Appropriate Court for Filing a Passing-Off or Trademark Infringement Case in view of the Commercial Courts Amendment Act, 2018

Appropriate Court for Filing a Passing-Off or Trademark Infringement Case in view of the Commercial Courts Amendment Act, 2018

Introduction

The Government of India understanding the need to address the issue of quicker resolution of matters identifying with business issues. The said Ordinance was replaced and established as the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015 which have come into effect from from October 23, 2015 to manage such issues and guarantee quick disposal of cases.

Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015 (“the Commercial Courts Act”)

The Act accommodates a different set of Commercial Courts to be set up by State Governments at the District level to try suits and cases relating to business issues of an estimation of atleast Rs.1 crore or more. Where the High Court exercises original civil jurisdiction, the High Courts are required to set up Commercial Divisions to try such business disputes. The Act likewise requires the High Courts to set up Commercial Appellate Divisions inside every High Court to hear appeals from the sets of Commercial Courts and Commercial Divisions and to discard them within 6 months of their filing date. The Act likewise changes the Code of Civil Procedure, 1908 (CPC).

The term commercial disputes includes, broad and different range of disputes emerging out of agreement for sale of goods or provision of services, agreement related to immovable property used exclusively in trade or commerce, partnership agreement, intellectual property rights, export or import of merchandise or services, franchising agreements, distribution and licensing agreements, management and consultancy agreements, shareholders agreements, joint venture agreements, and so forth.[1]

Some of the key amendments made to the provisions of CPC are-

  • Procedure relating to disclosure, discovery, investigation, affirmation and denial of documents introduced;

 

  • New procedure for conducting "case management hearings" has been acquainted with guarantee that the process of adjudication isn't delayed;

 

  • New & separate process for an "Summary Judgment" has been acquainted which would permit cases to be summarily adjudicated without recording oral evidence before the issues are outlined;

 

  • Written Statement will be filed within a time of 30 days and can be extended by the court to a limit of 120 days from the date of service of the summons, in case of failing, the defendant will forfeit his right to file the same;

 

  • Written arguments shall be submitted by a party on the side of his case to the Court within 4 weeks before initiating the oral arguments and such written arguments shall form part of the record;

 

  • Judgment shall be announced within ninety days of conclusion of arguments;

 

Trade Marks Infringement and Passing Off under the Commercial Courts Act

Section 29 of the Trade Marks Act, 1999 deals with the Infringement of registered trademarks.

The owner of a brand name has two reasons accessible against the improper use of their marks by different dealers:

  • An action for encroachment on account of an registered brand name, which is a statutory remedy;
  • An action for passing off on account of an unregistered brand name, which is a common-law remedy;

"Passing-off" is a tort actionable under common law which can be used to enforce unregistered brand names. The term "Passing Off" has not been defined in the Trademarks Act, 1999.

Any dispute relating to encroachment and passing off trademark shall be brought before the “Commercial Courts” under the Commercial Courts Act.

In the case of Skechers USA Inc & Ors v. Pure Play Sports & Ors,[2] The Petitioner filed a suit against the respondents for permanent injunction controlling respondents from encroaching the trade dress of the petitioner shoes and passing off their shoes look like that of petitioner and for reliefs of recovery of damages, accounts, delivery and so forth. The Hon'ble Delhi High Court, considering about the entirety of facts and conditions of this case, passed a summary judgment for disposal of the suit in favour of petitioner, regardless of there being no application filed by it for the same and allowed a pronouncement for injunction against all the respondents together and severally and imposed expenses of the suit.

In the case of Flipkart Internet Private Limited v. www.flipkartwinners.com and Ors,[3] the Hon'ble Delhi High Court provided that the defendants have no genuine possibility of defending the case, as they have neither entered appearance nor filed their written statement and conceded a pronouncement for permanent injunction in favour of plaintiff controlling the defendants from utilizing the mark "Flipkart" or some other misleading variation which is similar to the plaintiff brand name "Flipkart" in regard of domain name, lucky draw contest or some other way adding up to encroachment of plaintiff's brand name.

Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts (Amendment) Act, 2018 (“Commercial Courts Amendment Act”)

This was enacted on August 20, 2018 and coming into effect from May 03, 2018 to bring some significant changes:

  • The value of commercial disputes has been reduced to Rs. 3,00,000/ - from Rs. 1,00,00,000/ -
  • The Commercial Courts will be set up at the level of District Judge even in jurisdictions where the High Court exercises ordinary original civil jurisdiction.
  • The division of commercial courts into:
  1.  Courts at the level of a District Judge; and
  2. Courts below the level of a District Judge;

in jurisdictions where the High Court doesn't  exercise ordinary original civil jurisdiction.

  • Establishment of Commercial Appellate Courts in jurisdictions where the High Court doesn't exercise ordinary original civil jurisdiction. Appeals from Commercial Courts below the level of District Judge will lie before the Commercial Appellate Court.

 

  • Introduction of mandatory "pre-establishment mediation" prior to filing a suit, as per the Commercial Courts (Pre-Institution Mediation and Settlement) Rules, 2018 through the State Legal Services Authorities and the District Legal Services Authorities, except if the suit provides any immediate interim relief.

 

 

 

BY-

ANKITA MISHRA