The Case of Suzuki Motors vs. Suzuki (India) Ltd.

Trademark is a negative or exclusionary right, which means it excludes others from using the identical or similar marks as that of a registered proprietor. Violation of this right may give rise to an act of infringement. Thus, in trademark law, there can be one proprietor of a registered trademark and a thorough searching needs to be done before the filing of a trademark application. In India, the Trademark Act mentions two types of grounds of refusal of a mark to be registered as a trademark. One of the types of grounds is provided under Section 9 of the Act i.e. absolute grounds of refusal and another type of ground is provided under Section 11 of the Act i.e. relative grounds of refusal. If a mark passes the threshold of these two sections of the Act, the mark may be registered as a trademark. However, there are certain exceptions provided under the Act itself that allows registration of more than one proprietor of an identical or similar mark. The present case Suzuki Motors vs. Suzuki (India) Ltd. ¹ deals with one such instance.

Facts of the Case

The plaintiff, Suzuki Motors, is a well-known transnational corporation having a tremendous reputation, goodwill and is a well-known brand in the world. They have a business relationship in about 190 countries and own about 5000 trademarks worldwide including India. They have registered their trademarks in India in 1972 under class 7 and class 12 goods.

In 1982, the plaintiff entered into a joint venture with the Indian Government under the name Maruti Suzuki India Limited (MSIL) and they made extensive publicity regarding this in newspapers and print media advertisements. Around the same time, in 1982, the defendants, Suzuki India Ltd., adopted this same trade name, Suzuki, for their investment business and finance business. It was alleged by the plaintiff, that the defendants have adopted such name dishonestly to gain a benefit out of the plaintiff’s reputation and goodwill in the market. The defendant claimed that such adoption was unintentional and they should be allowed to do business under this name based on the reputation earned by way of honest and concurrent use provided under section 12 of the Trademarks Act, 1999.

Issue

The court had to deal with the issue, whether such use of a registered trademark was honest and concurrent use by the defendant.

Arguments

The plaintiff argued that the name ‘Suzuki’ was associated with the founder of the plaintiff and it is a Japanese surname and it is not associated with any Indian name, place, object or term. They argued that they are a worldwide known company and no one should be allowed to use a world-famed name irrespective of goods and services whether in the same class or different class because of its reputation and goodwill. Plaintiff further argued that an injunction should be granted if it prima facie appears that the adoption of the trademark was itself dishonest and even delay in bringing an action is not sufficient to defeat grant of an injunction.

Furthermore, the plaintiff argued that, Section 20 of Companies Act, 1956 bars registration of a company name which is identical or resembles the name of a company previously registered. Several case laws were cited by the plaintiff in furtherance of their arguments.

The defendants argued that they are carrying on with their business since 1982, nearly 25 years and they have been using this trade name under a different class than that of the plaintiff. They further argued that they should get the benefit of honest and concurrent use. Furthermore, they argued that the plaintiff had filed the present suit with malafide intent as they have filed the injunction suit after 25 years and the court should construe such ignorance by the plaintiff as acquiescence provided under section 33 of the Act.

Judgement

The court decided the case on two grounds— on procedural insufficiency and on the merits of the case. Under Order VIII Rule 5 of Code of Civil Procedure, 1908, in the absence of specific denial, the averments made in the plaint will be considered as admission and under Order XII rule 6 the court may be based on such admission, decree such order or pass such judgements as it may think fit. The defendants, in this case, failed to provide specific denial to certain allegations made by the plaintiff in its written objection and thus court decided that based on this ground alone they can pass a judgement against the defendant.

Further deciding on the merits of the case, the court held—

• The plaintiff is a worldwide well-known company and they have sufficiently proved their existence in the Indian market since 1972. The argument that in 1982, the defendants were unaware of the plaintiff is untenable

• If the trademark having an element of prior continuance and use and it has been copied, no amount of explanation, even if it is plausible, is capable of defending infringement of trademark of such prior user

• Since the defendant has no connection with the plaintiff, the use of the brand name ‘Suzuki’ by the defendant, would create a misleading impression that the defendant is associated with the plaintiff or that the defendant has been licensed by the plaintiff to use the name Suzuki, which is false and untrue and can cause confusion among the consumers.

• A fair and honest trader will not give a misleading name to its product which may cause detriment to the goodwill and reputation of the plaintiff. The defendant, knowingly indulging itself into such activities, can be held as a fraudulent infringer.

• Relying on the judgement of Timken Company v. Timken Services Pvt. Ltd.¹ the court asserted that the defendant, a fraudulent infringer who has knowingly and deliberately violated the rights of the plaintiff, cannot complain and cannot seek the defence of delay, laches or acquiescence simply because the infringement at the very initial stage itself was fraudulent.

• The defendant must have the knowledge that his conduct of adoption of someone else's mark may engender certain consequences. The defendant carried on the risk of continuing its business uninterruptedly for a number of years before any action was taken by the plaintiff against it. Thus, if the defendant continued to do business by using the impugned mark, it did so at its own peril. The defence of continued use cannot be set up under these circumstances. Once there is a dishonest intention to adopt the mark, a mere delay will not preclude the plaintiff in bringing an action against the defendant because, in case of a continuing tort, a fresh period of limitation begins to run every moment of time during which the breach continues.

Thus the court allowed the injunction suit and granted the prayers by the Plaintiff against the defendant.

Conclusion

The court in this case thoroughly went over the matter, both on the procedural aspect and the substantive aspect of the law. The court has rightly pointed out that in order to grant the benefit of honest and concurrent use to the potential infringer, “Honest” and “Concurrent Use” both are prerequisite. In the instant case, though the defendant proved “Concurrent Use” for 25 years, use of the trade name ‘Suzuki’ by the defendant was, in fact, not “Honest”. Thus failure to fulfil of the statutory requirement, the court rightly rejected the claims by the defendants. One thing to note here is that registration of such trademarks under the Act is subjected to certain condition and limitations. Thus powers provided under Section 12 of the Act should be exercised as restrictively as possible.

BY-

DEBKRIPA BURMAN