Case: N.R. Dongre  Vs. Whirlpool Corpn.

The suit is a passing off action brought by theto restrain the defendant appellants from manufacturing, selling, advertising or in any way using the trade mark WHIRLPOOL in any other trade mark deceptively or confusingly similar to the trade mark of WHIRLPOOL in respect of their goods. The subject matter of this appeal is the manufacture, sale and advertisement of washing machines by theusing the mark WHIRLPOOL as a part of the name by which they had recently commenced marketing the washing machines manufactured by them. In short, the claim of theis based on prior user of the mark WHIRLPOOL and a transborder reputation indicating that any goods marketed with the use of the mark WHIRLPOOL gives the impression of it being a goods marketed by the plaintiffs, and the washing machines manufactured, sold and advertised by the defendants give that impression resulting in confusing the intending buyers with this impression. In this suit, the plaintiffs sought a temporary injunction which has been granted by the ld. Single Judge and affirmed by the Division Bench of the High Court.2. In view of the fact that the trial of the suit has yet to conclude and the final decision of the suit is awaited, it is appropriate that the question of temporary injunction is decided only on the basis of undisputed facts and the material which can legitimately be taken into account at the interlocutory stage. For this reason reference is confined by us only to such material which can be of significance at this stage.3. The Whirlpool Corporation, plaintiff No. 1 is aincorporated in U.S.A. TVS Whirlpool Ltd., plaintiff No. 2 is a limited company incorporated in India in which the plaintiff No. 1 is a majority share holder. The plaintiff No. 2 has been licensed by the plaintiff No. 1 to use the trade mark and trade name WHIRLPOOL. The defendants Nos. 1 and 2 are the trustees of Chinar Trust, and defendants Nos. 3 and 4 are the trustees of Mansarovar Trust also trading as(India). Usha International Ltd., the defendant No. 5 is a company incorporated under the Indian Companies Act. The defendants have registrations in respect of trade marks such as USHA,4. According to the plaintiffs, they have an established business in the manufacture, sale, distribution and servicing of washing machines of all kinds and the plaintiff No. 1 is the successor of trade mark WHIRLPOOL since 1937. By 1957 WHIRLPOOL was a leading trade mark and name in the United States and Canada in relation to washing machines. By 1986 the WHIRLPOOL was registered in relation to washing machines and dryers in class 7 as well as for appliances in classes 9 and 11 in more than 65 jurisdictions around the world including most of the commonwealth countries. Inthe plaintiff No. 1 obtained registration for the trade mark WHIRLPOOL in India in respect of clothes dryers, washers, dish washers and some other electrical appliances. These registrations were renewed periodically. However, in 1977, the registrations in India lapsed on account of failure to apply for renewal. In 1987 plaintiff No. 1 formed a joint venture with the plaintiff No. 2. On 15.7.1988 applications were moved by the plaintiffs with the Registrar of Trade Marks for registration of the trade mark WHIRLPOOL for certain goods including washing machines. The washing machines are being marketed by plaintiff No. 2 in India under the TVS brand using the phrase in collaboration with Whirlpool Corporation. Prior user of the mark WHIRLPOOL for such goods is claimed by the plaintiffs. The plaintiffs allege that in July, 1994 they came across an advertisement of defendants soliciting dealers for WHIRLPOOL washing machines. In short, this is the basis on which the plaintiffs claim to restrain the defendants from using the mark WHIRLPOOL for the goods manufactured by the defendants.5. On the other hand, the defendants filed an application on 6.8.1986 with the Registrar for registration of the trade mark WHIRLPOOL.On 16.10.1988 it was advertised in the trade mark journal. On 16.1.1989 plaintiff No. 1 filed a notice of opposition. On 12.8.1992 the Registrar passed an order dismissing the opposition and allowing the defendants application for registration on the ground of proposed user only. On 30.11.1992 the registration certificate was granted to the defendants to date back from 6.8.1987, the date of the application. Against the Registrars order dated 12.8.1992 the plaintiff No. 1 has preferred an appeal on 7.11.1992 in the Delhi High Court which is still pending. After grant of the certificate of registration to the defendants, on 4.8.1993 plaintiff No. 1 filed a petition in the Delhi High Court under Sections 46 and 56 of the Trade and Merchandise Marks Act, 1958 (for short the Act) for rectification by expunging the registration granted to the defendants. That matter is also pending in the High Court. The present suit was then filed on 4.8.1994 for the reliefs indicated earlier.6. the ld. Single Judge, by order dated 31.10.1994, granted a temporary injunction in favour of the plaintiffs as underall the foregoing reasons IA 7657/94 is allowed. The defendants, their partners, trustees, agents, representatives and assignees are hereby restrained from manufacturing, selling, advertising or in any way using the trade mark WHIRLPOOL or any other trade mark deceptively or confusingly similar to the trade mark Whirlpool in respect of their goods. The plaintiffs shall within 4 weeks from today place on record an undertaking in the shape of affidavits sworn in by their duly constituted attorney/s or representative/s undertaking to indemnify the defendants from any loss or damage which the defendants may incur on account of these proceedings and determined in this suit or any other duly constituted legal proceedings in the event of the plaintiffs being held not entitled to the relief sought for in the suit.By way of abundant caution I would like to clarify :(i) As stated in the earlier part of this order the defendants have filed only a short counter for paucity of time. Legal contentions have all been raised by either party and dealt with by this order. If the defendants bring forth any new material consisting of facts documents and evidence which they could not do earlier they shall have the liberty of moving an application under Order 39 Rule 4 CPC.(ii) that nothing said hereinabove, shall prejudice in any manner the rights of either party to have their pleas determined on merits after atrial.October 31, 1994 R.C. LAHOTI, J.On appeal, the Division Bench of the High Court came to the conclusion that there was no reason to interfere with the discretion exercised by the ld. Single Judge in granting the temporary injunction. Accordingly, the defendants appeal was dismissed.

Court's reasoning:
17. It has also been held that there is no plausible explanation offered by the defendants for recently adopting the mark WHIRLPOOL when business in washing machines was being carried out earlier in other names, which at this stage is supportive of the plea of unfair trading activity in an attempt to obtain economic benefit of the reputation established by the plaintiff No. 1 whose name is associated with the mark WHIRLPOOL. The plaintiffs conduct in opposing the defendants application for registration as soon as it was notified and persisting in the opposition by filing an appeal against the Registrars order and then an application for rectification of the entry in the register on grant of the certificate and also filing the suit without delay is referred by the trial court as sufficient to suggest that there was no abandonment of the mark, acquiescence or laches by the plaintiffs.18. In our opinion, the above concurrent findings, on which the grant of interlocutory injunction in favour of the plaintiffs is based is, to say the least, a reasonable conclusion on the relevant material available at this stage. It is not for this court at the stage of second appeal to reassess the material and reach an independent conclusion thereon for the first time and it has only to be seen whether the conclusion reached by the trial court was reasonably possible on the material. Moreover, even on a reassessment, it appears to us that the conclusion reached by the trial court in favour of the plaintiffs is the one more probable and reasonable on this material.Injunction is a relief in equity and is based on equitable principles. On the above concurrent findings, the weight of equity at this stage is in favour of the plaintiffs and against the defendants. It has also to be borne in mind that a mark in the form of a word which is not a derivative of the product, points to the source of the product. The mark/name WHIRLPOOL is associated for long, much prior to the defendants application in 1986 with the Whirlpool Corporationplaintiff No. 1. In view of the prior user of the mark by plaintiff No. 1 and itsreputation extending to India, the trade mark WHIRLPOOL gives an indication of the origin of the goods as emanating from or relating to the Whirlpool Corporationplaintiff No. 1. The High Court hasits satisfaction that use of the WHIRLPOOL mark by the defendants indicates prima facie an intention todefendants washing machines as those of plaintiffs or atleast the likelihood of the buyers being confused or misled into that belief. The fact that the cost of defendants washing machine is 1/3rd of the cost of the plaintiffs washing machine as stated by Shri Sibal, itself supports the plaintiffs plea that the defendants washing machines are not of the same engineering standard and are inferior in quality to the washing machines of the plaintiffs. In addition, it has been rightly held that the grant of interlocutory injunction would cause no significant injury to the defendants who can sell their washing machines merely by removing the small metallic strip bearing the offensive trade mark/name which includes WHIRLPOOL. On the other hand, refusal of the interlocutory injunction would cause irreparable injury to the plaintiffs reputation and goodwill since the trade mark/name WHIRLPOOL is associated for long because of prior user and even otherwise with the plaintiff No. 1Whirlpool Corporation. These factors which have been relied on for grant of the interlocutory injunction by the trial court indicate that the exercise of discretion was in accordance with the settled principles of law relating to the grant of interlocutory injunctions in aaction. The affirmance of the trial courts order by the Division Bench on an appeal reinforces the trial courts view.21. Applying the settled rule indicating the scope of interference in an appeal against exercise of discretion by the trial court to grant an interlocutory injunction, we find no ground to take a different view or to interfere with the grant of the injunction.22. On the above conclusion reached on the facts of this case, it is unnecessary to refer to the several decisions cited at the bar to indicate the settled principles of law regulating grant or refusal of interlocutory injunctions and the scope for grant of such an injunction is aaction even against the proprietor of a registered trade mark. None of those decisions lays down that in aaction based on the right in common law distinct from the statutory right based on a registered mark, an injunction cannot be granted even against an owner of the trade mark in an appropriate case. It is for this reason, Shri Kapil Sibal fairly conceded this position at the outset and relied on the fact of registration in favour of the defendants only for the limited purpose indicated earlier. The surviving controversy at this stage was confined only to the legality and propriety of an interlocutory injunction granted on the facts of this case.23. It cannot be seriously disputed that on the findings recorded by the trial court and affirmed on appeal by the Division Bench which appear to us as reasonable conclusion on the relevant material, grant of an interlocutory injunction is the appropriate order to make and the proper exercise of discretion by the trial court. The decision of this Court in Wander Ltd. & Anr. v. Antox India P. Ltd. (Supra) is alone sufficient to support this view. We may add that the trial court has taken care to protect the defendants interest at the interlocutory stage during the trial of the suit in the language used for grant of the inter locutory injunction reserving liberty to apply for its discharge or variation if additional material or subsequent events justify such a course.