PRINCIPLES OF ‘PRIOR ADOPTION AND USE’ VIS A VIS TRANSBORDER REPUTATION: JONES INVESTMENT CO V. VISHNUPRIYA HOSIERY MILLS

In the recent decision of Intellectual Property Appellate Board (IPAB) in the case of Jones Investment Co v. Vishnupriya Hosiery Mills, it was held that a multinational company cannot claim infringement of trademark by a local Indian company purely based on international presence, unless they can expressly establish that their presence extends to India or precedes that of the Indian company.

Facts of the case:

The appellant in this case is the Jones Investment Co. an American company who is engaged in the business of apparel, hosiery, footwear, etc. and uses the Trademark ‘Jones New York’ internationally thereto for the aforementioned goods. On the other hand, the Respondent is the Vishnupriya Hoisery Mills, a textile firm based in Erode, Tamil Nadu. The respondent applied for the registration of the trade mark ‘Jones’ for their textile products. This application was opposed by the appellant and in adjudication of the same Deputy Registrar of Trademarks dismissed the notice of the opposition on 9th March 2010. Thus being aggrieved by the decision of the Deputy Registrar, the appellants preferred this appeal in IPAB.

Arguments on behalf of the Appellants:

The counsel for the appellants mainly relied on two contentions inter alia. First, that the appellants had been using the mark ‘Jones New York’ since 1966 and thus they had acquired International reputation in the same. Further it was also contended that the appellants had registered their trade mark in India since 1997. Therefore, the registration of the trade mark with respect to same goods under the name ‘Jones’ by the respondent would cause confusion and would deceive the consumers.

Secondly, it was contended by the appellant that the respondent has not shown any substantial sale of their goods by using the impugned trade mark and the Deputy Registrar also pointed out that they have produced only meager sale. As such the respondent cannot claim reputation among the public in respect of their goods using the similar trade mark as adopted by the appellant. Also it was contended that in view of development of technology and communication the respondent cannot claim the ignorance of the international reputation of the appellant’s mark.

Arguments on behalf of the Respondent:

The counsel for the respondent submitted that the main issue involved in the case is that whether the appellants has established their use of trade mark ‘Jones New York’ in India on the date of application filed by the respondent before the Registrar for the registration of the impugned trade mark. And in response it was contended that till date the appellant is not using the trade mark ‘Jones New York’ in India. Therefore the question of transborder reputation of the appellants mark need not arise at all. The learned counsel relied on the decision of the Hon’ble Supreme Court in Milmet Oftho Industries & Ors vs. Allergan Inc reported in 2004 (28) PTC 585 among other cited cases.

Judgment:

IPAB at the outset stated that it is undisputed that the appellant till date is not using their trade mark ‘Jones New York’ in respect of their goods in India and it is their categorical statement that they proposed to use the same in India. The appellants failed to prove the use of the alleged trade mark since 1966 as they have filed their documents only from the year 1997 whereas the respondent have proved their claim of use of the trade mark since 1993 by producing relevant documents to substantiate their claim. Thus the question of confusion or deception need not arise.

The IPAB relied on decision of the Hon’ble Apex Court in Milmet Oftho Industries & Ors vs Allergan Inc. which is squarely applied to the present case that the multinational companies who have no intention of introducing their product in India should not be allowed to throttle an Indian company and the Indian company who has genuinely adopted the mark and developed product and it is first in the market cannot be prevented from using the mark.

Further the IPAB upheld the observation of the Deputy registrar that when the respondent is prior in adoption and use in India, the quantum of sales figure is immaterial. Thus the appeal was dismissed by IPAB with no order as to cost.

Conclusion:

The IPAB compared the facts and relied on Milmet and held that this was also a similar situation where the appellant company had no sales whatsoever in India under the trade mark ‘Jones New York’. Therefore, the appellant does not have any ground to ‘throttle’ the Indian business. Here it is pertinent to note that this was adjudicated only for the reason that the Appellants did not provide evidence to show that they had an established international reputation prior to 1997, whereas on the other hand the respondents substantially their presence in India since 1993. The operative test, therefore, in such cases is merely who is first in the market. Thus the IPAB has held in favour of the small firm like Vishnupriya Hosiery and against the big corporation solely in the interest of justice, equity and conscience. And if IPAB had held otherwise, it would lead to the growth of multinational corporations at the cost of small firms which is undesirable.

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

2 thoughts on “PRINCIPLES OF ‘PRIOR ADOPTION AND USE’ VIS A VIS TRANSBORDER REPUTATION: JONES INVESTMENT CO V. VISHNUPRIYA HOSIERY MILLS”

  1. The Board did not understand the following the principles of Milmet Oftho,wherein it was clearly stated that the prior user in the International market should get the priority secondly the Board did not understand that the Respondent has agreed that the Appellant is the prior adopter then why the Board failed to understand that the Proprietorship is with the Appellant which has been copied by the Respondent with a malafide intention to trade upon the goodwill of the Appellant. The case has been misunderstood by the Board

    1. Dear Sumitra,

      Thanks for the comment. We appreciate your point of view, but as we understand from the IPAB decision, although the appellants had registered their mark in India in 1997, they did not provide cogent evidence to prove that they had an established international reputation prior to 1997, and the respondents were able to prove that they had a presence in India since 1993. Even in Milmet case, it was held that, had the international company acquired a reputation prior to the adoption of trademark by the Indian company, it would be immaterial whether the former had a presence in India and it could validly proceed against the Indian company. The operative test, therefore, is merely who is first in the market.

      The Apex Court in Milmet case had held-

      “Multinational corporations, who have no intention of coming to India or introducing their product in India should not be allowed to throttle an Indian Company by not permitting it to sell a product in India, if the Indian Company has genuinely adopted the mark and developed the product and is first in the market”

      Comparing the facts of Milmet and the present case, IPAB concluded that this was also a similar situation where the appellant company had no sales whatsoever in India under the name ‘Jones New York’. Therefore, the appellant does not have any ground to ‘throttle’ the Indian business.

      We feel the judgement is in conformity with the decision of Hon’ble Delhi High Court in the case of Roca Sanitario S.A. vs. Naresh Kumar Gupta & Anr, pronounced on 15/03/2010, where the facts were more or less similar.

      Please let us know your views.

      Warm Regards
      Abhijeeet

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