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CASE NO.:

Appeal (civil) 2372 of 2001

Special Leave Petition (civil) 15994 of 1998

PETITIONER:

CADILA HEALTHCARE LIMITED

Vs.

RESPONDENT:

CADILA PHARMACEUTICALS LIMITED

DATE OF JUDGMENT: 26/03/2001

BENCH:

B.N.Kripal, Doraswamy Raju, British Kumar

JUDGMENT:

KIRPAL,J.

L.....I.........T.......T.......T.......T.......T.......T.......J

Leave granted. Appellant and respondent are pharmaceutical

companies manufacturing various pharmaceutical products. The two

companies had taken over the assets and business of the erstwhile

Cadila Group after its restructuring under Sections 391 & 394 of

the Companies Act. One of the conditions in the scheme of

restructuring of the Cadila Group was that both the appellant and

the respondent got the right to use the name CADILA as a

corporate name.

The present proceedings arise from the suit for injunction

which had been filed by the appellant against the respondent in

the District Court at Vadodara. The suit related to a medicine

being sold under the brand name Falcitab by the respondent

which, according to the appellant, was a brand name similar to

the drug being sold by it under its brand name Falcigo

The case of the appellant was that its drug Falcigo

contains Artesunate for the treatment of cerebral malaria

commonly known as Falcipharum. After the introduction of this

drug, the appellant on 20th August, 1996 applied to the Trade

Marks Registry, Ahmedabad for registration in Part-A, Class-5 of

the Trade and Merchandise Marks Act. On 7th October, 1996 the

Drugs Controller General (India) granted permission to the

appellant to market the said drug under the trade mark of

Falcigo. It is, thereafter, that since October, 1996 the

appellant claimed to have started the manufacture and sale of

drug Falcigo all over India.

The respondent company is stated to have got permission on

10th April, 1997 from the Drugs Controller General (India) to

manufacture a drug containing Mefloquine Hydrochloride. The

respondent was also given permission to import the said drug from

abroad. According to the appellant, it came to know in April,

1998 that the said drug, which was also used for the treatment of

Falcipharum Malaria, was being sold by the respondent under the

trade mark of Falcitab. The appellant then filed a suit in the

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District Court at Vadodara seeking injunction against the

respondent from using the trade mark Falcitab as it was claimed

that the same would be passed off as appellants drug Falcigo

for the treatment of the same disease in view of confusing

similarity and deception in the names and more so because the

drugs were medicines of last resort.

The respondent company stated in the defence that the word

Falci, which is the prefix of the mark, is taken from the name

of the disease Falcipharum Malaria and it is a common practice

in pharmaceutical trade to use part of the word of the disease as

a trade mark to indicate to the doctors and chemists that a

particular product/drug is meant for a particular disease. It

was also the case of the respondent that admittedly the two

products in question were Schedule L drugs which can be sold

only to the hospitals and clinics with the result that there

could not even be a remote chance of confusion and deception. It

may here be noticed that Schedule H drugs are those which can

be sold by the chemist only on the prescription of the Doctor but

Schedule L drugs are not sold across the counter but are sold

only to the hospitals and clinics.

The Extra Assistant Judge, Vadodara by his order dated 30th

May, 1998 dismissed the interim injunction application. He came

to the conclusion that the two drugs Falcigo and Falcitab

differed in appearance, formulation and price and could be sold

only to hospitals and institutions and there was, thus, no case

had been made out for grant of injunction and there was no chance

of deception or/of confusion specially as the drug was not meant

to be sold to any individual.

The appeal filed by the appellant before the High Court met

with no success. After discussing various cases which were cited

before it and after verifying the cartoons and packings of the

respective products, the High Court came to the conclusion that

it could not be said that there was a likelihood of confusion

being caused to an unwary consumer in respect of the disputed

marks. It observed that there was little chance of any passing

off one product for the other product.

When the special leave came up for hearing, detailed

arguments were heard and, for the reasons to be given, this Court

did not interfere with the orders passed by the courts below but

gave directions regarding expeditious disposal of the suit. In

this judgment, we give the reason for not interfering and also

set out the principles which are to be kept in mind while dealing

with an action for infringement or passing off specially in the

cases relating to medicinal products. The reason for not

interfering with the order appealed against was that there may be

possibility of evidence being required on merits of the case and

directions were given for speedy trial of the suit. Expression

of opinion on merits by this Court at this stage was not thought

advisable. We now proceed to examine the principles on which

these cases have been and are required to be decided.

Under Section 28 of the Trade and Merchandise Marks Act on

the registration of a trade mark in Part-A or B of the register,

a registered proprietor gets an exclusive right to use the trade

mark in relation to the goods in respect of which trade mark is

registered and to obtain relief in respect of infringement of the

trade mark in the manner provided by the Act. In the case of

un-registered trade mark, Section 27(1) provides that no person

shall be entitled to institute any proceeding to prevent, or to

recover damages for, the infringement of an unregistered trade

mark. Sub-section (2) of Section 27 provides that the Act shall

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not be deemed to affect rights of action against any person for

passing off goods as the goods of another person or the remedies

in respect thereof. In other words in the case of un-registered

trade marks, a passing off action is maintainable. The passing

off action depends upon the principle that nobody has a right to

represent his goods as the goods of some body. In other words a

man is not to sell his goods or services under the pretence that

they are those of another person . As per Lord Diplock in Erwen

Warnink BV Vs. J Townend & Sons, 1979(2) AER 927, the modern

tort of passing off has five elements i.e. (1) a

misrepresentation (2) made by a trader in the course of trade,

(3) to prospective customers of his or ultimate consumers of

goods or services supplied by him, (4) which is calculated to

injure the business or goodwill of another trader (in the sense

that this is a reasonably foreseeable consequence) and (5) which

causes actual damage to a business or goodwill of the trader by

whom the action is brought or (in a quia timet action) will

probably do so.

There being an action alleging passing off in the present

case, it will be appropriate to consider a few decisions,

specially of this Court, which are relevant on the point in

issue.

In National Sewing Thread Co. Ltd., Chidambaram Vs. James

Chadwick and Bros Ltd. AIR 1953 SC 357, this Court was dealing

with a case where an application for registration of a trade mark

had been declined by the Registrar who accepted the objections

filed by the respondent to the application for registration.

While interpreting Section 8 of the Trade Marks Act which

provides that no trade mark nor part of a trade mark shall be

registered which consists of, or contains, any scandalous design,

or any matter the use of which would by reason of its being

likely to deceive or to cause confusion or otherwise, be

disentitled to protection in a Court of Justice , this Court

observed at page 363 as under:

Under this Section an application made to register a trade

mark which is likely to deceive or to cause confusion has to be

refused notwithstanding the fact that the mark might have no

identity or close resemblance with any other trade mark.. What

the Registrar has to see is whether looking at the circumstances

of the case a particular trade mark is likely to deceive or to

cause confusion.

This Court elaborated this principle further at page 363 as

under:

The principles of law applicable to such cases are

well-settled. The burden of proving that the trade mark which a

person seeks to register is not likely to deceive or to cause

confusion is upon the applicant. It is for him to satisfy the

Registrar that his trade mark does not fall within the

prohibition of Section 8 and therefore, it should be registered.

Moreover in deciding whether a particular trade mark is likely to

deceive or cause confusion that duty is not discharged by

arriving at the result by merely comparing it with the trade mark

which is already registered and whose proprietor is offering

opposition to the registration of the mark. The real question to

decide in such cases is to see as to how a purchaser, who must be

looked upon as an average man of ordinary intelligence, would

react to a particular trade mark, what association he would form

by looking at the trade mark, and in what respect he would

connect the trade mark with the goods which he would be

purchasing.

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In Corn Products Refining Company Vs. Shangrila Food

Products Limited, 1960(1) SCR 968, this Court was again concerned

with an appeal arising out of the decision of the Registrar

pertaining to registration of a trade mark. M/s. Shangrila Food

Products had applied for registration of the mark Gluvita and

M/s. Corn Products, who were the owners of registered trade mark

Glucovita filed its objections to the registration of the

respondents mark. The Deputy Registrar came to the conclusion

that the two words Glucovita and Gluvita were not visually or

phonetically similar and that there was no reasonable likelihood

of any deception being caused by or any confusion arising from

the use of respondents proposed mark. Against the decision of

the Deputy Registrar, the appellant filed an appeal before the

High Court. A Single Judge of the Bombay High Court came to the

conclusion, dis-agreeing with the findings of the Deputy

Registrar, that the two marks were sufficiently similar so as to

be reasonably/likely to cause deception/confusion. The Division

Bench, on an appeal, however, set-aside the decision of the

Single Judge and restored the decision of the Deputy Registrar.

While allowing the appeal, it was observed at page 977 as

follows:

We, therefore, think that the learned appellate Judges

were in error in deciding in favour of the respondent basing

themselves on the series marks, having Gluco or Vita as a

prefix or a suffix.

Dealing with the question as to whether there was

likelihood of confusion between the two marks, which was the view

taken by Desai, J. of the Bombay High Court in that case which

was over-ruled by the Division Bench, this Court observed at page

978 as follows:

We think that the view taken by Desai, J., is right. It

is well known that the question whether the two marks are likely

to give rise to confusion or not is a question of first

impression. It is for the court to decide that question.

English cases proceeding on the English way of pronouncing an

English word by Englishmen, which it may be stated is not always

the same, may not be of much assistance in our country in

deciding questions of phonetic similarity. It cannot be

overlooked that the word is an English word which to the mass of

the Indian people is a foreign word. It is well recognised that

in deciding a question of similarity between two marks, the marks

have to be considered as a whole. So considered, we are inclined

to agree with Desai,J., that the marks with which this case is

concerned are similar. Apart from the syllable co in the

appellants mark, the two marks are identical. That syllable is

not in our opinion such as would enable the buyers in our country

to distinguish the one mark from the other. (emphasis added)

In Amritdhara Pharmacy Vs. Satya Deo, AIR 1963 SC 449 the

respondent had applied for the registration of the trade name

Lakshmandhara in respect of a medicinal preparation for the

alleviation of various ailments. This was opposed by the

appellant whose trade name Amritdhara had already been

registered in respect of similar medicinal preparation. The

question, which arose, was whether the name Lakshmandhara was

likely to deceive the public or cause confusion to the trade.

While interpreting Sections 8 & 10 of the Trade Marks Act, this

Court observed at pages 452-454 as follows:

It will be noticed that the words used in the sections and

relevant for our purpose are likely to deceive or cause

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confusion. The Act does not lay down any criteria for

determining what is likely to deceive or cause confusion.

Therefore, every case must depend on its own particular facts,

and the value of authorities lies not so much in the actual

decision as in the tests applied for determining what is likely

to deceive or cause confusion. On an application to register,

the Registrar or an opponent may object that the trade mark is

not registrable by reason of clause (a) of Section 8, or

sub-section (1) of Section 10, as in this case. In such a case

the onus is on the applicant to satisfy the Registrar that the

trade mark applied for is not likely to deceive or cause

confusion. In cases in which the tribunal considers that there

is doubt as to whether deception is likely, the application

should be refused. A trade mark is likely to deceive or cause

confusion by its resemblance to another already on the Register

if it is likely to do so in the course of its legitimate use in a

market where the two marks are assumed to be in use by traders in

that market. In considering the matter, all the circumstances of

the case must be considered. As was observed by Parker,J. in Re

Pianotist Co.s Application (1906) 23 RPC 774 which was also a

case of the comparison of two words

You must take the two words. You must judge them, both by

their look and by their sound. You must consider the goods to

which they are to be applied. You must consider the nature and

kind of customer who would be likely to buy those goods. In fact

you must consider all the surrounding circumstances; and you

must further consider what is likely to happen if each of those

trade marks is used in a normal way as a trade mark for the goods

of the respective owners of the marks. (p.777)

For deceptive resemblance two important questions are: (1)

who are the persons whom the resemblance must be likely to

deceive or confuse, and (2) what rules of comparison are to be

adopted in judging whether such resemblance exists. As to

confusion, it is perhaps an appropriate description of the state

of mind of a customer who, on seeing a mark thinks that it

differs from the mark on goods which he has previously bought,

but is doubtful whether that impression is not due to imperfect

recollection. (see Kerly on Trade Marks, 8th Edition, p. 400)

Let us apply these tests to the facts of the case under our

consideration. It is not disputed before us that the two names

Amritdhara and Lakshmandhara are in use in respect of the

same description of goods, namely, a medicinal preparation for

the alleviation of various ailments. Such medicinal preparation

will be purchased mostly by people who instead of going to a

doctor wish to purchase a medicine for the quick alleviation of

their suffering, both villagers & townsfolk, literate as well as

illiterate. As we said in Corn Products Refining Co. Vs.

Shangrila Food Products Ltd., (1960) 1 SCR 968: (AIR 1960 SC

142) the question has to be approached from the point of view of

a man of average intelligence and imperfect recollection. To

such a man the overall structural and phonetic similarity of the

two names Amritdhara and Lakshmandhara is, in our opinion,

likely to deceive or cause confusion. We must consider the

overall similarity of the two composite words Amritdhara and

Lakshmandhara. WE do not think that the learned Judges of the

High Court were right in saying that no Indian would mistake one

for the other. An unwary purchaser of average intelligence and

imperfect recollection would not, as the High Court supposed,

split the name into its component parts and consider the

etymological meaning thereof or even consider the meaning of the

composite words as current of nectar or current of Lakshman.

He would go more by the overall structural and phonetic

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similarity and the nature of the medicine he has previously

purchased, or has been told about, or about which has otherwise

learnt and which he wants to purchase. Where the trade relates

to goods largely sold to illiterate or badly educated persons, it

is no answer to say that a person educated in the Hindi language

would go by the etymological or ideological meaning and see the

difference between current of nectar and current of Lakshman.

Current of Lakshman in a literal sense has no meaning; to give

it meaning one must further make the inference that the current

or stream is as pure and strong as Lakshman of the Ramayana. An

ordinary Indian villager or townsman will perhaps know Lakshman,

the story of the Ramayana being familiar to him; but we doubt if

he would etymologise to the extent of seeing the so-called

ideological difference between Amritdhara and Lakshmandhara.

He would go more by the similarity of the two names in the

context of the widely known medicinal preparation which he wants

for his ailments.

We agree that the use of the word dhara which literally

means current or stream is not by itself decisive of the

matter. What we have to consider here is the overall similarity

of the composite words, having regard to the circumstance that

the goods bearing the two names are medicinal preparations of the

same description. We are aware that the admission of a mark is

not to be refused, because unusually stupid people, fools or

idiots, may be deceived. A critical comparison of the two names

may disclose some points of difference but an unwary purchaser of

average intelligence and imperfect recollection would be deceived

by the overall similarity of the two names having regard to the

nature of the medicine he is looking for with a somewhat vague

recollection that he had purchased a similar medicine on a

previous occasion with a similar name. The trade mark is the

whole thing - the whole word has to be considered. In the case

of the application to register Erectiks (opposed by the

proprietors of the trade mark Erector) Farwell, J. said in

William Bailey (Birmingham) Ltd.s Application, (1935) R.P.C.

136:

I do not think it is right to take a part of the word and

compare it with a part of the other word; one word must be

considered as a whole and compared with the other word as a

whole..I think it is a dangerous method to adopt to divide the

word up and seek to distinguish a portion of it from a portion of

the other word.

Another case relating to medicinal product is that of Durga

Dutt Sharma Vs. N.P. Laboratories, AIR 1965 SC 980. In that

case the respondent, who manufactured medicinal products, had got

the word Navaratna registered as a trade mark. The appellant,

who was carrying on the business in the preparation of Ayurvedic

pharmaceutical products under the name of Navaratna Kalpa

applied for registration of the words Navaratna Kalpa as a

trade mark for his medicinal preparations. The objection of the

respondent to the proposed registration prevailed. This led to

proceedings which culminated in the appeals to this Court. The

observations by this Court on two aspects are very pertinent.

Firstly with regard to the difference between an action for

passing off and action for infringement of trade mark, it

observed at page 990 as follows:

While an action for passing off is a common law remedy

being in substance an action for deceit, that is, a passing off

by a person of his own goods as those of another, that is not the

gist of an action for infringement. The action for infringement

is a statutory remedy conferred on the registered proprietor of a

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registered trade mark for the vindication of the exclusive right

to the use of the trade mark in relation to those goods (Vide S.

21 of the Act). The use by the defendant of the trade mark of

the plaintiff is not essential in an action for passing off, but

is the sine qua non in the case of an action for infringement.

No doubt, where the evidence in respect of passing off consists

merely of the colourable use of a registered trade mark, the

essential features of both the actions might coincide in the

sense that what would be a colourable imitation of a trade mark

in a passing off action would also be such in an action for

infringement of the same trade mark. But there the

correspondence between the two ceases. In an action for

infringement, the plaintiff must, no doubt, make out that the use

of the defendants mark is likely to deceive, but where the

similarity between the plaintiffs and the defendants mark is so

close either visually, phonetically or otherwise and the court

reaches the conclusion that there is an imitation, no further

evidence is required to establish that the plaintiffs rights are

violated. Expressed in another way, if the essential features

of the trade mark of the plaintiff have been adopted by the

defendant, the fact that the get-up, packing and other writing or

marks on the goods or on the packets in which he offers his goods

for sale show marked differences, or indicate clearly a trade

origin different from that of the registered proprietor of the

mark would be immaterial; whereas in the case of passing off,

the defendant may escape liability if he can show that the added

matter is sufficient to distinguish his goods from those of the

plaintiff.

Secondly, while dealing with the question of burden of

proof in an action for infringement of trade mark, this Court in

Durga Dutt Sharmas case (supra) held as under:

When once the use by the defendant of the mark which is

claimed to infringe the plaintiffs mark is shown to be in the

course of trade, the question whether there has been an

infringement is to be decided by comparison of the two marks.

Where the two marks are identical no further questions arise;

for then the infringement is made out. When the two marks are

not identical, the plaintiff would have to establish that the

mark used by the defendant so nearly resembles the plaintiffs

registered trade mark as is likely to deceive or cause confusion

and in relation to goods in respect of which it is registered

(Vide S. 21). A point has sometimes been raised as to whether

the words or cause confusion introduce any element which is not

already covered by the words likely to deceive and it has some

times been answered by saying that it is merely an extension of

the earlier test and does not add very materially to the concept

indicated by the earlier words likely to deceive. But this

apart, as the question arises in an action for infringement the

onus would be on the plaintiff to establish that the trade mark

used by the defendant in the course of trade in the goods in

respect of which his mark is registered, is deceptively similar.

This has necessarily to be ascertained by a comparison of the two

marks the degree of resemblance which is necessary to exist to

cause deception not being capable of definition by laying down

objective standards. The persons who would be deceived are, of

course, the purchasers of the goods and it is the likelihood of

their being deceived that is the subject of consideration. The

resemblance may be phonetic, visual or in the basic idea

represented by the plaintiffs mark. The purpose of the

comparison is for determining whether the essential features of

the plaintiffs trade mark are to be found in that used by the

defendant. The identification of the essential features of the

mark is in essence a question of fact and depends on the judgment

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of the Court based on the evidence led before it as regards the

usage of the trade. It should, however, be borne in mind that

the object of the enquiry in ultimate analysis is whether the

mark used by the defendant as a whole is deceptively similar to

that of the registered mark of the plaintiff.

Dealing once again with medicinal products, this Court in

F. Hoffmann-La Roche & Co. Ltd. Vs. Geoffrey Manner & Co.

Pvt. Ltd., 1969(2) SCC 716 had to consider whether the words

Protovit belonging to the appellant was similar to the word

Dropovit of the respondent. This Court, while deciding the

test to be applied, observed at page 720 as follows:

The test for comparison of the two word marks were

formulated by Lord Parker in Pianotist Co. Ltd.s application as

follows:

You must take the two words. You must judge of them, both

by their look and by their sound. You must consider the goods to

which they are to be applied. You must consider the nature and

kind of customer who would be likely to buy those goods. In

fact, you must consider all the surrounding circumstances; and

you must further consider what is likely to happen if each of

those trade marks is used in a normal way as a trade mark for the

goods of the respective owners of the marks. If, considering all

those circumstances, you come to the conclusion that there will

be a confusion, that is to say, not necessarily that one man will

be injured and the other will gain illicit benefit, but that

there will be a confusion in the mind of the public which will

lead to confusion in the goods-then you may refuse the

registration, or rather you must refuse the registration in that

case.

It is necessary to apply both the visual and phonetic

tests. In Aristoc Ltd. v. Rysta Ltd. the House of Lords was

considering the resemblance between the two words "Aristoc and

Rysta. The view taken was that considering the way the words

were pronounced in English, the one was likely to be mistaken for

the other. Viscount Maugham cited the following passage of Lord

Justice Lukmoore in the Court of Appeal, which passage, he said,

he completely accepted as the correct exposition of the law:

The answer to the question whether the sound of one word

resembles too nearly the sound of another so as to bring the

former within the limits of Section 12 of the Trade Marks Act,

1938, must nearly always depend on first impression, for

obviously a person who is familiar with both words will neither

be deceived nor confused. It is the person who only knows the

one word and has perhaps an imperfect recollection of it who is

likely to be deceived or confused. Little assistance, therefore,

is to be obtained from a meticulous comparison of the two words,

letter by letter and syllable by syllable, pronounced with the

clarity to be expected from a teacher of elocution. The Court

must be careful to make allowance for imperfect recollection and

the effect of careless pronunciation and speech on the part not

only of the person seeking to buy under the trade description,

but also of the shop assistant ministering to that persons

wants.

It is important that the marks must be compared as wholes.

It is not right to take a portion of the word and say that

because that portion of the word differs from the corresponding

portion of the word in the other case there is no sufficient

similarity to cause confusion. The true test is whether the

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totality of the proposed trade mark is such that it is likely to

cause deception or confusion or mistake in the minds of persons

accustomed to the existing trade mark. Thus in Lavroma case Lord

Johnston said:

we are not bound to scan the words as we would in a

question of comparatio literarum. It is not a matter for

microscopic inspection, but to be taken from the general and even

casual point of view of a customer walking into a shop."

On the facts of that case this Court came to the conclusion

that taking into account all circumstances the words Protovit

and Dropovit were so dissimilar that there was no reasonable

probability of confusion between the words either from visual or

phonetic point of view.

Our attention was drawn to a recent judgment of this Court

in S.M. Dyechem Ltd. Vs. Cadbury (India) Ltd. (2000) 5 SCC

573 where in a passing off action, the plaintiff, which was

carrying on the business under the mark of Piknik, filed a suit

for injunction against the defendant which was using the mark of

Picnic for some other chocolates sold by it. On the allegation

that the defendants mark was deceptively similar, the trial

court had issued an injunction which was reversed by the High

Court. On appeal, the decision of the High Court was affirmed.

One of the questions, which this Court considered, was that for

grant of temporary injunction, should the Court go by the

principle of prima facie case, apart from balance of convenience,

or comparative strength of the case of either parties or by

finding out if the plaintiff has raised a triable issue. While

considering various decisions on the point in issue, this Court

rightly concluded at page 591 as follows:

Therefore, in trade mark matters, it is now necessary to

go into the question of comparable strength of the cases of

either party, apart from balance of convenience.

On merits of the case, this Court took note of some English

decisions and observed in Dyechems case (supra) at page 594 that

where common marks are included in the rival trade marks, more

regard is to be paid to the parts not common and the proper

course is to look at the marks as a whole, but at the same time

not to disregard the parts which are common. This Court sought

to apply the principle that dissimilarity in essential features

in devices and composite marks are more important than some

similarity. This Court, after considering various decisions

referred to hereinabove, observed in Dyechems case (supra) at

page 596 as follows:

Broadly, under our law as seen above, it can be said that

stress is laid down on common features rather than on differences

in essential features, except for a passing reference to a

limited extent in one case.

Notwithstanding the aforesaid observations this Court in

Dyechems case (supra) proceeded to observe as follows:

It appears to us that this Court did not have occasion to

decide, as far as we are able to see, an issue where there were

also differences in essential features nor to consider the extent

to which the differences are to be given importance over

similarities. Such a question has arisen in the present case and

that is why we have referred to the principles of English Law

relating to differences in essential features which principles,

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in our opinion, are equally applicable in our country.

We are unable to agree with the aforesaid observations in

Dyechems case (supra). As far as this Court is concerned, the

decisions in the last four decades have clearly laid down that

what has to be seen in the case of a passing off action is the

similarity between the competing marks and to determine whether

there is likelihood of deception or causing confusion. This is

evident from the decisions of this Court in the cases of National

Sewing Thread Co. Ltd.s case (supra), Corn Products Refining

Companys case (supra), Amritdhara Pharmacys case (supra), Durga

Dutt Sharmas case (supra), Hoffmann-La Roche & Co. Ltd.s case

(supra). Having come to the conclusion, in our opinion

incorrectly, that the difference in essential features is

relevant, this Court in Dyechems case (supra) sought to examine

the difference in the two marks Piknic and Picnic. It

applied three tests, they being 1) is there any special aspect of

the common feature which has been copied ? 2) mode in which the

parts are put together differently i.e. whether dissimilarity of

the part or parts is enough to make the whole thing dissimilar

and 3) whether when there are common elements, should one not pay

more regard to the parts which are not common, while at the same

time not disregarding the common parts ?. In examining the

marks, keeping the aforesaid three tests in mind, it came to the

conclusion, seeing the manner in which the two words were written

and the peculiarity of the script and concluded that the above

three dissimilarities have to be given more importance than the

phonetic similarity or the similarity in the use of the word

PICNIC for PIKNIK.

With respect, we are unable to agree that the principle of

phonetic similarity has to be jettisoned when the manner in which

the competing words are written is different and the conclusion

so arrived at is clearly contrary to the binding precedent of

this Court in Amritdharas case (supra) where the phonetic

similarity was applied by judging the two competing marks.

Similarly, in Durga Dutt Sharmas case (supra), it was observed

that in an action for infringement, the plaintiff must, no

doubt, make out that the use of the defendants mark is likely to

deceive, but where the similarity between the plaintiffs and the

defendants mark is so close either visually, phonetically or

otherwise and the court reaches the conclusion that there is an

imitation, no further evidence is required to establish that the

plaintiffs rights are violated.

Lastly, in Dyechems case (supra), it was observed in para

54 as under:

As to scope of a buyer being deceived, in a passing-off

action, the following principles have to be borne in mind. Lord

Romer, L.J. has said in Payton & Co. Vs. Snelling, Lampard &

Co. (1900) 17 RPC 48 that it is a misconception to refer to the

confusion that can be created upon an ignorant customer that the

courts ought to think of in these cases is the customer who knows

the distinguishing characteristics of the plaintiffs goods,

those characteristics which distinguish his goods from other

goods in the market so far as relates to general characteristics.

If he does not know that, he is not a customer whose views can

properly be regarded by the Court. (See the cases quoted in N.S.

Thread & Co. Vs. Chadwick & Bros. AIR 1948 Mad 481 which was a

passing-off action.) In Schweppes Case (1905) 22 RPC 601 (HL)

Lord Halsbury said, if a person is so careless that he does not

look and does not treat the label fairly but takes the bottle

without sufficient consideration and without reading what is

written very plainly indeed up the face of the label, you cannot

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say he is deceived.

These observations appear to us to be contrary to the

decision of this Court in Amritdharas case (supra) where it was

observed that the products will be purchased by both villagers

and townfolk, literate as well as illiterate and the question has

to be approached from the point of view of a man of average

intelligence and imperfect recollection. A trade may relate to

goods largely sold to illiterate or badly educated persons. The

purchaser in India cannot be equated with a purchaser of goods in

England. While we agree that in trade mark matters, it is

necessary to go into the question of comparable strength, the

decision on merits in Dyechems case (supra) does not, in our

opinion, lay down correct law and we hold accordingly.

It will be useful to refer to some decisions of American

Courts relating to medicinal products. In the case of American

Cynamid Corporation Vs. Connaught Laboratories Inc., 231 USPQ

128 (2nd Cir. 1986), it was held as under:

Exacting judicial scrutiny is required if there is a

possibility of confusion over marks on medicinal products because

the potential harm may be far more dire than that in confusion

over ordinary consumer products.

It may here be noticed that Schedule H drugs are those

which can be sold by the chemist only on the prescription of the

Doctor but Schedule L drugs are not sold across the counter but

are sold only to the hospitals and clinics. Nevertheless, it is

not un-common that because of lack of competence or otherwise,

mistakes can arise specially where the trade marks are

deceptively similar. In Blansett Pharmaceuticals Co. Vs.

Carmick Laboratories Inc., 25 USPQ 2nd, 1473 (TTAB 1993), it was

held as under:

Confusion and mistake is likely, even for prescription

drugs prescribed by doctors and dispensed by pharmacists, where

these similar goods are marketed under marks which look alike and

sound alike.

In the case of Glenwood Laboratories, Inc. Vs. American

Home Products Corp reported in 173 USPQ 19(1972) 455 F. Reports

2d, 1384(1972), the Court of the United State had held that:

The fact that confusion as to prescription drugs could

produce harm a contrast to confusion with respect to

non-medicinal products as an additional consideration of the

Board as is evident from that portion of the opinion in which the

Board stated: The products of the parties are medicinal and

applicants product is contraindicated for the disease for which

opposers product is indicated. It is apparent that confusion or

mistake in filling a prescription for either product could

produce harmful effects. Under such circumstances, it is

necessary for obvious reasons, to avoid confusion or mistake in

the dispensing of the pharmaceuticals.

The boards view that a higher standard be applied to

medicinal products finds support in previous decisions of this

Court, Clifton Vs. Plough 341, F.2d 934, 936, 52, CCPA 1045,

1047 (1965) (It is necessary for obvious reasons, to avoid

confusion in the dispensing of pharmaceuticals), Campbell

Products, Inc. Vs. John Wyeth & Bro. Inc, 143, F. 2d 977,

979, 31 CCPA 1217 (1944) it seems to us that where ethical goods

are sold and careless use is dangerous, greater care should be

taken in the use of registration of trade marks to assure that no

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harmful confusion results)

In the case of R.J. Strasenburgh Co. Vs. Kenwood

Laboratories, Inc. reported in 106 USPQ 379, as noted in the

decision of Morgenstern Chemical Companys case (supra), it had

been held that:

Physicians are not immune from confusion or mistake.

Further more it is common knowledge that many prescriptions are

telephoned to the pharmacists and others are handwritten, and

frequently handwriting is not unmistakably legible. These facts

enhance the chances of confusion or mistake by the pharmacists in

filling the prescription if the marks appear too much alike when

handwritten or sound too much alike when pronounced."

The drugs have a marked difference in the compositions with

completely different side effects, the test should be applied

strictly as the possibility of harm resulting from any kind of

confusion by the consumer can have unpleasant if not disastrous

results. The courts need to be particularly vigilant where the

defendants drug, of which passing off is alleged, is meant for

curing the same ailment as the plaintiffs medicine but the

compositions are different. The confusion is more likely in such

cases and the incorrect intake of medicine may even result in

loss of life or other serious health problems. In this regard,

reference may usefully be made to the case of Glenwood

Laboratories, Inc. Vs. American Home Products Corp., 173 USPQ

19(1972) 455 F.Reports 2d, 1384(1972), where it was held as

under:

The products of the parties are medicinal and applicants

product is contraindicated for the disease for which opposers

product is indicated. It is apparent that confusion or mistake

in filling a prescription for either product could produce

harmful effects. Under such circumstances, it is necessary for

obvious reasons, to avoid confusion or mistake in the dispensing

of the pharmaceuticals.

It was further submitted on behalf of the appellant that

although the possibility of confusion in a drug being sold across

the counter may be higher, the fact that a drug is sold under

prescription or only to physicians cannot by itself be considered

a sufficient protection against confusion. The physicians and

pharmacists are trained people yet they are not infallible and in

medicines, there can be no provisions for mistake since even a

possibility of mistake may prove to be fatal.

As far as present case is concerned, although both the

drugs are sold under prescription but this fact alone is not

sufficient to prevent confusion which is otherwise likely to

occur. In view of the varying infrastructure for supervision of

physicians and pharmacists of medical profession in our country

due to linguistic, urban, semi-urban and rural divide across the

country and with high degree of possibility of even accidental

negligence, strict measurers to prevent any confusion arising

from similarity of marks among medicines are required to be

taken.

Here, it will be useful to refer to the decision of

Morgenstern Chemical Companys case (supra) where it has been

held as under:

[5] In the field of medical products, it is particularly

important that great care be taken to prevent any possibility of

confusion in the use of trade marks. The test as to whether or

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not there is confusing similarity in these products even if

prescribed and dispensed only by professionally trained

individuals does not hinge on whether or not the medicines are

designed for similar ailments. The rule enunciated by Judge

Helen in Cole Chemical Co. Vs. Cole Laboratories D.C. Mo.

1954, 118F. Supp. 612, 616, 617, 101, USPQ 44,47,48, is

applicable here:

Plaintiff and defendant are engaged in the sale of medical

preparations. They are for ultimate human consumption or use.* *

*They are particularly all for ailments of the human body.

Confusion in such products can have serious consequences for the

patient. Confusion in medicines must be avoided. * * * * *

Prevention of confusion and mistakes in medicines is too vital

to be trifled with

The observations made by Assistant Commissioner Leeds of

the Patent Office in R.J. Strasenburgh Co. Vs. Kenwood

Laboratories, Inc. 1955, 106 USPQ 379, 380 are particularly apt,

that

Physicians are not immune from confusion or mistake.

Further more it is common knowledge that many prescriptions are

telephoned to the pharmacists and others are handwritten, and

frequently handwriting is not unmistakably legible. These facts

enhance the chances of confusion or mistake by the pharmacists in

filling the prescription if the marks appear too much alike when

handwritten or sound too much alike when pronounced."

The defendant concedes that physicians and pharmacists are

not infallible but urges that the members of these professions

are carefully trained to detect differences in the

characteristics of pharmaceutical products. While this is

doubtless true to dos not open the door to the adoption by

manufacturers of medicines of trade marks or names which would be

confusingly similar to anyone not exercising such great care.

For physicians and pharmacists are human and in common with the

rest of mankind are subject to human frailties. In the field of

medicinal remedies the courts may not speculate as to whether

there is a probability of confusion between similar names. If

there is any possibility of such confusion in the case of

medicines public policy requires that the use of the confusingly

similar name be enjoined (See Lambert Pharmacol Ltd. Vs. Bolton

Chemical Corporation DCNY 1915, 219 F. 325.326.

In the book titled as McCarthy on Trade Marks, it is

observed in the footnote at page 23-70 as under:

Physicians and Pharmacists are knowledgeable in their

fields does not mean they are equally knowledgeable as to marks

and immune from mistaking one mark from another. (Schering Corp

Vs. Alza Corp reported in 207 USPQ 504 (TTAB 1980) )

In the case of Syntex Laboratories Inc. Vs. Norwich

Pharmacal Co. reported in 169 USPQ 1(2nd Cr. 1971), it is

observed as under:

Stricter standard in order to prevent likelihood of

confusion is desirable where involved trade marks are applied to

different prescription pharmaceutical products and where

confusion result in physical harm to consuming public.

Trade mark is essentially adopted to advertise ones

product and to make it known to the purchaser. It attempts to

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portray the nature and, if possible, the quality of the product

and over a period of time the mark may become popular. It is

usually at that stage that other people are tempted to pass off

their products as that of the original owner of the mark. That

is why it is said that in a passing off action, the plaintiffs

right is against the conduct of the defendant which leads to or

is intended or calculated to lead to deception. Passing off is

said to be a species of unfair trade competition or of actionable

unfair trading by which one person, through deception, attempts

to obtain an economic benefit of the reputation which other has

established for himself in a particular trade or business. The

action is regarded as an action for deceit. (See Wander Ltd.

Vs. Antox India Pvt Ltd., 1990 Suppl. SCC 727.

Public interest would support lesser degree of proof

showing confusing similarity in the case of trade mark in respect

of medicinal product as against other non-medicinal products.

Drugs are poisons, not sweets. Confusion between medicinal

products may, therefore, be life threatening, not merely

inconvenient. Noting the frailty of human nature and the

pressures placed by society on doctors, there should be as many

clear indicators as possible to distinguish two medicinal

products from each other. It is not uncommon that in hospitals,

drugs can be requested verbally and/or under critical/pressure

situations. Many patients may be elderly, infirm or illiterate.

They may not be in a position to differentiate between the

medicine prescribed and bought which is ultimately handed over to

them. This view finds support from McCarthy on Trade Marks, 3rd

Edition, para 23.12 of which reads as under:

The tests of confusing similarity are modified when the

goods involved are medicinal products. Confusion of source or

product between medicinal products may produce physically harmful

results to purchasers and greater protection is required than in

the ordinary case. If the goods involved are medicinal products

each with different effects and designed for even subtly

different uses, confusion among the products caused by similar

marks could have disastrous effects. For these reasons, it is

proper to require a lesser quantum of proof of confusing

similarity for drugs and medicinal preparations. The same

standard has been applied to medical products such as surgical

sutures and clavicle splints.

The decisions of English Courts would be relevant in a

country where literacy is high and the marks used are in the

language which the purchaser can understand. While English cases

may be relevant in understanding the essential features of trade

mark law but when we are dealing with the sale of consumer items

in India, you have to see and bear in mind the difference in

situation between England and India. Can English principles

apply in their entirety in India with no regard to Indian

conditions? We think not. In a country like India where there

is no single common language, a large percentage of population is

illiterate and a small fraction of people know English, then to

apply the principles of English law regarding dissimilarity of

the marks or the customer knowing about the distinguishing

characteristics of the plaintiffs goods seems to over look the

ground realities in India. While examining such cases in India,

what has to be kept in mind is the purchaser of such goods in

India who may have absolutely no knowledge of English language or

of the language in which the trade mark is written and to whom

different words with slight difference in spellings may sound

phonetically the same. While dealing with cases relating to

passing off, one of the important tests which has to be applied

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in each case is whether the misrepresentation made by the

defendant is of such a nature as is likely to cause an ordinary

consumer to confuse one product for another due to similarity of

marks and other surrounding factors. What is likely to cause

confusion would vary from case to case. However, the appellants

are right in contending that where medicinal products are

involved, the test to be applied for adjudging the violation of

trade mark law may not be at par with cases involving

non-medicinal products. A stricter approach should be adopted

while applying the test to judge the possibility of confusion of

one medicinal product for another by the consumer. While

confusion in the case of non-medicinal products may only cause

economic loss to the plaintiff, confusion between the two

medicinal products may have disastrous effects on health and in

some cases life itself. Stringent measures should be adopted

specially where medicines are the medicines of last resort as any

confusion in such medicines may be fatal or could have disastrous

effects. The confusion as to the identity of the product itself

could have dire effects on the public health.

Keeping in view the provisions of Section 17-B of the Drugs

and Cosmetics Act, 1940 which inter alia indicates an imitation

or resemblance of another drug in a manner likely to deceive

being regarded as a spurious drug it is but proper that before

granting permission to manufacture a drug under a brand name the

authority under that Act is satisfied that there will be no

confusion or deception in the market. The authorities should

consider requiring such an applicant to submit an official search

report from the Trade Mark office pertaining to the trade mark in

question which will enable the drug authority to arrive at a

correct conclusion.

Broadly stated in an action for passing off on the basis of

unregistered trade mark generally for deciding the question of

deceptive similarity the following factors to be considered:

a) The nature of the marks i.e. whether the marks are word

marks or label marks or composite marks, i.e. both words and

label works.

b) The degree of resembleness between the marks,

phonetically similar and hence similar in idea.

c) The nature of the goods in respect of which they are

used as trade marks.

d) The similarity in the nature, character and performance

of the goods of the rival traders.

e) The class of purchasers who are likely to buy the goods

bearing the marks they require, on their education and

intelligence and a degree of care they are likely to exercise in

purchasing and/or using the goods.

f) The mode of purchasing the goods or placing orders for

the goods and

g) Any other surrounding circumstances which may be

relevant in the extent of dissimilarity between the competing

marks.

Weightage to be given to each of the aforesaid factors

depends upon facts of each case and the same weightage cannot be

given to each factor in every case.

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The trial court will now decide the suit keeping in view

the observations made in this judgment. No order as to costs.

Appeal is disposed of.