India: What Amounts To “Use” With Regards To Non-Use Cancellation Petitions?
Trademarks garner immense goodwill and reputation for any brand. Although the right to register a trademark is a constitutional right, there are many requirements to be fulfilled for valid registration and one such requirement is that in order to maintain the registration of a trademark, it must be used within the statutory time period. This provision with regards to use ensures that other brands and companies that may want to legitimately use the same or similar mark may not be deterred from doing so due to some registration of a mark that is not in fact in use by the registrant.
Therefore, as per Section 47 of the Trademarks Act, 1999 (the “Act”), non-use of a trademark for 5 years and three months from the date on which the mark was registered leads to cancellation of its registration. This provision ensures that registrants use their trademarks in a bona fide manner and trademark squatters who do not intend to use their marks after registration are barred from doing so post the statutory period of five years. Thus, any person aggrieved by the registration of the mark may apply for its cancellation. While non-use cancellation petitions are an efficient remedy for legitimate trademark holders, what amounts to “use” with regards to these petitions has been a matter for judicial interpretation and the term has broadly been defined over time.
“Use” Need Not Be Physical
The expression “use in the course of trade” has a wide and overarching scope. The combined reading of Section 2 (2)(b) and 2(2)(c) of the Trade Marks Act, 1999 lays down that the use of the mark shall be construed as a reference to the use of printed or visual representation of the mark. Thus, the use of a mark in relation to goods include the use of the mark upon, or in physical or in any other relation whatsoever, to such goods. In relation to services, it shall be construed as a reference to the use of the mark as or as part of any statement about the availability, provision or performance of such services.
The Apex Court in the case of Hardie Trading Ltd. and Anr. vs Addison Paints and Chemicals analysed the aspect of “usage” and ruled that use may be other than physical use. The Court held that use of the mark was not limited to use of the mark on goods, which were being sold, but would encompass all other types of use including non-physical use. The Court further referred to the landmark English case of Bon Matin where it was held that price lists and promotional literature can also be construed as use.
“Use” can also be considered in the promotional context, and it is worth noting that even mere advertisements without actual existence of the goods can be considered to amount to “use” of the mark in this regard. Thus, before actual use of the mark on goods or services, the “use” requirement may be satisfied if there has been some pre-use promotion of the goods.
In the case of M/S J. N. Nichols Ltd v Rose and Thistle and Anr., the Court laid down precedents in respect to interpretation of use of the mark. The Court held that “use of the mark does not postulate actual sale of the goods bearing such a mark. 'Use' can be in any form or way and does not necessarily mean and imply actual physical sale and even mere advertisement without even the existence of the goods can be said to be a use of the mark.” Similarly, the Division Bench of the Delhi High Court in the case of N.R. Dongre And Ors. v. Whirlpool Corporation And Anr. held that dissemination of knowledge of a trade mark in respect of a product through advertisement in media amounts to use of the trade mark, irrespective of whether or not the advertisement is coupled with the actual existence of the product in the market.
The Bona Fide Requirement
With regards to bona fide “use”, “use” must be considered according to genuine commercial standards. In the case of Kabushiki Kaisha Toshiba v. TOSIBA Appliances, the Court emphasised the importance of bona fide use and held that “the intention to use a trade mark sought to be registered must be genuine and real.” This requirement is the very essence of the matter because the right to register a trademark by a legitimate trademark holder is a constitutional right and this right ought to be preserved. Therefore, any “use” which does not aim to trade, but in fact is to only avoid such non-use cancellation petitions will be rejected and not be considered bona fide in nature.
Pertinently, even mere 'intention to use' the mark at times constitutes use of the mark. However, such intention has to be specific and genuine. In fact, in the case of American Home Products Corporation v. Mac. Laboratories (P) Ltd., also known as the Dristan case, the Supreme Court dismissed the rectification application of the Respondent and held that even though the manufacturing of the goods had not commenced in India, but the Appellant did enter into a technical collaboration agreement and thereby such arrangement can be categorised as legitimate intention to use the mark. Along the similar lines, in the case of Express Bottlers Services Pvt. Ltd. v. Pepsi Inc., the Court stated that “quantity or volume and/or the number of sales of the goods bearing the trade mark are not the object or purpose of enquiry …The scope of enquiry is whether there was any bonafide use of the mark in relation to the goods in course of trade during the said span of time.”
Further, it is not only the use of the mark per se but also the use of the mark in respect of specification of goods that has to be considered to determine the bona fide use. In Vishnudas Trading as Vishnadas Kishendas Vs. Vazir Sultan Tobacco Co. Limited, the Supreme court laid down that “a trader or manufacturer who is trading in or manufacturing only one or some of the articles or goods under a trade mark and has no bona fide intention to trade in or manufacture the other articles or goods falling under that class but has obtained registration of its trade mark under that class which covers several other articles or goods, held, registration liable to be rectified by confining it to the specific articles or goods which are actually intended to be traded in or manufactured.”
“Use” Within The Statutory Period
Finally, in order to avoid non-use cancellation, the trademark holder must prove “use” of the mark within the statutory period. Any “use” which goes beyond this time frame may not account for “use”. The onus to prove non-use, generally, is on the person who files the application for rectification, however the onus might be shifted to the trademark holder in the course of hearing and in case he fails to establish usage, his mark will be liable to be removed from the register. In this regard, in the case of Express Bottlers Services Pvt. Ltd. v. Pepsi Inc., the Court stated that, “Non-use during this crucial statutory period has to be proved by the applicant for obtaining order for removal of the mark. If bonafide use of the mark within the statutory period is proved, then non-user for a longer period prior to the statutory period will not help the applicant.”
However, there are numerous grounds on which non-use is excused. Non-use can be justified in the case of “Force Majeure” or any other special circumstances that are not due to the fault of the proprietor of the mark. For instance, in the case of M J Exports Pvt. Ltd Bombay vs. Sunkist Growers, Los Angeles, USA, it was held that when non-use of the trademark was due to special circumstances such as import policy, import control and tariff duty of the government of India and not due to the voluntary act of the registered proprietors, then the registered proprietors would be granted statutory protection.
Conclusion
In the world of metaverse and virtual trademark registrations, it is significant to avoid non-use revocations. Thus, any commercial bona fide use of the mark within the statutory period may be sufficient to defend a cancellation petition. Keeping the above-mentioned precedents set by Indian Courts in mind, it is noted that “use” has been broadly defined and it encompasses “use” even in the promotional context. In fact, even a single incidence of “use” may amount to sufficient “use”. However, what is more important is to prove that the “use” was also legitimate and within the framework of the statutory period . Finally, it should be noted that the burden of proof in such petitions lies on the petitioner who must prove that the mark has not been in “use”. However, the burden of proof may shift to the respondent when they are attempting to establish evidence of legitimate “use” in order to defend such a petition.
References:
1989 RPC 536
K.R Beri & Co. vs. The Metal Goods Mfg. Co Pvt Ltd. and Anr. AIR 1980 Delhi 299
M/S J. N. Nichols Ltd v Rose and Thistle and Anr., AIR 1994 Cal 43
N.R. Dongre And Ors. v. Whirlpool Corporation And Anr.,
AIR 1995 Delhi 300Electrolux Ltd. v. Electrix Ltd. (1953) 71 R.P.C. 23
Kabushiki Kaisha Toshiba v. TOSIBA Appliances 2008 (37) PTC 394 (SC)
American Home Products Corporation v. Mac. Laboratories (P) Ltd., AIR 1986 SC 137.
Shri Anand Bansal, (Sole Proprietor Ansul Industries) Vs. Shiva Tobacco Co. and Registrar of Trade Marks, Trade Marks Registry, MIPR2007 (1)90
Vintage Distillers Limited vs Ramesh Chand Parekh, CS(COMM) 292/2022
M/S. J.N. Nichols (Vimto) Limited vs Rose & Thistle And Another AIR 1994 Cal 43, 98 CWN 216
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