Delhi High Court: “Bukhara” Declared A “Well-Known Trade Mark” In Contrast To The US Judgements

OVERVIEW

In a recent suit for trade mark infringement and passing off as well as cancellation petitions preferred by ITC Limited (“the Plaintiff”) against Central Park Estates Private Limited and St. Jerome Hospitality Management Pvt. Ltd. (“the Defendants”) involving the trade mark “BUKHARA” and its variants, the Hon’ble Delhi High Court granted “BUKHARA” the status of a “well-known mark” based on overwhelming evidence filed by Plaintiff showing reputation and global distinction earned by the Plaintiff’s mark “BUKHARA”.

In its judgement, the Hon’ble Court also succinctly dealt with the following aspects:

· rich history of recognition of well-known marks in India even in respect of completely unrelated goods and services;

· Indian jurisprudence widely recognizing transborder reputation of foreign marks and according them the status of well-known marks under common law, well before the provision was statutorily incorporated;

· litigation in the United States relating to the mark “BUKHARA” and factors distinguishing the US judgements and Indian legal position with respect to transborder reputation and the ‘well-known mark’ doctrines.

SUBMISSIONS IN BRIEF

The Plaintiff preferred the suit against the Defendants seeking protection of its trade mark “BUKHARA” used in respect of restaurant and other hospitality services. It was claimed that the Plaintiff adopted the mark “BUKHARA” for its restaurant at ITC Maurya Hotel in New Delhi in late 1970’s wherein the restaurant provided various cuisines inspired from the North-West frontier region of India.

It was also claimed that the restaurant “BUKHARA”:

· is also known for its interiors, decors, layout, arrangement of restaurant, the cutlery in which the food is served, the wooden menu cards and the rustic look maintained over the years;

· uses traditional methods for cooking such as clay oven or tandoor;

· visited by various world-renowned celebrities, Presidents, and heads of States. Various chefs of global repute have also worked at the Plaintiff’s restaurant.

The Plaintiff also relied on its trade mark registrations for the mark “BUKHARA” and its stylized variants in India, with the earliest registration dated April 23, 1985. Additionally, the Plaintiff also relied on a large number of awards received and unique décor and stylized font reflected on various items used in the restaurant.

The suit was initiated by the Plaintiff being aggrieved by the Defendants’ adoption of the mark “BALKH BUKHARA” for its restaurant in Gurugram. On enquiry, the Plaintiff had also learnt that the Defendant No.1 has obtained registrations of the marks ‘BALKH BUKHARA RESTAURANT’ and ‘BALKH BUKHARA’ logo form under Trademark Nos. 3839762 and 4010765, both on ‘proposed to be used’ basis. The Plaintiff further learnt that the Defendants had copied the logo form and the font as well as interiors of the restaurant, décor, seating style, staff uniform, bib/apron, utensils, wooden menu and the whole look and feel of the restaurant.

In addition to the present suit, the Plaintiff also sought cancellation of Defendants’ two marks through two cancellation petitions.

The Defendants on the other hand submitted before the Hon’ble Court that the mark “BUKHARA” has not been earlier protected by US Courts but nonetheless, the Defendants do not intend to use the mark ‘BALKH BUKHARA’ or any other mark consisting of the word and mark ‘BUKHARA’ for their restaurant, hotel, or other hospitality related services and have no objection if the suit is decreed based on terms mutually agreed between the parties.

COURT’S DECISION

Considering that the parties amicably arrived at an agreement, the Court decreed the suit in accordance with the settlement terms including:

· permanent injunction against the Defendants for trade mark infringement and passing off;

· change in the menu card, jacket as part of uniform, copper glass; removal of the name and word ‘BUKHARA’ from the restaurant, the display board, any promotional items, boards, websites, and the other items including napkins, menu cards, uniforms, invoices, stationery, and any other places within its restaurant where such mark appears, on or before 31st December, 2022;

· cancellation/rectification of Defendant No.1’s trade mark registration under No.4010765 in Class 43 and deletion/modification in the trade mark registration under No.3839762 in Class 43 for the word mark “BALKH BUKHARA RESTAURANT”.

The Hon’ble Court directed the Defendants to file the requisite applications/forms for implementing the undertakings with respect to their trademark registrations, within four weeks of the present order and the Registrar of Trademarks to take the necessary action within two weeks thereafter. The Rectification Petitions also were disposed off as per the agreed terms.

COURT’S ANALYSIS RELATING TO WELL-KNOWN MARKS

Notably, the Hon’ble Court also decided on the Plaintiff’s plea to declare “BUKHARA” a well-known mark and Defendants’ reliance on the decision of US Second Circuit Court whereby the Court refused to grant an injunction protecting the mark “BUKHARA” in the US.

The Hon’ble Court traced the history of recognition of well-known marks in India and observed that the attribute of certain trademarks or names attaining the status of well- known marks has been acknowledged and recognised by Courts in India for the last two-three decades. In this regard, the Court placed reliance on judicial precedents wherein marks such as “APPLE”[1], “WHIRLPOOL”[2] and “BENZ”[3] etc. were recognized as “well-known marks” by courts even before the said marks were actually used on a commercial scale in India. The Hon’ble Court reiterated statutory provisions with respect to ‘well-known marks’ incorporated in the Trade Marks Act, 1999 under Section 2(zg), Section 11(2) and (6), Section 29(4) and Rule 124 of the Trade Marks Rules 2017.

The Hon’ble Court added that the statutory provisions were aligned with international best practices such as the Agreement on Trade-Related Aspects of Intellectual Property Rights, 1869 U.N.T.S. 299 (1994) (hereinafter “TRIPS”) and WIPO’s Joint Recommendation Concerning Provisions on the Protection of Well-known Marks, September 20-29, 1999 and reiterated relevant extracts from the decision passed in Tata Sons Ltd. v. Manoj Dodia,[4]which elaborates upon the principles for declaration of a mark as well-known and how transboundary protection is essential to counter unfair competition.

Applying the above statutory provisions and precedents, the Hon’ble Court perused the extensive documents placed on record by the Plaintiff and opined that “these documents denote that not only has the mark ‘BUKHARA’ been intrinsically connected to Indian cuisine, but the Plaintiff’s restaurant has also been recognized internationally as a customary stop for foreign celebrities and dignitaries. The Plaintiff has also placed on record various news clippings and pictures depicting a tradition whereby every US President who visits India, visits the Plaintiff restaurant and a special menu is prepared for each such President. In light of this overwhelming evidence, the reputation and global distinction earned by the Plaintiff’s mark ‘BUKHARA’ is beyond well-established and the said restaurant has clearly internationalised India’s cuisine.”

US JUDGEMENTS ON THE MARK “BUKHARA” AND COURT’S FINDINGS IN CONTRAST

With respect to Defendants’ reliance on the US judgements, the Hon’ble Court delved into the facts of the two rounds of litigation in the US and US Courts’ decisions concerning the ‘BUKHARA’ mark. In a suit filed by ITC against certain ex- employees, an injunction was sought against use of the mark ‘BUKHARA’. The facts were that ITC had established a “BUKHARA” restaurant in Manhattan 1986 and in 1987 a franchise agreement was entered into for a “BUKHARA” restaurant in Chicago. The former restaurant in New York operated for five years. In Chicago, the franchise was cancelled after 10 years. Thereafter, sometime in 1999, some ex-employees of the New Delhi “BUKHARA” restaurant/Plaintiff restaurant incorporated Punchgini Inc. and started a restaurant called ‘Bukhara Grill’.

In a suit filed by ITC against these ex-employees, the US Court of Appeals for the Second Circuit held that the principle of territoriality is basic to American trademark law and ownership of a mark in one country would not confer exclusive rights to the said mark in another country. The Court also held that under federal trademark law, the viability of famous marks doctrine is uncertain. In this decision being ITC Ltd et. al. v. Punchgini, Inc., et. al., 482 F.3d 135 (2nd Cir. 2007), the Court held that “ITC cannot assert a successful claim for trade mark infringement under Section 32(1)(a) of the Lanham Act or state common law; nor can it continue to maintain the registered mark, which the district court correctly ordered cancelled”. With respect to ITC's state law claim of unfair competition, the US Court deferred its ruling pending the New York Court of Appeals' response to two questions: (a) whether the famous marks doctrine is recognized under the state's common law of unfair competition and, if so, (b) how famous a mark must be to qualify for such common law protection.

The two questions were decided on 13th December, 2007 by the Court of Appeals of New York in ITC Ltd et. al. v. Punchgini, Inc., et. al., 9 N.Y.3d 467, which considered the famous marks doctrine in the context of unfair competition and mainly held as under:

· Accordingly, while we answer "Yes" to the first certified question, we are not thereby recognizing the famous or well-known marks doctrine, or any other new theory of liability under the New York law of unfair competition. Instead, we simply reaffirm that when a business, through renown in New York, possesses goodwill constituting property or a commercial advantage in this state, that goodwill is protected from misappropriation under New York unfair competition law. This is so whether the business is domestic or foreign.

· If the customers of a New York defendant do not identify a mark with the foreign plaintiff, then no use is being made of the plaintiff’s goodwill, and no cause of action lies under New York common law for unfair competition. As a result, to prevail against defendants on an unfair competition theory under New York law, ITC would have to show first, as an independent pre-requisite, that defendants appropriated (i.e., deliberately copied), ITC's Bukhara mark or dress for their New York restaurants. If they successfully make this showing, plaintiffs would then have to establish that the relevant consumer market for New York's Bukhara restaurant primarily associates the Bukhara mark or dress with those Bukhara restaurants owned and operated by ITC.

In the second round, after the decision of the New York Court of Appeals, the matter was considered once more by the District Court and finally decided by the US Court of Appeals of the Second Circuit in ITC Ltd. v. Punchgini, Inc., 518 F.3d 159 (2nd Cir. 2008), which held that the evidence on record was insufficient to rase a triable question of fact. The District Court’s summary judgment in the second round in favour of the Defendants was, thus, upheld. In conclusion therefore, ITC was unsuccessful in protecting the “BUKHARA” mark in the US.

The Hon’ble Court upon review of the above US judgements noted that the decisions turned on two factors:

1. That there was no evidence of BUKHARA having enjoyed goodwill and reputation in New York; and

2. That the famous marks doctrine as set forth in Article 6bis of the Paris Convention and Article 16(2) of TRIPS has not been incorporated into the relevant federal law.

The Hon’ble Court observed that the US judgments would not be applicable in the context of India, where it is clear from the record that the mark “BUKHARA” originated in India, and enjoys substantial goodwill and reputation not only among Indians but also among foreigners who travel to India and carry back the said reputation. India also recognizes transborder reputation and the `well- known mark’ doctrines, both in its judicial decisions and in statutes.

Consequently, the Hon’ble Court held that in view of all these circumstances which are in contrast to the position in the US, and considering the Indian legal position as elaborated above and the enormous fame and goodwill evidenced from the documents placed on record which are not denied by the Defendants, the mark ‘BUKHARA’ of the Plaintiff is declared as a well-known mark under Section 2(zg) read with Section 11(2) of the Act. The Court directed the Registrar of Trade Marks to add the mark “BUKHARA” to the List of Well-Known Trade Marks upon the Plaintiff completing the requisite formalities.

CONCLUSION

The decision rendered by the Hon’ble Court is well-reasoned and crystal clear in highlighting the distinction in the settled law applicable in India and US pertaining to well-known and famous marks. The decision also succinctly traces the history, judicial approach and growing jurisprudence in India with respect to protection and enforcement of well-known marks and reinforces confidence of IP owners in the legal regime as far as brand protection and enforcement of well-known and famous marks is concerned in India.

[1] Apple Computer Inc. v. Apple Leasing & Industries [Suit No.2751 of 1989, decided on 4th May, 1991 [2] NR Dongre v. Whirlpool Corporation & Anr., AIR 1995 Delhi 300 [3] Daimler Benz Aktiegesellschaft v. Hybo Hindustan, [S.L.P. (C) No. 7450 of 1994, decided on 18th July, 1994] [4] 2011 (46) PTC 244 (Del)