Unauthorized use of a registered trademark and breach of confidentiality provisions in a Franchise Agreement constitute infringement and entitle the plaintiff to liquidated damages.

1. The plaintiff M/s. Amoha Education (P) Ltd., formerly known as Vivekananda Kalvi Nilayam Pvt. Ltd., has filed the suit for perpetual injunction retraining the defendant from in any manner infringing their trademark "Veta” or any other mark deceptively similar to their trademarks, for direction to the defendant to surrender to them all their teaching, resource, technical know how, study and course materials and for liquidated damages of Rs. 5 Lakhs with interest.

2. The defendant is one Satishkumar who is carrying on business in the name and style of M/s Vidhya Easy Spoken Academy in Arakonam.

3. The case of the plaintiff, as narrated in the plaint, is as follows:-

(a) The plaintiff is in the business of imparting training in English communication skills amongst other activities and had been marketing their services and products under the name Vivekananda Institute's Spoken English Training Course and marketing such products under the brand name "Veta” which has been registered as a trademark under the Trade Marks Act, 1999 in Class 41 under No. 1280828 on 26.4.2004 in respect of education services which is valid for a period of ten years and is renewable. The plaintiff also had made an additional representation dated 12.9.2008 for the use of the trade mark "Veta One” under the acknowledgement No. 1731089.

(b) While so, the defendant had approached the plaintiff for establishing a Franchise centre using the goodwill, reputation, services and the products of the plaintiff for providing training in English communication skills and requested the plaintiff to grant a franchise. Accordingly, the plaintiff also agreed for the defendant to run a training centre in the name of M/s Vidhya Easy Spoken English Academy at No. 5 Railway Police Line Street, Arakonam, Vellore, and the agreement was reduced to writing on 08.12.2009.

(c) As per the Franchise Agreement, the defendant was permitted to use the trade name, reputation and goodwill of the plaintiff in the business of conducting training in English communication skills. The defendant also paid a security deposit of Rs. 50,000/- as per Clause 5 of the agreement and non-refundable Franchise Fee of Rs. 1 Lakh. It is stated that as per Clause 6 of the agreement, the defendant has to pay a sum of Rs.12,000/- per month with Service Tax to the plaintiff as royalty which was subject to annual increase and though it was agreed by the defendant, he had defaulted in paying the royalty amount from June 2011.

(d) Therefore, the plaintiff issued a termination notice dated 24.9.2011 terminating the Franchise Agreement and calling upon the defendant to pay the dues of Rs.42,995/- which was due after adjusting the study materials advance amount. The plaintiff also had called upon the defendant to hand over the teaching, course and technical know how material. According to the plaintiff, Clause 27 of the Franchise Agreement restrains the defendant from setting up any similar centre in the same territory or the district within the radius of 100 Kms. from the territory for a period of 2 years from the termination of the Agreement and in the event of violation of the said clause, the franchisee shall be liable to pay the liquidated damages of Rs. 5 Lakhs to the franchisor.

(e) The further allegation of the plaintiff is that though they had terminated the franchise on 24.9.2011, the defendant continued to use the plaintiff's trade mark brand name, goodwill, course material, printed matter, advertisements, etc. and therefore, they issued another letter dated 25.10.2011 enclosing the statement of accounts and calling upon the defendant to pay a sum of Rs. 42,995/- towards royalty dues. The plaintiff further stated that the defendant is continuing the institute in the same place at Arakkonam even after termination and also started a new Institute at No. 4, PJN Street, near State Bank of India, Arakkonam and also running another Institute at Sholinghur, all under the same name "Veta", which is the register