M/s Crocs Inc. USA v. M/s Bata India Ltd & Ors. [Decided on 24 January, 2019]

PARTIES

The Appellant : M/s. Crocs Inc;

The Respondents are, inter alia, Bata  India Ltd.,  Liberty  Shoes Ltd., Action   Shoes    Pvt.  Ltd., Aqualite India Ltd., Bioworld Merchandising India Ltd., Relaxo Footware Ltd., and Kidz Palace.

FACTS

Crocs Inc (Plaintiff ) filed a suit against Bata India ltd. & Ors (Defendant) ,alleging that two of his registered designs (Registered Design No.197685, and Registered Design No.197686) has new, novel, original and unique shape, configuration, pattern, ornamentation and composition of lines (design),which were infringed by the defendant. Plaintiff filed a suit for the injunction on the ground of passing off of trademark which is an action in common law.

Plaintiff also alleged he has acquired exclusive rights to use, apply, publish, expose and exploit (collectively referred as “use”) the designs in relation to its goods and business (covered by it) so that  any rival violative third party cannot use ,as both the designs are registered .

 the design adopted and applied are identical and/or a substantial and fraudulent imitation to the registered designs of plaintiff by defendant in relation to their footwear.So,Plaintiff alleged that the defendants were engaged in the business of manufacture and trade of footwear, identical to that of Crocs Inc.

Plaintiff also stated that Crocs Inc, had already built a handsome revenue by selling large number of these registered products and this action of Defendant has affected the revenue of plaintiff  because of which he has suffered huge losses both in business and in reputation and such losses are incapable of assessment in monetary terms.

Plaintiff contended that this action of defendant  amounts to piracy and fraudulent use of Crocs Inc’s design. It was also alleged that they were applying those designs for the purpose of sale, causing and enabling to apply them to the registered goods and also publishing, exposing or causing to be published or exposed for sale the respective articles which has violated the exclusive rights of Plaintiff.

ISSUE

Whether a design can also function as a trademark?

RULE

Section 2(d), Designs Act, 2000

ANALYSIS


ARGUMENTS BY DEFENDANT

Defendant contended that no passing off trademark action lies if plaintiff claims passing of action of elements of design as trademark.This passing of suit is not maintainable as there is no novel feature in the registered designs.

The defendants denied that they were not infringing the plaintiff’s registered designs as registration granted to the plaintiff with respect to footwear itself is an invalid registration stating   Sub- Section (4) of Section 22 of the Act which defines Piracy of registered design.He can’t be accused of piracy of registered design.Defendant also stated that the plaintiff has got registration of these designs which were incapable of registration, and consequently, the plaintiff is not entitled to seek any relief by filing a suit.

Defendant also stated Clauses (b) to (d) of Sub-Section (1) of Section 19 of the Act   which enables cancellation of designs stipulates that any “person interested” can move the Controller grounds, for cancellation of registration . He contended that the disputed goods were available to the public since December 2002 contrary to the plaintiff’s prior publication claim. 

So, the plaintiff’s registered design at the time of registration was not a new or original design or there existed any prior publication of a registered design, it made no difference that the plaintiff was successful in getting the designs registered as such registered designs were already published or lack of newness/originality so it do not provide  any legal right to the plaintiff to allege piracy of the registered design.

 The defendant also contended that these products were in the market since 2014 and were being traded continuously and extensively by him and  plaintiff/Crocs Inc was aware about this.Defendant urged that the clog-shaped design of the plaintiff’s footwear and shoe, cannot claim novelty as it is a very common design. Prior to the plaintiff Crocs Inc.the design was sold by Holey Soles. It was further alleged by Defendant that the Crocs Inc. had deliberately concealed that it is identical to the European Union (EU),which was declared invalid by the decision of the Third Board of Appeal on 26.03.2010 by the Office of Harmonization in the Internal Market.

After existence of the legal right asserted by the plaintiff there can be the grant of an interlocutory injunction.

CONCLUSION

The court interpreted the legislative intention behind the Design Act which is to grant limited monopoly by design registration and after the term of registration, it should be open for anyone to use the said design. The Plaintiff was unsuccessful in a suit filed for design infringement as the designs on which the suit was filed were found to be not new or original ,as  the court agreed with the Defendant that the plaintiff has not been able to show any extra features, besides the design, which is used as a trade mark. Interim injunction in the passing off claim (in the composite suits) shall be taken up together and decided, by the Single Judge.

The court held that a registered design cannot constitute a trade mark, however if there are features  other than those registered as a design and are shown to be  used as a trade mark and with respect to which goodwill has been acquired,  it is only those extra features which can be protected as  a  trade  mark. If there has been a copy   of registered design, only an action for infringement under the Designs Act would lie.

[Analyzed by Ms. Soumya Gupta, Intern (May, 2020), Lexstructor, Reviewed by Lexstructor]

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