SM MOTORENTEILE GMBH vs A.A. AUTOMOBILES & ORS.
* IN THE HIGH COURT OF DELHI AT NEW DELH
Reserved on: September 18th, 2024
% Pronounced on: September 26, 2024
+ CS(COMM) 553/2019
SM MOTORENTEILE GMBH …..Plaintiff
Through: Mr. Manish Biala, Advocate.
Versus
A.A. AUTOMOBILES & ORS. …..Defendants
Through: Mr. T.K. Tiwari, Advocate for D-2
CORAM:
HONBLE MR. JUSTICE SAURABH BANERJEE
J U D G M E N T
I.A. 13721/2019-Stay
1. The plaintiff vide the present application seeks grant of an interim injunction for restraining the defendants.
2. Succinctly put, based on the submissions made by the learned counsel for the plaintiff as also the pleadings and documents filed in support thereof, the following is the case of the plaintiff.
3. The plaintiff, SM Motorenteile GmbH, is a company incorporated under the laws of Germany having its registered office at Asperg, Germany and an office in Pune, India. The plaintiff is a highly reputed company and is known worldwide for manufacturing and supplying high quality original equipments for various reputed automobile companies under the trade marks (SM Logo-1) and (SM Logo-2), (hereinafter referred to as SM Logos).
4. Initially, the plaintiff was only engaged in manufacturing gaskets, pistons and valves but later in 1995, it also started manufacturing a plethora of products under the trade mark SM Logo-1 and turned into one of the most trusted brands in the world in the field of vehicle spare parts. The plaintiffs range of products includes gaskets, assemblies, hydraulic tappet, pistons, piston ring sets, universal joints, clutch release bearings, bearings, cylinder liners, camshafts, conrod bushings, valves guides, collets, steam seals, seat inserts and tappets, cylinder heads, aluminium die-cast and powder metal parts. All the aforementioned products are manufactured as per the international standards and can be applied to all kinds of engines, air compressors, transmission systems, pumps and attachment parts. Further, the plaintiffs massive worldwide distribution networks in over 100 countries, including India, ensures the constant global supply of plaintiffs products.
5. The plaintiff, being the global supplier of high precision engine and vehicle components, it also partners with many industrial enterprises in the automotive sector and the aftermarket industries and has notable collaborations and tie-ups with reputed international brands such as Honda, Yamaha, Volkswagen, Skoda, Mercedes Benz, Bitzer, BPR-Rotax, and General Motors, to name a few.
6. The plaintiff and the aforementioned SM Logos dates back to the 1970s, starting with the year 1973, when the said SM Logos were first used as a branding for the products of a Joint Venture company named Schoettle Motorenteile GmbH. The said JV company was founded by Mr. Wolfang Schoettle who held 55% of the shareholding of the company, and the rest of the 45% of the shareholding was then held by a company called Nippon Piston Rings, Japan. Thereafter, in 1983, Mr. Wolfang Schoettle along with Ms. Giesela Schoettle bought another company, named MVI Motorenteile GmbH. Though the two aforesaid companies, Schoettle Motorenteile GmbH and MVI Motorenteile GmbH were separate entities, they both carried on business together under the brand of the SM Logos. Consequently, in the year 1998, both the aforesaid companies i.e. Schoettle Motorenteile GmbH and MVI Motorenteile GmbH together registered the brand SM Logo-1 with the German Trademarks Office, bearing registration no.39867330 and in 1999 both the companies obtained another registration from the World Intellectual Property Organization under Class 12 (for vehicle parts) for the SM Logo-1 under the registration no.715313.
7. Consequently, in the year 2004, Schoettle Motorenteile GmbH applied for the registration of the trade mark i.e. SM Logo-2 in India. The said trade mark application bearing number 1278489 in Class 12 was granted registration and the same is valid and subsisting. It was mutually decided by both the aforesaid companies i.e. Schoettle Motorenteile GmbH and MVI Motorenteile GmbH that the said registered trade mark number 1278489 i.e. SM Logo-2 shall be jointly used by both the companies for their businesses.
8. In the year 2006, the business and operations of MVI Motorenteile GmbH were completely separated from that of Schoettle Motorenteile GmbH. It was mutually agreed during this separation of business that MVI Motorenteile GmbH shall retain all the rights, title and interest in the aforementioned SM Logos. In the year 2008, Schoettle Motorenteile GmbH ceased to exist and another company called NPR of Europe continued as its successor.
9. Thereafter, MVI Motorenteile GmbH obtained multiple registrations for the SM Logos in various countries during the years 2010 and 2011.
10. In the year 2011, the name of the company MVI Motorenteile GmbH was changed to its present name SM Motorenteile GmbH, i.e. the plaintiff.
11. In December, 2011, the plaintiff applied for registration of its trade mark i.e. SM Logo-1 in India vide application no.2254102 in Class 7 and was granted registration which is valid and subsisting till date.
12. The SM Logos are unique in their own way. The mark SM inside the globe corresponds to the abbreviation of the then Company Schoettle Motorenteile GmbH, while the red globe signified the fact that the products of the company is available worldwide. Further, the mention of the word ‘Germany’ below the SM mark indicates that the plaintiff company has been incorporated in Germany and the term ‘precision parts’ signifies that the company is involved in the business of manufacturing and supplying vehicle spare parts manufactured under precise control and quality engineering. The SM Logos have been adopted and used extensively and continuously across the globe in over 100 countries including India, by the plaintiff since their adoption in 1998.
13. The plaintiffs sales figures in India for the years 2016, 2017 and 2018 were 2,47,445, 2,44,069 and 2,79,126 respectively.
14. The plaintiffs website http://www.smoriginal-germanv.com/en/ can be accessed from anywhere in the world and is visited regularly by millions of people, including Indian internet users.
15. The defendants are engaged in the trade of vehicle spare parts including the sale of gaskets, suspension parts, clutch parts, piston rings, head bolts, etc. from their respective address. The defendant no.1 is a proprietorship concern of defendant no.2, who is in complete control of the management and business of defendant no.1 and is responsible for its day to day functioning. The defendant no.1 has been previously dealing in the products of the plaintiff.
16. In the year 2005, the defendant no.2 requested the plaintiff to authorise defendant no.1 to produce gaskets under the plaintiffs trade marks in collaboration with another company. In order to ascertain the feasibility of the proposed business idea by the defendant no.1, the plaintiff asked the defendant no.2 to provide the sample of gaskets, but the defendant nos.1 and 2 did not provide any sample to the plaintiff. Instead they kept dealing in plaintiffs products. However, it was only in the year 2014 that the plaintiff found that the defendant nos.1 and 2 were using plaintiffs trade mark on their business card even though they were not authorised by the plaintiff to do so.
17. Thereafter, the plaintiff had immediately sent cease-and-desist notice to both the defendant nos.1 and 2 calling upon them to cease and desist from illegally using the plaintiffs trade marks, thereby representing in the market that the defendant nos.1 and 2 had some nexus with plaintiff.
18. The plaintiff was under the impression that the defendant nos.1 and 2 would have ceased from their illegal activities, however, in July, 2019, the plaintiff was informed by market sources in Delhi that cheap imitations of the plaintiffs products (gaskets) were being sold in the market by the defendant nos.3, 4 and 5, and that the said gaskets are being supplied by an entity in Mumbai. On further enquiry, the plaintiff came to know that the impugned gaskets in Delhi markets were being supplied by none other than defendant no.1 through defendant no.2, who have been dealing with the products of the plaintiff in the past.
19. The plaintiff, hiring the services of a private investigator, bought the infringing products from the defendant nos.3, 4 and 5, which revealed that the packaging of the purchased gaskets, being sold by them, bore an exact and identical trademark of the plaintiff and that they were being supplied by the defendant nos.1 and 2.
20. Upon approaching this Court, this Court vide order dated 30.09.2019, passed an ex-parte ad-interim injunction against the defendants as under:
.
13.Considering the plaint, and the documents and on hearing the learned counsel for the plaintiff, this Court is of the view that plaintiff has made out a prima facie case for grant of ad-interim injunction. Accordingly, till the next date of hearing, defendants, their officers, servants, partners and agents, stockists or others acting on their behalf are restrained from selling, exporting, importing, offering for sale, distributing, advertising, directly or indirectly dealing in goods and/or services under the trademarks and/or or any mark identical or deceptively similar thereto, on products comprising of gaskets and allied and cognates goods, and/or any other products, in any manner whatsoever, amounting to infringement of Plaintiffs registered trademark nos. 2254102 and 1278489, passing off an unfair trade competition till the next date of hearing
.
21. Since then, the present suit has already been decreed in favour of the plaintiff and against the defendant nos.4 and 5 vide order dated 18.01.2023 as also against the defendant no.3 in view of the compromise entered into between them vide order dated 27.04.2023 and the present application in the pending suit is thus surviving qua the remaining defendant nos.1 and 2 only.
22. In fact, in addition to passing the aforesaid order of ex-parte ad-interim injunction on 30.09.2019, this Court was also pleased to appoint two Local Commissioners for visiting the premises of the said defendant nos.1 and 2. As per the reports filed by both the said Local Commissioners, various infringing products bearing the impugned/ similar marks as that of the plaintiff were found at the premises of the both defendant nos.1 and 2.
23. Interestingly, after being duly served both defendant nos.1 and 2 though have collectively filed a common written statement containing bald denials without any specific statement controverting any of the averments/ allegations made by the plaintiff in the plaint. In any event, no reply to the present application has been filed by the defendant nos.1 and 2.
24. However, now at this stage, learned counsel for the defendant nos.1 and 2 have filed a written synopsis raising fresh pleas and taking new/ additional grounds for the first time. They being beyond the pleadings made by them in the written statement, cannot be considered.
25. This Court has heard the learned counsel/s for the parties as also gone through the pleadings along with the documents in support thereof forming a part of this Courts record.
26. At the outset, a comparative analysis of the two conflicting products exhibiting their overall getup and packaging are brought out as under:-
Plaintiffs Product
Defendants Product
27. Due to continuous and extensive use, the high quality of the products, the worldwide reputation and significant efforts towards publicity and promotion, the SM Logos of the plaintiff have become exclusively and solely associated with the plaintiff and its products. The plaintiffs trade mark SM Logos have acquired instantaneous recognition and meaning in the minds of the public all over the world, including India, with respect to plaintiffs products. The said trade mark SM Logos have thus attained a reputation of a well-known trade mark.
28. The defendants have dishonestly and with a mala fide intention chosen to adopt and use the plaintiffs trade mark SM Logos without any authorization/ consent/ permission/ sanction thereof from the plaintiff, even though they had a past relation with it and were thus fully aware of the plaintiff and its trade mark SM Logos. Since they have adopted and are using the very same trade mark SM Logos of the plaintiff for the very same products and are operating through the very same trade, same channels for the very same set of customers as that of the plaintiff, the same is bound to cause incalculable confusion and deception in the minds of the general public. Any man of average intelligence with an imperfect recollection, especially those who are belonging to the rural background having less, in fact, no knowledge of the non-relation of the defendant nos.1 and 2 with the plaintiff are bound to get confused and deceived into believing which is otherwise.
29. All of the above is certainly going to cause immense harm, loss and injury to the plaintiff as also to its long established goodwill and reputation as also to that of its trade mark SM Logos as they would be tarnished without the plaintiff having any control over them.
30. Moreover, the impugned products of the defendant nos.1 and 2 and their packaging do not comply with the applicable laws, including the Legal Metrology Act, 2009 and the Legal Metrology (Packaged Commodities) Rules, 2011.
31. Also, since the said defendant nos.1 and 2 have not denied the averments/ allegations made by the plaintiff anywhere, they are deemed to have been accepted. The common written statement filed by the said defendant nos.1 and 2 is bereft of any material/ particular/ specific denial by them. What has been averred by them are evasive and without any substantive basis and/ or reasonings and they have not disclosed their stance and/ or facts. In view thereof, this Court is of the view that the averments/ allegations made by the plaintiff herein are deemed to be admitted by the defendant nos.1 and 2.
32. For the said reasons, in the considered opinion of this Court, it is because of the said defendant nos.1 and 2 have no real prospects of successfully defending the claim(s) made by the plaintiff before this Court in the present application. Thus, there is no other compelling reason as to why the present application be not allowed in favour of the plaintiff and against the remaining defendant nos.1 and 2.
33. Therefore, the defendant nos.1 and 2 are clearly guilty of infringing and passing off their products as that of the plaintiff.
34. In view of aforesaid, the plaintiff has been able to make out a prima facie and the balance of convenience for grant of an interim injunction is also in favour of the plaintiff and against the defendant nos.1 and 2. Therefore, allowing them to continue using the registered trade mark SM Logos of the plaintiff without any authorization/ consent/ permission/ sanction from it is likely to end up causing deception and confusion in the market as also amongst the members of general public, which calls for a restraint by this Court, more so, since that is without the defendant nos.1 and 2 having obtained any requisite licensees from the requisite authorities as also since the plaintiff has no checks and balances over the same, their quality, their price and/ or their standard. As such, if the said defendant nos.1 and 2 are not restrained by way of an injunction, there is a likelihood of the plaintiff suffering irreparable harm, loss, injury and prejudice which cannot be compensated for in terms of money.
35. Accordingly, for the aforenoted reasoning and analysis, till the pendency of the suit, the defendants, their officers, servants, partners and agents, stockists or others acting for sale are restrained from distributing, advertising, directly or indirectly dealing in goods and/ or services under the trade marks and/ or or any mark identical or deceptively similar thereto, on products comprising of gaskets and allied and cognates goods, and/ or any other products, in any manner whatsoever.
36. As such, the present application is allowed with the aforesaid directions in favour of the plaintiff and against the defendants.
CS(COMM) 553/2019
37. List for hearing on 18.11.2024.
SAURABH BANERJEE, J.
SEPTEMBER 26, 2024
So
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