FOOT LOCKER RETAIL, INC vs. SMT. GEETA KEWALANI

Neutral Citation Number : 2023/DHC/000802 $~20 * IN THE HIGH COURT OF DELHI AT NEW DELHI + CS(COMM) 739/2022 & I.A.17325/2022, I.A.1325/2023, I.A.1326/2023, I.A.1327/2023, I.A.1328/2023 FOOT LOCKER RETAIL, INC ..... Plaintiff Through: Ms. Anuradha Salhotra and Ms.Sharika Vijh, Advs. versus SMT. GEETA KEWALANI ..... Defendant Through: Mr. Dhruv Tailor and Mr.Dhananjai Shekhawat, Advs. CORAM: HON'BLE MR. JUSTICE C.HARI SHANKAR J U D G M E N T (ORAL) % 02.02.2023 I.A.17325/2022 (under Order XXXIX Rules 1 & 2 of the CPC) 1. The plaintiff Foot Locker Retail, Inc. is a company incorporated in the United States in 1974. The plaintiff claims to be involved in manufacture and sale of footwear, under the ―FOOT LOCKER‖ brand and since 1974 internationally. The plaintiff holds registrations of the brand ―FOOT LOCKER‖ in over 100 international jurisdictions. In India, the device was registered in favour of the plaintiff in Class 35, which deals with ―shoes, footwear and athletic clothing‖, st with effect from 31 October 1988. The plaintiff also has an online presence through the websites www.footlocker.com and www.kidsfootlocker.com , both created in 1995. 2. The plaintiff has, in the plaint, referred to various awards and CS(COMM) 739/2022 Page 1 of 18 Signature Not Verified Digitally Signed By:SUNIL SINGH NEGI Signing Date:04.02.2023 20:43:46 Neutral Citation Number : 2023/DHC/000802 encomiums which it has earned over a period of time and contends that it has, by now, become a world famous brand. 3. Though the plaint asserts that the plaintiff was commercially using ―FOOT LOCKER‖ as a brand in India, at least since 2015, the invoices placed on record with the plaint indicate such user since 2018. nd 4. On 22 January 2021, the plaintiff applied with the Registry of Trademarks for registration of the word mark ―FOOT LOCKER‖ in Class 35, which covers ―retail stores services featuring clothing, footwear and headgear, online retail store services, featuring clothing, footwear and headgear‖. The registration, as applied, was granted by th the Registry to the plaintiff on 24 September 2021. 5. Thereafter, in January 2022, the defendant filed an application before the Registrar of Trademarks under Section 57 of the Trademarks Act, 1999, seeking rectification of the register and removal, therefrom, of the registration granted to the plaintiff of the ―FOOT LOCKER‖ word mark in Class 35. The defendant in the said application, did not disclose any earlier registration for the mark ―FOOT LOCKER‖, whether in word or in device form, granted to it. The application was predicated on a plea of prior user. The defendant claimed user of the ―FOOT LOCKER‖ mark since 2001. 6. The plaint avers that, on the said rectification being filed and on notice thereof being received by the plaintiff, inquiries were made, which revealed that the defendant had, in fact, obtained a registration CS(COMM) 739/2022 Page 2 of 18 Signature Not Verified Digitally Signed By:SUNIL SINGH NEGI Signing Date:04.02.2023 20:43:46 Neutral Citation Number : 2023/DHC/000802 th mark in Class 25 on 4 February 2013. Ms. Salhotra, for the learned Counsel for the plaintiff emphasised the fact that, in the rectification application filed by it in March 2022, this earlier registration held by the defendant was not disclosed. 7. The plaintiff came to learn, on further enquiry, that the defendant was also engaged in sale of footwear using the mark from a shop in Jaipur. The plaintiff, thereupon, addressed notices to the defendant, calling upon the defendant to cease and desist from using the mark as the plaintiff already held valid and subsisting registrations for the said ―FOOT LOCKER‖ mark both in Classes 25 and 35. On the notices failing to elicit any favourable response, the plaintiff has instituted the present suit before this Court, seeking an injunction against the defendant from using the ―FOOT LOCKERS‖ mark whether in word or in device form, apart from ancilliary reliefs of delivery or rendition of accounts, costs and damages. 8. Written statement has been filed by way of response to the suit. 9. The plaintiff has also filed I.A.17325/2022, with the plaint, under Order XXXIX Rules 1 and 2 of the Code of Civil Procedure, 1908 (CPC), seeking grant of interim relief. I have heard Ms. Anuradha Salhotra, learned Counsel for the plaintiff and Mr. Dhruv Tailor, learned Counsel for the defendant, at length on this application and proceed, by this judgement, to dispose of it. 10. Ms. Salhotra submits that this is a clear case of infringement. CS(COMM) 739/2022 Page 3 of 18 Signature Not Verified Digitally Signed By:SUNIL SINGH NEGI Signing Date:04.02.2023 20:43:46 Neutral Citation Number : 2023/DHC/000802 The mark of the defendant is clearly imitative of, and deceptively similar to, the registered mark the plaintiff. The addition of a terminal ‗S‘ would make no difference. 11. Ms Salhotra points out that the plaintiff has priority of st registration, dating back to 31 October 1988. Even though the defendant pleads priority of user, Ms. Salhotra invokes Section 29(1) 1 2 and (2) read with Section 34 of the Trademarks Act, to justify the prayer for interlocutory injunction. She submits that Section 34 disentitles the plaintiff from injuncting the defendant only if the user of the impugned mark by the defendant is prior in point of time both to the registration as well as the user of the mark by the plaintiff. Inasmuch as the plaintiff‘s registration dates back to 1988 and, even as per its showing, the defendant‘s registration is of 2013, claiming user of 2001, she submits that Section 34 would not act as an embargo against the plea for injunction advanced by her. As the case is one of

CS(COMM) 739/2022 Page 4 of 18 Signature Not Verified Digitally Signed By:SUNIL SINGH NEGI Signing Date:04.02.2023 20:43:46 Neutral Citation Number : 2023/DHC/000802 a similar mark being used for identical goods, she submits that there is every chance of an unwary customer, who comes across the goods of the defendant bearing the impugned mark, believing the goods to be those of the plaintiff. As such, she submits that a clear case for injunction is made out. 12. Mr. Dhruv Tailor on the other hand, initially places reliance on the judgment of the Supreme Court in Neon Laboratories v. Medical 3 Technologies Ltd. emphasising paras 9, 10 and 11 thereof which reads thus:

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13. He submits, relying on the said passages from the decision, that the inaction, on the part of the plaintiff, in using the mark 4 (1996) 5 SCC 714 5 (2004) 12 SCC 624 6 (2016) 2 SCC 683 CS(COMM) 739/2022 Page 7 of 18 Signature Not Verified Digitally Signed By:SUNIL SINGH NEGI Signing Date:04.02.2023 20:43:46 Neutral Citation Number : 2023/DHC/000802 for 30 years till 2018, despite having obtained registration of the mark in its favour in 1988, disentitles the plaintiff from either pleading infringement or seeking any injunctive relief. He submits, relying on 3 7 Neon Laboratories , that Sections 34 and 47(1) of the Trademarks Act have to be read in conjunction, and if so read, would disentitle the plaintiff to any relief in the present application. 14. Apropos the claim of user of the ―FOOT LOCKER‖ mark by the plaintiff since 2015, Mr. Dhruv Tailor submits that there is no corroborative material available on record. He submits that the plaintiff never advertised its products in India, and does not have any India specific website, whereas it has specific websites for access in other countries targetted by it. He further submits that there is no evidence whatsoever of the plaintiff having any goodwill or reputation in the Indian market. All awards and encomiums, to which the plaintiff has eluded, he points out, are overseas. 7 47. Removal from register and imposition of limitations on ground of non-use . – (1) A registered trade mark may be taken off the register in respect of the goods or services in respect of which it is registered on application made in the prescribed manner to the Registrar or the High Court by any person aggrieved on the ground either – (a) that the trade mark was registered without any bona fide intention on the part of the applicant for registration that it should be used in relation to those goods or services by him or, in a case to which the provisions of Section 46 apply, by the company concerned or the registered user, as the case may be, and that there has, in fact, been no bona fide use of the trade mark in relation to those goods or services by any proprietor thereof for the time being up to a date three months before the date of the application; or (b) that up to a date three months before the date of the application, a continuous period of five years from the date on which the trade mark is actually entered in the register or longer had elapsed during which the trade mark was registered and during which there was no bona fide use thereof in relation to those goods or services by any proprietor thereof for the time being: Provided that except where the applicant has been permitted under Section 12 to register an identical or nearly resembling trade mark in respect of the goods or services in question, or where the Registrar or the High Court, as the case may be, is of opinion that he might properly be permitted so to register such a trade mark, the Registrar or the High Court, as the case may be, may refuse an application under clause (a) or clause (b) in relation to any goods or services, if it is shown that there has been, before the relevant date or during the relevant period, as the case may be, bona fide use of the trade mark by any proprietor thereof for the time being in relation to – (i) goods or services of the same description; or (ii) goods or services associated with those goods or services of that description being goods or services, as the case may be, in respect of which the trade mark is registered. CS(COMM) 739/2022 Page 8 of 18 Signature Not Verified Digitally Signed By:SUNIL SINGH NEGI Signing Date:04.02.2023 20:43:46 Neutral Citation Number : 2023/DHC/000802 8 15. Adverting to Section 29(6) of the Trade Marks Act, Mr. Dhruv Tailor submits that the plaintiff‘s goods are neither sold nor exposed to trade in India within the meaning of clause (b) of the said provision. 16. Mr. Tailor has also placed reliance on the judgment of a Division Bench of this Court in Veerumal Praveen Kumar v. Needle 9 Industries (India) Ltd. for the proposition that inordinate disuse of a mark would disentitle the proprietor of the mark from injuncting any subsequent user of the same mark. Mere registration, he submits, does not entitle the proprietor of a mark to an injunction, if the proprietor leaves the mark unused for years at a stretch. In the present case, he seeks to point out, the plaintiff used the registered ―FOOT LOCKER‖ mark for the first time, even as per the plaint, only 30 years after registration was obtained. 17. Mr. Dhruv Tailor has also pointed out that the decision in 7 Veerumal Praveen Kumar was subsequently followed by this Court 10 in Radico Khaitan Ltd v. Devans Modern Breweries Ltd . 18. Responding to the submission of Mr. Tailor in rejoinder, Ms. Salhotra submits that the emphasis, by Mr. Tailor, on the failure, on the part of the plaintiff, to use the mark of which it had obtained registration in 1988 for several years was of no consequence, as the plaintiff‘s mark was not vulnerable to cancellation on that

CS(COMM) 739/2022 Page 9 of 18 Signature Not Verified Digitally Signed By:SUNIL SINGH NEGI Signing Date:04.02.2023 20:43:46 Neutral Citation Number : 2023/DHC/000802 ground, in view of the stipulations contained in Section 47 of the Trademarks Act. She points out that, though the defendant claims to have commenced user of the impugned mark in 2001, it obtained registration of the mark only in 2013, i.e. after 12 years in Class 25. In a case of clearcut infringement such as the present, she also emphasises the aspect of dishonesty, as she submits that it could not be a mere coincidence that the defenant decided to adopt the very same ―FOOT LOCKER‖ mark in which the plaintiff had international recognition in over 80 countries. Analysis 19. I have heard learned Counsel for both sides and perused the material on record. 20. Mr Tailor has not contested the allegation of infringement, perhaps advisedly. That the mark of the defendant is deceptively similar to the device mark, and the ―FOOT LOCKER‖ word mark, both of which stand registered in the plaintiff‘s favour, is self-evident. One is ―FOOT LOCKER‖; the other ―FOOT LOCKERS‖. The terminal ‗S‘ makes no difference to a consumer of average intelligence and imperfect recollection – the mythical creature from whose point of view infringement and passing 11 12 off are to be assessed. F. Hoffman-La Roche emphasizes the fact that the average consumer who constitutes, as it were, the nodal test 10 258 (2019) DLT 177 11 Refer Corn Products Refining Co. v. Shangrila Food Products Ltd, AIR 1960 SC 142; Amritdhara Pharmacy v. Satyadeo Gupta, AIR 1963 SC 449; F. Hoffman-La Roche & Co. Ltd v. Geoffrey Manner & Co. Pvt Ltd, (1969) 2 SCC 716; Cadila Health Care Ltd v. Cadila Pharmaceuticals Ltd, (2001) 5 SCC 73; Mahendra & Mahendra Paper Mills Ltd v. Mahindra & Mahindra Ltd, (2002) 2 SCC 147; Satyam Infoway Ltd v. Sifynet Solutions Pvt Ltd, (2004) 6 SCC 145 12 (1969) 2 SCC 716 CS(COMM) 739/2022 Page 10 of 18 Signature Not Verified Digitally Signed By:SUNIL SINGH NEGI Signing Date:04.02.2023 20:43:46 Neutral Citation Number : 2023/DHC/000802 for assessing infringement and passing off is a man of ―imperfect recollection‖, and this emphasis has continued, throughout, till 13 Satyam Infoway and even thereafter. Viewed thus, is clearly deceptively similar to . 21. The visual dissimilarity between and pales into insignificance, given the near identity of the marks otherwise. Brand logos keep changing, and, therefore, where the marks are otherwise identical or deceptively similar, the mere fact that they may be written differently cannot impact the aspect of infringement. In any event, identity of the marks is not necessary for Section 29 to apply; where the goods on which the marks are affixed are the same, similarity of the marks, as would lead to confusion, or a presumption of association between the impugned mark of the defendant and the plaintiff, is sufficient. 22. The mark is registered in favour of the plaintiff since 1988. That registration is, till date, valid and subsisting. No application for rectification of the register or otherwise, qua the said mark, has been filed by anyone including the defendant. 23. The mark which is registered in favour of the defendant in 2013 is . ―FOOT LOCKER‖ cannot be treated as an ordinary or a descriptive mark or as publici juris . It is, quite clearly, an invented mark, which is, therefore, entitled to additional protection even on that ground. It is difficult for this Court to believe that, as an entity involved in manufacture and sale of footwear, the defendant was 13 (2004) 6 SCC 145 CS(COMM) 739/2022 Page 11 of 18 Signature Not Verified Digitally Signed By:SUNIL SINGH NEGI Signing Date:04.02.2023 20:43:46 Neutral Citation Number : 2023/DHC/000802 unaware of the mark of the plaintiff, especially in view of the international recognition that it commands (which Mr Tailor has not sought to question) . The adoption of the mark by the defendant is, therefore, prima facie, with a view to capitalise on the plaintiff‘s goodwill. 24. Section 29 of the Trademarks Act deals with infringement. The present case, on its facts, would attract sub-sections (1) and (2) of 1 Section 29 , inasmuch as (i) the defendant‘s mark is deceptively similar to the mark of the plaintiff, (ii) the defendant is using the impugned mark for goods which are identical to the goods in respect of which the plaintiff uses its registered mark i.e. footwear and (iii) in such circumstances, there is every likelihood of confusion, in a customer of average intelligence and imperfect recollection, who may be lured into believing that the products of the defendant, bearing the mark actually emanate from the plaintiff or are, at the very least, associated with the plaintiff. 25. The fact that the plaintiff has not used the mark for 30 years after it was registered in the plaintiff‘s favour cannot be a ground to hold that there is no infringement, as the mark is valid and subsisting even as on date. Para 5 of the report in Midas Hygiene 14 Industries (P) Ltd. v. Sudhir Bhatia places the matter beyond pale of doubt: ―5. The law on the subject is well settled. In cases of infringement either of trade mark or of copyright normally an 14 (2004) 3 SCC 90 CS(COMM) 739/2022 Page 12 of 18 Signature Not Verified Digitally Signed By:SUNIL SINGH NEGI Signing Date:04.02.2023 20:43:46 Neutral Citation Number : 2023/DHC/000802 injunction must follow. Mere delay in bringing action is not sufficient to defeat grant of injunction in such cases. The grant of injunction also becomes necessary if it prima facie appears that the adoption of the Mark was itself dishonest.‖ 26. There is also some substance in Ms. Salhotra‘s contention, in this context, that, when the defendant applied for registration of its mark, the plaintiff‘s mark was cited as an earlier registered mark but that, nonetheless, the mark was registered in favour of the defendant merely on the defendant‘s contention that the marks were not similar. She points out that the defendant‘s only response to the First Examination Report of the Examiner, who cited the plaintiff‘s as a pre-existing mark to which the proposed mark of the defendant was deceptively similar, was that the marks were not similar. To say the least, the grant of registration to the defendant‘s mark appears to be 15 irregular. While, no doubt, Section 31(1) of the Trade Marks Act accords presumption of validity to a registered trade mark, it is merely a presumption, and no more, and, as held in R.S. Sujatha v. State of 16 17 Karnataka , following Harihar Banerji v. Ramshashi Roy , 18 Gujarat Electricity Board v. Atmaram Sugomal Postani , Shimla 19 Development Authority v. Santosh Sharma and Dr. Sunil Kumar 20 Sambhudayal Gupta v. State of Maharashtra , every presumption is rebuttable. Where the grant of registration is prima facie unjustified, the presumption cannot enjoy any welcome greater than it deserves.

CS(COMM) 739/2022 Page 13 of 18 Signature Not Verified Digitally Signed By:SUNIL SINGH NEGI Signing Date:04.02.2023 20:43:46 Neutral Citation Number : 2023/DHC/000802 27. In such circumstances, it is difficult for this Court to hold that any equity is vested in the defendant merely because of the fact that it has obtained a registration for the mark in 2013 for footwear when, in fact, more than 25 years prior thereto, the mark already stood registered in favour of the plaintiff, in India, for footwear. 28. The submission of Mr. Taylor that the plaintiff would not be entitled to injunction merely because it had allowed the FOOT LOCKER mark, after obtaining registration in 1988, to remain unused for 30 years, though attractive at first blush, does not, on a deeper 9 scrutiny, commend acceptance. Veerumal Praveen Kumar , on which Mr. Taylor placed reliance, was a case in which, even on the date when the suit was filed, the asserted mark was not in use. It was in these circumstances that the Division Bench of this Court held that there was no enforceable right in the plaintiff, which deserved protection by way of grant of injunction. Para 29 of the report in the said case indicates this position, which reads thus: ―29. We are in agreement with the view of the learned Single Judge of the Bombay High Court that if there is non-user for a long period of time then by mere registration of the mark continuing the respondents would not be entitled to any injunction. This view is 21 further reinforced by the judgment in Imperial Group's case wherein it was held that where there is no trading to give rise to a goodwill there is no interest to be protected by a trademark and such a trademark cannot exist in vacuum .‖ (Emphasis supplied) 29. Per contra , in the present case, the plaintiff, even if after considerable delay, did commence commercial use of the 20 (2010) 13 SCC 657 21 Imperial Group Ltd v. Philip Morris & Co. Ltd, 1983 FSR 72 CS(COMM) 739/2022 Page 14 of 18 Signature Not Verified Digitally Signed By:SUNIL SINGH NEGI Signing Date:04.02.2023 20:43:46 Neutral Citation Number : 2023/DHC/000802 mark at least in 2018. Thereafter, despite having been called upon by the plaintiff to desist use of the mark in respect of which it had an earlier registration, the defendant did not do so. 30. Apropos Section 34 of the Trademarks Act, Ms. Salhotra is correct in her submission that the said provision would not act as an inhibitor to grant of injunction in her favour. Section 34 would disentitle a plaintiff to an injunction against an infringing defendant only where the user by the defendant of the infringing mark is prior in point of time both to the registration as well as the user of the mark asserted by the plaintiff. In the present case, the plaintiff‘s registration, of the mark, is anterior to both the registration, as well as the user, by the defendant, of the impugned mark. Section 34, therefore, would not disentitle the plaintiff to an injunction against the defendant. 3 31. Adverting, now, to paras 9, 10 and 11 of Neon Laboratories , on which Mr. Tailor placed reliance, the said paragraphs, properly and holistically read, do not come to his assistance. Rather, in para 9 of the report, the Supreme Court has clearly held that the right conferred by Section 34 on a subsequent user, against an injunction being issued against it, was ―when its user is prior to the user of the proprietor and prior to the date of registration of the proprietor, whichever is earlier‖, thereby supporting the finding in para 30 supra . 32. Insofar as the reference to Section 47 of the Trademarks Act, in 3 Section 10 of the report, in Neon Laboratories is concerned, a conjoint reading of paras 10 and 11 of the report make it clear that the CS(COMM) 739/2022 Page 15 of 18 Signature Not Verified Digitally Signed By:SUNIL SINGH NEGI Signing Date:04.02.2023 20:43:46 Neutral Citation Number : 2023/DHC/000802 Supreme Court has, in the said paras, merely held that, if the defendant has allowed the impugned mark to remain in disuse for several years, that could afford an additional ground of challenge to a plaintiff. The said passages cannot be read, in any manner, as disentitling a plaintiff to injunction against an infringer even where the factum of infringement is clearly established. 33. In the aforementioned circumstances, there is a clear prima facie case in favour of the plaintiff. The balance of convenience would also be in favour of the plaintiff as the plaintiff has been using the mark at least since 2018 and, as Ms. Salhotra correctly points out, there is no application seeking rectification of the register qua the mark which is asserted in the present case. Once infringement is 14 established, para 5 of Midas Hygiene clearly mandates grant of injunction, delay or no delay. In a somewhat similar vein, in 22 Laxmikant V. Patel v. Chetanbhai Shah , while setting aside an order of the High Court refusing to grant injunction in a case where the defendant had passed off its goods as those of the plaintiff, the Supreme Court observed (in para 14 of the report) thus: ―14. In the present case the plaintiff claims to have been running his business in the name and style of Muktajivan Colour Lab and Studio since 1982. He has produced material enabling a finding being arrived at in that regard. However, the trial court has found him using Muktajivan as part of his business name at least since 1995. The plaintiff is expanding his business and exploiting the reputation and goodwill associated with Muktajivan in the business of colour lab and photo by expanding the business through his wife and brother-in-law. On or about the date of the institution of the suit the defendant was about to commence or had just commenced an identical business by adopting the word Muktajivan as a part of his business name although till then his business was being run in the name and style of Gokul Studio. The intention of the defendant to make use of the business name of the plaintiff so as to divert his 22 (2002) 3 SCC 65 CS(COMM) 739/2022 Page 16 of 18 Signature Not Verified Digitally Signed By:SUNIL SINGH NEGI Signing Date:04.02.2023 20:43:46 Neutral Citation Number : 2023/DHC/000802 business or customers to himself is apparent. It is not the case of the defendant that he was not aware of the word Muktajivan being the property of the plaintiff or the plaintiff running his business in that name, though such a plea could only have indicated the innocence of the defendant and yet no difference would have resulted in the matter of grant of relief to the plaintiff because the likelihood of injury to the plaintiff was writ large. It is difficult to subscribe to the logic adopted by the trial court, as also the High Court, behind reasoning that the defendants' business was situated at a distance of 4 or 5 km from the plaintiff's business and therefore the plaintiff could not have sought for an injunction. In a city a difference of 4 or 5 km does not matter much. In the event of the plaintiff having acquired a goodwill as to the quality of services being rendered by him, a resident of Ahmedabad city would not mind travelling a distance of a few kilometres for the purpose of availing a better quality of services. Once a case of passing-off is made out the practice is generally to grant a prompt ex parte injunction followed by appointment of Local Commissioner, if necessary. In our opinion the trial court was fully justified in granting the ex parte injunction to the plaintiff based on the material made available by him to the court . The trial court fell in error in vacating the injunction and similar error has crept in the order of the High Court. The reasons assigned by the trial court as also by the High Court for refusing the relief of injunction to the plaintiff are wholly unsustainable.‖ (Emphasis supplied) 34. Non-grant of interim relief would also result in irreparable loss to the plaintiff. 35. In the aforementioned circumstances, the defendant, as well as its partners, associates assignees in business, licensees and all others acting on its behalf would stand injuncted from using the ―FOOT LOCKERS‖ mark, whether as a word mark or a device mark, on footwear or any other associated items or like goods, or in promoting or advertising the said mark, pending disposal of the present suit. The defendant would also stand injuncted from releasing, in the market, any goods which bear the infringing mark, even if already manufactured and lying in stock. CS(COMM) 739/2022 Page 17 of 18 Signature Not Verified Digitally Signed By:SUNIL SINGH NEGI Signing Date:04.02.2023 20:43:46 Neutral Citation Number : 2023/DHC/000802 36. The application stands allowed in the aforesaid terms. I.A. 1325/2023 (under Section 10, CPC for stay of suit) th 37. List this application for hearing and disposal on 15 February 2023. C.HARI SHANKAR, J FEBRUARY 2, 2023/ kr CS(COMM) 739/2022 Page 18 of 18 Signature Not Verified Digitally Signed By:SUNIL SINGH NEGI Signing Date:04.02.2023 20:43:46