The Supreme Court’s landmark decision in Renaissance clarifies the legal test for the infringement of trademarks
17 January 2022
On January 19, 2022, India’s apex court delivered its decision in Renaissance Hotel Holdings Inc v. B Vijaya Sai & Ors., Civil Appeal, 404 of 2022, setting the law on the tests to determine trademark infringement, holding that when a defendant uses a mark which is identical or similar to a registered trademark, for similar goods or services, then the only outcome is an injunction which restrains such use.
It also held that in these situations, the reputation of the plaintiff’s trademark in India and honesty of the defendant’s adoption of the mark are irrelevant inquiries. Moreover, the Supreme Court clarified that when an identical mark is adopted by a defendant for the identical goods/ services for which the plaintiff has a trademark registration, likelihood of confusion must be presumed under Section 29(3) of the Trade Marks Act, 1999 (statute), and infringement stands established.
The judgment assumes greater importance because it also urges courts to consider the legislative intent in enacting the statute. It notes that in this case, the statute was created for the following purposes (among others):
- To increase globalization.
- To encourage investment and transfer of technology.
- To simplify and harmonize trademark management systems.
- To prohibit third-party misuse of trademarks.
After setting straight these principles, the Supreme Court reversed the underlying decision of the High Court of Karnataka, which had refused to grant an injunction to the appellants. In order to appreciate this decision, let’s take a quick view of the facts:
Brief facts
Renaissance Holdings Inc. (appellant), part of the Marriott Group, runs renowned hotels under the “Renaissance” mark. The respondents were operating a few hotels in India under the “Sai Renaissance” banner.
In 2009, when the appellant filed a civil suit for infringement of its trademark, the court of first instance (the District Court at Bengaluru) held the respondents liable for infringement, as the respondents’ mark was identical and was used for identical services (hotels).
In 2012, the High Court of Karnataka reversed this decision and held that respondents did not infringe because:
- The appellant was unable to prove that its mark “Renaissance” had a reputation in India. As per the High Court, this was a necessary ingredient to prove infringement under Section 29(4)(c) of the statute.
- The respondents had adopted the mark “Sai Renaissance” honestly. They had claimed that the word renaissance represented re-birth, and they were ardent devotees of the revered, late spiritual leader Sai baba. Their hotels were intended to cater only to guests who visited Sai Baba’s hermitage (ashram).
- The respondents had not taken unfair advantage of the appellant’s trademark, and thus, their use was an acceptable defense to infringement under Section 30(1)(b) of the statute.
The Supreme Court’s reversal
The Supreme Court held that the High Court grossly erred because:
- It applied Section 29(4) to hold that the trademark Renaissance did not have reputation in India. This was wrong because the case squarely fell under Section 29(2), as the respondents used an identical mark for identical services. On the other hand, Section 29 (4) is concerned with the use of an identical mark for dissimilar services. Only in this situation does the reputation of the mark become relevant, and this inquiry is irrelevant for a case covered under Section 29(2). It also held that consumer confusion is an aspect relevant to the issue of passing off (a tort principle under the common law of passing off), and was irrelevant to the issue of infringement.
- It misapplied Section30(1)(b).Section 30(1), which recognizes statutory defenses to infringement, requires two qualifying criteria, i.e., a) use as per honest practices; and b) no unfair advantage of the registered trademark.
The Supreme Court held that both the above requirements had to be met together for the exception to apply. However, the High Court erred and applied only Section 30(1) (b), without deciding that the respondents’ use was in accordance with honest commercial practices.
- The High Court ignored two important principles of statutory interpretation, namely:
- That the statute must be interpreted not just literally, but contextually, with specific regard to the Parliament’s intention behind creating it.
- Individual clauses within a provision cannot be read in isolation.
- That the statute must be interpreted not just literally, but contextually, with specific regard to the Parliament’s intention behind creating it.
Conclusion
This is the first decision from the Supreme Court of India which correctly distinguishes the legal tests of infringement when a registered mark is used for similar goods (Section 29(2)) or for dissimilar goods (Section 29 (4)). Further, though the statute is worded very clearly, its interpretation by different courts was not uniform. Despite the registration of a trademark, injunctions were often declined because the defendants’ adoption of the same mark was found to be honest, or that consumer confusion was considered unlikely. The court has clarified that these aspects are relevant for deciding passing off, but not infringement of a registered trademark.
The true importance of this decision is that it sets the stage for clear and uniform decision making on trademark infringement
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