Rainbow Hospitals Vs  Rainbow Children’s Medicare Limited and Ors

Application Dismissed by The High Court of Madras

A trademark is a sort of intellectual property that usually consists of a name, word, phrase, logo, symbol, design, image, or a combination of these components. Trademark infringement is the violation of a trademark’s exclusive rights without the permission of the trademark owner or any licensees (assuming that such permission was within the terms of the license). Infringement occurs when one party, the “infringer,” uses a trademark that is identical or confusingly similar to another party’s trademark in relation to products or services that are identical or similar to the products or services covered by the registration. A trademark owner may file legal action against a party who infringes on his or her registration. And so is the prevailing case :

OVERVIEW OF THE CASE :

The Rainbow children’s Medicare limited is having chain of Pediatric multi-specialty, obstetrics and gynecology hospitals in India in the name and style of “Rainbow Children’s Hospital’’. In addition, the “Rainbow Children’s Hospital” in Chennai was inaugurated. Rainbow Children’s Medicare Limited claimed to be the original, honest, bona fide, prior adopter and user of the trademark “RAINBOW” in reference to various Medical/health care services in India for over 23 years.

They had registered its trademark “RAINBOW” and its numerous combinations, such as Rainbow Children Medicare Limited. The Rainbow Children’s Hospital (respondent) also learned that applicant herein was operating under the brand Rainbow Hospitals/Rainbow Children’s Hospital in Salem, and thus issued a cease and desist notice on 18.08.2022. The applicant hereby responded that he was a genuine adopter and user of the mark Rainbow, forcing the  respondent (Rainbow children’s medicare limited ) to launch a suit for the aforementioned relief.

The  respondent (Rainbow children’s medicare limited ) herein has registered Office at Hyderabad and he is also having a branch of his Hospital Chennai-15. Therefore, by invoking Section 134(2) of Trademarks Act, treating him as the one carrying on the business within territorial limits of this Court, the suit was filed by the first respondent before The High court of Madras .

The respondent(Rainbow children’s medicare limited ) herein filed the present suit seeking permanent injunction restraining the applicant herein from infringing/passing off the Registered Trademarks of the first respondent namely “RAINBOW’, RAINBOW HOSPITAL, RAINBOW CLINICS and RAINBOW HOSPITAL FOR WOMEN AND CHILDREN.

The recent order passed by the The High Court of Madras is regarding the application  filed by the first defendant(Rainbow hospitals ) in the suit seeking to decide the issue of territorial jurisdiction of this Court to entertain the present suit.

Following receipt of the suit summons, the petitioner (Rainbow Hospitals ) filed the application, claiming that the High Court of Madras lacks jurisdiction to hear the case. The applicant’s special argument is that the applicant hospital is located in Salem, and thus no aspect of the cause of action, namely trademark infringement/passing off, occurred within the territorial borders of this Court. When no part of the cause of action arose within the territorial limits of this Court, the first respondent cannot maintain a suit in the location of its branch or subordinate office, but it should have filed the current suit in the location of its registered office or elsewhere.

The main question that has to be decided in the  application filed by the defendant (Rainbow Hospitals ) is whether the first respondent/plaintiff (Rainbow children’s medicare limited ) is entitled to file the present suit before this Court by virtue of the fact it has got its branch office/hospital within the territorial limits of this Court, when no part of the cause of action arose within the jurisdiction of this Court.

Section 134 of Trademarks Act, reads as follows:

1) No suit–

(a) for the infringement of a registered trade mark; or 

(b) relating to any right in a registered trade mark; or 

(c) for passing off arising out of the use by the defendant of any trade mark which is identical with or deceptively similar to the plaintiff’s trade mark, whether registered or unregistered, shall be instituted in any court inferior to a District Court having jurisdiction to try the suit.

(2) For the purpose of clauses (a) and (b) of sub-section (1), a “District Court having jurisdiction” shall, notwithstanding anything contained in the Code of Civil Procedure, 1908 (5 of 1908) or any other law for the time being in force, include a District Court within the local limits of whose jurisdiction, at the time of the institution of the suit or other proceeding, the person instituting the suit or proceeding, or, where there are more than one such persons any of them, actually and voluntarily resides or carries on business or personally works for gain. 

Explanation.–For the purposes of sub-section (2), “person” includes the registered proprietor and the registered user.

A reading of the aforementioned provision reveals that the Trademarks Act allows the plaintiff (Rainbow Children’s Medicare Limited) who is filing the suit for infringement of the registered trademark to present the suit in the place where he or she voluntarily resides, conducts business, or personally works for gain.

According to the Section’s explanation, the term “person” used in the section comprises the registered proprietor or registered user. The first respondent (Rainbow Children’s Medicare Limited) herein is the registered proprietor of the trademark, and the current complaint is brought for infringement of the registered trademark and other reliefs. As a result of the concession granted by Section 134 of the Trademarks Act, the applicant is authorised to file a complaint in the Court whose jurisdiction it operates.

If Section 134 of the Trademarks Act and Sections 20 and 120 of the Civil Procedure Code are read together, the expression “carries on business” cannot be given a qualified meaning, as contended by the learned counsel for the applicant, because Section 20 of the Civil Procedure Code is inapplicable to the High Courts in exercising their original jurisdiction.

The legislature in its wisdom has given a concession to the plaintiff (Rainbow children’s medicare limited )  under Section 134 of Trademark Act, to sue for infringement of trademark by allowing the presentation of the plaint in the place, where he carries on his business.

RELEVANT CASE : A close scrutiny of the facts involved in Sanjay Dalia case would make it clear, in that case, the plaintiff was having its head office at Mumbai and Branch Office at Delhi. The whole of the cause of action arose at Mumbai and hence the Hon’ble Apex Court held that when plaintiff was carrying on business at a place and the cause of action wholly or in part had arisen in that place, he has to file a suit in that place instead of filing a suit in a place, where no part of the cause of action arose but he had branch office. In other words where plaintiff carries on business in more than one place by having different branch office at different places (namely A, B, C) and the cause of action either partially or wholly arose at place ‘B’ and not in places A and C, the concession available to plaintiff under Section 134 of Trade Marks Act, is restricted to place ‘B’ alone. To that extent, the sweep of Section 134(2) is restricted by combining place of business and cause of action. But in cases where no part of cause of action arose in any of the places A, B or C, plaintiff has option of filing suit in any one of the place A, B, C.

In the case on hand, the whole of the cause of action arose at Salem, where the applicant/defendant (Rainbow hospitals) carries on business. The registered office of the first respondent/plaintiff (Rainbow chilfren’s medicare limited) is situated at Hyderabad and it’s branch hospital is situated within the territorial limits of this Court at Chennai. No part of the cause of action arose either at Chennai or at Hyderabad. In such circumstances, it cannot be said that the plaintiff shall file suit only at Hyderabad, where no cause of action arose or at Salem, where it has no branch office. As mentioned earlier, by virtue of Section 120 of CPC, Section 20 of CPC is not applicable to the original side of this Court.

When cause of action for the suit does not arise either wholly or in part in the place where the principal office or the branch office of the plaintiff are situated, the plaintiff can file a suit either in the place, where his principal office is situated or in a place where his branch office is situated. On the other hand, if part of the cause of action arose in a place where either the principal office of the plaintiff or it’s branch office is situated, then as held by the Apex Court in Sanjay Dalia case, the suit has to be filed only in the place, where part of cause of action arose and also any one of plaintiff’s office is situated.

According to the plaint averments, the cause of action, namely trademark infringement, occurred in Salem, where neither the first respondent/plaintiff’s major office nor its branch office is located. Therefore, the first respondent/plaintiff(Rainbow children’s medicare limited ) has chosen to file the suit at Chennai, where its branch office is situated. Chennai is closer to Salem, where the whole cause of action arose. The principal office of plaintiff situated at Hyderabad, which is far away from the place, where the whole cause of action arose and hence by virtue of Section 134 of Trademarks Act, this Court has got territorial jurisdiction to entertain the suit.

Accordingly, the present application filed by the first defendant (Rainbow Hospitals ) is dismissed.