Full Judgment Text
* IN THE HIGH COURT OF DELHI AT NEW DELHI
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% Judgment pronounced on: 9 December, 2015
+ I.A. No.10720/2012, I.A. No.19935/2014, I.A. No.
15400/2012 & I.A. No. 40/2013 in CS (OS) 1663/2012
HELAMIN TECHNOLOGY HOLDING SA & ANR ..... Plaintiffs
Through Mr. Pravin Anand, Adv. with
Mr. Aditya Gupta and Mr. Vishnu
Rege, Adv.
versus
HARIBANSH RAI & ORS ..... Defendants
Through Mr. Shanmuga Patro, Adv with Mr.
Tarun Kumar, Adv for D-1 to 6
CORAM:
HON'BLE MR.JUSTICE MANMOHAN SINGH
MANMOHAN SINGH, J.
1. By way of this order, I propose to decide the following four
pending applications:-
(a) I.A. No. 10720/2012 under Order XXXIX Rule 1 and 2 CPC filed
by the plaintiffs;
(b) I.A. No. 19935/2014 under Order XXXIX Rule 4 CPC filed by
the defendants for vacation of interim order;
(c) I.A. No. 15400/2012 under Order VII Rule 10 and 11 CPC filed
on behalf of the defendants for rejection of plaint;
(d) I.A. No. 40/2013 under Order I Rule 10 CPC filed by the
defendants.
CS (OS) No.1663/2012 Page 1 of 26
2. The plaintiffs have filed the suit for permanent injunction
restraining passing off, damages, rendition of accounts and delivery up
against the defendants.
3. Brief facts of the case as per the plaint are that the plaintiff No.
1 is a limited Company incorporated under the laws of Switzerland and
is the world leader in development, production and marketing of
specific scale corrosion inhibitors used in water-steam and heating
circuits/steam generators, warm and hot water networks, boilers,
turbines, cooling systems etc. The plaintiff No. 1 began its commercial
operations in 1986 when the trademark and the name ‘HELAMIN’ was
first used in the course of trade.
4. Plaintiff No.2 is the wholly-owned subsidiary and the
manufacturing and world export branch of plaintiff No.1 and uses the
trademark and trade name HELAMIN under the license from plaintiff
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No.1. Plaintiff No.2 was founded on 11 May, 1989 and is a limited
Company incorporated under the laws of France.
5. Plaintiff No. 1 is the pioneer and inventor of a revolutionary
polyamines filming technology to prevent scale and corrosion in water-
steam cycle systems (turbines included) as well as in cooling systems.
The plaintiffs’ products serve to form a continuous and hydrophobic
protective film on metal surfaces, thus acting as a barrier between
water and metal to prevent corrosion.
6. It is stated that the plaintiff No.1 has a strong international
commercial presence in over 40 countries across the world including
India and has a leading share in its specific market segment within the
global water treatment chemicals market. The plaintiff No.1’s
products are sold through an integrated distribution network
CS (OS) No.1663/2012 Page 2 of 26
supported by the plaintiff’s international distributors in several
countries.
7. It is averred that the plaintiffs have been using the trademarks
HELAMIN 906 H and HELAMIN BRW 150 H since the year 1993 and the
trademark HELAMIN 90 H-TURB since the year 2002. The plaintiff
No.1’s trademark HELAMIN is coined from ‘Helvetia’ (the Latin name
for Switzerland) and ‘Polyamin’ which denotes a chemical compound
comprising of multiple amino groups.
8. The plaintiff No.1 had applied for registration of the trademark
HELAMIN in India under application No.1717404 in relation to
“chemicals used in industry and chemical products for the protection of
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metallic surfaces” in classes 1 and 2 respectively, as of 1 August,
2008.
9. It is also averred that as a result of long and continuous use
since the year 1986, coupled with extensive sales spanning over a
wide geographical area, the trademark/name HELAMIN has acquired
tremendous reputation and goodwill amongst the customers and the
members of the trade all over the world and has become distinctive of
the plaintiffs. The well-known character of the plaintiffs’
trademark/name HELAMIN is reflected from the plaintiffs’ worldwide
consolidated sales turnover from 2000 to 2011 which averaged
approximately US$10,000,000 per year. The worldwide consolidated
advertisement expenses for the plaintiff’s HELAMIN products from
2000-2011 aggregates to approximately US$300,000.
10. It is the case of the plaintiffs against the defendants that in
2001, defendant No. 3 began working with Helamin Technology
Holding Group (HTHG) as a technical consultant for their UAE market.
CS (OS) No.1663/2012 Page 3 of 26
During his course of employment with the plaintiffs, he had access to
confidential information as well as end user customer know-how and
received technical training pertaining to the working and applications
of HELAMIN water treatment chemicals.
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11. On 28 June, 2001, defendant No. 6 Helamin Impex Pvt. Ltd.
was incorporated at the initiative of defendant No. 3 as the CEO.
Thereafter, an informal agreement was arrived at between Filtro S.A.
(international distributor of plaintiff No. 1 at the time) and defendant
No. 6 for supply of samples of original HELAMIN products for the
purpose of trial tests only.
12. It is alleged that defendant No. 6 reported additional trials and
surreptitiously continued to obtain HELAMIN samples from Filtro S.A.
to conduct further trial tests. Defendant No.7, who is the director of
defendant No.8 i.e H2O Facilities SA left Filtro SA in December, 2006
and had misappropriated and forged letter heads and stamps of Filtro
SA.
13. In early 2007, Filtro SA was voluntarily liquidated, consequent
upon which plaintiff No.2 succeeded Filtro SA and took over as the
exclusive International Distributor of the HELAMIN products. In the
absence of a contract or signed agreement between Filtro SA and
defendant No.6 and in view of the consistently poor results achieved
by defendant No.6 in spite of several trial tests conducted by it with
the sample HELAMIN products, plaintiff No.2 ceased the supply of the
HELAMIN water treatment chemicals to defendant No.6. While
defendant No.6 stopped requesting for sample HELAMIN products for
trial tests from plaintiff No.2, defendant No.6 continued to
unauthorisedly import and supply water treatment chemicals under
CS (OS) No.1663/2012 Page 4 of 26
plaintiff No.1’s trademark HELAMIN and also continued to transact
business under the corporate name/trade name predominantly
comprising of HELAMIN.
14. Thereafter, inquiries were conducted in the market by the
plaintiffs which revealed that defendant No.6 was selling water
treatment chemicals based on the ‘Helamin’ technology to fertilizer
companies in India and also created false impression that defendant
No.6’s products originated from or were connected to the plaintiffs. On
further inquiries by the plaintiffs, it was revealed that the products
being sold by defendant No.6 were procured/imported from defendant
No.9, which is subsidiary of, or is connected and/or related to
defendant No.8 and is being actively run and managed by defendant
No.7.
15. It is further alleged that defendant No.7 was unlawfully claiming
to have obtained the approval to grant manufacturing/blending rights
to defendant No.6 during his tenure at Filtro SA. It is stated that there
was never such an approval granted to defendant No.6 by Filtro SA,
especially since Filtro SA was never authorized to grant such rights
being merely an international distributor of HELAMIN products and the
only entity that was authorized to grant such rights was plaintiff No.1.
16. It is alleged that the defendants are extensively using plaintiff
No.1’s trademark and name HELAMIN in relation to its products and
services, thereby, misleading the public into believing that the
defendants’ products originate from or are connected to the plaintiffs.
It is also alleged that the defendants do not maintain their own
website, there are web pages hosted by other entities which pertain to
the defendants and their activities, wherein the defendants have
CS (OS) No.1663/2012 Page 5 of 26
hyperlinked the plaintiff’s website www.helamin.com giving the
impression that the defendants are connected to or affiliated with the
plaintiffs.
I.A. No. 15400/2012(under Order VII Rule 11 CPC by
defendant)
17. Firstly, I shall take up the above mentioned application for
rejection of the plaint wherein it is stated that none of the defendants
are based in Delhi and neither do they carry any business in the
territorial jurisdiction of Delhi hence jurisdiction of this Court is not
attracted. Further, the address given by defendant No. 6 is non-
existent and was shut down 5 years ago.
It is stated that the suit is bad for mis-joinder of parties as it is
settled law that the main company must be made defendant No. 1
whereas in the present case the main company Helamin Impex Pvt.
Ltd. has been deliberately made as defendant No.6. The defendant
No.1 and 2 are claimed as Directors of defendant No.6. The business is
being carried out by defendant No.6 as a corporate entity and
Directors are not to be impleaded, thus all the individual persons who
have been impleaded as defendants are liable to be deleted. It is
further stated that Mr. K.S.P. Thakur who was claimed as CEO of
defendant No.6 does not hold any position whatsoever nor does he
own any shareholding with defendant No.6. As far as the defendant
Nos. 5 to 9 are concerned, the plaintiff has stated that they had been
members of the defendant company which is not true and no issue has
been raised against the said defendants.
It is claimed by the defendant that the plaintiffs have not
disclosed before this Court as to how the plaintiffs acquired the rights
in the marks after the main Company, Filtro. S.A had gone into
CS (OS) No.1663/2012 Page 6 of 26
bankruptcy. The plaintiff No.1 as per the documents of the plaintiffs
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appears to have been registered on 10 November, 2011. The exact
registration date is not decipherable in as much as the translated copy
of the certificate of registration has not been filed on record. The
manner in which the plaintiffs claim to be the owner of the trademark
“HELAMIN” in India is concocted and misleading as not a single
document has been filed on record to show ownership of the mark
“HELAMIN” in favour of the plaintiffs.
It is stated that no documents have been placed on record to
show as to how the assets and liabilities of Filtro S.A. came to be
vested in the plaintiffs and thus, the suit is not maintainable. It is
further stated that the plaintiffs are neither successors nor
associates/holding companies of Filtro S.A. The Helamin Technology
Holding and Helamin France (or manipulated company HTHG having no
legal identity) have never succeeded/ owned Filtro SA till date.
18. The defendants state that when the relationship with Filtro S.A.
ended they became associated with a company called H2O SA Facilities
Switzerland run by the ex-director of Filtro S.A. They were marketing
these high quality products under the name of INDIAMIN. The plaintiffs
created a false propaganda to destroy the defendants’ reputation and
mislead Nagarjuna Fertilizers, a client they had for 5 years.
19. The defendants submit that the name Helamin Impex Pvt. Ltd
has been used since their incorporation and Filtro S.A. was aware of
the same. They now sell their products under the mark of INDIAMIN
but are entitled to use the same corporate name as there is no
injunction to this effect. They further state that defendant No. 3 has no
association with defendant No. 6. They submit that defendant No. 3
just acted as a technical advisor to the plaintiffs, a relationship which
CS (OS) No.1663/2012 Page 7 of 26
was terminated in 2010 and therefore, he is not a necessary party to
the suit.
20. The ground of suppression of material facts raised by the
defendant cannot even form the basis of rejection of the plaint under
Order VII Rule 10 and 11 of the CPC. The ground of misjoinder of
parties also cannot form the basis of rejection of the plaint under
Order VII Rule 10 and 11 of the CPC.
21. During the hearing, the only ground for rejection of the plaint
that was pressed by the counsel for the defendant was that this Court
lacked territorial jurisdiction. As regards the defendants’ averment that
this Court does not have territorial jurisdiction to entertain the present
suit, the defendants have themselves filed invoices in the Court of the
District Judge at Gautam Budh Nagar (U.P.) which clearly show that
the defendants are carrying on business within the jurisdiction of this
Court. These invoices clearly state that the defendant has an office at
the defendant’s address at “D-503, Block D, Kalka Apartment, Plot-31,
Sector 6, Dwarka, Delhi”.
22. The plaintiffs have invoked territorial jurisdiction in view of the
averment made in para 53 of the plaint. The same is reproduced
herein below:-
“53. This Hon’ble Court has the necessary territorial
jurisdiction to entertain and try the present suit under Section
20 of the Code of Civil Procedure, 1908 since Defendant Nos.7
to 9 are engaged in manufacturing and exporting the
counterfeit HELAMIN products to defendant Nos. 1 to 6 who
are carrying on their business activities in New Delhi through
Defendant No.6’s branch office at D-503, Kalka Apartments,
Plot No.31, Sector-6, Dwarka, New Delhi-110075 and are
using plaintiff No.1’s trade mark, corporate name and trading
style, and publicizing and marketing its deceptive and
infringing products and services inter alia in Delhi. The cause
of action to institute the present suit thus arises substantially
CS (OS) No.1663/2012 Page 8 of 26
within the jurisdiction of this Hon’ble Court.”
23. The law of territorial jurisdiction is quite settled which has been
laid down in the following judgements:-
i. In Tata Iron & Steel Co. Ltd. v. Mahavir Steels & Ors .;
47(1992) DLT 412 it was observed in para 11 as under:
“11. The question regarding jurisdiction can only
be gone into after the evidence of the parties is
recorded in the case. Even in the Punjab case the
suit was not thrown out at the threshold under
Order 7 Rule 11 CPC but only after the parties
were given an opportunity to lead evidence. The
plaint in the present suit categorically states that
the defendant no.1 was selling the channels of
defendant no.2 under the offending trade mark
which is deceptively similar to that of the plaintiff.
On these averments the Court must assume
jurisdiction and proceed with the suit to determine
the question relating to the confirmation/vacation
of the stay order at this stage.”
ii. In Pfizer Products Inc. v. Rajesh Chopra & Ors, 2006(32)
PTC 301(Delhi) wherein it was observed as under :-
“12. The other aspect of the matter is that a threat
of selling the offending goods in Delhi would in
itself confer jurisdiction in the courts in Delhi to
entertain a suit claiming an injunction in respect
thereof. Whether the threat perception is justified
or not is another matter which has to be
considered and decided upon in the application
filed by the plaintiff under Order 39 Rules 1 and 2
or on merits when the suit is taken up for disposal.
Insofar as Order 7 Rule 10 is concerned, assuming
that whatever is stated in the plaint is correct, one
would have to also assume that the threat or the
intention of the defendants to sell and offer for sale
the offending goods in Delhi is also correct.
Therefore, if the threat exists then this court would
certainly have jurisdiction to entertain the present
suit.
CS (OS) No.1663/2012 Page 9 of 26
iii. In LG Corporation & Anr. v. Intermarket
Electroplasters(P) Ltd. and Anr.; 2006 (32) PTC 429,
following observations were made in para 7 :-
“7. ……The question as to whether the Court has
territorial jurisdiction to entertain a suit or not has
to be arrived at on the basis of averments made in
the plaint, that truth or otherwise thereof being
immaterial as it cannot be gone into at this
stage…..”
24. The abovementioned three decisions have been approved by this
Court.
25. The plaintiffs have placed on record the documents obtained by
filing applications under the Right to Information Act, 2005 which show
that the defendant No. 6 is carrying on business within the territory of
this Court from the same address as mentioned above. In the
documents obtained by the plaintiffs in response to the application
under the Right to Information Act, the said address is identified as an
office from where sale of goods bearing the infringing trademark
HELAMIN were conducted. These documents would clearly show that
the defendant No. 6 has an office at the said address within the
territory of Delhi. At this stage, only the prima facie view is to be taken
and in case, some material is available on record that the defendants
have done any business or intended to do business in due course, the
issue of territorial jurisdiction is to be postponed as the suit is also
maintainable at the place where a threat is made by a party.
26. The question whether defendant No. 6 continues to carry on
business at the said address is a question of fact which can only be
determined at trial and cannot be determined at this prima facie stage
while deciding an application for return of the plaint under Order VII
CS (OS) No.1663/2012 Page 10 of 26
Rule 10 CPC. It is well settled that this Court cannot go into disputed
questions of fact at this prima facie stage. None of the decisions
referred by the counsel appearing on behalf of the defendant Nos. 3
and 6 are applicable to the facts of the present case. Thus, the
application filed is not maintainable. The same is dismissed.
I.A. No. 40/2013 under Order l Rule 10 CPC by defendant
27. The second above mentioned application has been filed seeking
deletion of defendant Nos. 1 to 5 from the array of parties. It is
claimed that the present suit is bad in mis-joinder of parties.
28. It is stated that the main company i.e. Helamin Impex Pvt. Ltd.
should be made defendant No. 1 but has deliberately been made as
defendant No.6. The defendant Nos.1 and 2 have been claimed as
Directors of defendant No.6. The business is being carried out by the
defendant No.6 as a corporate entity and Directors are not to be
impleaded. Further defendant No. 3 who was claimed to be CEO of
defendant No. 6 does not hold any position nor own any shareholdings
with defendant No. 6. Thus, all individuals person who have been
impleaded as defendants are liable to be deleted.
29. It is stated that defendant No. 6 was incorporated in 2001 with
the complete consent and approval of M/s. Filtro S.A. which was the
main company conducting international business on behalf of the
plaintiffs. Further, the defendants have filed documents to show that
defendant No.6 was incorporated as Helamin Impex Pvt. Ltd with the
complete consent and approval of the then management of the
plaintiffs. However, sometime in the year 2010, the plaintiffs along
with Apex Trading directly contacting plants and industries in India
using Polyamine treatment supplied/serviced by the defendant No.6,
to completely sideline it by defaming and damaging its goodwill.
CS (OS) No.1663/2012 Page 11 of 26
30. The plaintiffs submit that they are willing to drop defendant Nos.
1, 2, 3 and 5 from the suit on the basis of their statement (as recorded
in the written statement filed by defendant No. 6 and adopted by
defendant Nos. 1, 2, 3 and 5) that they have stopped using the
trademark HELAMIN and the consequent undertaking that they will not
in any manner use the trademark or trade name HELAMIN. The
plaintiff further states that as is a natural corollary to this undertaking,
defendants Nos. 1, 2 and 5 should not be allowed to pursue their
trademark applications for HELAMIN formative marks and the
opposition filed by them against the plaintiff’s trademarks.
31. Since defendant No. 3, Mr. KSP Thakur, has been personally
involved in the infringing activities as was evident from his presence
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and submissions made in Court at the hearing on 24 September,
2015, the plaintiffs stated that their consent to delete defendants
should not extend to Mr.Thakur.
32. As the defendant No.3 is not agreeable to give up the mark
Helamin from the part of its corporate name of defendant No.6 and the
counsel appearing on behalf of the plaintiff stated that the matter be
decided on merit. Thus, the consent recorded in order
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dated 24 September, 2015 qua defendant No.3 is allowed to be
withdrawn by the plaintiffs. The application is accordingly
disposed of.
I.A. No. 10720/2012 under Order XXXIX Rule 1 and 2 CPC and
I.A. No. 19935/2014 under Order XXXIX Rule 4 CPC
33. Now I shall take up the remaining two above mentioned
applications, the details of which are already mentioned in the earlier
paras of my order.
34. It is the case of the plaintiffs that the plaintiff No. 1 is the
CS (OS) No.1663/2012 Page 12 of 26
pioneer and inventor of a revolutionary polyamines filming technology
to prevent scale and corrosion in water-steam cycle systems (turbines
included) as well as in cooling systems (open or closed), which was
launched under the trademark HELAMIN and is patented. The plaintiffs’
HELAMIN products are proprietary formulations of a perfect blend of
components that include protective (filming) polyamines,
polycarboxylates (dispersants), and volatile (alkalinizing) amines,
working in a synergistic way to provide optimum protection and
passivation of all ferrous and non-ferrous metal surfaces in the entire
water and steam circuit. The plaintiffs’ HELAMIN products serve to
form a continuous and hydrophobic protective film on metal surfaces,
thus acting as a barrier between water and metal to prevent corrosion.
Significantly, the plaintiffs have been using, in particular the
trademark HELAMIN since the year 1986, the trademark HELAMIN 906
H and HELAMIN BRW 150 H since the year 1993, and the trademark
HELAMIN 90 H-TURB since the year 2002.
35. The plaintiffs and defendant No. 6 entered into an informal
arrangement/ agreement in the year 2001 under which defendant No.
6 acted as the plaintiffs’ supplier of HELAMIN goods in India from the
year 2001 – 2006.
36. It is an admitted position that before the informal arrangement/
agreement between the plaintiff and defendant No. 6, the defendant
No. 6 was not selling any goods or providing any services under the
trademark HELAMIN.
37. It is also an admitted position (as it is evident from the stand
taken by the defendants in their written statement) that the informal
arrangement/ agreement between the parties no longer exists and
that the plaintiff has stopped supplying the HELAMIN seed material to
CS (OS) No.1663/2012 Page 13 of 26
defendant No.6.
38. The defendants have also admittedly ceased to use the mark
HELAMIN as a trademark for its products in view of the cessation of
the arrangement with the plaintiffs.
39. The above said circumstances speak from themselves in view of
the plea taken in the written statement filed by defendant No. 6, which
are reproduced herein under:-
“..From 2010, once the stock of Helamin was over, the
Defendant No.6 started manufacturing and selling products
under the name 'INDIAMIN'…”(Paragraph 14 of the written
statement)
“It is further submitted that after the relationship with Filtro
SA ended, Defendant No. 6 is now associated with a
company namely, H2O SA Facilities, Switzerland which is
run by Mr. Bezzoli, Ex-Director of Filtro SA”. (Paragraph 15
of the written statement)
“However, Defendant No.6, have used the name INDIAMIN
(since 2010) in an honest manner as the product could no
more be manufactured based on the Helamin seed material
as the company supplying the same i.e. Filtro S.A has since
gone into liquidation.” (Paragraph 16 of the written
statement)
40. During the course of hearing of interim application, a statement
was made by the defendant No.3 informing the Court that defendant
No.3 is not willing to delete or remove the mark Helamin from the
corporate name of the defendant No.2. Counsel for the plaintiffs
argues that it is the sole intention to cause confusion in the market
and to mislead consumers into believing that there continues to exist
an association between the plaintiffs and defendant No. 6, they
continue to misuse the plaintiffs’ trademark HELAMIN as an integral
part of its trade name/ corporate name ‘HELAMIN IMPEX PRIVATE
CS (OS) No.1663/2012 Page 14 of 26
LIMITED’ and the said misuse of the mark HELAMIN by defendant No.
6 as part of its corporate name is causing actual confusion in the
market regarding the said defendant’s association with the plaintiffs.
Through the present application the plaintiffs pray that the defendants
be restrained from using the mark HELAMIN both as a trademark and
as trade name. This Court is left with no option but to decide the
applications on merit.
41. The defendant No. 6 has filed an application being I.A. No.
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19935/2014 seeking vacation of ex parte injunction order dated 30
May, 2012 wherein it has been stated that the plaintiffs mislead this
Court and obtained the said order not to protect its business interests
or claim over the trade name but purely to create rumours in market
to the detriment of the defendants.
42. It is stated that since 2010 the defendant No.6 started
manufacturing and selling polyamine based boiler water treatment
chemical products under the brand and style of ‘Indiamin’. However, in
August/September, 2014 the plaintiffs itself informed the authorities
that “Indiamin or other products available in India have nothing to do
with its products.
43. It is stated that the plaintiffs did not inform the Court that
defendant No.6 had stopped using HELAMIN for its products since the
year 2010 which is almost 2 years prior to the restraint order. The
plaintiffs also did not inform the authorities in India in 2013 about the
cancellation of registration of trademark HELAMIN in USA.
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44. It is stated that as on 1 August, 2008 HELAMIN was not being
used by the plaintiff or its predecessor in India and the plaintiff No.1
was aware and in complete knowledge of corporate name, existence
and line of business of the defendant No.6 since the day its
CS (OS) No.1663/2012 Page 15 of 26
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collaboration with Filtro SA commenced which ought to be 18
October, 2001 or a date prior thereto.
45. As per the pleading and material placed on record which reveals
that the plaintiff No.1 now holds the title over the trademark HELAMIN
in India and in several countries across the world and has accordingly
obtained/ applied for protection for the trademark HELAMIN across the
world. The chain of title leading to the plaintiff acquiring rights in the
trademark HELAMIN has been given here as below:-
46. In order to establish the above chain of title over the trademark
HELAMIN, the plaintiffs place reliance on the trademark assignment
agreement between trademark Faborga SA and Helamin Holdings SA.
Copy of the same has been placed on record. The plaintiffs’ counsel
also relies on the application (bearing No. 1717404) for the trademark
HELAMIN. The said application was originally filed in the name of
Helamin Holdings SA and subsequently a request was filed for
recording of change of name of Helamin Holdings SA to plaintiff No. 1.
Similarly, plaintiff No. 1 has filed another trademark application
bearing no. 2493382 for the trademark HELAMIN. Further, records of
CS (OS) No.1663/2012 Page 16 of 26
the plaintiffs’ trademark registrations in countries such as Switzerland,
Hungary, Greece and Denmark have also been filed by the plaintiffs in
the proceedings. These documents would prima facie show that the
plaintiff No.1 has title in the trademark HELAMIN.
47. Counsel for the defendant No.3 and 6 submits that a third party,
namely Filtro SA, holds the rights over the trademark HELAMIN even
though no such claim has been made by the third party or its
successors/ liquidators till date. The said argument on their behalf
prima facie is not correct in view of the certificate of the official
liquidator of Filtro SA who has confirmed the following:
“We, FIDUCIAIRE BEAUMONT SA, 25 rue des Caroubiers, 1227
Carouge Switzerland, represented by Mr. Pierre Beauverd, as
the late Liquidator of FILTRO SA in liquidation and FABORGA
SA in liquidation, hereby certify that:
1. FILTRO SA was not holding the HELAMIN® Trademark
nor the Patents rights related to Helamin products as
part of its assets.
2. FABORGA SA was holding such HELAMIN® Trademark
and Patent rights related to Helamin products as part of
its assets. Such HELAMIN® Trademark and Patent
rights related to Helamin products have been
subsequently transferred to HELAMIN HOLDING SA
(now HELAMIN TECHNOLOGY HOLDING SA) as of 2007.
3. FILTRO SA was the worldwide Distributor only
(excluding Germany and Turkey) of Helamin original
products that have always been manufactured by
FABORGA SARL (now HELAMIN FRANCE SARL). As
such, FILTRO SA was not manufacturing the Helamin
original product which they were sourcing from
FABORGA SARL exclusively and supplying to their
international customers.”
48. It is evident from the statement of its official liquidator, that
Filtro SA was only the worldwide distributor (excluding Germany and
CS (OS) No.1663/2012 Page 17 of 26
Turkey) of Helamin original products which were manufactured by
Faborga SARL. As has been explained hereinabove, Faborga SARL is
the predecessor in interest of Helamin France SARL.
49. The following chart depicts the relationship between the
plaintiffs' predecessor in interest and title and defendant No. 6 and
clearly shows that the common law rights in the mark HELAMIN vest
with the plaintiffs.
50. Counsel for the plaintiffs has relied on the certificate filed by the
official liquidator of Filtro SA. The plaintiffs further place reliance on
the invoices filed in the present proceedings which would show that
goods supplied to defendant No. 6 were manufactured by Faborga Sarl
and then supplied to Filtro SA for distribution purposes.
51. It is also pertinent to mention that the defendant No. 6 has itself
identified as an “Authorized Agent of Helamin® Gmbh, Germany” in its
invoices, thereby belying his case that he was in association only with
Filtro SA and that the said party is the owner of the HELAMIN
trademark and is entitled to use the mark Helamin as part of its
CS (OS) No.1663/2012 Page 18 of 26
corporate name. The following is an extract from the invoice filed by
the defendant No. 6 in the suit filed by the said defendant in the
District Court, Gautum Budh Nagar which has been given here as
below:
52. Therefore, the plea raised by the defendants about the
challenging of ownership of the mark Helamin of plaintiff No.1 is
without any force. Similarly, the defence taken by the defendants that
they have independent exclusive right to use the mark in their
corporate name is false and frivolous once, it is established that they
were agent of Helamin, Germany in view of settled law that the Agent
is not entitled to grab the mark of the principle being authorised agent.
It amounts to breach of trust.
53. The plaintiffs’ trademark HELAMIN is a coined mark being formed
from two words HELVETIA’ (the latin name for Switzerland) and
‘POLYAMIN’ and thus enjoys a very high degree of protection.
Plaintiffs, through their predecessors in interest, adopted the mark in
the year 1986 and have been using the mark worldwide since then. In
order to establish its use of the trademark HELAMIN before the year
2001, the plaintiff has filed number of brochures and promotional
material evidencing using of the trademark HELAMIN products before
the year 2001.
54. The defendants’ earliest user claim is of the year 2001 and that
too such user claim is based on the supply of goods manufactured by
CS (OS) No.1663/2012 Page 19 of 26
the plaintiffs. Since defendant No. 6 was merely supplying the goods
manufactured by the plaintiffs under the authority of the plaintiffs, any
goodwill and reputation generated in India by virtue of the defendant
No. 6’s use of the trademark HELAMIN in India accrues to plaintiff No.
1. Such user of the defendants cannot be considered as his own user
as far as proprietorship of the mark HELAMIN is concerned.
55. It is not the defendants’ case that they were, at any point of
time before entering into the agreement with the plaintiffs,
independently selling products which did not originate from the
plaintiffs or any of their associates. The defendants have admitted that
after the stock of HELAMIN goods supplied by the plaintiffs was over,
defendant No. 6 started manufacturing and selling products under the
mark INDIAMIN. The defendants have further admitted that they could
no longer honestly use the trademark HELAMIN after the supply of the
HELAMIN seed material had ceased.
56. The arrangement/ agreement between the plaintiffs and the
defendants terminated in the year 2006 and as has been admitted by
the defendants, they have no right to use the trademark HELAMIN
after the termination of the relationship and once the supply of the
HELAMIN seed material had ceased.
Since the defendants are no longer getting supply of the
HELAMIN seed material from the plaintiffs, they have no authority or
justification to continue use of the trade name HELAMIN. The
continued use of the trade name HELAMIN by defendant No. 6 shows a
clear intent to cause consumer confusion. Consumers are bound to
believe that defendant No. 6 continues to be associated with the
plaintiffs and continues to supply materials using the plaintiffs’ seed
material even though no such association or relationship exists.
CS (OS) No.1663/2012 Page 20 of 26
57. It is admitted by the defendants since defendant No. 6 has itself
filed a lawsuit before the Gautam Budh Nagar District Court. Defendant
No. 6 in the said suit has averred that the use of the trademark
HELAMIN by the plaintiffs’ distributors is causing confusion in the
market. Since the confusion is admitted, the only question which
remains is identifying the prior user of the trademark HELAMIN which
undoubtedly is the plaintiff (through its predecessors in interest). The
said suit filed by defendant No. 6 has been dismissed by the Gautam
Budh District Court for non-prosecution. Further both the plaintiffs and
the defendants have filed documents which show instances of actual
confusion.
58. It is now well settled that once a licensor – licensee or a
manufacturer – distributor relationship terminates, the licensee or the
distributor has no right whatsoever to use either the trademark or the
trade name of the licensor and the manufacturer. The Courts
have held that there can only one source of the goods associated with
one trademark. Reference be made to the following
decisions:-
(a) Velcro Industries v. Velcro India Ltd ., 1993 (1) Arb. LR 465
“It is also not possible, at this prima facie stage, to accept
Mr. Shah's argument that, Defendants are entitled to
continue to use the name Velcro as part of their corporate
name, because they have independently developed a
reputation in India. As stated above, Defendants were merely
acting as Licensees from 1969 to 1986. In my view, the fact
that, in Agreement Exh. 'E', it is not provided that on
termination, Defendants will cease to use "Velcro" as part of
its trade name makes no difference. This is a registered
Trade Mark. To allow Defendants to use it as part of its
Corporate name is to permit Defendants to give an
impression to the public that they are still connected with or
CS (OS) No.1663/2012 Page 21 of 26
have a licence from the Plaintiffs. In this behalf it is relevant
to note that the reputation, if any, of the Defendants in the
Indian Market is obviously from manufacture and sale of
hook fasteners of synthetic materials which were only under
licence.”
(b) Eaton Corporation & Anr. v. Bch Electric Limited, 2013(55)
PTC 417(Del)
“…in case the law with regard to the rightful owner of the
trademark and the act of ex-licensee is examined, it emerges
that either during the licensing period of agreement or after
expiry, it is implicit and clear that the ex-licensee is not
entitled to claim the ownership of a trademark nor he is
permitted by law to file an application for registration of the
trademark in his name nor is entitled to file the petition for
rectification of the same very trademarks in which ex-
licensee was using the trademarks as a permissive user,
otherwise it would amount to fraud and misrepresentation.
The ex-licensee under no circumstances can declare himself
as owner of the trademark to claim the concurrent user
because as per scheme of the Act, the benefit of concurrent
user can be derived by a party whose user is honest and
bonafide. In the present case, both things are missing. In
other words, he cannot be allowed to make a hole in the
plate in which he was eating; such wrongful user would be
considered as stolen property which cannot become rightful
property in any amount of user.”
(c) Rob Mathys India Pvt. Ltd. v. Synthes Ag Chur , 1997 (17)
PTC 669 (DB)
“In the case in hand, it is apparent that 10 years period of
the collaboration agreement dated 15th April 1978 has
expired long ago and it has also been revoked as well by
notice. Thus, the license to use the trade marks in both the
actions had ceased to exist. The principle being that there
could only be one mark, one source and one proprietor.
There cannot be two origins as the registered trade mark as
well as the unregistered trade mark both could be used only
CS (OS) No.1663/2012 Page 22 of 26
under the collaboration agreement by the defendant
/appellants. The appellant/ company is obviously not the
owner. They cannot be allowed to use the registered trade
mark device and the word "Synthes" and the trade mark
"AO/ASIF" after the revocation of the collaboration
agreement.”
59. The defendants have wrongly claimed that the plaintiffs have
acquiesced in the use of the trade name HELAMIN by defendant No. 6.
As it is well settled that the defence of acquiescence is not available to
those who have continued to use the mark fraudulently and
dishonestly. Defendant No. 6 was clearly aware of the plaintiff’s title in
the trademark HELAMIN and despite such knowledge has continued to
use the trade name HELAMIN. The fact that the defendant stopped
using the trademark HELAMIN for its products but continued to use the
trade name also establishes that it clearly recognized that it did not
have any right to use the said trademark and trade name but
continued to do so fraudulently and dishonestly.
60. In the case of Eaton Corporation (supra) which cites settled
law on the subject:-
“It is settled law that where there is fraud, there is no room
for doctrine of acquiescence to operate. The acquiescence
cannot be inferred merely by reason of the fact that the
plaintiff has not taken any action against the infringement of
its rights. Even if the defendant has been using both the
trademarks from the period when the relation between the
parties are broken. Is it possible that the defendant would and
could take any benefit out of it knowing the said trademarks
are belonging to the plaintiffs? Can the defendant in the facts
of the present case is entitled to take the defence of estoppel,
acquiesces, delay, latches and abandonment of the same trade
marks by the plaintiff?”
61. It is rightly alleged by the plaintiffs that as soon as they came to
CS (OS) No.1663/2012 Page 23 of 26
know of defendants’ use in the year 2009, they addressed letters to
third parties in order to dispel any confusion prevailing in the market
owing to the defendant No. 6’s misuse of the plaintiffs’ trademark. In
this regard, reference may be had to the copy of the certificate dated
th th
17 February, 2011 and letter dated 5 May, 2010 issued by the
plaintiffs regarding the relationship between defendant No. 6 and the
plaintiffs.
62. The defendants have themselves furnished a letter written by
the representative of the plaintiffs to IFFCO (filed along with the I.A.
No. 19935 of 2014 under Order XXXIX Rule 4) which exemplifies such
efforts being made by the plaintiffs.
The said correspondence would explain the following:
i. The defendants are benefiting from the confusion being caused
in the market by virtue of their use of the HELAMIN
trademark/trade name. The fact that the defendants have
objected to such letters being addressed by the plaintiffs itself
shows that the defendants seek to continue illegally riding
upon the plaintiffs’ reputation and goodwill.
ii. On learning that the defendants are not the OEMs (Original
Equipment Manufacturers), organizations such as IFFCO
decided to source the product from the plaintiffs thereby
establishing the plaintiffs’ reputation.
iii. The representative from IFFCO clearly points out that they “do
not want to take any risk in [our] system”. This shows that
the products being offered by the plaintiffs and the defendants
involve high risk and thus the harm that can be caused by the
defendants’ misuse of the plaintiffs’ trademark is
enormous.
CS (OS) No.1663/2012 Page 24 of 26
63. In view of the above, the application bearing No. I.A. No. 10720
of 2012 is allowed.
64. As is admitted by the defendant in paragraph 14 and 16 of the
written statement as well as paragraph 6 of the present application,
the defendants have stopped using the mark HELAMIN for
its products since the year 2010. Thus, the application being I.A. No.
th
19935/2014 seeking a vacation of the order dated 30 May, 2012 is
accordingly dismissed.
65. As per the defendants’ own admission, the defendants have
stopped using the mark HELAMIN since the year 2010 and thus no
prejudice whatsoever is being caused to the defendants by virtue of
the order dated May 30, 2012 passed by this Court. Thus, there is no
th
occasion for this Court to vacate the order dated 30 May, 2012. The
defendants are also restrained to use the mark HELAMIN as part of its
corporate name and in any form whatsoever which may create
confusion and deception during the pendency of the suit. All the
grounds raised in their applications under Order XXXIX Rule 4 CPC are
not tenable in law. The balance of convenience clearly lies in favour of
the plaintiffs and against the defendants who cannot grab the well-
known mark of the plaintiff No.1 in this fashion. If the defendants are
allowed to use the mark of the rightful owner/principle, it would
amount to granting the agent to appropriate the mark of the real
proprietor. Thus, the plaintiffs would suffer injury if the injunction will
not continue. The application filed by the defendants is dismissed.
Consequently, the prayer of the plaintiffs’ application under Order
XXXIX Rule 1 and 2 CPC is allowed.
66. All the above four mentioned applications are disposed of. The
finding arrived at are tentative and shall have no bearing when the suit
CS (OS) No.1663/2012 Page 25 of 26
is decided after trial.
CS (OS) No. 1663/2012
th
67. Parties to appear before the Joint Registrar on 15 February,
2016 for further proceedings.
(MANMOHAN SINGH)
JUDGE
DECEMBER 9, 2015
CS (OS) No.1663/2012 Page 26 of 26