Case: M/S. S.M.Dyechem Ltd., Mumbai Vs. M/S.Cadbury (India) Ltd., Mumbai

Bros. AIR 1948 Mad. 181, the passing off action failed. But thereafter James Chadwick Co. succeeded in an appeal arising out of the registration proceedings and the said judgment was confirmed by this Court in N.S. Thread & Co. v. James Chadwick & Bros., AIR 1953 SC 357 . It was held that the judgment in the passing off case could not be relied upon by the opposite side in latter registration proceedings. 43. In the same tone, Halsbury (Trade Marks, 4th Ed., 1984 Vol. 48, para 187) says that in a passing off action the "degree of similarity of the name, mark or other features concerned is important but not necessarily decisive, so that an action for infringement of a registered trade mark may succeed on the same facts where a passing off action fails or vice versa". As to vice-versa, Kerly says (para 16.12), an infringement action may fail where plaintiff cannot prove registration or that its registration extends to the goods or to all the goods in question or because the registration is invalid and yet the plaintiff may show that by the imitating the mark or otherwise, the defendant has done what is calculated to pass off his goods as those of plaintiff. 44. In Schweppes Ltd. v. Gibbens, 1905(22) RPC 601(HL) Lord Halsbury said, while dealing with a passing off action that "the whole question in these cases is whether the thing - taken in its entirety, looking at the whole thing - is such that in the ordinary course of things a person with reasonable comprehension and with proper insight would be deceived". Defendants name on his goods is an indication of there being no case of passing off : In the present case, defendants goods contain the words `Cadbury on their wrapper. As per the principle laid down in Fisons Ltd. v. E.J. Godwin, (1976) RPC 653, the occurrence of the name `Cadbury on the defendants wrapper is a factor to be considered while deciding the question of passing off. Similarly in King & Co. Ltd. v. Gillard and Co. Ltd., 22 RPC 327 amd Cadbury-Schweppes Pty. Ltd. v. The Pub. Squash Ltd., (1981) RPC 429, it was held that the presence of defendants name on his goods was an indication that there was no passing off, even if the trade dress was similar. The fact that the defendants wrapper contains the word `Cadbury above the words PICNIC in therefore a factor which is to be taken into account. Buyers ignorance and chances of being deceived : As to scope of a buyer being deceived, in a passing off action, the following principles have to be borne in mind. Lord Romer, LJ has said in Payton & Co. v. Snelling Lampard & Co., 1900(17) RPC 48 that it is a misconception to refer to the confusion that can be created upon an ignorant customer. The kind of customer that the Courts ought to think of in these cases is the customer who knows the distinguishing characteristics of the plaintiffs goods, those characteristics which distinguish his goods from other goods in the market so far as relates to general characteristics. If he does not know that, he is not a customer whose views can properly be regarded by the Court. [See the cases quoted in N.S. Thread & Co. v. Chadwick & Bros., AIR 1948 Mad. 481 , which was a passing off action]. In Schweppes case, Lord Halsubury said, if a person is so careless that he does not look and does not treat the label fairly but takes the bottle without sufficient consideration and without reading what is written very plainly indeed up the face of the label, you cannot say he is deceived. 45. In our view, the trial Court in the present case went wrong in principle in holding that there was scope for a purchaser being misled. The conclusion was arrived at without noticing the above principles. 46. In the result, on the question of passing off, the relative strength of the case again appears to us to be more in defendants favour. Point 6 is decided accordingly. 47. The issue of laches of the appellant-plaintiff, though relied upon by the respondent, does not, in view of our finding at Point 5, assume any significance in this case. 48. Coming to the question whether the appellate court was right in interfering with the discretion of the trial Court and in vacating infunction, we are of the view that, on facts, interference was justifiable. If wrong principles were applied by the trial Court under Order 39, Rule 1 CPC, the appellate Court could certainly interfere in interlocutory proceedings under Order 39, Rule 1 CPC. Here, the trial Court gave importance to phonetic similarity and did not refer to the differences in essential features. It did not also have the wary customer in mind. On the other hand, the High Courts approach in this behalf was right as it noticed the dissimilarities in the essential features and concluded that viewed as a whole, there was neither similarity nor scope for deception nor confusion. (No doubt both Courts went into the validity of the plaintiffs registered mark and into the question of `distinctiveness of the word PIKNIK under section 9(1)(e). But in our view that was not necessary). Thus, when wrong principles were applied by the trial Court while refusing temporary injunction, the High Court could certainly interfere. Point 7 is decided accordingly. 49. In the result, the appeal is dismissed. We, however, reiterate the direction given by High Court in regard to maintenance of accounts and the undertaking to be given by the defendant for damages, if any, that may be granted in the suit, in case the suit succeeds. 50. We make it clear that the above findings on facts are for the purpose of the temporary injunction and will not come in the way of the Court in the suit to decide the matter on the evidence produced. 51.

Decision (1 = appeal accepted, 0 = rejected): 0

Explanation:
0[ds]The provisions of section 111 deal with `stay of proceedings where the validity of registration of the trade mark is questioned etc.. In the present case, while the plaintiff - appellant has filed the present suit on 18.2.99 for permanent injunction etc. against the defendant-respondent on the ground of `infringement and `passing off, the defendant has filed an application for rectification on 19.3.99 in the High Court of Bombay. Now Section 111 is intended to protect the plaintiff. The defendant, by filing a rectification proceeding late in the High Court cannot preclude the plaintiff from seeking interim relief in view of sectionour view, any decision on the question of `validity of the appellants trade raised as a defence in the present application filed under Order 39 Rule 1 CPC will seriously jeopardise a decision on the same issue now pending in the rectification proceedings filed by the respondent in the Bombay High Court. We would therefore not go into the question of `validity or `distinctiveness of the plaintiffs trade mark nor into the applicability of National Bell Co. Case (1970(3) SCC 665) as thoseare to bedecided in the rectification proceedings. We are of the view that the case before us can be disposed of by considering whether there is prima facie any deception and hence infringement and whether there is any `passing off. Points 1, 2 and 3 are therefore notlearned Judge observed that in American Cyanamid, Lord Diplock did not lay down that the relative strength of the case of each party need not be gone into. Thereafter, this Court in Palmolive case has referred to Laddie, Js view and said hat the view of Laddie, J. is correct and that American Cyanamid cannot be understood as having laid down anything inconsistent with the `old practice. We may also add that now the courts in England go into the question whether the plaintiff is likely or unlikely to win in the suit i.e. into the comparative strength of the case of the rival parties - apart from the question of balance of convenience. See again Laddie, J. in BarclaysBank Inc v. R.B.S. Advanta, 1998 RPC307 where such a question is posed and where Series 5 Software was followed. Therefore, in trade mark matters, it is now necessary to go into the question of `comparable strength of the cases of either party, apart from balance of convenience. Point 4 is decidedour view, the trial Court in the present case went wrong in principle in holding that there was scope for a purchaser being misled. The conclusion was arrived at without noticing the above principles.