SC on Passing Off and Delays

In a recent decision, Wockhardt limited vs. Torrent pharmaceuticals Ltd., a 2-Judge Bench of the Supreme Court clarified sure vital principles of passing off of trademarks and delays and acquiescence.

Factual and Procedural Background

Pharmaceutical company, Torrent (“Plaintiff/ Respondent”) owns branded drugs named “CHYMORAL” and “CHYMORAL FORTE”. These drugs are accustomed alleviate swellings and wounds which can occur post-surgery. Rival company, Wockhardt, (“Defendant/Appellant”) started commercialism product underneath the name of “CHYMTRAL FORTE”, thereby just substituting the letter ‘T’ therewith of ‘O within the Respondent’s trademark using a deceptively similar trademark. On being approached by the Plaintiffs, the only the single Bench of the bombay high court refused to grant an interim injunction in their favour on the ground that no case for passing off had been created. A Division Bench of the Court, however, reversed this decision and granted the required injunction to the plaintiff, stating that a transparent case of passing off was created out by the facts of the case. The matter was thenceforth appealed to the Supreme Court.

Ingredients of Passing Off

In common law, passing off the single right to protection of goodwill in business against misrepresentation by another and preventing probability of damage arising from such misrepresentation. except deceptive similarity of product, many alternative factors have to be compelled to be looked into for constituting a passing off claim, a number of that are mentioned here. The Classical Trinity check postulates that the subsequent ought to be proven: (1) goodwill owned by the claimant (2) misrepresentation by defendant; and (3) the likelihood of harm to that goodwill.

Apart from the higher than, sure alternative factors certain be thought of too. Proof of false representation (which could also be intentional or unintentional) that led public to believe that trademark belongs to defendant must be given. the only judge Bench of the bombay HC has also control that “it isn’t necessary to point out fraud or fraudulent intent and also the defendant’s state of mind is irrelevant.”

On Delays and Acquiescence

Acquiescence may be a species of estoppel and consists of express or implied assent to invasion of one’s rights, done through certain “positive acts” i.e., by sitting by or by refusing or failing to act. Such acts can’t be constituted of mere silence or inaction.

The single judge Bench of the city HC thespian a sharp line of dsitinction between delay and acquiescence. For acquiescence, it held that “knowledge of the defendant’s mark and product” in addition to “a long period of inaction against the alleged invasion of a claim of exclusivity”, it’s no answer to mention ‘there is no positive act’, for acquiescence is additionally not express consent, however is silent assent. Mere inaction isn’t acquiescence either, however prolonged inaction in addition to the knowledge of an invasion of that right would possibly somewhat be. It held that Plaintiff’s acts amounted to acquiescence since they were lying by for a long period and that they had done positive action creating defendant believe he may begin his business. The Division Bench, however, held that it didn’t amount to acquiescence since the Plaintiffs had ne’er created such false impressions through their “positive acts”. (For more clarity on the concept of delay, consult with prof. Basheer’s post, wherever he explains once delays amount to laches.)

The Supreme Court’s finding of fact

The SC adopted a similar approach as that of the single judge bench of the city HC and explicit  that fraud wasn’t needed to prove passing off. counting on a 2001 SC judgment, it control that “though passing off is, in essence, associate action supported deceit, fraud isn’t a necessary part of a right of action, which the defendant’s state of mind is whole inapplicable to the existence of a reason for action for passing off, if otherwise the litigator has imitated or adopted the Plaintiff’s mark.” On the matter of delay and acquiescence, it merely concurred with the Division Bench and didn’t add any additional observations of its own.

This finding of fact helps in reaffirming principles that have antecedently expressed by the High Courts of urban center, Bombay, etc. sure queries stay nonreciprocal, though. it’s unclear whether or not the Court attracts a distinction between the ideas of fraud and deceit. though the Supreme Court clearly states that fraud isn’t a necessary part of passing off in its call, it doesn’t equally categorical that deceit, too, isn’t necessary for an equivalent since it states that passing off is “an action supported deceit”. Also, if we tend to square measure to conclude that deceit is critical for proving a passing off claim, what would represent as deceit and will an equivalent disagree from ‘deception’.

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