Delhi High Court Restrains Zydus Wellness over the Use of ‘Sugarlite’ Brand Name

Delhi High Court Restrains Zydus Wellness over the Use of ‘Sugarlite’ Brand Name

The Delhi High Court by its division judges bench comprising of Justices Manmohan and Saurabh Banerjee has set aside the impugned order of the Trial Court wherein it refused to restrain the respondent from using the impugned mark ‘SugarLite’ or any other identical and/ or deceptively similar mark as that of the registered trademark ‘SUGARLITE’ of the appellant.

In the matter at hand, appellant- M/S. Delhi Marketing had challenged the order passed by the Trial Court wherein the application under Order XXXIX Rules 1 and 2 read with Section 151 of the Code of Civil Procedure, 1908 was dismissed, against the respondent.

The appellant traded in fast moving consumer goods like edible oil, dairy and dairy products, beverages etc. just like its predecessor who was the owner of the trademark ‘SUGARLITE.’ The said predecessor assigned the trademark ‘SUGARLITE’ along with its goodwill to the appellant, whereafter the appellant appointed the predecessor as a permitted user of the trademark till 31 December, 2018 and subsequently appointed ‘Goodhealth Industries Private Limited’ as the permitted user.

Thereafter, respondent commenced negotiations with the predecessor for license of the said trademark ‘SUGARLITE’ in April 2018 and upon its failure applied for registration of the impugned mark ‘SugarLite’ before the Trade Mark Registry, who, vide its Examination Report objected to its registration citing the already registered trademark ‘SUGARLITE’ of the appellant.

The appellant instituted a suit for permanent injunction, restraining infringement of trademark, passing off, damages and rendition of accounts before the Trial Court seeking appropriate reliefs for restraining the respondent and others from using the impugned mark ‘SUGARLITE’ or any other identical and/ or deceptively similar mark as that of the registered trademark ‘SUGARLITE’ of the appellant.

The Trial Court had observed that the defendant had coined the mark ‘SugarLite’ in the year 2018 and rejected the contention of the appellant that the competing marks were deceptively similar or that the goods of the parties were cognate or allied or that they were sold at the same shops to the same class of customers and distributed through the same channels and held that the competing marks were used for totally different class of products.

It had further observed that not only was the visual appearance of the two marks different but they also related to different class of products and the manner in which the parties were trading, there would be no likelihood of confusion. It was also observed that the appellant never gave any sales or expenditure figures qua promotion of the trademark ‘SUGARLITE’ and that it was not a well-known trademark within the meaning of Section 2(zg) of the Trade Marks Act, 1999. It also stated that the appellant could not claim monopoly over the entire class of goods, and accordingly dismissed the interim application of the appellant.

Aggrieved thereby, the appellant filed the appeal primarily contending that the learned Trial Court had erred in observing that the respondent “coined” the impugned mark ‘SugarLite’ in 2018 and also that the competing marks are not deceptively similar as the competing goods were not totally different and were being sold together and further that the visual appearance of the competing marks were different.

The Court noted that respondent despite having the knowledge that the appellant was a registered proprietor of the valid and subsisting trademark ‘SUGARLITE’, had not challenged it but approached its predecessor in April 2018 for negotiations and thereafter upon failure of talks, filed an application for registration of the impugned mark ‘SugarLite’ which the appellant filed pre- publication objections to.

It was further noted that the appellant had issued a Cease-and-Desist notice in September 2019 to the respondent which led to a further exchange of letters till March 2020. The Bench noted that the respondent despite having variants of its registered trademark ‘SugarFree’ adopted ‘SugarLite’ after the failure of talks with the predecessor of appellant.

In this regard, the Court opined, “In the opinion of this Court, the respondent knowingly took a big calculated risk in adopting an identically similar mark ‘SugarLite’ as that of the registered trademark ‘SUGARLITE’ of appellant despite complete knowledge of its existence since before. Having done so, the respondent is estopped from contending something which is far from reality.”

The Court was of the considered view that though the font of the two competing marks were different, nonetheless, they were overall identically similar to each other, being allied and cognate products as they were generally procured from the same source in the market and sold over the counter to almost the same class of purchasers, there was all likelihood of confusion in the minds of the general public in assuming that the two competing marks were emanating from a common source of origin.

While noting that there was no conflicting mark to that of ‘SUGARLITE’ of the appellant, the use of an identical and deceptively similar trademark by the respondent in respect of similar and/ or allied and cognate goods without its permission tantamount to violation of both common law rights and the statutory rights under the Trade Marks Act, discerned the bench.

Additionally, the Court expressed its dismay while holding that the Trial Court had arbitrarily, capriciously and perversely, completely ignoring the documents on record, passed the impugned order against the settled principles of law. It was neither in agreement with the reasoning nor the findings in the impugned order as they were not plausible.

Thus, the Bench concluded that the Trial Court erred in dismissing the contentions of the appellant which caused them irreparable harm, loss and injury which would be likely to be caused to it with the balance of convenience.

Accordingly, the Court did not concur with the findings of the Trial Court that the impugned mark ‘SugarLite’ was coined by the respondent. Thus, held that the impugned order was liable to be set aside.