‘CHEMCO’ Trademark Injunction Granted, But Domain and Trade Name Use Protected: Bombay High Court
‘CHEMCO’ Trademark Injunction Granted, But Domain and Trade Name Use Protected: Bombay High Court
Introduction
The Bombay High Court has partly granted interim relief in a trademark infringement dispute between two rival plastic manufacturers using the name “CHEMCO.” While restraining Chemco Plast from using “CHEMCO” or “CHEMCO PLAST” as trademarks, the Court allowed continued use of “Chemco” as a trade name and domain name, recognising the defendant’s long and concurrent business use.
Factual Background
Chemco Plastic Industries Pvt. Ltd. is engaged in the manufacture of plastic products and claimed ownership of the trademark “CHEMCO” across multiple classes. The plaintiff asserted that the mark had been in continuous use since 1973 through its predecessor and relied on trademark registrations dating back to 2012.
Chemco Plast, a rival manufacturer, contended that it had independently adopted and used the name “Chemco” through its predecessor since 1977 and had operated under the name “Chemco Plast” for over two decades. It denied using “Chemco” as a trademark and claimed that the plaintiff had acquiesced in its long-standing use.
Procedural Background
The plaintiff instituted a commercial trademark infringement and passing off suit before the Bombay High Court and sought an interim injunction restraining the defendant from using “CHEMCO” or “CHEMCO PLAST” as a trademark, trade name, and domain name.
The matter came up before a single bench of Justice N. J. Jamadar, which considered the rival claims at the interim stage.
Issues
1. Whether Chemco Plastic had established a prima facie case of prior use and proprietary rights over the “CHEMCO” mark.
2. Whether Chemco Plast’s use of “CHEMCO” or “CHEMCO PLAST” amounted to trademark infringement or passing off.
3. Whether the defendant could be restrained from using “Chemco” as a trade name or domain name.
Contentions of the Parties
The plaintiff argued that it was the registered proprietor of the “CHEMCO” mark and that the defendant had dishonestly adopted an identical mark to mislead consumers and ride on its goodwill. It relied on trademark registrations and claimed continuous use through its predecessors.
The defendant countered that it had independently used “Chemco” since 1977 and that its business name “Chemco Plast” had been in use for more than 25 years. It argued that it had not used “Chemco” as a trademark and accused the plaintiff of delay, suppression of material facts, and acquiescence.
Reasoning and Analysis
On the issue of prior use, the Court found that Chemco Plastic had failed, at the prima facie stage, to establish a clear nexus between itself and its alleged predecessor-in-interest. The Court observed that the plaintiff had not produced sufficient material to show that the goodwill and trademark rights were properly assigned.
Turning to the defendant’s conduct, the Court noted that Chemco Plast had itself filed multiple trademark applications for “CHEMCO” and “CHEMCO PLAST.” This, the Court held, indicated an intention to use the mark as a trademark, thereby threatening the plaintiff’s registered rights.
On passing off, the Court noted that both parties began using “CHEMCO” around the same period, with only a one-year difference. Given this near-simultaneous adoption and the absence of evidence showing that the plaintiff had acquired significant goodwill prior to the defendant’s use, the Court held that no prima facie case of passing off was made out.
While assessing balance of convenience, the Court emphasised that both parties had coexisted in the market for nearly 25 years and that there was no prima facie evidence of dishonest adoption by Chemco Plast. A complete injunction restraining all use of “Chemco” would therefore cause disproportionate hardship to the defendant.
However, given the defendant’s attempts to register “CHEMCO” and “CHEMCO PLAST” as trademarks, the Court held that it could not be permitted to use those expressions as trademarks. At the same time, the defendant was allowed to continue using “Chemco” as a trade name or domain name, owing to its long-standing and concurrent use.
Decision
The Bombay High Court partly allowed the interim injunction application. Chemco Plast was restrained from using “CHEMCO” or “CHEMCO PLAST” as trademarks. However, it was permitted to continue using “Chemco” as its trade name and domain name. The interim arrangement will operate pending final adjudication of the suit.
