Passing Off Action For Product Registered Under Design Act Maintainable: Delhi High Court Restores Crocs' Pleas Against Liberty, Bata, Relaxo

The suits were dismissed earlier by a single judge by holding that no passing off action can be found on a trade dress which is registered as a design under the Designs Act.

A division bench of Justices C. Hari Shankar and Ajay Digpaul have now held that Courts cannot decline protection to the plaintiff on the sole ground that the subject matter of the passing off action happens to be a registered design.

It affirmed that if the defendant, by using the plaintiff's registered design, or something deceptively similar thereto, seeks to pass off its goods as those of the plaintiff, a passing off action, at the instance of the plaintiff and against the defendant, would lie.

“Passing off is a distinct right, which resides in its own common law space, apart from and independent of, the confines and constraints of the Trade Marks Act, or the Designs Act, or, for that matter, any other statute. In fact, there appears to be no justifiable reason to limit passing off to the use of one's trade mark, or even trade dress, by another,” the bench reasoned.

Crocs had relied on a three-Judge bench decision of the High Court in Mohan Lal v. Sona Paints & Hardwares (2013) to contend that an action for passing off, on the basis of a trademark which formed the subject matter of a Design Registration, would lie but— separate suits would have to be filed for design infringement and passing off.

The Single judge had however, relied on a five-Judge bench of the High Court in Carlsberg Breweries A/S v Som Distilleries and Breweries Ltd (2019) to hold that a registered design confers on the registrant, only the right to restrain another from infringing the design and not to restrain another from passing off its goods.

The division bench in its 70-page judgment held that Mohan Lal (supra) or Carlsberg Breweries (supra) did not exclude an action for passing off in case of design infringement. It held,

“Plaintiff does not have to base its case of passing off on “something more” than the subject matter of its design infringement claim. The very same subject matter can, therefore, constitute the basis of the claim of design infringement, as well as the claim of passing off. ”

It asserted that Carlsberg Breweries (supra) only highlighted the “overlap” between a passing off action and an action for design infringement.

To succeed in a claim of design infringement, fraudulent imitation of the design, in the defendant's article, has to be proved.

In a passing off action, the owner of the mark has to establish that the defendant has misrepresented to the public that its goods are those of the plaintiff.

It emphasized that the five-judges in Carlsberg Breweries (supra) endorsed Mohan Lal (supra) to hold that if “elements of the design” are not merely “used as a trade mark” but are used by the defendant as a “larger trade dress get up, presentation of its product through its packaging, and so on”, a sustainable claim for passing off would lie.

“Commercial use of the registered design of the plaintiff by the defendant, not merely as a trade mark, but as its larger trade dress, or packaging, or the like, so as to pass off its goods as the goods of the plaintiff, would certainly justify a claim for passing off at the instance of the plaintiff,” the High Court thus held and directed the single judge to proceed with Crocs' suit.

Appearance: Mr. J. Sai Deepak, Sr. Adv. with Mr. S.K. Bansal, Mr. Ajay Amitabh Suman, Mr. Gaurav Gogia, Mr. Deepak Shrivastava and Mr. R. Abhishek, Advs for Appellant; Mr. Neeraj Grover, Ms. Mohona Sarkar and Mr. Kashish Vij, Advs for Respondents

Case title: M/S Crocs Inc USA v. M/S Bata India & Ors

Case no.: RFA (OS) (Comm) 22/2019

Click here to read judgment