ELUDICATION
AVINASH NAGARWAL
INTRODUCTION
Upon registering its trademark under the Trademarks Act, 1999, an organization or business obtains the exclusive right to prevent any other entity from using that trademark for a period of 10 years. This exclusive right empowers the trademark owner to stop others from using the same or a similar trademark. However, there are instances where a business might register a trademark without being aware of a pre-existing user with a similar mark. In such cases, the law recognizes the concept of prior use, which grants priority to the earlier user. Thus, priority in registration is subordinate to priority in usage, meaning that even if a trademark is registered, the rights of the earlier user take precedence if they have been using the mark prior to the registration by the later entrant.
This gives the impression that the rights of an earlier user are more significant than the rights of the owner of a registered brand. The ‘previous/prior use’ theory is addressed in the Trade Marks Act, 1999, in Section 34 which acts as an exception to Section 28. To put it in a simpler way, Section 34 of the Trademark Act 1999, stipulates that a registered user cannot prevent a third party from making use of his or her registered brand if the third party has been making consistent use of the trademark from an earlier date/prior date. This provision safeguards the legitimate interests of third parties who use trademarks that are identical to or confusingly similar to those of registered trademark owners.
ESSENTIALS OF SECTION 34 TRADEMARK ACT 1999 –
In the dispute between Kamat Hotels (India) Ltd. and Royal Orchid Hotels Ltd., the court reaffirmed the principles of prior use. The following is a list of the requirements that need to be met in order for prior usage to be considered against a trademark that has been registered in India:
The trademark and the subsequently registered mark may be identical or similar.
The trademark must be applied to the same category of goods as the mark that was subsequently registered. If it falls under a different category, further rules would need to be applied, such as the need that the mark be well-known in India and that its use be harmful to the prior user’s goodwill.
The prior use must involve a brand registered on Indian territory. A trademark registered in India cannot be invalidated by prior usage in other countries.
The trademark must be used consistently. In other words, it shouldn’t be a short-term use. It is crucial that the trademark has some reputation and link with the owner.
The trademark must have been in use prior to the date of registration or the usage of the trademark whose registration is being challenged.
JUDICIAL VIEW POINTS
In one of the cases, the Supreme Court of India had ruled that if a subsequent user registers his trademark, the prior user would still possess actual ownership rights over them and that the rights of the prior user cannot be interfered with or disturbed by the subsequent registered user. The impact of the term “use” is tremendously significant in Section 34, which defines “usage” as continuing, consistent behaviour. When permitted, the protection afforded to a prior user under Section 34 of the law has the consequence of diminishing the guarantee provided by a registered mark. As a result, Section 34’s qualifications necessitate the submission of pertinent materials demonstrating prior use. Regarding the commodities and businesses for which the registered mark is also used, there must be clear evidence of the mark’s application.
In M/S S. Narendra Kumar & Co. vs. Everest Beverages and Foods the court reaffirmed that an interim injunction can be granted even if the prior user fails to provide concrete evidence of earlier use. the Delhi High Court ruled that the prior user has established use of the mark anterior to the date of registration.
In the classical decision of Toyota Jidosha Kabushiki Kaisha v. Prius Auto Industries Ltd. and Ors, the Supreme Court of India ruled that prior use cannot be asserted if it did not occur in the same region as the Defendant and the jurisdiction of the passing off action. Having been the first to adopt and utilize the mark PRIUS in 1997, Toyota sued Prius Auto Industries Ltd. for trademark infringement in the aforementioned case. Nevertheless, evidence presented by Toyota showed that the company did not begin using the mark PRIUS in India until 2010, well after Prius Auto Industries had begun doing so in 2006. Hence, the Court ruled that Prius Auto Industries had unrestricted use of the PRIUS trademark in India.
In order to protect the rights of the trademark user, it is highly advised to keep accurate records of all trademark usage dating back to the first time the trademark was used in connection with products or services. Recently, In the case of Vinita Gupta Vs Amit Arora the hon’ble high court of Delhi, held that, the Plaintiff has made out a prima facie case for grant of injunction. Balance of convenience also lies in favour of the Plaintiff who has been using the trademark since the year 2018, i.e., prior in point in time to the Defendant who has dishonestly chosen to adopt a deceptively similar trademark in 2019 in respect of identical goods, with a view to pass off his goods as that of the Plaintiff. In case the interim injunction is not granted, irreparable injury shall be caused to the Plaintiff. The Hon’ble court restrained the Defendant and all those acting on his behalf from selling, offering for sale any goods, advertising or promoting any product under the trademark APPLEPLANT or any trademark deceptively similar or identical to Plaintiff’s trademark.
CONCLUSION
Under the Trademarks Act of 1999, prior users are protected against claims of passing off. To assert this protection, it must be demonstrated that there is a general resemblance between the two marks and that this resemblance is likely to cause confusion in the public's perception, ultimately leading to harm or loss for the prior user. Given these conditions, businesses seeking to register their trademark are advised to conduct thorough searches to identify any pre-existing, potentially confusingly similar marks. This due diligence can help avoid future legal complications. Consequently, the right of prior use as outlined in Section 34 of the Act can serve as a vital defence against trademark infringement claims, reinforcing the importance of prior use in trademark law.