A licensee cannot claim disparagement of trademark without the owner present as a party; non-joinder does not justify the rejection of a plaint under Order VII Rule 11 CPC.

JUDGMENT

Jyoti Singh, J.

I.A. 13233/2022 (under Order VII Rule 11 CPC, by Defendant)

1. Present application has been preferred on behalf of the Defendant under Order VII Rule 11 read with Section 151 CPC, 1908 seeking rejection of the plaint on two grounds: (a) Plaintiff is legally disentitled to institute a suit for infringement of DHI marks by virtue of provisions of Section 53 of the Trade Marks Act, 1999 (hereinafter referred to as the `Act'); and (b) non-joinder of necessary party qua the claim for disparagement under Proviso to Rule 9 of Order I CPC.

2. Relevant it would be to mention at this stage that during the course of hearing of the present application, with respect to the claim of infringement of the DHI trademarks, learned counsel for the Plaintiff had fairly given up the relief of infringement on account of the Plaintiff being a licensee under the Master Franchise Agreement dated 26.03.2018 (hereinafter referred to as the `MFA') in light of the statutory bar under Section 53 of the Act. Therefore, this Court is not adjudicating on the first ground raised by the Defendant for rejection of the plaint.

3. Arguing in support of the second ground qua disparagement, learned counsel for the Defendant submitted that the present suit is, in fact, a suit for defamation of the DHI trademarks, disguised as a suit for trademark disparagement, which is evident from the averments in the plaint. In paragraph 64 of plaint, it is pleaded that the cause of action first arose when the Defendant posted the defamatory content and in paragraph 24, it is averred that the suit is for defamation viz. disparagement of Plaintiff's brand. It is Plaintiff's own case that it is merely a licensee of the DHI trademarks. It is trite that in cases of defamation, it is only the `defamed' who has locus to institute proceedings. The DHI technique of hair transplantation was conceived, developed and is owned by `DHI Global Medical Group' and not the Plaintiff. Plaintiff claims to have acquired the license under the MFA, Clause 5.2(d) whereof clearly provides that franchisee will never become entitled to any part of this goodwill nor any indemnification for promoting or protecting the goodwill. In the absence of any goodwill vesting in the Plaintiff in the DHI marks/technique, no claim for defamation/disparagement can lie in the absence of the owner/proprietor of the said marks. The cause of action for defamation, if any, is based on the impugned videos which only make a reference to the DHI brand and technique and it is not even the Plaintiff's case that they make any reference to the Plaintiff i.e. SilverMaple Health Care Services Private Limited. Positive assertions in the plaint relate to invasion of goodwill and reputation of DHI marks and technique.

4. Section 48(2) of the Act is clear in its scope and provides that permitted use of a trademark shall be deemed to be used by the proprietor thereof and shall be deemed not to be used by a person other than the proprietor, for the purposes of Section 47 or for any other purpose for which such use is material under this Act or any other law. Use by a licensee is always a use by the owner and licensee cannot claim any independent proprietorship on the marks. Further, in the case of Ramdev Food Products (P) Ltd. v. Arvindbhai Rambhai Patel and Others, (2006) 8 SCC 726, it was held that when a right to use a trademark is given under an agreement, such a right can be exercised only in the manner laid down in the agreement. Thus, Plaintiff cannot sue for disparagement of DHI marks/technique in the absence of the proprietor/owner, who is a necessary party in the present suit. Present plaint is thus liable to be rejected under Order VII Rule 11(d) CPC as being barred under law by virtue of Proviso to Rule 9 of Order I CPC, on account of non-joinder of a necessary party.

5. Without prejudice to the above submission, it was contended that Plaintiff may have an independent positive right under the co