CASE SUMMARY: CROMPTON GREAVES CONSUMER ELECTRICS V. V GUARD INDUSTRIES LIMITED

CASE DETAILS

• FULL TITLE: CROMPTON GREAVES CONSUMER ELECTRICS V. V GUARD INDUSTRIES LIMITED
• CITATION: FAO(OS)(COMM) 153/2022 & CAV 159/2022
• BENCH: Hon’ble Mr. Justice Vibhu Bakhru and Hon’ble Mr. Justice Amit Mahajan.
• DATE OF JUDGMENT:  6th March, 2024

FACTS OF THE CASE

• Crompton Greaves Consumer Electricals Limited has filed the present appeal, impugning an order dated 12.05.2022, whereby the application preferred by V Guard Industries Limited (hereinafter ‘V Guard’), under Order XXXIX Rules 1 and 2 of the Code of Civil Procedure 1908 was allowed and the appellant was restrained from manufacturing, selling, offering for sale, advertising, directly or indirectly dealing in electric irons under the impugned mark “PEBBLE”.
• The current controversy connects to electric irons sold by CROMPTON since October 2020 under the mark “CROMPTON PEBBLE”, which is alleged by V GUARD to be infringing its rights obtained for marketing water heaters under the mark “PEBBLE”.
• V GUARD has claimed exclusive use of the mark PEBBLE as the label mark is registered since 26.03.2013 for goods being water heaters, electric water heaters, heating coils, and electric water geysers. It claimed that the mark has acquired enviable goodwill and reputation such that it has acquired the status of a well-known mark under Section 2(1)(zb) of the Trade Marks Act,1999. It declares that the utilization of the mark “CROMPTON PEBBLE” by CROMPTON totals to an infringement of the mark “PEBBLE”.
• V GUARD had also submitted an application for registration of the word mark “PEBBLE” in electric irons and other goods. It is stated that the registration has since been granted during the pendency of the present appeal. V GUARD claimed that the word “PEBBLE” is an essential and prominent part of its label mark and, thus, it has an exclusive right qua the said word in respect of any electric good. It is further claimed that V GUARD has been selling electrical products since the year 1977. It has been selling consumer electrical and electronic apparatus, including pumps, fans, batteries, inverters, etc., under its house mark, “V GUARD,” as well as other trademarks, and it claims to have a turnover of over ₹2600 crores. It is further claimed that its products are available across India and in other countries, including Nepal, Sri Lanka, and the United Arab Emirates. It has been selling water heaters, electric water heaters, water geysers, etc., under the label “PEBBLE” since 2013 and has relied on its sales statements.
• CROMPTON argued that their mark is visually, structurally, and phonetically different from the plaintiff’s device mark. The word CROMPTON is claimed to be a prominent part of the defendant’s mark, which is sufficient to distinguish the plaintiff’s mark from that of the defendant. It further argued that the goods in question are also dissimilar and, hence, there is no scope for confusion or deception.

QUESTION OF LAW

• Are the marks identical?
• Whether the goods are similar enough to entitle the plaintiff to an order of injunction under the provisions of Section 29(2) of the TM Act?
• Is the prima facie case for passing off made out?

ARGUMENTS OF THE PLAINTIFF (RESPONDENT)

• The plaintiff contended that “PEBBLE” is the essential and dominant feature of its registered label mark and, therefore, it is entitled to exclusive protection over the mark. Thus, the plaintiff has not made out a case for infringement against the defendant under Section 29(2) of the TM Act.
• It argued that the defendant’s use of the mark “PEBBLE” in relation to similar goods was likely to cause confusion among consumers and constituted trademark infringement.
• The plaintiff submitted that its registered label mark had acquired substantial goodwill and reputation in the market through continuous use and extensive sales, thereby entitling it to protection under the Trade Marks Act, 1999.
• It further asserted that the defendant had adopted the mark dishonestly with the intention of riding upon the goodwill and reputation associated with the plaintiff’s trademark.

ARGUMENTS OF THE DEFENDANT (APPELLANT)

• The defendant contended that the plaintiff is the certified proprietor of only a label/device mark and not the word mark “PEBBLE”. Therefore, registration of the label does not confer an exclusive right over the word “PEBBLE.”
• It was contended that “PEBBLE” is a common English word and not an invented or coined expression; hence, the plaintiff cannot claim a monopoly over its use.
• The defendant submitted that trademark comparison must be made as a whole, and the mere presence of the word “PEBBLE” in the plaintiff’s label does not entitle it to exclusive rights over that word.
• The learned senior counsel for the appellant has further argued that the respondent does not have a word mark registration but only has a device mark registration in a particular style and colors, with three pebbles stacked on top of each other. He submits that the respondent only sells water-geysers, and that too with its house mark “V-Guard”. 
• The Respondent cannot claim exclusivity over the mark “PEBBLE” as its mark is not a well-known mark and has a sale figure of only ₹ 31.49 crores. It is also stated that the Respondent has never attempted to file an application requesting inclusion of its mark in the list of ‘well-known’ marks before the Registrar of Trade Marks.
• It was argued that the plaintiff’s separate application for registration of the word mark “PEBBLE” itself demonstrates that it does not possess exclusive rights in the word by virtue of its label registration.
• The defendant contended that the parties deal in dissimilar goods, and the plaintiff had neither sold electric irons under the mark “PEBBLE” nor produced evidence of any such commercial use. Consequently, there was no likelihood of consumer confusion or passing off.
• It was further submitted that the plaintiff’s mark had not attained the status of a well-known trademark and lacked the reputation necessary to satisfy the requirements of Section 29(4) of the Trade Marks Act, 1999. The plaintiff’s sales figures and period of use were insufficient to establish such reputation.
• The defendant argued that the plaintiff’s products are marketed under its house mark V-Guard, whereas the defendant’s products prominently bear the well-known house mark Crompton, which clearly distinguishes the source of the goods and eliminates any possibility of consumer confusion.

JUDGEMENT OF THE CASE

• The court judged that the adoption of the word “PEBBLE” for use on geysers is distinctive and arbitrary and has been used by the plaintiff since the year 2013. No worthy explanation has been afforded by the defendant for the adoption of the word “PEBBLE” on its product. It is not the case of the defendant that the word “PEBBLE” is common or generic to the trade of electrical appliances. The finding of the learned Single Judge in this regard is that use of the mark “PEBBLE” by the defendant is prima facie without due cause, and it has accepted the same to acquire inequitable benefit of the reputation and goodwill of the plaintiff.
• The learned Single Judge, prima facie, held that the impugned mark “PEBBLE” is phonetically, visually, and structurally identical to the dominant part of the plaintiff’s registered trademark. It also put forward that the defendant is asserting the use of the mark only from the year 2020, and the inclusion of the word CROMPTON cannot, in the lack of continuous and extensive use in relation to goods, act as a source identifier.
• The learned Single Judge referred to Section 29(4) of the TM Act and held that the plaintiff’s mark prima facie has a reputation in India and the defendant has been using the mark without due cause. Regarding the issue of passing off, the learned senior counsel for the defendant fairly states that since the goods have been held to be not similar, he is not imperatively seeking for any verdict, albeit prima facie in that regard.
• The competing goods have been held to be not similar, and the plaintiff has been held to be not entitled to an order of injunction applying the principles of Section 29(2) of the TM Act. The mark used by the defendant, prefixed with the admittedly well-known mark of the defendant being “CROMPTON,” and, therefore, the prima facie finding of passing off is not sustainable. The appeal is dismissed in the aforesaid terms.

CRITICAL ANALYSIS

• The judgment clarifies that registration of a label mark does not automatically confer exclusive rights over a word contained in the label.
• It reinforces the distinction between word marks and device/label marks, thereby preventing undue monopolization of common English words.
• The Court correctly adopted a consumer-centric approach by considering the overall impression of the competing marks and the dissimilarity of the goods.
• The decision provides important guidance on the strict requirements under Section 29(4) of the Trade Marks Act, 1999, particularly regarding reputation and well-known status.
• However, the judgment sets a high threshold for proving trans-border reputation, which may make enforcement difficult for emerging brands with substantial goodwill but without well-known mark recognition.