Introduction
LT Overseas North America Inc and Anr., who are engaged in the rice processing, marketing and export business, filed a suit against KRBL Limited alleging that the defendant’s use of the mark “Zabreen Royal” for the manufacture, sale and distribution of Basmati rice constituted infringement and passing off of the plaintiffs’ trademark registrations, which include the word ‘Royal’ and associated marks. The plaintiffs claimed that they have prior adoption, long and continuous use, an established marketing network, significant global sales and meticulous quality control, which has led to their marks acquiring a strong reputation and goodwill.
The first plaintiff became aware of the use of the Impugned Mark through their sales team in April 2022, but attempts at reaching an amicable settlement failed. The plaintiffs argued that the use of the Impugned Mark would result in irreparable harm and injury to their business.
The defendant contended that the plaintiffs were estopped from seeking to prevent the use of the word ‘Royal’ per se, as they had previously stated in their reply to the examination reports during registration that they were only seeking protection for the word in a label/logo/device format. Additionally, the defendant relied on Section 17 of the Trademarks Act, which provides that protection is granted to the mark as a whole and not to its individual components. Moreover, the defendant asserted that the plaintiff did not hold any registration for the word mark “Royal.”
The defendant’s second argument, which was perhaps the central one, was that they were using the word ‘Royal’ in a descriptive/laudatory sense along with their mark “ZABREEN” to describe the royal quality of their Basmati rice, which has extra-long grains and a royal taste. Therefore, the defendant argued that the Impugned Mark was not likely to cause confusion.
The Court began its examination by addressing whether the term ‘Royal’ can be considered a descriptive mark. It outlined the two critical assessments established by McCarthy to determine if a trademark is descriptive or suggestive: [a] if connecting the mark with the relevant product or service requires imagination; and [b] if the mark is one that rivals must use to describe their product [paragraphs 36 and 37].
The Court utilized these tests to determine whether the word ‘Royal’ could be considered a descriptive mark in this case. It was concluded that the term ‘Royal’ does not fulfill the criteria of being a descriptive term when used for rice. This is because it requires a high level of imagination and cognitive process to associate the term ‘Royal’ with rice, which does not fulfill the first test. Moreover, ‘Royal’ is not a natural attribute or a synonym for rice, which means that competitors are not obligated to use it when referring to rice, thereby failing the second test.
The Court examined the defendant’s cases on descriptive terms and concluded that they were not relevant to the present case because in those cases, either the term was not a significant part of the mark, or it was not registered as a trademark. In the current case, neither of these conditions applied [paras 43-47]. The defendant’s assertion that ‘Royal’ was a term common to the trade was dismissed as it required a factual determination at trial [para 52].
Although the court concluded that the term ‘Royal’ was not descriptive of rice, it was considered laudatory in the defendant’s use of it [para 47]. The court also stated that while ‘Royal’ cannot be regarded as a descriptive term for rice, it is undoubtedly a term of praise [para 64].
It may be challenging to comprehend how a term can be laudatory but not descriptive, as the Court did not provide a clear rationale for distinguishing between the two types of marks. The defendant used the term “Royal” to highlight the positive qualities of its rice, such as its kind and quality, which are also descriptive of the rice. Thus, the Court could have either concluded that the term “Royal” was both descriptive and laudatory or that it was neither. In the former case, the plaintiff would not have been entitled to any rights over the word “Royal,” while in the latter case, the defendant would have been held liable for using the word “Royal” in a laudatory sense.
Conclusion
Returning to the verdict, the defendant presented a proposed packaging to address the court’s and plaintiff’s concerns. The Court ruled that the proposed packaging prominently displayed the term ‘Zabreen’, sufficient to protect the defendant from liability. Nevertheless, the current packaging emphasizes the term ‘Royal’ and was thus deemed to cause dilution and susceptible to injunction during the trial [paras 74-75]. However, the Court ruled that the defendant’s use of ‘Royal Zabreen’ would be allowable if it changed its packaging [para 76].
Overall, the judgment provides a useful analytical framework for assessing descriptive use. However, the ambiguity in distinguishing between descriptive and laudatory use, as well as between descriptive use and the applicable defenses, is a source of concern.
Author : Tanya Saraswat, in case of any queries please contact/write back to us via email to chhavi@khuranaandkhurana.com or at IIPRD.
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