“Trademark Conflict Resolution: Exploring Prohibitive Injunctions and Passing-Off Lawsuits in Cases of Registered Marks – Insights from the High Court of Kerala”

M/S Mariyas Soaps and Chemicals & Anr. v. M/S Wipro Enterprises Ltd. & Anr.

“Kerala High Court Reverses District Court Decision on Trademark Dispute: Wipro’s ‘Chandrika’ vs. Mariyas Soaps and Chemicals’ ‘Chandra‘

In a recent development, the Kerala High Court overturned a District Court judgment that had prohibited M/S Mariyas Soaps and Chemicals from using their registered trademark ‘Chandra.’ This decision was based on the perceived similarity between ‘Chandra’ and Wipro’s established ‘Chandrika’ soap line.

The Division Bench of Justices Anil K. Narendran and P.G. Ajithkumar highlighted a well-established legal principle: a registered trademark owner cannot bring forth a trademark infringement lawsuit if the opposing party also possesses the registered trademark.

Wipro, known for its Ayurvedic soaps introduced in 1940, holds a registered trademark for ‘Chandrika.’ The mark received national registration in 1976 after initial registration in 1947. Wipro argued that Mariyas Soaps and Chemicals, the appellant, attempted to promote washing soap and detergents under the name ‘Chandra,‘ which bore a confusing resemblance. This similarity, they contended, would infringe on Wipro’s registered trademark, thus prohibiting the appellants from marketing their goods under this mark.

The District Court had ruled that ‘Chandra‘ was indeed confusingly similar to ‘Chandrika,’ and the appellants’ use of similar color schemes, writing styles, and designs amounted to trademark infringement. Moreover, considering the products’ shared class and category, the appellants’ use of the ‘Chandra’ trademark could lead to consumer confusion. Therefore, the District Court barred them from marketing products with the ‘Chandra’ brand.

The appellant’s attorneys argued that since both parties held legitimate trademark registrations, the District Court should not have issued an injunction. They emphasized that registration grants the right to use the trademark for goods and services, and the fact that Wipro had registered their mark earlier shouldn’t be the basis for seeking an injunction for trademark infringement.

In Wipro’s defense, attorney R. Sanjith contended that the company had been selling ‘Chandrika’ since 1940 and that the appellants, despite their recent trademark registration, couldn’t sell their goods.

The Court noted that while the appellants were promoting washing soap and related products under the ‘Chandra’ name, Wipro marketed Ayurvedic soaps using the ‘Chandrika‘ trademark. However, the Court emphasized that a party wronged by trademark infringement can pursue a passing-off lawsuit. Registration’s exclusive rights are not absolute; they are subject to the Act’s provisions. Under Section 28(3) of the Trade Marks Act, two registered trademark owners with nearly identical marks cannot sue each other but can enforce rights against third parties. Passing-off rights stem from common law rather than statutory provisions.

Considering that both parties held valid trademark registrations for the products in question, the Court questioned whether the respondents had grounds for a prohibitory injunction. Citing the 2016 case of S. Syed Mohideen v. P. Sulochana Bai, the Court concluded that if both parties owned the trademark in question, the registered trademark owner couldn’t sue for infringement.

In light of these legal principles, the Court addressed whether the respondents could seek relief based on passing off. Referring to S. Syed Mohideen (2016), the Court noted that registered trademark rights are subject to the Act’s regulations. To establish passing off, three elements needed to be proven:-

1. Goodwill of ‘Chandrika’:- The Court acknowledged Wipro’s substantial goodwill for the ‘Chandrika’ product due to pan-India registration since 1976, distinctive packaging, and popularity among consumers.
2. Misrepresentation by Appellants:– The Court affirmed the District Court’s finding that the appellants’ labeling, color scheme, writing style, and design were misleadingly similar to Wipro’s.
3. Damage to ‘Chandrika’ Goodwill:– Despite both products falling under the same class, the Court observed no significant decline in Wipro’s market share or financial losses after the appellants’ entry in 2020.

Consequently, the Court determined that the respondents were not eligible for an injunction based on passing off claims. The appeal was allowed.”