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High Court Of Delhi
WEARWELL CYCLE COMPANY INDIA LIMITED - Appellant
Versus
WEARWELL INDUSTRIES - Respondent
Decided On : 11/22/1968
TRADEMARK - PASSING OFF - INJUNCTION - BALANCE OF CONVENIENCE - LIKELIHOOD OF DECEPTION - TRADE AND MERCHANDISE MARKS ACT, 1958, SECTION 27(2).
Fact of the Case:
Plaintiff, a manufacturer of cycles under the trademark "Wearwell" for 12 years, filed a suit for permanent injunction against the defendants, who started using the same trademark just three months before the suit. The plaintiff claimed exclusive rights to the trademark based on its long-standing use and reputation. The defendants contended that they were entitled to use the trademark as they had acquired the rights from the English company that originally owned the trademark.
Finding of the Court:
The court held that the plaintiff had acquired exclusive rights to the trademark "Wearwell" through its long-standing use and reputation. The court found that the defendants' use of the trademark was likely to deceive the public into thinking that their cycles were manufactured by the plaintiff. The court also held that the balance of convenience was in favor of the plaintiff as the defendants had only recently started using the trademark and had not yet established a reputation for their cycles.
Issues: 1. Whether the plaintiff had acquired exclusive rights to the trademark "Wearwell" through its long-standing use and reputation? 2. Whether the defendants' use of the trademark was likely to deceive the public into thinking that their cycles were manufactured by the plaintiff? 3. Whether the balance of convenience was in favor of the plaintiff?
Ratio Decidendi: 1. The court held that the plaintiff had acquired exclusive rights to the trademark "Wearwell" through its long-standing use and reputation. The court found that the plaintiff had been using the trademark for 12 years and had sold cycles worth Rs. 3 crores under that name. The court also found that the plaintiff had spent Rs. 4 lakhs on advertising the trademark. 2. The court held that the defendants' use of the trademark was likely to deceive the public into thinking that their cycles were manufactured by the plaintiff. The court found that the defendants were using the same trademark as the plaintiff and that their cycles were similar in appearance to the plaintiff's cycles. The court also found that the defendants had not taken any steps to distinguish their cycles from the plaintiff's cycles. 3. The court held that the balance of convenience was in favor of the plaintiff. The court found that the plaintiff had been using the trademark for a long time and had established a reputation for its cycles. The court also found that the defendants had only recently started using the trademark and had not yet established a reputation for their cycles.
Final Decision: The court allowed the appeal and set aside the order of the lower court. The court granted a temporary injunction restraining the defendants from using the trademark "Wearwell" in the name of their business and as a mark on the cycles made and sold by them.
( 1 ) THIS is an appeal against the order of the Additional District Judge, Delhi dated 16/5/1967 refusing the grant of temporary injunction to the plaintiff-appellant. The application for temporary injunction by the plaintiff before the Additional District Judge, though made under Order 39, Rules I and 2 read with Section 151 Civil Procedure Code. , was actually cov. ered by Order 39, Rule 2 alone inasmuch as the suit by the plaintiff was for restraining the defendants from committing "other injury of any kind" within the meaning of Rule 2 (1 ). The injury complained of was the harm caused to the plaintiff by the sale of deceptiv. e goods by the defendants. The order of the learned Additional District Judge was apparently, therefore, passed under Order 39, Rule 2 Civil Procedure Code and not under Section 151 Civil Procedure Code It was therefore, appealable under Order 43, Civil Procedure Code.
( 2 ) BRIEFLY, the facts leading to the filing of this appeal against the order dated 16/5/1967 passed by the Additional District Judge, dismissing the appellants application for temporary injunction are as follows:
( 3 ) SHRI K. C. Aggarwal, the father of defendant No. 2 and certain other persons decided to promote a company to manufacture "wearwell" Cycles. These cycles used to be manufactured by an English Company called the Wearwell Cycle Company Limited in England. Shri Aggarwal, therefore, went to England and entered into an agreement with the English Company. Shri Aggarwal acted for Janki Das and Sons of Jullundur, India, and the agreement was entered into by him for the benefit of the Indian Company which was to be formed under the name of "wearwell Cycle Company (India) Limited". The English Company permitted by this agreement the Indian Company to use any of its proprietary marks in India. The Indian Company was registered under the Indian Companies Act on 14/11/1951. It obtained the licence to manufacture cycles under the Registration and Licencing of Industrial Undertaking Rules, 1952 on 14/1/1953. The Indian company went into production by the end of 1954 and produced and. sold cycles worth Rs. 3 crores or so by the time the suit came to be filed in 1966. The Indian Company had spent about Rs. 4 lakhs to adv. ertise its cycles. The word "wearwell" and monogram containing the said word were displaced on all the cycles made and sold by the Indian Company.
( 4 ) THE agreement entered into with the English Company contemplated that the Indian Company would enter into an agreement with the English Company after the Indian Company was registered incorporating the terms of the said agreement into the new agreement between the two companies. This, howev. er, does not seem to hav. e been done. By the end of 1965 Shri K. C. Aggarwal was remov. ed from the Directorship of the Indian Company. Defendant No. 2, Ashok, is his son born probably on 25/4/1947, He took his B. Com. degree in 1966 and started the business of selling cycles from the 25/7/1966 as would, appear from the licence as a dealer obtained by him from the Sales Tax Authorities. He also used the name "wearwell" and the monogram containing that word on the cycles sold by him. The plaintiff Company came to know of this in September, 1966 and immediately filed the Suit No. 3 of 1966 on 26/10/1966. The plaintiff av. erred that from the end of 1954, it has been manufacturing cycles under the trade mark "wearwell" in four different models, v. iz-; Popular Wearwell, Super delux Wearwell, Delux Wearwell and Super Jet Wearwell. Since February, 1966, however, the plaintiff has been concentrating on the manufacture of their famous model Deluxe Wearwell. Its production till the filing of the suit was approximately worth Rs. 3 crores as per the statement showing the yearly figures of sale attached. It has spent about Rs. 4 lakhs on adv. ertising the trade mark "wearwell" as per statement attached. The trade mark "wearwell" is the key portion of the plaintiff s tra
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