DELHI HIGH COURT RESTRAINS OVERSEAS ENTITIES FROM INFRINGING THE WELL-KNOWN TRADE MARK ‘TATA’

Background of the matter

Tata Sons Private Limited (referred to as “Tata Sons”) brought an action of permanent injunction before the Ld. Single Judge of the Delhi High Court, for restraining infringement of the trade mark and copyright in TATA by the defendants Hakunamatata Tata Founders and Tata Bonus. The defendants were engaged in the sale of cryptocurrency labeled TATA coin, and were using the trade mark TATA as it is, without any attempt to disguise the same, or adding any misleading prefix or suffix to grant such mark a perceived distinctiveness. Besides cryptocurrency, Hakunamatata Tata Founders was also found to be selling merchandise, such as t-shirts, shorts, caps, facemasks etc, under the name ‘TATA’. The businesses of the defendants were found to be registered in the United Kingdom and the United States, and they were using the identical mark TATA for online trading in cryptocurrency through their interactive website(s) ‘www.tatabonus.com’ and ‘www.hakunamatata.finance’. Such websites were accessible from India, especially Delhi. In addition to such websites, the defendants were also using the identical mark TATA on its social media handles as ‘tatatoken’/ ‘TataToken’, and were found to have business interests in the Indian markets. Tata Sons submitted that the team behind websites ‘www.tatabonus.com’ and ‘www.hakunamatata.finance’, being UK nationals of Pakistani origin, were likely aware of the brand reputation of the trade mark TATA among Indian nationals.

The trade mark TATA

As known to most of us, Tata Sons was incorporated in the year 1917, and the trade mark TATA, that forms a part of its trading name, was derived from the surname of its founder Shri Jamsedji Nusserwanji Tata. The trade mark TATA has been in continuous and uninterrupted use since 1917, and Tata Sons along with its group companies has emerged as India’s largest private-sector employer with presence in textiles, iron and steel, power, chemicals, hotels and automobile, computers and computer software, electronics, beverages, telecommunications, financial services, mutual funds, insurance, broadcasting, aerospace and retail industries. Therefore, with a market capitalisation of Rs.17,80,000 crores and an employee pool of 800,000 people worldwide across all the 29 publicly listed Tata Companies as on March 31, 2021, it is safe to conclude that the trade mark TATA has acquired excellent reputation and exclusively denotes the conglomeration of Tata companies.

In fact, in the case of Tata Chemicals Limited v. Deputy Registrar of Trade Marks 2003 (27) PTC 422 Del, the Delhi High Court declared TATA as a well-known trade mark. Subsequent to this decision, the trade mark TATA was included in the list of well-known trade marks maintained by the Indian Trade Marks Registry.

Ratio of the Ld. Single Judge of the Delhi High Court

The Ld. Single Judge did not have any doubt about maintainability of the suit for infringement instituted by Tata Sons and agreed to register and proceed with the suit in Delhi. He did not even have any doubts regarding Tata Sons’ intellectual property rights in the trade mark “TATA” as opposed to the defendants. However, he was hesitant about his extraterritorial jurisdiction to injunct the parties based in the United Kingdom and United States by way of an ad-interim order from infringing the trade mark TATA, and therefore declined the prayer of Tata Sons’ for an ad-interim order of injunction against the defendants. He further went on to state that there was no evidence of the defendants targeting Indian customers to sell their cryptocurrency and merchandise. Lastly, he deemed that the traffic of Indian visitors to the websites was too scant to call the websites interactive, which is an essential factor recognised by Indian courts for attracting territorial jurisdiction in the cases of online trading.

Decision of the Ld. Division Bench of the Delhi High Court

Aggrieved by the decision of the Ld. Single Judge of the Delhi High Court, Tata Sons moved an appeal before the Ld. Division Bench of the Delhi High Court. The Ld. Division Bench reviewed the matter and came to the conclusion that even if a website is not directed at consumers in a particular country, the simple fact of there being no restriction to accessing such website amounts to targeting. Targeting need not be an aggressive act of marketing directed towards customers. A mere looming presence of a website in a country and the ability of the residents of such country to access the website is sufficient to establish targeting. The Ld. Division Bench went on to state that in addition to traffic of Indians on the websites ‘www.tatabonus.com’ and ‘www.hakunamatata.finance, the omnipresent nature of the defendants’ social media accounts indicates that they have a looming presence over the internet, including being within the jurisdiction of the Delhi High Court.

The Ld. Division Bench stated that if the Ld. Single Judge was unsure about his extraterritorial jurisdiction to injunct the defendants, he should not have admitted the suit and should have dismissed it outright. Once the Ld. Single Judge has admitted the suit, he has no cause to doubt his jurisdiction to decide the application for ad-interim injunction and cannot reject the same. In case of doubts, the Ld. Single Judge could have deferred on deciding the ad-interim application and issued notices to the defendants to appear in the suit. The Ld. Division Bench disagreed with the view of the Ld. Single Judge with regard to the territorial jurisdiction of the Delhi High Court to adjudicate the matter.

Based on the submissions of Tata Sons, the Ld. Division Bench set aside the order of the Ld. Single Judge and granted an ex-parte ad-interim injunction restraining the defendants, their partners or proprietors from manufacturing, selling, offering for sale, supplying, advertising or unauthorisedly using Tata Sons’ well-known trade mark TATA, or any other deceptively similar mark thereto as part of the name of their digital token/ cryptocurrency TATA Coin or as part of their corporate name/domain name, website ‘www.tatabonus.com’ and social media pages. The Ld. Division Bench held the exception that the domain name/ website ‘www.hakunamatata.finance’ by Hakunamatata Tata Founders does not need to be prohibited since Hakunamatata is a generic word and the word “TATA” is fully coalesced in the word hakunamatata.

As on the date of publication of this article, neither the websites ‘www.tatabonus.com’ or ‘www.hakunamatata.finance’ appear to be accessible over the internet.

Key takeaways

• It was reiterated by the Ld. Division Bench of the Delhi High Court in its ad-interim order that TATA is a well-known trade mark.
• Courts can grant interim injunction, pending final determination of issue of territorial jurisdiction, which often is a mixed question of law and facts, after trial.
• Once a suit has been admitted by a judge, such admission is indicative of his prima facie view of the maintainability of the suit. After admission, the judge can have no cause to doubt his jurisdiction over adjudicating the matter. If required, he must issue notice to the respondent in case of ex-parte applications, and not dismiss the ad-interim application outright.

Soumik Chakraborty

Having worked in capital market with one of the leading Corporate Law firms in India for a while, Soumik decided to switch and pursue a career in IP laws about 6 years back. He is currently a part of the trademarks where he advises clients in areas of fast moving consumer goods, food and beverages, healthcare, clothing and footwear, among others. He is also involved in trademark oppositions and rectification proceedings and also design cancellation actions. Additionally, he assists the litigation team on various matters relating to trademarks and designs.

Related Posts