Arudra Engineers Private Limited vs Pathanjali Ayurved Limited- O.A. No. 258/2020 Order dt. August 08, 2020 by Madras High Court
The pandemic has had a curious effect on businesses the world over. Total shutdowns of uncertain duration have had a debilitating impact on the economy, but equally, opportunists have tried to take advantage of the situation in any way possible. The consumer goods company, Patanjali Ayurved Limited (“Patanjali”), is one such entity that tried to use the “Coronil” trademark for an ayurvedic product that it claimed was a “cure” for Covid19. As it turned out, the trademark was owned in India already by another company for a completely different product, and Patanjali lost its claim, besides receiving a severe reprimand from the Madras High Court for its brazen attempt at using the mark.
The High Court, via its order dated August 08, 2020, refused to vacate its interim stay restraining Patanjali from using the trademark ‘Coronil’. The Court also slapped INR 10 lakh as costs for chasing profits by claiming COVID-19 ‘cure’. The Court held that Patanjali invited this litigation on themselves. A simple check with the Trade Marks Registry would have revealed that ‘Coronil’ is a registered and subsisting trademark. If the company had, and had still, with audacity used the name ‘Coronil’, then it deserved no consideration at all. The Court said that Patanjali could not assume that it could bulldoze its way and infringe a registered trademark. If it had not checked with the Registry, then the company was at fault.
Plaintiff’s claims and contentions:
- The Plaintiff ‘Arudra Engineering Private Limited’ claimed that they were in the business of chemical cleaning and manufacturing of Material Handling Systems and Polymeric Epoxies for various factories in India and abroad for two decades.
- The Plaintiff is the registered proprietor of the trademarks ‘CORONIL-92 B’ and ‘Coronil-213 SPL’ since 1993, used for chemical agents that undertakes to sanitize and clean heavy industrial machinery and containment units at factories with minimal corrosion.
- News reports revealed that Patanjali was marketing its product as a cure for Coronavirus using the same name “Coronil”. The Plaintiff claimed that this amounted to an infringement of its registered trademarks, and dilution of the distinctiveness of the trademarks, claiming rights under Section 29(4) of the Trade Marks Act, 1999 (“the Act”).
Defendant’s claims and contentions:
- The Defendants (Patanjali Ayurved Limited & Divya Yog Mandir Trust) contended that the suit was vitiated by bad motives and that it was part of a larger conspiracy against the Patanjali group to scuttle their business.
- The company claimed that the Coronil tablet was an Immunity Booster and clinical trials conducted by the company using Ayurvedic medicines for Coronavirus treatment at the NIMS University, Jaipur, showed that Coronavirus-infected persons recovered after using certain Ayurvedic medicine.
- Patanjali contended that the Plaintiff had not raised any objection when it had obtained approval for processing Coronil tablet and also till the license was granted by the Government of Uttarakhand under the scrutiny of the Ministry of Ayush, Government of India.
- Patanjali also claimed that Coronil tablets sold by Divya Pharmacy were altogether different and belong to different classes, and that it was settled law that a proprietor of a trademark cannot enjoy monopoly over the entire classes of goods.
The Court held that a prima facie case was made out by the Plaintiff on account of its prior registration of a trademark in which the primary word is ‘Coronil’, and that the Plaintiff must be afforded protection from infringement, even if it was for a different class of goods.
When Patanjali tried arguing that the Plaintiff had not registered the trademark ‘Coronil’ independently, the Court said that it was not always obligatory that the whole or part must be registered as separate trademarks.
The Court also addressed in detail the meaning of the term ‘reputation in India’ as written in Section 29(4)(c). Patanjali’s counsel argued that the original legislative intent was to use the words ‘well known mark in India’, but the final statute as enacted contained the words ‘has a reputation in India’. The Court ruled that under Section 29(4) of the Act, protection was granted even when the offending mark was used for a different class of goods. The only pre-condition was that the Plaintiff’s mark should have a ‘reputation in India’.
The Court also held that permission was not granted to Patanjali to market its product, holding out that it cures Coronavirus. The company could have used any name to signify its product as an immunity booster and market the same to the general public rather than play upon the fear and panic among the public by introducing a product ostensibly to cure Coronavirus, when as a fact, it does not, and later stating it is an immunity booster. Thus, the Court held that the company had failed to prove that Coronil tablet is a cure for Coronavirus. Consequently, the use of the very name ‘Coronil’ by the Defendants was without any due cause and took unfair advantage of the term ‘Coronil’ (which was anyway a registered trademark of the Plaintiff.
The Court closed its opinion by allowing the suit and imposing a cost of INR 10 Lakh on Patanjali stating that the company was merely chasing further profits by exploiting the fear and panic among the general public by projecting a cure for the Coronavirus, when, in fact, its ‘Coronil Tablet’ is not a cure but rather an immunity booster for cough, cold and fever.
The Court also said that the company must realise that there are organisations which are helping the people in this critical period without seeking recognition and it would only be appropriate that they are made to pay costs to them. In that spirit, the Court ordered the Defendants to pay Rs. 5 Lakh each to Adyar Cancer Institute, Chennai, and Naturopathy Medical College & Hospital, Chennai where treatment to Covid19 patients are accorded free of cost without any claim to either trademark, copyright, patent or design, but only with service as a motto.