M/s Nandhini Deluxe v. M/s Karnataka Co-operative Milk Producers Federation Ltd.

Appellant: Nandhini Deluxe

Respondent: Karnataka Co-operative Milk Producers Federation Ltd (KMF)

Case citation: (2018) 9 SCC 183

Court: Supreme Court of India

Bench: Justice A.K. Sikri and Justice Ashok Bhushan

Date of Judgement: 26 July 2018.

Facts of the Case:

The dispute arose with respect to the use of the mark ‘Nandhini’. The appellant Nandhini Deluxe was a popular restaurant chain in Karnataka, and the respondent Karnataka Co-operative Milk Producers Federation Ltd. (KMF) had been producing and marketing its products under the aforementioned mark well in advance. The respondent had been dealing in milk and milk products under the mark ‘Nandini’ since the year 1985, and owned the registered trade mark under Classes 29 and 30, under Schedule IV, Trade Marks Rules, 2002. Later the appellant applied for the registration of its brand mark ‘Nandhini’, in respect of various food items sold by it in its restaurants. The respondent objected to the registration, arguing that the appellant was attempting to ride on the goodwill garnered by their well-known brand name, as the marks were deceptively similar.

Procedural History:

The objections of the respondent were dismissed by the Deputy Registrar of Trade Mark, allowing the registration in favour of the appellant.

Later, the respondent approached the Intellectual Property Appellate Board (IPAB), Chennai, pleading that the previous order be overturned. The IPAB decided that the appellant’s mark could not be registered on grounds of earlier use by the respondent,

having acquired distinctiveness, and its proneness to cause confusion in the minds of the consumers. The High Court of Karnataka upheld the order of the IPAB.

Issues in the Case:

• Whether the trade marks ‘Nandini’ and ‘Nandhini’ were deceptively similar under Section 11 of the Trade Marks Act, 1999.
• Whether the use of the mark ‘Nandhini’ by the appellant was likely to cause confusion or lead to deception in the minds of the general public.
• Whether the registration of the mark in favour of the appellant would infringe upon the rights of the respondent.

Holding:

The Supreme Court held “no” as an answer to all of the above questions. Arguments:

• Appellant (Nandhini Deluxe) —

– Goods and services of the appellant and the respondent are wholly different from each other. The IPAB and the High Court only compared the marks, and did not take into consideration that the two operate in different industries.

– The marks are clearly distinguishable as the mark of the appellant is succeeded by the word ‘deluxe’, besides it being spelled differently.

– The mark in question is the name of a deity, and a common Hindu name, and would not thus warrant invocation of Section 11(2) of the Trade Marks Act, 1999. Therefore, the respondent should not be able to enjoy monopoly over it.

– No finding of the IPAB showed that the respondent’s mark is well-known. – The use of mark ‘Nandhini’ by the appellant is honest, and not with an intention to deceive.

• Respondent (KMF) —

– The IPAB concluded that the respondent’s mark had acquired a distinctiveness to the point where the appellant’s use of the same mark would lead the average consumer to believe that the appellant’s goods were owned by the respondent.

– Its distinctiveness had been established for nearly two decades, despite ‘Nandhini’ being a generic name, or that of a deity.

– The appellant’s contention regarding honest and concurrent use was indefensible under Section 12 of the Trade Mark’s Act, 1999. Thus, permitting the registration of the appellant’s mark would harm the respondent’s business.

Judgment:

The Supreme Court ruled in favour of the appellant Nandhini Deluxe, permitting the use of the mark ‘Nandhini’. The Court observed that although the marks were similar in appearance and pronunciation, they differed from each other in terms of visual appearance and the kind of products they were used for.

By applying the principles laid down in National Sewing Thread Co. Ltd. v. James Chadwick and Bros, the Court stated that it was difficult for an ordinary consumer to confuse the goods of the two parties with each other.

Furthermore, the Court emphasised that the name ‘Nandhini’ was a generic name, and therefore could not be monopolised by one party over a whole class of goods and services. Referring to the case of Vishnudas Trading as Vishnudas Kushandas, the Court decided against the registration of a trade mark as absolute, and perpetual, stating that the rectification of the ambit of registration did not infringe upon the respondent’s rights.

Ratio Decidendi:

– Mere similarity of marks does not establish confusion and the possibility of deceit especially if the goods differ in nature.

– Generic and common names can not be monopolised unless distinctiveness has been acquired.

– Limiting and rectifying the ambit of registration if not permitted would lead to one party being allowed to enjoy “trafficking” in trade mark.

– Trade mark protection is class-specific, and unless “well-known” does not extend to unrelated goods and services.

Significance of this Case:

This judgement is a landmark judgement in Indian trade mark jurisprudence. It has been used to establish concurrent use, to define “well-known” marks, to protect businesses with similar marks, and to highlight the gaps in trademark law.

Examples of cases where this judgement has been cited are:

1. Bayerische Motoren Werke Ag v. Om Balajee Automobile (India) Pvt. Ltd. 2. Avtar Singh & Ors. v. Sakshi Srivastava & Anr.
2. HTE Corporation v. Mr. LV Degao & Ors.

Conclusion:

The decision of the Supreme Court of India in Nandhini Deluxe v. Karnataka Co-operative Milk Producers Federation Ltd. serves as a valuable precedent for future cases involving similar situations of overlapping brand names across different sectors and industries. The Court refused monopoly over common and generic names, and declined granting of a registration as absolute and immune to alteration. This promotes positive and healthy competition between businesses. It also protects the rights of small businesses against exploitation by large corporations.

References:

1. Avtar Singh & Ors. v. Sakshi Srivastava & Anr., CS (COMM) 385 of 2020
2. Bayerische Motoren Werke Ag v. Om Balajee Automobile (India) Pvt. Ltd., CS (COMM) 292 of 2017
3. HTE Corporation v. Mr. LV Degao & Ors., CS (COMM) 263 of 2020
4. M/s Nandhini Deluxe v. M/s Karnataka Co-operative Milk Producers Federation Ltd., (2018) 9 SCC 183
5. National Sewing Thread Co. Ltd. v. James Chadwick and Bros., AIR 1953 SC 357 6. Trade Marks Act, 1999
6. Trade Marks Rules, 2002
7. Vishnudas Trading as Vishnudas Kushandas v. Vazir Sultan Tobacco Co. Ltd., Hyderabad and Anr., 1996 INSC 719.