Case Analysis: Coca-Cola Company v. Bisleri International Pvt. Ltd. & Ors. (2009) | Trademark Infringement

The 'Case Analysis: Coca-Cola Company v. Bisleri International Pvt. Ltd. & Ors. (2009)' delves into the legal dispute between Coca-Cola and Bisleri International concerning the Mazza trademark, famously known as the Mazza conflict. It represents a landmark judgment in the history of intellectual property rights in India.

Case Title: Coca-Cola Company v. Bisleri International Pvt. Ltd. & Ors.

Court: Delhi High Court

Citation: (2009) 164 DLT 59

Judge: Justice Manmohan Singh

Decided on: 20th October, 2009

Introduction

Whenever Intellectual Property Rights are discussed, the name of this case comes up. The Bisleri Company sold the trademark rights of “MAAZA” to the well-known company Coca-Cola. Even after this transaction, Bisleri started selling drinks with the same name in Turkey. When Coca-Cola learned this, it sued Bisleri for infringement of trademark-. Whenever one party is trying to bypass the trademark agreement by limiting its application based on territory or geographical area, this case is usually cited. Due to the brand on which both the companies fought this case in court, this case is also known as the “Maaza War” case.

Facts

The plaintiff in this case is Coca-Cola which is a world-known brand with its presence in more than two hundred countries. The defendant i.e. Bisleri company is also a big brand that is known for its plain drinking water. In the year 1993, on the 18th of September, Bisleri transferred all the intellectual property rights of several products including “Maaza” to the plaintiff. In the same year, on the 12th of November, an assignment deed that highlighted the agreements related to the utilization of the name “Maaza”, was entered into by the above parties. Next year, i.e., in 1994, Coca-Cola acquired all the trademarks and formulation rights by entering into a Licensing Agreement.

In the year 2008, the plaintiff applied in the country of Turkey for registration of the trademark of “Maaza”. When the defendant discovered this fact, it sent a notice to the plaintiff, on 7th September 2008, rejecting the licensing agreement, saying that the plaintiff was no longer allowed “to produce any product with the name of “Maaza” or use its trademarks, either directly or indirectly”. The argument on which this whole case revolves is that the agreements and assignment deeds entered into by the parties allowed the defendant to use the trademark of “Maaza” outside India.

Issues involved in this case

1. Whether Delhi High Court have the proper jurisdiction to entertain this case?

2. Whether the Coca-Cola Company is entitled to damages for passing off and infringement of trademark?

3. Whether the plaintiff is entitled to get the order of permanent injunction against the defendant?

4. Whether export of goods bearing the trademark of “Maaza” is a violation of the trademark rights of the plaintiff?

Laws concerned in this case

1. As per Section 26 of the Trade Mark Act of 1999, if the trademark owner has not renewed the trademark by non-payment of renewal fees in proper time, leading to the removal of its registration from the designated register, for any new trademark registration of the same trademark by someone else within one year after its removal due to such reason, the same trademark will be deemed to be a registered one and this new application will be rejected unless it is shown to the tribunal that-

a. In the two years before the removal of the trademark, there has been no real trade use of the same, or

b. It is unlikely that the new trademark would cause any confusion or deception in transactions because of the use of the previously removed trademark.

2. Section 41 of the Specific Relief Act 1993 states the grounds for refusal of injunction; the practical application of this section implies that parties cannot enter into such a contract that is detrimental or voluntary, which would prohibit the suit for injunction.

3. Section 42 of the above Act, states that the plaintiff becomes entitled to the imposition of injunction if they had performed their part of the contract to which they made themselves bound.

Arguments of Parties

The defendant primarily argued that the Delhi High Court doesn’t have the jurisdiction to entertain this case because the point of sale is outside India. The plaintiff, on the other hand, replied that the Licensing Agreement dated 13th May 2004, was initiated and completed within the jurisdiction of the court. Furthermore, the defendant is running its business within the territorial limits of this court’s jurisdiction.

The defendant also showcased its planning for the future to use the trademark “Maaza” in India by the way publishing the article in the Delhi edition of the Times of India. Additionally, there is a factory of the defendant which produces these products situated in Delhi from where the defendant is also operating its sales.

The plaintiff contended that the legal remedy of injunction as well as awarding damages is given under section 135 of the Trade Marks Act of 1999 and therefore this suit is not barred as per section 41 (h) and (i) of the Specific Relief Act of 1963. He further added that he has the right to ask for an injunction from the court for the enforcement of a negative agreement as provided by the Specific Relief Act of 1963 under section 42. Moreover, he added that he would suffer irreversible damage for which no form of compensation would be enough.

The plaintiff reiterated that it is a well-known legal principle that the goods that are being exported should be deemed as they are being sold within the nation. The trademark of “Maaza” is registered in the plaintiff’s name and therefore the creation or manufacturing of any goods bearing this trademark whether it is exported to another country or sold in India will constitute an infringement of the intellectual property rights of the plaintiff.

On the other hand, the defendant said that it has the right to sell its goods anywhere globally because it had registered the trademark of “Maaza” all over the world. It also claimed that there hasn’t been any violation of the plaintiff's trademark rights as the goods are sold in Turkey and not in India.

Judgement

The court held that because the defendant is substantially involved in the commercial activities in Delhi, this gives the court the appropriate jurisdiction to decide the case that concerns the violation of trademark rights and the provisions in the law that upholds this reasoning are given in section 134 (2) of the Trade Marks Act of 1999 and section 20 (c) of the Code of Civil Procedure of 1908. The court explained that from a criminal law point of view, Indian Citizens are held accountable for the offences perpetrated outside the country as provided by the Indian Penal Code. The defendant produces his goods from Delhi which consequently gives the Delhi High Court the jurisdiction over this suit.

The assignment deed is a binding agreement between the parties as per the Specific Relief Act of 1963 under section 41 (h) and (i). This means that the party that is responsible for breaching the contract is liable to the party that has been wronged when the breach of contract occurred. The intellectual property rights and all the other associated rights of the trademark of “Maaza” were explicitly and unconditionally specified and the defendant had agreed to transfer the same. Therefore the defendant had no right to terminate the contract in any way. The time of the transfer of all these rights from the defendant to the plaintiff can be specifically pointed out as the date on which the contract was signed by the parties. This very contract gave the plaintiff the power of being the rightful owner of the trademark and hence has the proprietorial discretion, without the need to notify or seek permission from anyone regarding its usage.

The court upheld that for trademark use, a sale made outside the country is equivalent to a sale made within the country. As the plaintiff became entitled to use the trademark, after the execution of the assignment deed, whether within India or outside India, the infringement of the trademark rights has occurred. A temporary injunction is being issued against the defendant that disallows the defendant from using the trademark of “Maaza” in India and outside India, this is a necessary step to safeguard the rights of the plaintiff and save it from irreversible damages.

Conclusion

The distinctive symbol or group of words that represents a business or its goods is called a trademark of that company. If there is an active use of this symbol all the administrative requirements are done and the costs of registration to the concerned authority are paid in time then that company gains the exclusive right to use that trademark to propagate in the open market.

The court decided in favour of the plaintiff as the defendant had used the trademark 'Maaza' with the mere presumption, that the agreement signed was limited to India only.

This case also established that trademark is an international issue, and the protection of trademark rights is practised beyond international boundaries.

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