Madras High Court Holds Geetham Restaurants Guilty of Passing Off for 17 Months, Rejects Trademark Infringement Claim Over ‘GEETHAM’

Madras High Court Holds Geetham Restaurants Guilty of Passing Off for 17 Months, Rejects Trademark Infringement Claim Over ‘GEETHAM’

Introduction

The Madras High Court held that former franchisees of the Sangeetha Caterers restaurant chain were liable for passing off for a period of about 17 months after termination of the franchise relationship. However, the Court ruled that the use of the name “GEETHAM” did not amount to trademark infringement, as the plaintiff’s rights were confined to composite marks and not the standalone word “Sangeetha.”

Factual Background

The dispute arose out of a franchisor-franchisee relationship that subsisted between the parties from 2011 till 31 May 2022. The defendants operated multiple franchise outlets of the “Sangeetha” chain in Chennai. In early 2022, they sought permission to shift one of the outlets due to metro rail construction, but the request was rejected. This led to termination of the franchise arrangement by mutual understanding.

After termination, the defendants continued restaurant operations from the same locations under the name “GEETHAM,” including outlets at Velachery, T. Nagar, Thoraipakkam, Medavakkam, OMR, and Navalur. The plaintiff alleged that the defendants deliberately projected the new outlets as a continuation of the earlier franchise business by retaining the same premises, adopting an identical red-and-green colour scheme, and making representations such as “only the name has changed” and “same taste, same team.”

Procedural Background

Sangeetha Caterers instituted a suit seeking permanent injunction, removal of the “GEETHAM” signages, rendition of accounts, and costs. The matter came up before the Madras High Court for adjudication on claims of trademark infringement and passing off.

Issues

1. Whether use of the mark “GEETHAM” amounted to trademark infringement of the plaintiff’s registered “Sangeetha” marks.

2. Whether the defendants’ continued use of similar trade dress and business representations amounted to passing off.

3. Whether the plaintiff was entitled to accounts of profits and costs for the period of misrepresentation.

Contentions of the Parties

The plaintiff argued that the defendants dishonestly attempted to transition the goodwill of the established “Sangeetha” restaurants into their own business by using identical colour schemes, operating from the same outlets, and representing continuity in food taste and staff.

The defendants contended that “GEETHAM” was visually and phonetically distinct from “SANGEETHA.” They further submitted that the plaintiff did not possess a standalone registration over the word “Sangeetha” and instead relied only on composite registrations such as “SVR Sangeetha.”

Reasoning and Analysis

The Court accepted the defendants’ contention on trademark infringement. It held that when the rival marks were compared as a whole, “GEETHAM” was not deceptively similar to the plaintiff’s composite marks. The Court also noted that “Sangeetha” is a common word and that the plaintiff did not hold exclusive standalone rights over it. Accordingly, the claim of infringement was rejected.

However, on the issue of passing off, the Court found clear evidence of misrepresentation. The defendants had initially adopted a trade dress identical to the plaintiff’s iconic red-and-green colour scheme, continued operations from the same premises, and made public statements suggesting continuity of the earlier franchise business. This created the misleading impression that the well-known “Sangeetha” restaurants had merely “metamorphosed” into “GEETHAM.”

The bench of Justice Senthilkumar Ramamoorthy held that this conduct effectively diverted the plaintiff’s customer base and constituted passing off for the period from 1 June 2022 to 2 November 2023. It further noted that after court directions, the defendants had modified their branding, and therefore no continuing restraint on the name “GEETHAM” was warranted beyond that date.

Decision

The Court granted a permanent injunction restraining the defendants from using the earlier red-and-green trade dress associated with Sangeetha Caterers. It declined to restrain use of the name “GEETHAM” or the revised branding adopted after 2 November 2023.

The defendants were directed to render true accounts of profits for the period from 1 June 2022 to 2 November 2023 and pay the profits earned during that period to the plaintiff. Costs of ₹10 lakh were also awarded.

In this case the plaintiff was represented by Senior Advocate K.Sriram for A.S.Kailasam and Associates. Meanwhile the defendant was represented by Senior Advocate P.S.Raman for A.Ramesh Kumar.