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2023 Supreme(Del) 2287

IN THE HIGH COURT OF DELHI AT NEW DELHI
C. Hari Shankar, J.
Subway LP LLP – Appellant
Versus
Infinity Food – Respondent
CS(COMM) 843 of 2022
Decided On : 12-01-2023

Advocates appeared:
Sandeep Sethi, Senior Advocate with Peeyoosh Kalra, Gaurav Mukerjee and Suyash Malhotra, Advocates, for the Plaintiff.
Pushkar Sood, K.P. Singh, Anshuman Sood, Keshav Rai, Vishwajeet Singh, Tarkar and Rishabh Singh, Advocates, for the Defendants.

The main legal point established is that the application of the anti-dissection rule and the identification of dominant marks are crucial in determining infringement of registered trade marks.

Headnote:

ORDER (Oral) I.A. 20529/2022 - Order XXXIX Rules 1 and 2 of the CPC - Trade Marks Act - Section 36F(1) - Section 29(1) to (5) - Section 17(2) - Infringement of registered trade marks - Anti-dissection rule - Dominant mark - Passing off - Similarity in layout of restaurants

Fact of the Case:

The plaintiff, Subway IP LLC, a well-known global chain of restaurants, alleged that the defendants infringed its intellectual property rights by using similar brand names, logos, and other elements. The defendants offered to make changes, but the plaintiff was not satisfied.

Finding of the Court:

The court found that the defendants' modifications addressed the alleged infringement, and the plaintiff's exclusivity claims over certain elements were not sustainable. The court also concluded that no passing off was established.

Issues: The issues involved infringement of registered trade marks, application of the anti-dissection rule, identification of dominant marks, and passing off.

Ratio Decidendi: The court applied the anti-dissection rule and found that the defendants' modifications eliminated the alleged infringement. It also emphasized that no exclusivity could be claimed over common elements and that passing off required trial and evidence of confusion.

Final Decision: The court dismissed the prayer for interim injunction, subject to the defendants carrying out the stated changes and undertaking not to use the allegedly infringing marks.

ORDER (Oral)

I.A. 20529/2022 (Order XXXIX Rules 1 and 2 of the CPC)

1. This judgement provides the reasons for the order in this case, which was pronounced on 9th January 2023.

2. The plaintiff Subway IP LLC is a Company incorporated in the State of Delaware, U.S., which operates a well-known global chain of restaurants under the name `SUBWAY', with the name being represented with the well-known logos [IMG] and [IMG]. The plaintiff is the properietor, in India, of registrations not only of the `SUBWAY' word and device marks, but also of `SUBWAY CLUB' and `VEGGIE DELITE', being the names allotted by the plaintiff to its club sandwich and vegetable sandwich respetively. The plaintiff holds the following trade mark registrations in India:

S. No.Trade MarkRegistration No.ClassDate of applicationValid till
1 SUBWAY5137043020th July 19897th April 2025
2SUBWAY5137053220th July 19897th April 2023
3 [IMG]13477824230th March 200530th March 2025
4SUBWAY1349577427th April 20057th April 2025
5SUBWAY1933097299th March 20109th March 2030,
6 [IMG]IRDI-359762729, 30, 32, 35, 4313th January 201713th January 20271[*Rights protected under the Madrid Protocol read with Section 36F(1) of the Trade Marks Act:

"36-F. Effects of international registration. -

(1) From the date of the international registration of a trade mark where India has been designated or the date of the recording in the register of the International Bureau about the extension of the protection resulting from an international registration of a trade mark to Indiathe protection of the trade mark in India shall be the same as if the trade mark had been registered in India.] ,

7 [IMG]IRDI- 364291329, 30, 32, 35, 4313th January 201713th January 2027*,
8 [IMG]IRDI- 364957029, 30, 32, 3513th January 201713th January 2027*
9SUBWAY CLUB524950829, 3016th December 202116th December 2031
10VEGGIE DELITE175066129, 304th November 20084th November 2028

3. Copies of the registrations have been placed on record. The defendant does not dispute the proprietorship, by the plaintiff, of the aforesaid registered trade marks.

4. The plaintiff, therefore, asserts exclusivity over the word and device marks SUBWAY, [IMG], VEGGIE DELITE and SUBWAY CLUB.

5. Defendant 1 Infinity Foods LLP is a partnership firm of which Defendants 3 and 4 are partners. Defendants 3 and 4 are licensees of the plaintiff, to whom the plaintiff has granted the right to franchise the plaintiff`s outlets vide agreement dated 30th May 2019. Since then, Defendants 3 and 4 have, through the outlets owned by them, been serving and distributing the products of the plaintiff. Recitals A and B in the franchise agreement dated 30th May 2019, on which Mr Sethi learned Senior Counsel for the plaintiff places reliance, read as under:

    `A' Subway IP LLC, a Delaware limited liability company with a principal office in Doral, Florida, USA ('SIP') owns a proprietary system for establishing and operating restaurants featuring sandwiches, pizza and salads under the trade name and service mark Subway* (the "System"). The system was developed spending considerable money, time, and effort. The System includes the trademark Subway*, other trademarks, trade names, service marks, commercial announcements (slogans) and related insignia (logos) SIP name [the 'Marks']. The System also includes confidential information and goodwill. The parties acknowledge that SIP owns the Marks registered with the India Trade Mark Registry, including the trademark "Subway" in international classes 30 and 32 on July 20, 1989 under registration numbers 513704 and 513705, respectively; 'Subway & Design' in class 42 on March 27, 2007 under registration number 1347782; 'Subway' in international class 42 on August 7, 2008 under registration number 1349577; and "VEGGIE DELITE" in classes 29 and 30 on May 18, 2015 under registration number 1750661.

    B. SIP granted a non-exclusive license to Subway International B.V., a Netherlands limited liability company ('Licensor') to

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