Introduction
Trademarks play a crucial role in distinguishing one corporation’s products and services from those of its competitors. In India, the Trademarks Act, 1999 constitutes the primary legal framework governing trademarks. The concept of “prior use” versus “registered trademark,” each of which has its own significance and ramifications, is at the centre of a foundational debate in trademark law.
Understanding the Basics
Both registered and unregistered trademarks are protected by the Indian Trademarks Act of 1999. Obtaining a registered trademark requires filing an application with the Trademarks Registry and adhering to the necessary formalities. On the other hand, the concept of prior use refers to the commercial use of a mark prior to its registration.
Prior Use
When a mark is not registered, prior use becomes significant. Prior use indicates that a business or entity has been using a particular mark in commerce prior to the date of filing for a trademark. This prior use can be used as a defence against trademark owner claims of infringement.
Under the doctrine of prior use, even if a mark is not registered, the entity that has been using it before may be able to continue using it within the prior use’s geographical scope. This recognition of prior use safeguards established businesses from being displaced by subsequent registrants claiming rights to the same or a similar mark.
Registered Mark
A registered trademark confers a host of exclusive rights on its owner. These rights include the ability to prevent others from using an identical or deceptively similar mark for the same or similar goods/services for which the registered mark is used. This provides the trademark owner with a solid legal basis for pursuing legal action against infringers.
In order to obtain a registered trademark, a thorough search must be conducted to ensure that the mark is unique and not already in use. Once registered, the owner’s rights are protected by law, and they have the right to initiate infringement proceedings, seek damages, and even request that the Customs authorities prevent the importation of goods bearing infringing marks.
The Conflict
Disputes frequently result from the tension between prior use and registered trademark rights. There may be instances in which a prior user is unable to register their mark due to the existence of a similar registered trademark. In contrast, a registered trademark owner may face opposition from prior users who can demonstrate a history of commercial use.
In certain instances, in India, the principle of “first to use” rather than “first to register” applies. This is especially true when the prior use is well-documented and predates the registration of a competing mark. Courts may protect the prior user and prohibit the registered trademark owner from infringing the prior user’s rights.
Striking a Balance
Section 12 of the Trademarks Act states that where more than one person is using an identical or similar mark in good faith, either in the same locality or in different localities, and their rights to use the mark have been established either through use or by registration under the Act, the Registrar may allow the registration of the mark to both parties or impose conditions for its use.
The purpose of this provision is to balance the rights of both parties and avoid undue hardship to either party, while also ensuring that the public is not misled or confused by similar marks. The decision would likely depend on factors such as the distinctiveness of the mark, the industries in which the parties operate, the extent of their respective uses, and the potential for consumer confusion.
Case Study: Hatsun Agro Product Ltd v Sri Ganapathy Dairy
Facts
Hatsun Agro Product Ltd (the plaintiff) was a manufacturer and marketer of various food and dairy products, including ice cream, dairy whitener, ghee, and butter. They had been using the mark “ARUN” since 1970 and had registered the mark across multiple classes, including class 29, which was relevant to this case. The plaintiff also claimed the use of their ARUN stylised mark only from January 2006 for ghee.
The plaintiff alleged that Sri Ganapathy Dairy (the defendant) was selling ghee under the identical mark “ARUN,” claiming that this constituted trademark infringement and passing off.
The defendant contended that they had been using the “ARUN AGMARK GHEE” mark since 1989, and it was derived from the first four letters of their founder’s name, Mr. Arunachalam. They asserted that their use of the mark was honest and that they were the prior user of the mark “ARUN” for ghee.
Court’s Decision
The court examined the evidence presented by both parties and ruled in favor of the defendant. The court held that the defendant was indeed the prior user of the “ARUN” mark for ghee, as they had been using it since 1989, predating the plaintiff’s use of the same mark for ghee from January 2006. The court emphasized the importance of prior use as a valid defense against trademark infringement claims.
The court also rejected the plaintiff’s argument that the mark “ARUN” had acquired a secondary meaning and that the defendant’s use of their mark infringed on the plaintiff’s registration in class 29. The court noted that “ARUN” is a common Indian name and that the defendant’s use of the first four letters of their founder’s name was not an infringement, especially considering their status as the honest prior user of the mark.
Additionally, the court dismissed the plaintiff’s claim that ghee and ice cream were allied goods and that the registration of “ARUN” in class 29 should confer an exclusive right to use the word. The court stated that such exclusive rights couldn’t be claimed when the plaintiff had only marketed their ghee under a different mark, “HATSUN.”
The court’s decision highlighted the principle that prior user rights take precedence over subsequent user rights, even if the subsequent user has registered the trademark. This principle, protected under the Indian Trademarks Act, safeguards the rights of those who have used a mark in commerce before its registration by another party.
Conclusion
The Indian Trademarks Act, 1999 recognises both the value of prior use and registered trademarks. A registered trademark provides stronger and broader protection, while prior use protects established businesses from losing market presence as a result of subsequent registrations. When establishing and defending brand identity, it is essential for businesses to strategically consider both factors.
In cases of potential conflict, it is essential to consult with legal professionals. Whether protecting a registered trademark or asserting prior use, a comprehensive understanding of the legal provisions and precedents is required to make informed decisions and navigate India’s complex trademark landscape.
