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2023 Supreme(Mad) 2700

IN THE HIGH COURT OF JUDICATURE AT MADRAS
SANJAY V. GANGAPURWALA, P.D. AUDIKESAVALU, JJ.
Phonepe Private Limited – Appellant
Versus
Digipe Fintech Private Limited – Respondent
O.S.A. (CAD). Nos. 70 to 73 of 2023
Decided On : 22-08-2023

Advocates appeared:
For the Appellant:Sathish Parasaran, Senior Counsel for M/s. P. Giridharan, H. Siddharth, Siddharth Govind, Advocates. For the Respondents:R. Sathish Kumar, Advocate.

The plaintiff must satisfy all the ingredients for claiming temporary injunction, including prima facie case, irreparable loss, and balance of convenience. The plaintiff's stand before different courts and authorities must be consistent. The plaintiff's trademark 'PhonePe' was not exclusive as there were other trademarks with the suffix 'Pe' in the market.

Headnote:

Trademark - Interim Injunction - Trademarks Act, 1999 - Section 13, Section 32, Rule 28 of the Trademark Rules, 2017 - [PhonePe] - [Interim Injunction] - [Section 13, Section 32, Rule 28 of the Trademark Rules, 2017] - The court dismissed the appeals challenging the order granting interim injunction to restrain the defendants from infringing the registered trademark 'PhonePe' by using the 'DigiPe' mark and passing off the trademark 'PhonePe' by use of their mark 'DigiPe'. The court found that the plaintiff failed to make out a prima facie case for grant of interim injunction and that the balance of convenience was in favor of the defendants. The court also noted that the plaintiff's stand before different courts and authorities was inconsistent, and the plaintiff's trademark 'PhonePe' was not exclusive as there were other trademarks with the suffix 'Pe' in the market.

Fact of the Case:

The plaintiff filed a suit seeking interim injunction to restrain the defendants from infringing the registered trademark 'PhonePe' by using the 'DigiPe' mark and passing off the trademark 'PhonePe' by use of their mark 'DigiPe'. The plaintiff claimed that 'PhonePe' is a well-known trademark and the word 'Pe' is the dominant element in the registered trademark. The plaintiff had obtained trademark registrations for various 'PhonePe' trademarks and claimed wide usage and popularity.

Finding of the Court:

The court found that the plaintiff failed to make out a prima facie case for grant of interim injunction and that the balance of convenience was in favor of the defendants. The court noted that the plaintiff's stand before different courts and authorities was inconsistent, and the plaintiff's trademark 'PhonePe' was not exclusive as there were other trademarks with the suffix 'Pe' in the market.

Issues: Prima facie case for grant of interim injunction, Balance of convenience, Consistency of plaintiff's stand before different courts and authorities, Exclusive rights to the trademark 'PhonePe'

Ratio Decidendi: The plaintiff must satisfy all the ingredients for claiming temporary injunction, including prima facie case, irreparable loss, and balance of convenience. The grant of injunction is an equitable relief, and the plaintiff's stand before different courts and authorities must be consistent. The plaintiff's trademark 'PhonePe' was not exclusive as there were other trademarks with the suffix 'Pe' in the market.

Final Decision: The appeals challenging the order granting interim injunction were dismissed, and no costs were awarded to either party.

JUDGMENT

(Prayer: Appeals under Order XXXVI Rule 9 of the Original Side Rules read with Clause 15 of the amended Letters Patent and read with Section 13 of the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts (Amendment) Act to set aside the fair and decreetal order passed by the learned Judge in OA Nos.809 to 812 of 2022 in CS (Comm. Div) No.248 of 2022, dated 7.6.2023 and allow the present appeals.)

Common Judgment:

Sanjay V. Gangapurwala, C.J.

1. The unsuccessful applicant/plaintiff is the appellant herein. These appeals are filed challenging the common order dated 7.6.2023 passed by the learned Single Judge in O.A.Nos.809 to 812 of 2022.

2. For the sake of convenience, the parties are referred to as per the original designations in the suit.

3. The plaintiff herein had filed C.S. (Comm. Div.) No.248 of 2022. Pending suit, the plaintiff filed O.A.Nos.809 to 812 of 2022 seeking interim injunction to restrain the defendants from infringing the registered trademark of the plaintiff “PhonePe” by using the “DigiPe” mark and passing off the trademark “PhonePe” by use of their mark “DigiPe”. The plaintiff also sought an injunction to restrain the defendants from using the domain name DigiPe.com, etc. The plaintiff also sought an order of injunction restraining the defendants from passing off the trade dress/copying the contents of the plaintiff''s domain name.

4. The learned Single Judge dismissed the Original Applications on the ground that plaintiff failed to make out a prima facie case for grant of interim injunction. It was held that the plaintiff failed to disclose material facts concerning dismissal of the similar interim applications filed against third parties before the other High Courts which, if disclosed, will have a bearing on the outcome of the said applications.

5.1. Mr.Satish Parasaran, learned Senior Counsel for the plaintiff, vehemently contends that the plaintiff coined the distinctive “PhonePe” mark in the month of September, 2015 in relation to its service/platform. The said “PhonePe” trademark is a combination of two words “Phone” and “Pe”. The word “Pe” does not exist in English language and the term “Pe” in the plaintiff''s PhonePe trademark was adopted as a unique source identifier. The unique spelling in English and capitalization of the “Pe” feature confers inherent distinctiveness and the same is automatically entitled to protection as an essential feature of the “PhonePe” Trademark. The plaintiff has also obtained trademark registrations of various PhonePe trademarks, as a family of marks, which includes marks that are phonetically similar to “PhonePe” such as “FonePay”, “Fonepe”, “Foneis”, as well as phonetically dissimilar marks such as “CardPe” and “StorePe”, which bear the formative “Pe” element. Due to to wide usage and popularity of the plaintiff''s trademarks, it is claimed that the annual turnover of the plaintiff is in excess of Rs.68,980 lakh.

5.2. It is further submitted that the plaintiff launched its “PhonePe” App on 29.8.2016 and the said application is an instant payment solution that facilitates payments via mobile payment applications. The application of the plaintiff acts as a container for various payment instruments, including but not limited to wallet, debit/credit card, Unified Payment Interface (UPI) and external wallets. The plaintiff provides its services to businesses/ merchants by enabling them to accept payments and services from its customers for the products or services on their platform. The application can also be used to pay bills, recharge, send money, et al. The plaintiff was a pioneer in the digital payment industry in India and is one of the leading and most popular digital payments and financial services companies with more than 400 million registered users. As of September, 2022, the plaintiff has more than 37 crore users and almost 1/3rd of the population of India is on the PhonePe App as registered users. The recogniti

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