Dispute vis-à-vis Product Packaging and Visual Impression of Products; Reading in light of YiPPee Case

INTRODUCTION

In the recent case adjudicated by the Karnataka High Court ITC Limited v. CG Foods (India) Private Limited ITC Limited, the manufacturer of Sunfeast YiPPee instant noodles, launched its product in 2010 with various flavours, including Magic Masala. The company claims that the overall visual appearance of the Magic Masala variant's packaging, featuring an orange-red colour scheme, has been used consistently since its launch and has become well-known through substantial promotional efforts. ITC alleges that CG (India) Private Limited, the manufacturer of WAI WAI instant noodles, has infringed on their copyright and caused damage to their goodwill by using a similar packaging design for their WAI WAI Xpress Noodles Majedar Masala product. ITC seeks protection from alleged misrepresentation and copyright infringement, arguing that the similarities between the packaging could deceive consumers. The case revolves around the issue of passing off and copyright infringement, with ITC claiming that CG's actions have harmed their reputation and goodwill in the market.

THE JUDGEMENT

In the Yippee case Court ruled in favour of the defendant, CG (India) Private Limited, rejecting ITC Limited's appeal and upholding the trial court's decision to dismiss the injunction application. The Court found that the primary point of reference for consumers when purchasing ITC's goods is the brand name "Sunfeast Yippee" or the mark "Yippee" rather than the packaging's visual appearance. In establishing this decision, the Court outlined key principles for conducting enquiries in cases involving packaging design, emphasizing the importance of considering the consumer's perspective and imperfect recollection.

1.      Concept of passing off

2.      Concept of Distinctiveness

3.      Deceptive Similarity Test

4.      Copyright Infringement Test

 The Court also provided guidelines for evaluating injunction applications in pending lawsuits related to passing off claims.

1.      Concept of passing off

The High Court's decision vis-à-vis passing off was passed on the misrepresentation by defendant that leads consumers to believe their product is associated with or originates from the plaintiff's business. This misrepresentation can be express or implied and must be likely to cause damage to the plaintiff's business or goodwill. To establish a passing off claim, the plaintiff must demonstrate two key elements:

(1) distinctiveness of their mark, and

(2) deceptive similarity between the defendant's mark and their own.

The court focuses on whether the defendant's mark is likely to be associated with or used to identify the plaintiff's products, and whether this association could cause harm to the plaintiff's business.

The court's decision highlights that passing off is a tort that protects against material misrepresentation of a plaintiff's products, and that the defendant's adoption of the plaintiff's distinctive features can lead to consumer confusion and damage to the plaintiff's goodwill. The court considers the broad impressions or key details of the marks, rather than minor details, to determine whether a misrepresentation has occurred.

2.      Concept of Distinctiveness

The High Court's decision clarifies that distinctiveness in law refers to the unique features of a mark that enable consumers to identify the product's source and distinguish it from others. The court distinguishes between "distinctiveness in fact" and "distinctiveness in law," emphasizing that the latter is determined by the legal significance of the mark, not just its inherent characteristics. Court referred to the case Payton V Snelling, Lampard where emphasised the importance of remaining alive to the distinction between "distinctiveness in fact" and "distinctiveness in law" and not to confuse the two as one and the same thing.

·         The court holds that distinctiveness is not about the overall appearance of the mark but rather the specific features that perform the function of a trademark, which is source identification. In this case, the court finds that the brand name "Sunfeast Yippee" and the sub-brand "Magic Masala" are the distinctive features that the relevant public relies on to associate the goods with the plaintiff.

·         The court also notes that distinctiveness can develop over time through secondary meaning, and that the strength of a trademark depends on its ability to identify the source of the product in the minds of consumers.

The court's decision emphasizes the interdependence between distinctiveness and misrepresentation, highlighting that the features considered distinctive in law are those that are likely to cause consumer deception if adopted by a defendant.

3.      Deceptive Similarity Test

The court considers the perspective of a hypothetical purchaser, who is an ordinary person of average intelligence, to determine if they would be likely to confuse the defendant's goods with the plaintiff's due to similarities in get-up.

·         The court examines whether the defendant has copied the essential features of the plaintiff's mark to the point of causing deception. This involves comparing the overall get-up of both parties, including features not necessarily part of the plaintiff's mark.

·         The court notes that establishing a case of passing off by get-up alone is challenging, especially at the interlocutory stage, unless the resemblance is so close that it could only have occurred through deliberate imitation.

·         The hypothetical purchaser would primarily rely on the brand name "Sunfeast Yippee" or the mark "Yippee" to identify the plaintiff's goods, rather than the color scheme or get-up. The court considers it unlikely that a shopkeeper would mistakenly hand over the plaintiff's product based on a request for "red-orange noodles," given the presence of other similar-looking wrappers on the market.

4.      Test of Copyright Infringement

Copyright infringement occurs when a substantial portion of the plaintiff's work is reproduced, not necessarily an exact replica. The court emphasizes that the defendant's work does not need to be identical to the plaintiff's, but rather, a significant part of the plaintiff's work must be copied.

If the plaintiff cannot demonstrate that substantial features of their get-up have been reproduced in the defendant's get-up, then any similarities in non-essential features are irrelevant. This means that the plaintiff must show that the defendant has copied the essential and significant aspects of their work, not just minor details. The Court's test for copyright infringement focuses on substantial reproduction of the plaintiff's work, rather than exact duplication.

Finally, Court affirmed the trial court's decision, finding that the defendant's use of a similar packaging design did not constitute passing off or copyright infringement.

CONCLUSION

From the judgement of the Karnataka High Court, it can be summed up that if the plaintiff fails to demonstrate that the defendant's work has copied the essential and significant aspects of the plaintiff's work, then any similarities or identities in non-essential features will be deemed irrelevant. Referring to the case Cadila Health Care Ltd. v. Cadila Pharmaceuticals Ltd. court highlighted the importance of assessing the potential for deception based on the overall impression created by the competing marks.

It’s evident from the judgement of court vis-à-vis copyright infringement that to establish copyright infringement, the test is whether the reader or viewer gets an unmistakable impression that the subsequent work is a copy of the original. Hence in order to establish copyright infringement, the defendant's work need not be an exact replica of the plaintiff's work. Rather, the key consideration is whether the defendant's work reproduces a substantial portion of the plaintiff's work.