 

31st October, 2013 was a dooms day for Cadbury when it lost 4 of its éclair related trademarks on the basis of rectification petitions made by ITC. S. Usha, the Vice-Chairperson of the Intellectual Property Appellate Board (IPAB), ordered with a direction to the Registrar of Trade Marks to remove the trade marks registered under Nos. 298102, 353398, 436335 and 327607 from the Register.  She also dismissed ORA/28/05/TM/KOL stating that “nothing survives in the said trademarks.”  The catalyst for the rectification petitions was a civil suit for trademark infringement filed by Cadbury, in 2005, against ITC with a prayer for an injunction restraining ITC using the word ‘éclair’ in conjunction with ITC’s trademarks.

In a counter to the trademark infringement suit filed by Cadbury, ITC filed rectification petitions against the four trademarks.

The four trademarks are as follows:

 ORA/25/05/TM/KOL relates to Cadbury’s Chocolate Éclairs (a label mark) under No.298102 in class 30, registered on 24.01.1976. ORA/26/05/TM/KOL relates to Cadbury Chocolate Éclairs (a label mark) under No.353398 in class 30 and registered on 31.10.1985. ORA/28/05/TM/KOL relates to the trade mark Chocolate Éclairs Pop (a label mark) under No.436335 in class 30 registered on 31.10.2002. ORA/29/05/TM/KOL relates to the Trade Mark Cadburys Orange flavoured Chocolate Éclairs (a label mark) under No.327607 in class 30 and registered on 31.01.1985.

Facts of the case:

M/s ITC Limited (herein after Applicant) is an existing company which is one of the leading reputed corporate in India and has been engaged in the business of marketing and manufacturing consumer goods since 1910. The applicant’s trade mark has acquired an immense goodwill and reputation owing to high quality of the goods manufactured by them.

The applicant started the business of marketing confectionery products in the year 2002 under the brand names “Minto – O” & Candyman. The applicant started marketing the éclairs confectionery in or about August, 2003. Since then, the applicant has been continuously and extensively using the trade mark Éclairs in conjunction with its famous trade mark “Candyman” which was well recognized by the customers.

On the other hand respondent is one of the largest international beverage and confectionery companies in the world.  The trade mark Cadbury Eclair was adopted by the respondent’s predecessors several decades ago. The trade mark has been used continuously since its adoption. The trade mark Cadbury Eclair is used in respect of a milk chocolate with a chewing caramel shell.

The respondent introduced a product under the name Cadbury Chocolate Eclairs/Eclair in the year 1972 in India. The trade mark Cadbury Chocolate Eclairs was registered under No.298102 in Class 30 as early as 01.08.1974 in respect of Milk Chocolates and Chocolate sweets. As such, the respondent has the exclusive right to use the trade mark. The respondent’s trade mark is registered in various other countries.

On 05.04.2005, the applicants received an order of exparte injunction dated 01.04.2005 restraining the applicant from using the trade mark “Eclairs” or any other deceptively similar trade mark. The said order was passed by the City Civil Court Judge, Ahmedabad in a suit filed by M/s Cadbury Schweppes (registered proprietor/respondent herein.)

Being aggrieved by the injunction order, the applicants approached the Hon’ble High Court of Gujarat and the High Court of Gujarat passed a modified order dated 15.4.2005 allowing the applicants to manufacture and sell their éclairs products as Candyman Choco éclairs since other manufacturers, too, have been using the word Eclairs.

When the matter came up for oral arguments in front of the IPAB, Cadbury’s counsel reportedly informed the Court that the company was taking steps to withdraw the petitions and was not interested to argue the matter on merits. ITC however pushed for a hearing because of the injunction they had received from the Civil Court in Ahmedabad on behalf of Cadbury. Thereafter, IPAB revoked all the four trademarks for non-use.

Under section 47of the Trade Marks Act, 1999 IPAB can order the removal of the registered marks on the grounds of Non- Use, or if there has been no proof to show the usage of that mark for a period of five continuous years from the date of application.

Analysis:

It was rather shocking to see that Cadbury decided to abandon the four Trademarks which they have kept, maintained and used for past 40 years without even arguing in front of IPAB. It was more puzzling as to why Cadbury could not prove usage of the marks by providing evidences of advertisements of the product and availability of the product in the market.

According to the spokesperson of Cadbury India the label mark for Cadbury India which formed the subject matter of the case was no longer used by Cadbury and they had no plans to use it in future as well.

Thus, the implications of the said order would not allow Cadbury India to be the owner of the four trademarks and thus it cannot hold anyone for infringement of these marks in the future.

About the Author: Ms Sheetal Tiwari, Trademark Attorney at Khurana and Khurana and can be reached at: sheetal@khuranaandkhurana.com

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Indian Patent Office Rejects Compulsory Licensing Application: BDR Pharmaceuticals Pvt. Ltd. Vs Bristol Myers Squibb

India issued its first CL last year for a Bayer’s kidney liver cancer drug Nexavar to an Indian generic manufacturer Natco on all three grounds of section 84 (1) including reasonable requirement of public not being met, non availability of drug on affordable prices, and non-working of the invention in the territory of India. This decision by the Indian government that lead to the issuing of CL encouraged more domestic generic manufacturers to go ahead with filing more CL applications for patented drugs.

The term compulsory license is used to describe a number of mechanisms for non – voluntary authorizations to use patents. The most important global norm for the use of compulsory licenses is Article 31 of the WTO TRIPS Agreement, which addresses uses “of a patent without the authorization of the right holder, including use by government or third parties authorized by the government.

Recently, the Controller General of Patents (hereinafter Controller) in India has rejected BDR Pharmaceuticals Pvt. Ltd.’s application for CL for Bristol Myers Squibb’s (BMS) cancer drug SPRYCEL. SPRYCEL is a brand name in which the active pharmaceutical ingredient is DASATINIB, used by patients with Chronic Myeloid Leukemia which is covered in patent number IN203937. The drug has received Orphan Drug Status in USA, Europe and Switzerland. The Controller rejected the compulsory license application made by BDR for stating that BDR has failed to make out the prima facie case for the making of an order under section 87 of the Act.

BDR had requested for compulsory license of DASATINIB on March 4, 2013. BDR claimed that DASATINIB is a suitable chemotherapeutic option for the treatment of Chronic Myeloid Leukemia and is prescribed when a patient is resistant or develops resistance to the drug IMATINIB, in view of the improved tolerance and efficacy of the drug. BDR Pharmaceutical also submitted that the price of each tablet sold by the patentee is INR 2761/- which works out to INR 1, 65,680/- for 60 tablets per month per patient and about INR 19, 88,160/- per year per patient. BDR on the other hand submitted that it will make drug available to the public at a proposed price of Rs. 135/- per tablet which will work out to Rs. 8100/- per month for the treatment of Chronic Myeloid Leukemia patient and moreover the drug will be offered free of cost to a certain percentage of patients suffering from Chronic Myeloid Leukemia as determined by the cancer specialist.

BDR Requested for Voluntary Licence

In the present case, BDR sent a letter dated 2nd February 2012, to BMS requesting for a voluntary license for manufacturing DASATINIB in India.

In response to BDR’s letter,  BMS raised certain queries by their letter dated 13th March 2012 such  as “facts which demonstrate an ability to consistently supply high volume of the API, DASATINIB, to the market”, “facts showing your litigation history or any other factors which may jeopardize Bristol Myers Squibb’s market position”, “quality related facts and in particular compliance with local regulatory standards and basic GMP requirements”, “quality assurance systems due diligence”, “commercial supply teams”, “safety and environmental profile”, “risk of local corruption”.

BDR took this reply of Bristol Myers Squibb as ‘clearly indicative of the rejection of the application for voluntary licence’ and did not pursue the matter and made no further effort to arrive at a settlement and made an application of compulsory licence on 4th March 2013.

Notice of Prima Facie Case not being made out

After a review of the BDR’s CL application by the Controller, a notice was issued stating that a prima facie case was not being made out for the making of an order under Section 84 of the Act as ‘the applicant has not acquired the ability to work the invention to the public advantage’, in the absence of the requisite approval from DCGI, and ‘the applicant has also not made efforts to obtain a licence from the patentee on reasonable terms and conditions’. BDR filed a request for hearing with the Patent Office on May 13, 2013.

BDR’ Arguments and Controller’s Decision

In the hearings fixed by the Controller, BDR submitted that by not specifically replying to the request for voluntary licence, the patentee could have continued to correspond asking for more and more information and kept the request for voluntary licence in abeyance. Moreover, the patentee could have also used the information sought from the applicants against the applicants themselves in ongoing suits for patent infringement.

BDR further argued that if the patentee avoids to specifically rejecting the request for voluntary licence or does not address the terms for grant thereof, the application for compulsory licence could be indefinitely delayed for want of specific denial from the patentee, unless the Ld. Controller exercises his powers in appreciating the efforts made by the applicant towards fulfilling the requirements of Section 84(6)(iv). In considering the application field under this section, the Controller shall take into account,—

(iv)   as to whether the applicant has made efforts to obtain a licence from the patentee on reasonable terms and conditions and such efforts have not been successful within a reasonable period as the Controller may deem fit.

The Controller stated that the contentions of the applicant are misplaced and ‘explanation’ to Section 84(6) of the Patent Act, 1970, clarifies beyond doubt that a patentee cannot indefinitely prevent an applicant for voluntary licence from making an application for compulsory licence under Section 84 of the Act. At the most, if at all, the patentee can prevent a prospective applicant for six months from making an application for compulsory licence.

The Controller further stated it is evident from the proceedings that the applicant realized his mistake and thereafter tried hard to somehow justify the inaction of not replying at all to the letter of the patentee dated 13th March 2012 due to which these submissions can only be termed as afterthought.

BDR also contended that to the utter surprise of the applicant, in the April 2012 issue of ‘Indian Business Law Journal’, the attorney for the patentee publicly declared that the strategy on behalf of the patentee was ‘to keep the potential licensee of a compulsory licence engaged without a clear outright rejection’ and continue with fresh queries. This lead the applicant to conclude that there would be no purpose in responding to the said letter of the patentee seeking more information, because any response on the part of the applicant would have been treated by the patentee on these lines or in the same manner as publicly stated by their attorney.

On this contention made by the applicant, the Controller stated that the applicant ought to have appreciated that a statement/opinion given by the attorney       of the patentee in a journal cannot be taken as evidence against the patentee in the present case.

On BDR’s arguments on ‘reasonable period’ the Controller stated that if the applicant really believed that the ‘reasonable period’ is something less than ‘six months’ why did he not take action in accordance with his beliefs. That is, after making an offer on 2nd February 2012 to the patentee and after receiving the patentee’s reply dated 13th March 2012, why did the applicant wait till 4th March 2013 to file the present application.

Moreover, the Controller stated that the term ‘efforts’ is not accompanied by the qualifying term ‘reasonable’ and the applicant ought to have appreciated that the duty cast upon the applicant to make ‘efforts’ is absolute and inflexible and without exceptions.

The Controller also stated that the decision to grant a voluntary licence, particularly on as subject matter covered by a patent, is an important decision for a patentee. While, it is possible that some of the queries raised by the patentee may not be strictly reasonable, it is natural that the patentee may seek additional information from the requesting party to satisfy himself about the credentials and capability of the said party. The Controller held that the applicant did not make efforts to obtain a licence form the patentee on reasonable terms and conditions.

The applicant sought to argue that the three substantive requirements under section 84(1) namely, (a) non-satisfaction of reasonable requirements of the public, (b) non-availability at a reasonably affordable price, and (c) not worked in the territory of India, have been met singularly and independently satisfied by the applicant due to which any irregularity in procedure/timeline may be either waived or condoned or declared to be not applicable.

The Controller however stated that the stage for making a ruling on the applicability of the grounds of Section 84 on merits has not yet arrived. The Controller further held that the deliberate intent on part of the applicant to refrain from entering into any kind of dialogue with the patentee for the purpose of securing the grant of voluntary licence, and the exercise of a deliberate choice to only invoke the provisions relating to compulsory licences without taking the requisite steps laid down by the law, cannot be classified as an ‘irregularity in procedure/timeline’, which can be waived or condoned or declared to be not applicable.

The controller thus held that a prima facie case for issuing a CL under Section 87 is not made out and rejected the application of CL.

Last year India bore the brunt of issuing CL to Bayer by the Global MNCs alleging that India’s patent decisions side with the domestic generic industry. However, the current decision clearly indicates that decisions relating to compulsory licensing would be judiciously based on the merits of the case and patent rights would be lawfully protected. It is to be seen whether this decision will be challenged by BDR at IPAB or not.

About the Author: Ms. Harsha Rohatgi, Patent Associate, Khurana & Khurana, Advocates and IP Attorneys and can be reached at: harsha@khuranaandkhurana.com

Anti Dilution Protection of Trade Mark: Bloomberg Case

The era of globalisation and internationalisation of trade and commerce has developed certain complex socio legal issues with regard to well known Trade Marks. Trade Marks are territorial in nature, but in the light of globalisation and internationalisation there is need to protect well known trade marks against their dilution beyond geographical limits. A trade mark is said to have diluted when by the use of similar or identical trade mark in another non competing markets, it loses its capacity to signify a single source vis-a-vis its distinctiveness. Thus trade mark dilution is a wrong committed against the owner of a famous trade mark which decreases or tarnishes the uniqueness of the impugned mark owing to its unauthorised use in relation to the goods or services that are not similar or identical to the goods or services of the owner of the trade mark.

In India, protection against dilution of trademark is available not only to the well known trade mark but also to the ‘marks with reputation’. Section 29 (4) of the Trade Marks Act, 1999 provides for the protection against the dilution of ‘trademarks with a reputation’. The Supreme Court of India in the case T.V Venugopal v. Ushodaya Enterprises[1] laid down the test of likelihood of confusion in relation to lesser known but identifiable marks i.e. marks with reputation. However there was ambiguity regarding the meaning of the term ‘mark with a reputation’ as against ‘well known mark’. This concept is clarified recently by the Delhi High Court in the Case of Bloomberg Finance LP v Prafull Saklecha which has widened the scope of anti dilution protection of trademarks in India. Justice Muralidhar has rendered this judgment allowing the marks which are not well known marks to also enjoy the anti dilution protection.

Critical Analysis of the Bloomberg Finance Lp v. Prafull Saklecha[2]:

Facts of the case:-

The plaintiff filed the present suit in the High Court of Delhi seeking for injunction against the defendants from using the mark ‘Bloomberg’ as part of their Corporate name. The plaintiff has been running 24/7 financial news channel since 2008 in India and claims to be using the mark Bloomberg in India, and claims to be using the mark Bloomberg in India since 1996. The defendants are companies incorporated in India using the name ‘Bloomberg’ as part name of their corporate. The immediate provocation for filing the present suit is that Defendant No. 1 through Defendant No. 5, Bloomberg Entertainment Private Limited, associated himself with a Hindi film ‘Deewana Mein Deewana’ on 28th September 2012. It is stated that the association of the Defendants with cinema and digital media would be detrimental to the Plaintiff’s reputation and goodwill and a film released under the banner of a ‘Bloomberg’ company is bound to mislead the public, giving the false impression that the Plaintiff is involved in the said film. The plaintiffs contended that the use of the mark by the defendants constituted infringement and passing-off, thereby diluting the brand Bloomberg. The defendants were using the word Bloomberg in their company’s names, operating in the fields of construction and realty, food, entertainment, etc.

Arguments Advanced:

The plaintiff argued that the plaintiff’s mark ‘Bloomberg’ was a well known mark in India and the defendants had taken unfair advantage of the mark by using it as a part name of their Corporate. It was further argued that the Defendants continuing the use the word ‘BLOOMBERG’ for their real estate business would adversely affect the reputation and the distinctive character of the registered mark of the Plaintiff.  The plaintiffs contended that the use of the mark by the defendants constituted infringement and passing-off, thereby diluting the brand Bloomberg.

The defendants on the other hand argued that the present dispute was essentially about the adoption of the mark BLOOMBERG as part of the corporate name of the Defendants group of companies. According to him, Section 29 (5) of the TM Act, 1999 was exhaustive of the issue and if the Plaintiff was not able to make out a case under Section 29 (5) of TM Act, 1999 then clearly it was not entitled to any interim injunction. It was further contended that the case fell neither under section 29(4) nor under section 29(5), therefore, the act did not constitute infringement. Further many more arguments were advanced by the defendants, but here it does not seem to be important to discuss in order to confine it to the anti dilution perspective only.

Judgment:

The Court held that the essential elements for dilution were prima facie established. The Plaintiff has been able to prima facie show that the mark BLOOMBERG is a well-known mark and enjoys both a trans-border reputation as well as a reputation in India. The court disregarded the defendant’s argument stating that the section 29(5) could not be held exhaustive of all situations of uses of the registered mark as part of the corporate name. Section 29(5) cannot be said to render section 29(4). Thus the court held that the legislature may not be said to have intended not to provide any remedy if a registered mark is used as a part name of the Corporate. Hence the court granted injunction against the defendant from using the mark ‘Bloomberg’ absolutely.

Conclusion:

The judgment in this case is in consonance with the Supreme Court ruling in T. Venugopal v. Ushodaya Enterprises and Delhi High Court ruling in the case Ford Motor Co. V. C.R. Borman to the extent that non-application of the likelihood of confusion test to the case of trade marks dilution. However Justice Muralidhar stated that the element of having to demonstrate the likelihood of confusion is absent in Section 29 (4) as against 29 (1) to (3). The Supreme Court and High Court periodically in the precedents have exempted the test of likelihood of confusion and held that the section 29 (4) applies only to those trademarks which have earned a reputation in India. However, until this case the term ‘mark with reputation’ remained shrouded and was under ambiguity. Prior land mark precedents including Ford Motor Co. Case were not clear with respect of specifying the legal test for determining as to when and how mark can be said to have acquired ‘reputation’ in India. The court in this case went further and clarified that it may not necessary to prove that the impugned registered mark is a well known mark, even in fact if it is. This makes easier to suffice the requirement as to the ‘reputation of the mark’ under section 29(4) of the Trade Marks Act, 1999.

Lastly, while comparing the phenomenon of dilution of trade mark with US and Europe, the US Trade Dilution Revision Act demands the mark to be a well known mark to enjoy protection whereas in Europe the Courts are left with the discretionary powers in order to determine the criteria or element of reputation as Community Trade Mark regulation does not provide meaning for reputation.

Thus the ruling as laid down in the case of Bloomberg case by Justice Muralidhar is laudable which has widened the scope of Section 29 (4) by allowing the anti dilution protection to trademarks with reputation in India and making it easier to suffice the ‘reputation’ requirement under section 29 (4)  of Trade Marks Act, 1999.

About the Author: Mr. Abhijeet Deshmukh, Trade Mark Attorney, Khurana & Khurana, Advocates and IP Attorneys and can be reached at: Abhijeet@khuranaandkhurana.com


[1] 2001 (2) ALT 42

[2] IA No. 17968 of 2012 in CS (OS) No. 2963 of 2012