CASE STUDY :- Anheuser-Busch LLC Vs. Mr. Surjeet Lal & Anr. (Delhi High Court)

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In its recent judgement, the Delhi HC pronounced that the sale of any product using recycled bottles of another manufacturer having their trademark embossed on the bottles would cause confusion as to its source and would result in infringement and passing off.

In India, trademark infringement is defined under Section 29 of the Trademarks Act, 1999. The law states that when an unauthorized person uses a trademark that is ‘identical’ or ‘deceptively similar’ to a registered trademark, it is known as a direct infringement. Moreover, indirect infringement occurs when a person, though not infringing directly, causes another person to infringe on a trademark. While, the infringement of a registered trademark is a cognisable offence meaning that the infringer may also face criminal charges along with civil charges, it is also not required by the Indian law for the trademark to be registered for the institution of civil or criminal proceedings. This is due to the common law principle of passing off. Though the trade mark Act, 1999 does not have an explicit provision that specifically describes passing off but there are a plethora of common law judgments that lets the courts draw its meaning as to whether the infringement of trade mark done is in such a way that the mark is not only deceptively similar to the trade mark of that other company but itis also capable of creating or is creating confusion for the customers, which ultimately results in damage for business of the company.

Passing off is the protection of the goodwill of traders concerning goods and services. “Goodwill” is the reputation of the brand that was built concerning specific goods or services and which attracts customers. It can be shared between an individual merchant or in some cases, such as all manufacturers of a specific product in a specific area. The fundamental principle behind the tort of passing off is that “A man is not to sell his goods under the pretense that they are the goods of another man” (Perry v Truefitt (1842)). In India, the Delhi HC in case of Cadbury India Limited and Ors. V. Neeraj Food Products explained the difference between passing off action and an action for trade mark infringement.

CASE DETAILS

The Plaintiff for this case: Anheuser-Busch LLC

The Defendant for this case: Mr. Surjeet Lal & Anr.

Judgement given by : Delhi High Court

Coram: Justice Pratibha M. Singh

Date of Pronunciation: 14th March, 2022

OVERVIEW OF THE CASE

Introduced in the year 2007 in India Budweiser has had a strong growth journey in India over the last decade, having emerged as the leading premium beer brand in the country. The firm, which started manufacturing Budweiser in India in 2010, reported a revenue of Rs 238 crore in FY15, according to data from the Registrar of Companies (RoC).

Fig. The beer bottles sold by Anheuser-Busch LLC under the trademark 'BUDWEISER'

The plaintiff Anheuser-Busch LLC is the owner of the trademark ‘BUDWEISER’ used as a recognition for the manufacturing and selling of beer bottles. The trademark ‘BUDWEISER’ is registered under trademark application numbers 958378, 958380,194586, 645366 and others in India.

The Defendant is the manufacturer and seller of beer under the marks ‘BLACK FORT’ and ‘POWER COOL’. The grievance of the Plaintiff was that the bottles of beer manufactured by the Plaintiff with the embossed word ‘BUDWEISER’ are being used by the Defendants by re-labelling them as ‘BLACK FORT’ and ‘POWER COOL’.

Fig. The Defendant is the manufacturer and seller of beer under the marks 'BLACK FORT’ and 'POWER COOL'

SUBMISSIONS ON BEHALF OF THE PLAINTIFF

Aggrieved by the Defendants’ actions, the Plaintiff filed a suit for trademark infringement of their bottles under Section 29 of the Trademarks Act, 1999, to seek permanent injunction restraining the Defendants, from manufacturing, selling, exporting, importing, offering for sale, distributing, advertising, directly or indirectly dealing in any bottle and/or packaging and/ or label or any material other goods bearing mark “BUDWEISER” or any other trademark deceptively similar to the Plaintiff’ s trademark amounting to passing off of the Defendants’ goods as that of the Plaintiff. The plaintiff further sought damages of Rs 2,00,05,000/- against the Defendants on account of the unauthorized use of the impugned marks. Images of such bottles, as also physical bottles, were also produced before the Delhi HC Court.

SUBMISSIONS ON BEHALF OF THE DEFENDANT

The Defendants provided the explanation that the bottles manufactured by the Plaintiff with the embossed word ‘BUDWEISER’ had come into the Defendant’s system through kabadiwalas, and therefore, entered the manufacturing line of the Defendant No.2-Company. The Defendants admitted that in view of the large volume of the bottles that are cleaned, filled and bottled, there may have been stray bottles of ‘BUDWEISER’ which may have been accidentally used by them. However, the Defendants were willing to give an undertaking to the effect that the bottles of ‘BUDWEISER’ shall not be used by it for manufacture and sale of their own beer.

COURT’S OPINION AND JUDGEMENT

The Court observed that said “infringing” bottles were available in the market even till date, with the Defendant’s product labels but embossed with the Plaintiffs mark ‘Budweiser’.

Reiterating the standpoint of the Court judgments in the cases of Cobra Beer Partnership Ltd. & Another v. Superior Industries Ltd., and M/s. Allied Blenders and Distillers Private Limited v. Rangar Breweries Ltd. where the courts pronounced the judgment that the recycled bottles already used by the plaintiffs cannot be used by the defendants as per the provisions of The Trademarks Act, 1999, the Delhi HC in the current case, the court pronounced the judgment in favor of the plaintiff passing a permanent injunction restraining the defendants from using similar beer bottles labelled ‘BUDWEISER’ to manufacture and sell their beer.

Further, the Court instructed the Defendants to exercise a greater degree of supervision at the manufacturing plant of the Defendant Companies, with random checks and inspections conducted by the Defendants to ensure that the bottles used in its manufacturing plant do not, in any manner, bear the mark ‘BUDWEISER’.

FURTHER READING

  • https://taxguru.in/wp-content/uploads/2022/03/Anheuser-Busch-LLC-Vs.-Mr.-Surjeet-Lal-Anr.-Delhi-High-Court.pdf
  • https://zestip.com/budweiser-granted-protection-by-delhi-high-court-against-use-of-their-recycled-beer-bottles/