IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE PIUS C.KURIAKOSE TUESDAY, THE 28TH APRIL 2009 / 8TH VAISAKHA 1931 RFA.No. 235 of 2008() --------------------- OS.5/2005 of V ADDL. DISTRICT COURT, ERNAKULAM .................... APPELLANT/DEFENDANT --------------------------------------- M/S.THE RENAISSANCE COCHIN,P.B.NO 2310, PALARIVATTOM, KOCHI-682025 REPRESENTED BY ITS MANAGING PARTNER MR.P.N.KRISHNADAS. BY ADV. SRI.SATHISH NINAN SRI.VIZZY GEORGE KOKKAT SRI.ARAVINDA KUMAR BABU T.K. SRI.SANTHOSH MATHEW SRI.C.HARIKUMAR RESPONDENT(S): PLAINTIFF ------------------------ M/S.RENAISSANCE HOTELS INC.MARRIOTR DRIVE, DEPT.52/923, WASHINGTON D.C.20058, USA, REPRESENTED BY MR.R.R.NAIR. ADV. SRI.JOSEPH KODIANTHARA ADV.SRI.JOSEPH MARKOSE THIS REGULAR FIRST APPEAL HAVING BEEN FINALLY HEARD ON 14/8/2008, THE COURT ON 28/4/2009 PASSED THE FOLLOWING: PIUS.C.KURIAKOSE J. ------------------------ R.F.A.No.235 of 2008 ------------------------ Dated this the 28th day of April , 2009 JUDGMENT The defendant in a suit for perpetual injunction filed under Sections 135 and 136 of the Trade Marks Act , being aggrieved by the judgment and decree passed against them, has preferred this appeal. The plaintiff in the suit is the respondent and the parties are referred to hereinafter as they were before the trial court. 2. The case of the plaintiff, as averred in the plaint in brief, is that they are a company incorporated in Delaware, U.S.A. and is one of the world's largest and leading hoteliers, having their outlets all over the world including the former “RENAISSANCE” Goa Resort, Goa and the “RENAISSANCE” Mumbai Hotel and Convention Centre at Mumbai. The plaintiff has been continuously using the Mark “RENAISSANCE” throughout the world from 1981 and in India from 1990. The plaintiff operates or franchises more than 130 hotels all over the world and is using the mark “RENAISSANCE” to represent its RFA.No.235/2008 2 Hotels. The plaintiff is expending crores of rupees every year for advertisement and promotion of its business and thereby the mark “RENAISSANCE” has become famous and associated with the plaintiff's well known “RENAISSANCE” Hotel brand. The plaintiff also operated the domain name www.renaissancehotels. com. in connection with providing information about the “RENAISSANCE” hotel chain and its hotel services. As a result the public associates the mark “RENAISSANCE” when used in a domain name with the plaintiff's high quality services. The high quality services rendered by the plaintiff to its customers has earned a reputation and developed a goodwill associated with the mark “RENAISSANCE” throughout the world. In India the plaintiff has operated two Hotels, one at Goa and one at Mumbai. The Goa “RENAISSANCE” hotel was founded in 1990 and changed its name to RAMADA CARAVALE in 2003. The Mumbai “RENAISSANCE” hotel has operated continuously since 2001. Both Hotels of the plaintiff are popularly known as “RENAISSANCE” Hotels. In these two hotels, the plaintiff has rendered extremely high standards of service and thereby has earned reputation and goodwill in the hospitality industry. RFA.No.235/2008 3 Though the plaintiff arranged a change of the name of the Goa Renaissance Hotel in 2003 since it has been continuously and extensively rendering hospitality services from its hotel in Mumbai since 2001, it can be seen that in India from 1990, the mark “RENAISSANCE” is associated with the hotels operated by the plaintiff. The plaintiff also applied for registration of the trade name “RENAISSANCE” in India by an application made in 1993 which was pending with the Registry at the time of filing the suit. Subsequently the Registry has granted registration in favour of the plaintiff. The plaintiff also applied for registration of the trade name “RENAISSANCE” in India by an application made in 1993 which was pending with the Registry at the time of filing the suit. Subsequently the Registry has granted registration in favour of the plaintiff. The plaintiff further alleged that they are a member of Marriot Rewards Program. The Marriot Rewards is the world's largest multi brand frequent guest programme and offers its members the opportunity to earn/redeem points at nine distinct holding brands, including the plaintiff's hotels. For the past five years, the Marriot Reward has been named the “ Best Hotel Reward Program in the world” by Business Traveller's Magazine. RFA.No.235/2008 4 Currently there are 27616/- Marriot Rewards members residing in India. 3. It is further averred that the defendants are operating a hotel in Cochin under the Trading Name “THE “RENAISSANCE COCHIN”. The plaintiff came to know of this when one of its customers through an e-mail reported that he was misled to believe that the Defendant Hotel was part of the plaintiff's hotel chain and had stayed there. The plaintiff issued a notice dated 3/12/2001 calling upon the defendant to desist from using the mark “RENAISSANCE”. The defendant through a reply dated 28/12/2001 issued through its Advocates expressed its willingness to change the name, but sought permission to use the expression “formerly the “RENAISSANCE” Cochin for two years. Subsequently in November 2002 the plaintiff received a letter from another lawyer said to be representing the defendant informing that the earlier letter was not authorized by the defendant. The plaintiff therefore, after issuing another notice, filed suit for prohibitory injunction against passing off and in respect of the dispute relating to the use of the word “RENAISSANCE”. The defendant filed written statement raising RFA.No.235/2008 5 various contentions. Pleadings have been narrated correctly by the learned Subordinate Judge and I do not propose to narrate them over again. In essence the contention of the defendant is that they have renamed its hotel (previously by name Polakulath Tourist Home) as “RENAISSANCE” Cochin and submitted application for registration of the trade name “RENAISSANCE” in 1997. According to the defendant, the plaintiff cannot claim exclusivity for the word “RENAISSANCE” and since the plaintiff had changed the name of the Goa Hotel from Renaissance to Ramada it would show that the name had no significance to the business of the plaintiff. The learned subordinate Judge formulated the following issues for trial ; 1. Whether the plaintiff has acquired right to exclusive use of the trade name/mark “RENAISSANCE” ? 2. Whether the defendant has acquired right to exclusive use of the trade name/mark Renaissance Cochin ? 3. Whether the user of the trade name/mark Renaissance Cochin by the RFA.No.235/2008 6 Defendant has infringed the right if any acquired by the plaintiff ? 4. Whether the plaintiff has got a cause of action to sue ? 5. Is the Plaintiff entitled to a decree of injunction as prayed for ? 6. Reliefs and Costs ? 4. At trial the evidence consisted of the oral testimony of PW1, Director of Human Resources of the plaintiff Company in India and that of DW-1 Managing Director of the defendant company. The documentary evidence consisted of Exts.A1 to A101 and B1 to B12. The documents have been described correctly in the appendix to the impugned judgment. Even though no specific contention had been raised in the suit that the suit is not maintainable in law for the reason that the authorisation issued to the signatory of the plaint was not produced and only some passing questions were asked to PW1 with respect to this and the trial court observed that no such contention was raised by the defendant in its written statement, RFA.No.235/2008 7 the trial court considered the argument and found that the suit is maintainable and that in any event the non production of the authorization is only a curable defect. It would appear from the judgment that the court recast the issues as follows; 1). Whether the suit is maintainable? 2). Is the defendant res trainable as prayed for ? 3. Reliefs and costs. With respect to the merits of the matter, the Trial court on an assessment of the evidence on record found that the plaintiff had started the Goa Hotel in 1993 and the Mumbai Hotel in 2001 and the various certificates of registration and Travel Directories overwhelmingly suggest the presence of the plaintiff in the hospitality industry all over the world from 1984 onwards and in India from 1993. The court further held that at the same time the defendant started its hotel only in 1998 and since the name of the hotel of the defendant is similar to the name of the plaintiff's hotel it is obvious that the plaintiff is entitled to maintain the passing off action. The trial court also did not accept that the initial reply given by a lawyer on behalf of the defendant was not authorized and held that the said reply RFA.No.235/2008 8 provides a set back to the defendant. The trial court therefore became pleased to restrain the defendant from passing off its hotel by using the name “RENAISSANCE” and also from using the domain name www.renaissancecochin.com. 5. Raising grounds A to F in the memorandum of appeal, it is prayed that the judgment and decree be set aside and the suit be dismissed. 6. I have heard the submissions of Sri.Sathish Ninan learned counsel for the appellant and also those of Sri. Joseph Markose, learned Senior counsel for the respondent. Sri.Sathish Ninan would place reliance on a number of judicial precedents in support of the various propositions argued by him. He argued that the suit is not maintainable in law. He conceded that the written statement does not project any contention regarding the maintainability of the suit due to the reason that the signatory to the plaint is not competent to represent the plaintiff company or to sign and verify pleadings on behalf of the plaintiff company. But since the institutional maintainability of the suit is being disputed, according to him it is open to the defendant to raise the contention. He submitted that the suit is filed by a company and RFA.No.235/2008 9 the plaint is said to have been signed by the power of attorney of the company. The Signatory is not an officer of the company, but a mere power of attorney holder. The Power of attorney was not produced. After affixing the signature to the plaint, the signatory is not heard of. But for the power of attorney, the signatory is incompetent to sign the plaint on behalf of the company since he is not a Director or an officer of the Company. Therefore, the production of the power of attorney was mandatory for the institution of the suit. He relied on the judgment of the Supreme Court in United Bank of India v. Naresh Kumar and others (AIR 1997 SC 3) in support of the argument that since the signatory is not an officer of the company, he will become competent to sign the plaint on behalf of the company only if there is authorization by the Board of Directors or there is a power of attorney in his favour. Strong objection was raised by him in respect of the power of attorney which was filed by the plaintiff before this court along with a petition under Rule 41 of Order 27 CPC. He argued that the power of attorney is not properly stamped. And since the non production of the power of attorney along with the suit is a RFA.No.235/2008 10 matter which goes to be very institution of the suit, the suit is to be held as not maintainable. 7. Coming to the issue as to whether the defendant is liable to be restrained by a decree of injunction from using its trade mark, Sri.Sathish Ninan submitted that the trade mark of the plaintiff is just “Renaissance” and that of the defendant is “The Renaissance Cochin” (also) Crown of an ancient Soldier. Sri.Satish Ninan submitted that decisions on the subject will show that in actions for passing off, mainly four issues arise for consideration. (a) The first issue, according to the learned counsel, is the “Time Factor” i.e. whose business (whether plaintiff's or defendant's) commenced prior in point of time. (b) Incidentally can/whether prior sales in small quantities establish priority. The second issue is “Reputation”; whether the goodwill has been established in the country. The third issue is “Deception”; actual or possible. The forth issue is “Damages”' actual or likelihood of. According to Sri.Satish Ninan, the plaintiff in order to secure a decree of prohibitory injunction, will have to prove that the plaintiff's business commenced prior in point of time, that goodwill/reputation has been established by RFA.No.235/2008 11 the plaintiff in the country, that the mark used by the defendant is deceptively similar to that of the plaintiff and that consequently there has been actual deception or possibility of deception and finally that consequent to the use of the mark by the defendant the plaintiff has sustained damages. It is only if all the above mentioned elements are proved by the plaintiff, the plaintiff will be entitled to get a decree of injunction. According to him, the issue of “Time Factor” and “Reputation” can be considered together in the light of the pleadings raised by the parties and the evidence adduced by them in this case. He further submitted that in paragraphs 3 and 5, it is stated that the plaintiff has earned reputation and goodwill in India since 1993. However, it is not stated as to which was the location in which the plaintiff set up the Hotel. In paragraph 5 of the plaint the amounts expended for advertisement and promotion of the business of the plaintiff has been referred. It only relates to the period from 2001. Coming to the evidence, the plaintiff produced A1 to A101 documents. Most of them were mere Photostat copies and inadmissible in evidence. Most of the advertisements produced by the plaintiff are in Foreign Newspapers and RFA.No.235/2008 12 Magazines. Advertisements produced as having been published in India is only since 2003. The chief examination of PW1 para 7 refers to the worldwide turn over of the plaintiff and does not give specifics regarding the turn over in India. In chief examination of PW1, at para 10, the expenses incurred in India relates only to the period 2001. Regarding the time factor and reputation, relevant portion of the evidence of PW1 is up to para 12 of the chief examination. There is nothing to indicate that prior to the year 2001 anything was practically done in India by the plaintiff to acquire goodwill and Reputation. Though the plaintiff would claim that it had a hotel at Goa since 1990 the cross examination of PW1 at pages 16, 18,19 and 25 casts doubts on the same. Going by the evidence of the defendant as DW1 read with Exts.B2, B3, B4, B7, B8 and B11 it is in evidence that the defendant had been doing business and using the mark ever since the year 1996. Sri.Satish Ninan further submitted that even assuming that the plaintiff had a Hotel at Goa in the year 1990, the mere small business earlier in point of time is not sufficient to constitute priority. There has to be sufficient evidence to show that though it was a prior small scale business RFA.No.235/2008 13 the plaintiff ahd established goodwill and reputation during that period. In the instant case there is no evidence to show that prior to the year 2001, the plaintiff had done anything in the country to establish reputation and goodwill. Therefore, even assuming that the plaintiff commenced its business in India earlier in point of time by commencing business in Goa, still it will not help the plaintiff to seek a decree for injunction unless it is shown that by the prior business the plaintiff had established goodwill and reputation in India. The learned counsel further pointed out that even according to the plaintiff and the plaint averment in para 3, the Hotel at Goa was re-branded under a different mark. That itself goes against the claim of the plaintiff regarding goodwill and reputation. If the plaintiff had really acquired a goodwill and reputation in respect of the mark and the business, plaintiff would not have changed the name of the Hotel to any other name. This very conduct of the plaintiff cuts at the very root of the plaintiff's case. As regards the question of “Trans Border Reputation”, Sri.Satish Ninan submitted that in order to earn reputation and goodwill in a country it is not essential that business must have been actually conducted in that RFA.No.235/2008 14 country. By way of advertisements or other materials also goodwill or reputation could be established in a country in spite of the fact that actual business is not being carried on there. This kind of reputation that transgresses the limits of jurisdiction of the country where actual business is being done to another country is termed “Trans Border Reputation” In the instant case the plaintiff could have produced material to show that by advertisements and publications the plaintiff had acquired a Trans Border Reputation in India prior to the starting of the business by the Defendant. However, the newspapers and magazines produced by the plaintiff relating to the advertisements made in India are all for the period after 2002. Coming to the aspect of deception, Sri.Satish Ninan submitted that except vague statements in paragraphs 8, 9 and 10 of the plaint, no specific averments have been made by the plaintiff. Even the name of the customer who allegedly sent E-mail is disclosed in the plaint. E-mail message contrary to the averment in the plaint was not produced along with the plaint. Though Ext.A77 purporting to be E-mail message is produced, maker of Ext.A77 is not examined. Referring to the judgment of the Supreme Court in RFA.No.235/2008 15 2001(5) SCC page 73, Sri.Satish Ninan submitted that for proving deception, relevant factors to be taken into account are ; a) Nature of Marks b). Degree of resemblance. c). Nature of goods. d). Similarity in the nature, character and purpose of the goods. e). The class of customers, their education, intelligence, degree of care and f). Dissimilarities between the marks. 8. Referring to the evidence of PW1 in cross examination at page 33 and the evidence of DW1 in chief examination at paras 5, 9 and 10 and cross examination of pages 13 and 14 Sri.Satish Ninan submitted that when the relevant aspects are taken into account, it will be seen that there has been no deception or possibility of deception. 9. Sri.Satish Ninan dealt next with the aspect of damages. He conceded that in a quai timet action proof of actual damages may not necessary. According to him, proof of actual damages may apply in cases where an interlocutory application for injunction is being considered. In a quai timet action the RFA.No.235/2008 16 apprehension of an injury is sufficient. The proceedings are initiated before the injury actually results. In this context, the learned counsel referred to the judgment of the Supreme Court in Kuldip Singh v. Subhash Chander Jain and others (2004 (4) SCC 50.). The counsel submitted that the defendant commenced business in the year 1996. The suit is filed only in the year 2005. By no stretch of imagination,the action can be said to be quai timet action. If any damages are resulted, the plaintiff could very well have proved the same. There is no proper plea or evidence regarding damages. In paragraph 12 of the plaint what is given is only a vague statement regarding damages. In the evidence of PW1 in chief examination, there is not even a whisper regarding damages. There is no case that any damages has resulted to the plaintiff consequent to the action of the defendant. There was no interim injunction and the plaintiff could have atleast proved the damages if any which resulted from the date of the suit till the date of the decree. There is no evidence regarding damages. According to Sri.Satish Ninan in the absence of evidence or even a proper plea regarding damages, the plaintiff is not entitled for injunction. RFA.No.235/2008 17 Sri.Satish Ninan's submissions were cemented by various judicial precedents. Judgment of the Supreme Court in Ramdev Food Products (P) Ltd. v. Arvindbhai Rambhai Patel And Others (2006(8) SCC 726), Laxmikant V.Patel v. Chetanbhai Shah And Another (2002) 3 Supreme Court Cases 65., Uniply Industries v. Unicorn Plywood Pvt. Ltd. And others (2001 (5) Supreme Court Cases 95), Cadila Health Care Ltd. v. Cadila Pharmaceuticals Ltd. (2001 (5) Supreme Court Cases 73) Milmet Oftho Industries And Others v. Allergan Ine (2004 (12 Supreme Court Cases 624) were relied on by him in support of his submissions made with reference to the time factor. Sri.Satish Ninan cited the judgment of the Supreme Court in 2001 (5) SCC 95 (supra) and Satyam Infoway Ltd. v. Sifynet Solutions (P) Ltd. (2004 (6) SCC 145) to expatiate his argument regarding the establishment of priority. Similarly, learned counsel relied on the judgments of the Ramdev Food Products (P) Ltd. v. Arvindbhai Rambhai Patel And Others (2006 (8) SCC 726), Heinz Italia And Another v. Dabur India Ltd. (2007 (6) SCC 1), 2002 (3) SCC 65(supra) in support of his argument regarding the goodwill and reputation. As regards RFA.No.235/2008 18 his arguments in the context of deception factors, Sri.Satish Ninan relied on the judgments of the Supreme Court in 2001 (5) SCC 73(supra) 2006 (8) SCC 726(supra), 2007 (6) SCC 1 (supra), 2004 (6) SCC 145 (supra). Sri.Satish Ninan relied on the judgment of the Supreme Court in 2001 (5) SCC 73 (supra), 2004 (12) SCC 624 (supra) to mention that stricter approach is contemplated only in action in support of medicinal products. Sri.Satish Ninan relied on the judgments of the Supreme Court in 2006 (8) SCC 726(supra) 2007 (6) SCC 1 (supra) 2004 (6) SCC 145(supra) and 2002 (3) SCC 65(supra) so as to expatiate the submissions made in the context of damages. Sri.Satish Ninan relied on the judgment of the 2006 (8) SCC 726 and 2002 (3) SC 65 (supra) to expound the concept of trade mark. To make out the distinction between infringement of Trade Mark and passing off he relied on the judgment of the Supreme Court in 2006 (8) SCC 726(supra) and Kaviraj Pandit Durga Dutt Sharma v. Navaratna Pharmaceutical Laboratories (AIR 1965 SC 980). 10. Sri.Joseph Markose, learned senior counsel for the respondent was able to meet the submissions of Sri. Satish Ninan RFA.No.235/2008 19 and he, in my opinion, was successful in putting up an excellent defence of the judgment under the appeal. Answering Mr.Satish Ninan's argument that the suit is not maintainable due to the reason that signatory to the plaint is not competent to represent the plaintiff, the learned senior counsel referred to the judgment of the Supreme Court in Bhagat Singh and Others v. Jaswant Singh (AIR 1966 SC 1861) and judgment of this court in South India Corporation Private Ltd. Madras v. State Trading Corporation of India Ltd. Cochin (AIR 1970 Kerala 138). The learned senior counsel submitted that at any rate non production of power of attorney is only a curable defect and he relied on the judgment of this court in AIR 1962 Kerala 19. The learned senior counsel would rely on the judgment of the Supreme Court in United Bank of India v. Naresh Kumar and Others (AIR 1997 SC 3) also. In support of his submissions regarding the merits, the learned senior counsel relied on the judgment of the Supreme Court in Ruston and Hornby Ltd. v. Vamindara Engineering Co. (AIR 1970 SC 1649). Sri.Jopseph Markose would attempt to distinguish the decisions of the Supreme Court in 2001 (5) SCC 95, 2007 6 SCC 1, 2004 (6) RFA.No.235/2008 20 SCC 145, 2004 (12) SCC 624 and 2002 (3) SCC 65(supra) cited by Sri.Satish Ninan in the context of time factor/prior user and would explain that there is pleading and evidence to justify the decree now passed in the light of the law as explained by those decisions themselves. My attention was drawn by Sri.Joseph Markose to salient aspects of the pleadings and the evidence in this regard. Sri.Joseph Markose relied on the judgments of the N.R.Dongre And Others Whirlpool Corporation and Another (1996 (5) Supreme Court Cases 714), AIR 2004 (6) SCC 145 (supra) in support of propositions canvased by him. Sri.Joseph Markose relied on the judgment of the Supreme Court