Gorbatschow Wodka Kg v. John Distilleries Ltd.

After reading this judgement you will be able to appreciate the various angles and dimensions that have come to be recognized as a part of IPR law in India. Read the judgement to find out whether a market player has a right over his bottles' design.
CITATION 
COURTHigh Court of Bombay
JUDGES/CORAMJustice D.Y. Chandrachud
DATE OF JUDGEMENT02.05.2011

Introduction

The present case is regarded as a landmark case in Intellectual Property Law and Trade Mark law in India. The question here was do shapes matter in the law relating to intellectual property?

Facts

The facts of the case are as follows: The Plaintiff in this case was a Vodka manufacturing company based in Germany. It has a distinctive vodka bottle, which was first introduced in 1958. The present shape was devised in 1996 and subsequently, in 1999 a design of a bird was embossed on the bottle. Vodka being synonymous with Russia, the shape of the bottle was based off the dome of the Russian Orthodox Church. The bottle has been registered in many countries including Germany, Australia etc. At the time, the application for registration of the shape of its bottle as a trademark was pending.

Through the Defendant’s website, it came to the knowledge of the Plaintiff that the former was selling Vodka in a bottle deceptively similar to the bottle of the Plaintiff. An action for passing off was accordingly instituted.

Contentions of the parties

The Plaintiff claimed that the international profile of its brand under the “trade mark shape of the bottle” is impressive as it is one of the top fifteen premium Vodkas in the world. The Plaintiff has numerous awards to its credit. The Vodka was sold in India by the Indian Tourism Development Corporation at International Airports since 1996 and it was officially launched in India in 2008. The Plaintiff claimed a global goodwill and trans-borders reputation transcending geographical barriers.

It was argued by the Plaintiff that:

  1. The expression “trade mark” as defined under Section 2 (zb) of the Trade Marks Act, 1999 includes the shape of goods as well;
  2. The shape forms part of the trade dress and has an established reputation worldwide and in India;
  3. The shape is not used by anyone else in the global market;
  4. The effect of the conduct of the Defendant has caused a dilution of the distinctive shape, a dilution of the Plaintiff’s goodwill and unfair competition. If the Defendant is not stopped, it may cause other potential infringers to encroach upon the rights of the Plaintiff as well;
  5. The registration obtained by the Defendant under the Designs Act, 2000 does postulate that it is the novel shape of the bottle which renders it registrable;
  6. Just because a registration under the Designs Act, 2000 has been granted, it is no defence to an action for passing off.
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On the other hand, the Defendant contented:

  1. It was granted a design registration for the bottle in February 2008 under the Designs Act, 2000. This was before the Plaintiff officially launched their vodka in India in June 2008.
  2. The bottle is coupled with a distinctive trade mark “SALUTE” and a differently coloured label and thus, cannot be confused with the Plaintiff’s bottle.
  3. Their target consumers are highly educated and rich and have the intellect to differentiate between the bottles. They submitted that a person who buys vodka in India cannot be equated to the person of average intelligence who buys fast moving consumer goods of a cheaper variety.
  4. Vodka is bought either at pubs and bars where the consumer selects a particular brand from the menu or from across the counter of liquor shops where again, the consumer has to place an order for a particular brand. Thus, there is no chance of deception.

Issues

The main issues in the case were:

1. Whether or not the shape of the bottle of vodka forms a part of the Intellectual Property Rights of the Plaintiff.

2. Whether or not the Plaintiff still has the right to move an action for passing off even though the Defendant obtained registration under the Designs Act, 2000.

3. Whether or not any injury would be caused to the Plaintiff’s goodwill if the Defendant is allowed to sell vodka in the bottles.

Summary of court decision and judgment

Interim relief was granted by a Single Judge in 2010 in terms of clause (a) of the prayer of the Plaintiffs, which read as follows:

“Pending the hearing and final disposal of the suit this Hon’ble Court be pleased to restrain the Defendant, its promoters, assigns, successors in interest, licensees, franchisees, partners, directors, representatives, servants, distributors, employees, agents and all persons claiming under the Defendant from using the objectionable bottle and/or any other shape identical/deceptively similar to the Plaintiff’s trade mark shape of the bottle upon and in relation to its products/business in any manner whatsoever so as to pass off or enable others to pass off its goods as that of the Plaintiff or convey that it is in some way connected with the Plaintiff.”

However, the defendant was allowed to market and sell its goods under the trade mark “SALUTE”. Subsequently, the High Court made the following observations: The Parliament has made it clear under the Trade Marks Act, 1999 that the shape of goods is a constituent element of trade mark and trade dress. The registration granted to the Defendant under the Designs Act, 2000 doesn’t impinge the right of the Plaintiff to move an action for passing off. What the Court must consider, prima facie, at this stage, are the broad and salient features of the two rival shapes. A meticulous attempt to find differences in the two shapes on a comparison side by side is impermissible. While the Plaintiff has adopted the design based on the architecture of the Russian Orthodox Church, the Defendant has given no explanation as to why their shape is so similar. The adoption of the shape by the Defendant is prima facie not honest. Even if the colour of the label is different, neither of the parties can be restricted to use label of only one colour. The fallacy lies in assuming that while those who are educated or affluent have the ability to discern, since they have higher disposable incomes, persons who do not belong to that category are more likely to be deceived. Gullibility as a trait of human character does not necessarily possess social or economic attributes. The ability of a consumer to discern is not necessarily relatable to social class or economic status and to make such an assumption would lead the Court to an unwitting stereotype. At least the Court must not accept such stereotypes. The Court will not readily assume that because consumers of premium goods and services have higher disposable incomes or, as the Defendant states are educated, that the likelihood of deception is minimal. If the law were to accept such a position, it would only open a pathway for deceit.

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The Court thus held that the plaintiff made out a strong prima facie case for the grant of injunction. Thus, the notice of motion was made absolute in terms of prayer clause (a).

Analysis

Hon’ble Justice J.D. Kapoor in the case of Colgate Palmolive Co. v. Anchor Health and Beauty Care Pvt. Ltd.[1], while discussing trade dress, rightly held “This criterion flows from the concept of action of passing off developed over the years that it is the similarities and not the dissimilarities which go to determine whether the action for passing off is required or not. That is why in trademark cases even the deceptive similarities are considered sufficient for infringement of the trademark. If similarities of trade dress are substantial from the look of the two goods, it comes within the mischief of passing off.” This happened to be the first case in India that accepted the concept of trade dress and provided protection to the plaintiff.

This relief of passing off can only be provided after the plaintiff has proved that the image/shape etc. of its own product is distinctive and when used by someone else, will enable that person to use the plaintiff’s reputation. The Apex Court has held in the case of Laxmikant v. Patel v Chetanbhai Shah[2] , that where there is probability of confusion in business, an injunction has to be granted even though the defendants were acting innocently.

In the present case, the Court rightly provided relief as there were some striking similarities between the shape of the bottles. Further, the plaintiff had proved that the shape of its bottle was associated worldwide with its company and formed a part of its trademark.

Conclusion

The packaging or look of a product has become extremely essential nowadays. Consumers associate a distinctive shape or packaging with a particular company and thus, with the emergence of intellectual property rights in India, the protection of such packaging becomes very important. This has given rise to the concept of trade dress law. Unlike traditional trademark law, which protects words or logo, trade dress law protects the packaging as a whole. This concept has become very relevant in the past few years.

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[1] 108 (2003) DLT 51.

[2] 2002 (24) PTC 1 (SC).