- 1 - IN THE HIGH COURT OF JUDICATURE AT BOMBAY O.O.C.J. NOTICE OF MOTION NO.3640 OF 2006 AND NOTICE OF MOTION NO.4044 OF 2006 IN SUIT NO.2996 OF 2006 ... Balkrishna Hatcheries ...Plaintiffs v/s. Nandos International Ltd. and anr. ...Defendants ... Dr.Virendra Tulzapurkar with Mr.Virag Tulzapurkar, Mr.S.V.Doijode, Ms.Meenakshi Iyyer i/b Doijode & - 2 - Associates for Plaintiff. Mr.Iqbal Chagla with Mr.D.J.Khambhata, Ms.Nandini Khitan and Mr.Chakrapani Mishra i/b Khaitan & Co. for the Defendant No.1. Mr.Ravi Kadam, Advocate General with Mr.Rahul Chitnis i/b Khaitan & Co. for Defendant No.2. ... CORAM: D.K.DESHMUKH, J. DATED: 4TH JUNE, 2007 ORDER: 1. This Notice of Motion is taken out by the Plaintiffs. The Plaintiffs have filed the present suit for infringement on the basis of their registered trade-mark, of which, according to the plaintiffs, word "Nandu’s" is an essential feature. The said mark "Nandu’s" is registered in respect of processed and frozen meat products and the said registration is valid and subsisting. 2. The Plaintiffs’ contention is that the Defendants - 3 - are using impugned mark "Nando’s" in respect of similar goods and/or similar services as that of the Plaintiffs. The Plaintiffs in the suit pray for a permanent injunction restraining the Defendants from in any manner using in relation to any eatable goods or restaurant or hotelling services or processed and frozen chicken and meat products the impugned trade-mark "Nando’s" or any other deceptively similar trade-mark so as to infringe the Plaintiffs’ registered trade-mark "Nandu". A perpetual injunction on the same terms in relation to passing off is also claimed. By this notice of motion temporary injunction in the similar terms is sought. 3. The Plaintiffs’ Suit is based on the following allegations: (a) Infringement of the Plaintiffs trade mark, consisting of Nandu’s written in a stylized manner and the device of a cockerel, both enclosed in a hat shaped outline. The registration is in Part B and in respect of ’Processed or Frozen Meat products’ falling in Class 29 of Schedule IV to the Trade Marks Rules 2002 ("the first trade mark"). The first trade - 4 - mark was registered on 4th July 1989; (b) A second trade mark was subsequently adopted by the Plaintiff in 2005 consisting of the word Nandu’s enclosed within an oval shaped structure in white colour with read outline and a gift tag structure occupying the centre expression ’Heat n Eat’ depicted in black colour below the oval structure. (c) It is alleged that both the first trade mark and the second trade mark have acquired distinctiveness in India and are associated by traders and members of the public exclusively with the Plaintiff. It is alleged that the Defendants mark ’Nando’s’ is almost identical with and/or deceptively similar to the Plaintiffs registered trade mark (i.e. the first trade mark). That by using the mark ’Nando’s’ the Defendants are passing off the Defendants goods and/or services as the goods and/or services of the Plaintiff or that they are in some way connected with the Plaintiff. 4. The Plaintiff alleges that: (i) it carried on poultry business; and - 5 - (ii) in course of time, started manufacturing and marketing processed and frozen chicken and meat products such as chicken kebabs, chicken nuggets, fried chicken, boneless chicken, chicken legs and other varieties of chicken products as well as meat pies , meat tenderizers; (iii) it adopted the first trade mark In respect of the said business. (iv) it has been extensively widening its product line and services by introduction of other food related products namely curries, biryanis, including vegetarian products in ready to eat form. (v) The Plaintiffs’ products came to be sold at food service outlets such as fast food counters, highway eateries and take away counters. 5. The 1st Defendant claims to be a major international chain running fast food outlets and the restaurant business, it serves Afro Portuguese cuisine (vegetarian and non-vegetarian and using the peri-peri chilly) and sells sauces under the - 6 - trade mark Nando’s. The 1st Defendant has stated to this Hon’ble Court that in future in India it will not sell its sauces other than at restaurants. 6. Admittedly,(i) the Plaintiffs have not been and are not engaged in the business of restaurants, cafes, snack bars and/or other heat and eat outlets for sale of food items, beverages and food related products at all, much less under the trade mark ’Nandu’. The Plaint merely states that the Plaintiffs "plan to open" such restaurants etc. (ii) the second trade mark is not registered and was adopted by the Plaintiff only in or about the year 2005. 7. The Plaintiffs have filed an affidavit in support of the motion. A detailed reply has been filed by the Defendants. The parties have also produced documents in support of their respective cases. 8. I have heard the learned Counsel appearing for both sides in detail, they have taken me through all - 7 - the pleadings and documents. They also relied on several authorities in support of their respective contentions. For the purpose of deciding this Notice of Motion, in my opinion, it can be assumed that the first Defendant’s mark "Nando’s" is similar to the Plaintiffs’ mark "Nandu’s". The Plaintiffs’ entire case on infringement is necessarily based on its one registered trade-mark i.e. the first trade-mark which is registered in Class 29 for "Processed or Frozen Meat Products." Hence as regards infringement any other business of the Plaintiffs including business in other non-meat food products and in ready to eat form is not relevant. So far as the aspect of infringement is concerned, the learned Counsel appearing for the Plaintiffs made three submissions based on the provisions of Section 29(1), 29(2)(b) and 29(4) of the Trade Mark Act, 1999 (hereinafter referred to as the said Act.) 9. Perusal of Section 29(1) of the said Act shows that it is equivalent to Section 29(1) of the 1958 Act. (i) It enables an action for infringement of a registered mark when a mark which is identical or deceptively similar thereto is used "in relation to goods or services in respect of which the trade mark - 8 - is registered and in such manner as to render the use of the mark likely to be taken as being used as a trade mark." (ii) Thus the Plaintiff will have to establish under Section 29(1) that identical or deceptively similar mark is being used by the Defendants in relation to the same goods or services i.e. processed or frozen meat products. (iii) It is an admitted position that the Defendants do not sell processed or frozen meat products at all, much less from their Restaurant. Even the Plaint does not allege this. The 1st Defendant in its Affidavit in Reply dated 1st March, 2007 has made it clear that the Defendants do not sell processed or frozen meat products. (iv) Hence no case of infringement under Section 29 (1) has been made out by the Plaintiff. 10. Section 29(2) of the Trade Marks Act, 1999 reads as follows: "(2) A registered trade mark is infringed by a person who, not being a registered proprietor or a person using by way of permitted use, - 9 - uses in the course of trade, a mark which because of- (a)its identity with the registered trade mark and the similarity of the goods or services covered by such registered trade mark; or (b)its similarity to the registered trade mark and the identity or similarity of the goods or services covered by such registered trade mark; or (c)its identity with the registered trade mark and the identity of the goods or services covered by such registered trade mark, is likely to cause confusion on the part of the public, or which is likely to have an association with the registered trade mark." 11. Under Section 29 (2) (b), the Plaintiff would have to establish: (a) That the 1st Defendant’s mark "Nando’s" is similar to the Plaintiff’s mark "Nandu’s". (b) That the 1st Defendant’s service of running restaurants/food outlets and the 1st Defendant’s goods viz sauces/condiments that are sold, are similar to the goods sold by the Plaintiff under its registered trade mark for Processed or Frozen Meat - 10 - Products. (c) That such similarity is likely to cause the public to confuse or associate the Defendant’s mark with that of the Plaintiffs. 12. In the context of provisions of the said Act, the similarity or association that is referred to in Section 29 can only be a similarity between goods and goods or a similarity between services and services and cannot be similarity between goods on the one hand and services on the other. This is for the following reasons : - (i) Under The Trade Marks Act 1958 (the 1958 Act or the Old Act) a trade mark could not be registered in respect of services. Any infringement by use of the registered trade mark or a mark deceptively similar to the registered trade mark had to be in relation to any goods in respect of which the trade mark was registered and in such manner as to render use of the mark likely to be taken as being used as a trade mark. Section 29(1) of the 1958 Act corresponds to Section 29(1) of the said Act save and except for the inclusion of the word "services" under section 29(1) - 11 - of the said Act. The term "goods" was defined under Section 2(1)(g) of the 1958 Act as meaning any thing which is the subject of trade or manufacturing i.e. clearly excluding services. The 4th Schedule to the Trade Marks Rules 1959 (the old rules or the 1959 Rules) classifies only goods under 34 different classes. These classes corresponded to Entries 1 to 34 of the 4th Schedule to the Trade Marks Rules 2002 (the 2002 rules or the new rules). Hence under the 1958 Act there was no question of any infringement in respect of services. (ii) As stated in the Objects and Reasons to the Trade Marks Act 1999 certain far reaching changes were made to the existing law governing trade marks. One of the major changes was the incorporation of the provision for registration of trade marks for services, in addition to their registration for goods. (iii) The scheme and provisions of the Said Act clearly disclose the dichotomy between goods on the one hand and services on the other. Section 2 (i) (j) defines goods in identical terms to the 1958 Act i.e. as meaning anything which is the subject of - 12 - trade or manufacture. However Section 2(1)(z) added a definition of the term "services" as follows: (z) "service" means service of any description which is made available to potential users and includes the provision of services in connection with business of any industrial or commercial matters such as banking, communication, education, financing, insurance, chit funds, real estate, transport, storage, material treatment, processing, supply of electrical or other energy, boarding, lodging, entertainment, amusement, construction, repair, conveying of news or information and advertising. (iv) Furthermore Section 2(2) provides that, in this Act unless the context otherwise requires any reference (a) ......; (b)......|; (c) to the use of a mark,- (i) in relation to goods, shall be construed as a - 13 - reference to the use of the mark upon, or in any physical or in any other relation whatsoever, to such goods;Â (ii) in relation to services, shall be construed as a reference to the use of the mark as or as part of any statement about the availability, provision or performance of such services; The aforesaid provision indicates that the use of the mark in relation to goods is distinct from the use of the mark in relation to services. (iii) Section 28(1) of the said Act reads as below : "Rights conferred by registration - (1) Subject to the other provisions of this Act, the registration of a trade mark shall, if valid, give to the registered proprietor of the trade mark the exclusive right to the use of the trade mark in relation to the goods or services in respect of which the trade mark is registered and to obtain relief in respect of infringement of the trade mark in the manner provided by this Act." - 14 - Section 28(1) confer upon the registered proprietor a statutory monopoly to use the trade mark in relation to the goods or services in respect of which the trade mark is registered. This would mean that a trade mark registered for goods or for any particular goods will confer upon the proprietor a monopoly only in respect of that class or if the registration is narrow only in respect of the goods for which the registration is given within a particular class. Similarly, the monopoly over the mark qua services would be restricted to only those services mentioned in the registration certificate. In the present case, as the Plaintiffs registration certificate discloses that the first trade mark is only in respect of "processed and frozen meat products" falling in Class 29 of Schedule IV to the 2002 Rules. The mark confers upon the Plaintiff the exclusive right to use the trade mark in respect of processed or frozen meat product and qua no other goods. (iv) Section 29 (2) must necessarily be interpreted with this in mind otherwise by the method of action for infringement under Section 29(2), the proprietor would be able to expand its statutory monopoly to a different class of goods or even to services. - 15 - (v) The distinction between goods and services is also made clear by the provisions of the 2002 Rules. Under Rule 22(1) of the 2002 rules, goods and services are to be classified in the manner specified in Fourth Schedule. The Fourth Schedule contains various classes of goods similar to the Fourth Schedule to the 1959 Rules (Classes 1-34). Thereafter under a separate heading "SERVICES" follow Classes 35 to 42. Classes 35 to 42 are exclusively services making it clear that Class 1 to 34 are exclusively goods. Significantly clause 42 also includes "Providing of food and drink" which would mean food items listed in class 29 to 34 do not include any services in respect of food items and drinks. Secondly Class 42 also contains a residuary class i.e. "services that cannot be classified in other classes". This residuary class applies only to services and does not extend to goods. This would mean that only goods which fall within the expressly specified classes in Class 1 to 34 are classifiable. Goods that are otherwise related to services but are not mentioned in Class 1 to 35 do not receive protection under the said Act. This also shows that goods and services are treated separately. - 16 - (vi) The most significant guide is to be found in Section 2(3) of the said Act which is reproduced below : "2(3) For the purposes of this Act, goods and services are associated with each other if it is likely that those goods might be sold or otherwise traded in and those services might be provided by the same business and so with descriptions of goods and descriptions of services." Associated Trade Marks are defined under Section 2(1)(c ) : "2(1)(c) "Associated trade marks" means trade marks deemed to be, or required to be, registered as associated trade marks under this Act." 13. Under Section 16 of the said Act, a trade mark can be registered or is deemed to be registered as an associated trade mark if it satisfies the conditions set out therein which include the requirements that both the marks must be in the name of the same - 17 - proprietor and in respect of goods and services which are associated with those goods. Under section 44 of the said Act, the associated trade marks are assignable and transmissible only as a whole and not separately. From the aforesaid provisions it s clear that for goods and services to be associated with each other and to be registered or to be deemed to be registered the following requirements are essential:- (a)The goods which must be sold or traded in and the services to be provided must be by the same business. (b)That the trade mark in respect of the associated goods and services must be registered in the name of the same proprietor. (c)The use of the trade mark in respect of the same goods or description of goods or the same services or description of services is identical to that which is registered in the name of the same proprietor; and (d)the marks are either identical or there is such a close resemblance as is likely to deceive or cause confusion if used by a person other than the proprietor. - 18 - (ii) Section 2 (3) represents the only point of convergence between goods and services in the Said Act. It represents the legislative intent that goods and services can be said to be associated only if the aforesaid provisions are satisfied. (iii) In a American decision Lloyds Food Product Inc. v. Eli’s Inc 987 F 2d 766 the United States Court of Appeal Federal Circuit decided an infringement action brought by Lloyds Food Products (the registered Proprietor of the mark "Lloyds" for food products) against Eli’s Inc from using the mark "Lloyds" for restaurant services. The Court of Appeal Federal Circuit held as follows : - The marks at issue in the cases relied upon by the board were used in conjunction with the sale of goods not with the provisions of services. A service mark is different from a mark for goods, especially, in the manner it is used in commerce. The legally significant use giving rise to rights in a mark for goods is derived from the placing of the mark in some manner on the goods either directly or on their containers or packing 15 U.S.C. 1127 (1988) A - 19 - service mark on the other hand, entails use in conjunction with the offering and providing of a service. This makes all the more important the use of the mark in Sales or advertising materials of different descriptions. (iv)The position under the new Trade Mark Act 1994 in England is somewhat different. The 1994 English Act also gives protection to trade mark in respect of services. However, the concept of an associated mark i.e. association between marks concerning goods and services has been deleted and no longer finds place in the English Trade Marks Act, 1994. The concept of associated marks was a part of the previous Act viz. The Trade Mark Act 1938. Secondly Section 9(1) of the Trade Marks Act 1994 which corresponds to Section 28 (1) of the said Act does not describe goods and services separately as does our Section 28(1). (v) Hence no question can arise under Section 29(2) of the said Act of even undertaking the exercise of comparing the Plaintiff’s goods in respect of which it has registration i.e. processed and frozen meat products with 1st Defendant’s service of the restaurant business. - 20 - 14. Assuming that goods may be considered similar to services the guiding principles and factors that are relevant in considering whether there is similarity between goods/services are as follows: (i)The English Trade Marks Act, 1938 contained a phrase "goods of the same description" which was relevant in deciding application for registration. There is a line of authorities that explain this phrase. (ii)In the matter of Application by Ladislas Jellinek (1946) 63 RPC 59, Mr. Justice Romer enunciated three tests that should be employed to determine this question. The case was one of the use of the mark "Panda" on shoes and on shoe polish. Mr. Justice Romer thought that three considerations were relevant:- a) The nature and composition of the goods; b) The respective use of the goods; c) The trade channels through which the respective - 21 - goods are bought and sold. Upon taking evidence and applying these Tests Mr. Justice Romer held that shoes and shoe polish, were not goods of the same description. (iii)In J Lyons & Loy Application (1959) RPC 120, the Court of Appeal was considering the trade mark "Hostess" in its use upon jellies and Ice cream. In this connection Lord Justice Evershed held as follows:- ".........But however, that may be and in cases of this kind I venture to doubt whether the question of onus should be given quite the same strict significance as in a pleading in a Common Law action" the problem, upon all the evidence before us, may now be shortly stated thus: Are jellies, or jelly tablets, goods of the same description as ice cream? If they are then the question at once claims an answer. What is the description? What form of but without also comprehending categories of other goods which might fairly in common sense be said not to be of the same description as either? - 22 - The answer to the question propounded by Mr. Levy was, "sweets", using that word as signifying the sweet course in a menu, dessert in French, rather than sweetmeats that is, chocolates and the like what, according to Mr. Levy, is known as in popular modern jargon as afters. My difficulty about this simple solution lies in the fact that it would apparently comprehend an extremely wide variety of foodstuffs, ranging from fruit salad to a steamed suet pudding; and I am not satisfied, or my part, that, whatever may be said of jellies a suet pudding could, by any sensible standard (other than its use as a sweet course) be regarded as goods of the same description as ice cream. A solution may, however, be provided by limiting the class of sweets somewhat thus a light sweet course or refreshment also commonly provided at buffets, garden parties, and similar festivities ......................... ..................................................... To all these cases the oft-quoted proposition that each was decided on its own particular facts is, to my mind, peculiarly applicable. In all cases of this kind regard will be had to such matters as the nature and composition of the goods, to their respective - 23 - uses and functions, and to the trade channels through which respectively they are marketed or sold; and in different cases ( as Mr. Levy observed) one ( but not always the same one) of these characteristics may have greater significance or emphasis than the others. The matter falls to be judged, as Lindley, L.J. observed in the case already quoted, in a business sense; and this is to my mind made clear which the problem has to be judged. By the Trade Marks legislation Parliament has provided that a registered proprietor of a mark, to be used by him in the course of his trade, has a monopoly right to that mark as an indication of by considering the legislative background against he trade source or origin of the goods, and the restriction contemplated by sec. 26 is an incident of the general legislative purpose. The question whether the goods are or not goods of the same description must therefore (I think) be one to be answered in the context of that purpose; and having regard to that context, the cases cited, and particularly McDowell’s case and the Australian Wine case, lend some support to the view that the phrase "goods of the same description" ought not to be given too restrictive a construction not, at all events, so as to be limited to goods - 24 - substantially analogous in kind, or commonly used as mere substitutes or alternatives the one for the other. Lord Justice Romer (at page 133) applied the three tests laid down by him in Jellinek to hold that Jellies and Ice Cream were goods of the same description. Lord Justice Ormerod (at page 135-136 ) held as follows :- Mr. Aldous submitted that the