Full Text
HIGH COURT OF DELHI
CS(COMM) 909/2022 & I.A. No. 7654/2024
YAHOO INC .....Plaintiff
Through: Mr. Pravin Anand, Mr. Dhruv Anand, Ms. Udita Patro, Ms. Nimrat Singh, Ms. Sampurnaa Sanyal and Mr. Dhananjay Khanna, Advs.
M: 9313399860
Through: None.
JUDGMENT
1. The present suit has been filed seeking permanent injunction restraining the infringement of trademark, passing off, unfair competition, tarnishment, dilution, damages, rendition of accounts of profits, etc.
2. The case, as canvassed by the plaintiff, is as follows: 2.[1] The plaintiff, Yahoo Inc. is an American multinational technology company focusing on media and online business. The plaintiff is the owner of the YAHOO trademarks. 2.[2] The trademark ‘YAHOO!’ has international significance, and the plaintiff has acquired trans-border reputation in respect of its trademark. The popularity of the trademark and the plaintiff’s name is evidenced by the fact that hundreds of millions of users world over, visit the website www.yahooinc.com and other region specific introductions of its Yahoo website, including, Yahoo.co.in, which was launched in India in June, 2000. 2.[3] The use of the internationally famous ‘YAHOO!’ trademark is not restricted only to computer and internet related services, but extends to clothing, sporting goods, office supplies, magazines, games and many more, including, collateral goods such as computer accessories. 2.[4] The plaintiff has licensed the ‘YAHOO!’ trademark for use on clothing and clothing accessories, such as t-shirts, jackets, caps and on various sporting goods, such as baseballs, basketballs, soccer balls, snowboards and volleyballs through licensees and co-branding agreements. 2.[5] The plaintiff has also used directly or through a licensee, the ‘YAHOO!’ trademark in connection with food products, such as candies, chocolate, mints, nuts, gourmet cakes, barbecue sauce, etc. pursuant to cobranding agreements with well known companies. Furthermore, besides deriving its revenue from the sale of advertising, co-branding and sponsorship agreements with other companies, the plaintiff also receives revenue from the sale of branded merchandise, under the said trademark. 2.[6] All this goes to establish that the fame, repute and renown of the plaintiff’s ‘YAHOO!’ trademark is not confined to any one class or type of goods and services. Further, due to the immense promotional activities, advertising, and its effect on the public, the manner of use, popularity of the yahoo website and web services, the trademark ‘YAHOO!’ of the plaintiff has acquired a secondary meaning in India. The use of the said mark by the plaintiff has been so wide spread that the general population understands the same as originating from the plaintiff alone. It has accordingly been declared as well known by this Court. 2.[7] The plaintiff rigorously invests in publicity and sponsoring of its ‘YAHOO!’ brands every year. There is widespread recognition of the plaintiff’s ‘YAHOO!’ trademark in India and the world over. By virtue of its popularity, its cutting-edge technology, the usefulness of the Yahoo service and its alliances with prominent companies, the plaintiff has achieved a strong globally prominent status among web users. It has been consistently rated as the most popular internet service, as well as one of the top websites of any time. Thus, the trademark ‘YAHOO!’ has for many years, been a strong and inherently distinctive trademark, and acts as a source identifier of the goods and services of the plaintiff. 2.[8] The plaintiff in late September, 2022 came across the defendant’s product ‘YAAHOO! Mouth Freshner’ listed on the Indiamart platform. The plaintiff hired an independent investigator, pursuant to which, it transpired that the defendant had been manufacturing a mouth freshner under the brand name ‘YAAHOO! Mouth Freshner’. Since the defendant was found to have adopted and using deceptively similar mark ‘YAAHOO!’, which amounted to infringement and passing off of the plaintiff’s trademark ‘YAHOO!’, the present suit has been filed.
3. Vide order dated 23rd December, 2022, this Court granted an ex-parte ad interim injunction in favour of plaintiff, thereby, restraining the defendant from manufacturing, selling, offering for sale, distributing products, or offering services, advertising, including on the internet, or in any other manner, infringing the rights in plaintiff’s registered ‘YAHOO!’ marks.
4. The defendant was proceeded ex-parte on 26th September, 2023, since despite service, the defendant failed to appear before this Court. The plaintiff was, thereafter, directed to file its ex-parte Evidence Affidavit vide order dated 26th September, 2023. The plaintiff has produced the Evidence by way of Affidavit of Col. J.K. Sharma, as PW-1. The plaintiff’s witness tendered Examination-in-Chief on 05th April, 2024, wherein, Evidence Affidavit of PW-1, was exhibited as PW-1/A.
5. Evidence Affidavit of PW-1, has been filed on the lines of the submissions made in the plaint.
6. Perusal of the Evidence Affidavit of PW-1 shows that PW-1 has deposed that plaintiff’s products and services are available in more than 46 languages and in 72 countries, regions and territories. The plaintiff’s services are rendered under the unique and highly distinctive trademark ‘YAHOO!’. The ‘YAHOO!’ trademark has been used continuously since 1994 and has also been recognized as a well-known mark by this Court in the case of Yahoo! Inc. Versus Akash Arora and Another, 1999 (19) PTC 201 DEL, 1999 SCC OnLine Del 133.
7. The ‘YAHOO!’ trademarks have been used by the plaintiff in connection with a wide variety of goods and services, including, Online Advertising, Web Directory, Search Services, E-mail, Chat, Retail, Computer, Software Services, etc. The plaintiff has broadened its offerings under the ‘YAHOO!’ brand to include, in addition to its directory and search services, a wide variety of other online services. Such services over the years include communication services, online commerce services, original content, example, Sports Information, Weather, News, Stock Quotes, Digital Magazines, etc. All these services offered by the plaintiff make use of ‘YAHOO!’ formative trademarks and domain names. Internet extracts from the Wayback machine, evidencing such use, have been exhibited as Ex. PW- 1/2 (Colly).
8. It has been deposed that the plaintiff has India specific websites, i.e., https://in.yahoo.com/ and https://in.search.yahoo.com, which have been accessible on internet since June 2000. These websites cater to the plaintiff’s users in India and offers the plaintiff’s services, in a manner that is suited specifically for India. Printouts of the said webpages, have been exhibited as Ex. PW-1/4 (Colly).
9. The plaintiff has a large online presence through its social media handles in India, such as Facebook, Instagram and X (formerly referred as Twitter). All the social media handles use the plaintiff’s well-known ‘YAHOO!’ mark. Printouts of the said webpages, have been exhibited as Ex. PW-1/5 (Colly).
10. It is deposed that plaintiff’s YouTube Channel, which also uses the plaintiff’s unique ‘YAHOO!’ mark, has over 200K subscribers, which further accentuates the plaintiff’s renown over the internet. Printouts of the plaintiff’s YouTube Channel, have been exhibited as Ex. PW-1/6 (Colly).
11. The plaintiff has been recognized with many industry awards over the years for its entrepreneurial role in providing information over the internet with extremely high quality website services. Printouts of some of the exemplary awards won by the plaintiff over the years, have been exhibited as Ex. PW-1/7 (Colly).
12. Thus, it is manifest that there is substantial awareness in India of the plaintiff’s services rendered under the ‘YAHOO!’ trademarks and domain names. This is not only on account of access of lakhs of users to the internet, but also by virtue of extensive publicity through write-ups and advertisements. Copies of write-ups and advertisements appearing in various newspapers, which demonstrate the renown of the plaintiff’s trademark ‘YAHOO!’ all over the world, including in India, have been exhibited as Ex. PW-1/8 (Colly).
13. The plaintiff is also the registered proprietor of the ‘YAHOO’ trademark, as well as various ‘YAHOO’ formative trademarks in India, in the following manner:
14. The registered trademarks have been renewed by the plaintiff and are subsisting on the Register of Trademarks. Printouts of the E-Register pages, along with Registration Certificates for these trademarks of the plaintiff, have been exhibited as Ex. PW-1/9 to PW-1/28.
15. It is deposed that the plaintiff has been vigilant in protecting and safeguarding its trademark rights from misuse by third parties and has in the past successfully enforced its Intellectual Property Rights in the well-known mark ‘YAHOO!’ in India, as well as in other parts of the world. Various orders passed by this Court in favour of the plaintiff protecting the wellknown trademark ‘YAHOO!’, have been exhibited as Ex. PW-1/29 to PW- 1/43.
16. It is further deposed that the plaintiff’s well-known trademark ‘YAHOO!’ is an established brand that has been ranked on many occasions among the 100 Best Global Brands by Interbrand, which is a leading brand marketing and consulting firm. According to a study conducted by APCO Worldwide, Yahoo has been ranked at the second place in the ranking, for the ‘Top 100 Most Loved Companies’. Documents pertaining to the same have been exhibited as Ex. PW-1/44 (Colly).
17. The well-known nature of the Yahoo trademark has been given due recognition by the Indian Trademark Registry, which has included the said trademark at serial number 54 in the list of well-known trademarks maintained by it. Printout of list of well-known marks, as taken from the official website of the India Trademark Registry, has been exhibited as Ex. PW-1/45.
18. It is deposed that upon coming across the products of the defendant, i.e., ‘YAAHOO! Mouth Freshner’, the plaintiff conducted a trademark search. It was found out that the defendant had filed for the mark ‘YAAHOO! Mouth Freshner’, being Trademark Application No. 2569027 under Class 31 in 2013, which was refused registration. The plaintiff’s trademark being Registration NO. 1361856 in Class 31 was cited in the Examination Report issued by the Trademark Registry for the defendant’s trademark application. The documents pertaining to the same have been exhibited as Ex. PW-1/47.
19. An independent investigation was conducted under the instructions and supervision of PW-1. The said investigation revealed that the defendant was listed on various third party online trade directories such as JustDial and Local Infolabel, with listings of the infringing products, including ‘Yaahoo mouth freshner’, ‘Yaahoo khajoor mouth freshner’ and ‘Yaahoo saunf mouth freshner’. Printouts from the website of the online listings of the defendant, on various online trade directories, have been exhibited as Ex. PW-1/49.
20. It is deposed that the independent investigator was informed by one representative of the defendant that they manufactured their mouth freshener products under the brand name ‘YAAHOO! Mouth Freshner’. The representative of the defendant further claimed that they had been using the mark ‘YAAHOO! Mouth Freshner’, for their mouth freshner product, for the last 9 years. The investigator was provided with a sample of the said product along with other samples of the defendant’s other products. Photographs of the samples of the infringing product, as given to the investigator, have been exhibited as Ex. PW-1/53 (Colly).
21. Considering the submissions made before this Court and the evidence on record, it is manifest that the plaintiff’s trademarks have been used by the defendant in a deceptively similar manner, as a prominent part of its products under the mark ‘YAAHOO! Mouth Freshner’. The infringing mark of the defendant wholly incorporates the plaintiff’s registered trademark
22. The facts and evidence on record make it obvious that such use of the ‘YAAHOO!’ trademarks by the defendant, is a blatant violation of the plaintiff’s exclusive rights in its ‘YAHOO!’ trademarks, and amounts to infringement and passing off of the plaintiff’s well-known trademarks.
23. It is evident that the defendant has adopted the plaintiff’s trademark, as the name of their product, in order to piggyback on the reputation of the plaintiff. The defendant’s adoption of the infringing trademark is clearly dishonest. There exists no plausible or viable explanation for the defendant to have adopted the said name, which is identical to the plaintiff’s trademark. It is highly improbable that the choice of the infringing trademark by the defendant, is a mere coincidence, or that the defendant was not aware of the existence and reputation of the plaintiff’s famous trademark ‘YAHOO!’.
24. The mala fide of the defendant becomes especially palpable, when one sees that even the font adopted by the defendant for its trademark, ‘YAAHOO! Mouth Freshner’ is nearly identical to the unique stylized font, which was earlier used by the plaintiff, for its marks. The table showing the comparison between the plaintiff’s and defendant’s mark, as given in the plaint, is reproduced as under:
25. It is also pertinent to note that the averments made by the plaintiff in the plaint, have not been rebutted by the defendant, as no written statement was filed by the defendant. The plaintiff has established the various facts by leading ex-parte evidence and exhibiting various documents in support of its submissions by filing its Evidence Affidavit.
26. The fact that the defendant has used the infringing trademark, despite its trademark application for the same having been refused by the Trademark Registry, demonstrates the dishonesty and mala fide of the defendant.
27. This Court notes the deposition of PW-1, wherein, it has been deposed in categorical terms that the defendant had been selling the infringing product for the last 9 years.
28. Considering the various submissions made before this Court and the exhibits on record, it is established that the plaintiff is entitled to decree in its favour. The plaintiff has also pressed for damages. As per the Evidence Affidavit of PW-1, the plaintiff has incurred cost of Rs.8,92,451/-, documents pertaining to which have been exhibited as Ex. PW-1/55.
29. The compensatory damages claimed by the plaintiff as per the calculation given in Evidence Affidavit is, Rs. 27,00,000/-.
30. The defendant has not appeared before this Court, despite service. However, the same cannot be a ground for not granting damages to the plaintiff. It is well settled that a defendant, who chooses to stay away from the proceedings of the court, should not be permitted to enjoy the benefits of evasion of court proceedings. Thus, in the case of Inter Ikea Systems BV Versus Imtiaz Ahamed[1], this Court held as follows: “xxx xxx xxx
20. The court is mindful of the fact that in such a situation where the defendant chooses to stay away from the court proceedings, he should not be permitted to enjoy the benefits of such an evasion. Any view to the contrary would result in a situation where a compliant defendant who appears in court pursuant to summons being issued, participates in the proceedings and submits his account books, etc., for assessment of damages, would end up on a worse footing, vis-avis a defendant who chooses to conveniently stay away after being served with the summons in the suit. That was certainly not the intention of the Statute. Section 135(1) of the Trademarks Act, 1999 provides that relief that may be granted in any suit for infringement of or for passing off includes injunction and at the option of the plaintiff, either damages or an account of profits. The plaintiffs in the present case have opted for claiming damages and have established beyond doubt that they have suffered damages on account of the conduct of the defendants which are a result of infringement of their trademark and copyright.
21. It is well settled that damages in cases like the present one must be awarded and a defendant, who elects to stay away from the court proceedings, should not be permitted to enjoy the benefits of staying away from the said proceedings. With regard to the relief of damages claimed by the plaintiffs herein, it may be noted that courts have been granting both, exemplary and punitive damages against the defendant in ex-parte matters of similar nature. In the case of Times Incorporated v. Lokesh Srivastava reported as (2005) 30 PTC 3 (Del), while awarding punitive damages of Rs. 5 lacs against the defendant therein, in addition to compensatory damages of a similar amount, a learned Single Judge of this Court had observed as below:
compensatory damages but award punitive damages also with a view to discourage end dishearten law breakers who indulge in violations with impunity out of lust for money so that they realize that in case they are caught, they would be liable not only to reimburse the aggrieved party but would be liable to pay punitive damages also, which may spell financial disaster for them. In Mathias v. Accor Economy Lodging, Inc. reported in 347 F. 3d 672 (7th Cir. 2003) the factors underlying the grant of punitive damages were discussed and it was observed that one function of punitive damages is to relieve the pressure on an overloaded system of criminal justice by providing a civil alternative to criminal prosecution of minor crimes. It was further observed that the award of punitive damages serves the additional purpose of limiting the defendant's ability to profit from its fraud by escaping detection and prosecution. If a tortfeasor is caught only half the time he commits torts, than when he is caught he should be punished twice as heavily in order to make up for the times he gets away. This Court feels that this approach is necessitated further for the reason that it is very difficult for a plaintiff to give proof of actual damages suffered by him as the defendants who indulge in such activities never maintain proper accounts of their transactions since they know that the same are objectionable and unlawful. In the present case, the claim of punitive damages is of Rs. 5 lacs only which can be safely awarded. Had it been higher even, this court would not have hesitated in awarding the same. This Court is of the view that the punitive damages should be really punitive and not flee bite and quantum thereof should depend upon the flagrancy of infringement.”
22. Similarly, in the case of Lachhman Das Behari Lal v. Sri Ghanshyam Das Jetha Nand reported as (2007) 35 PTC 693 (Del.), following the principle laid down in the case of The Himalaya Drug Company v. Sumit, reported as (2006) 126 DLT 23: (2006) 32 PTC 112 (Del.), wherein it was held that apart from compensatory damages, in cases of infringement of trade marks, copyrights, etc., courts should not only grant compensatory damages, but should also award punitive damages with a view to discourage and dishearten law breakers who indulge in violations with impunity, out of lust for money so that they are made to realise that in case they are caught, they would be liable not only to reimburse the aggrieved party, but also pay punitive damages, which may spell financial disaster for them, the said suit was decreed in favour of the plaintiff therein with punitive damages of Rs. 25 lacs imposed on the defendant. The aforesaid observations were made on the basis of certain other decisions namely, Times Incorporated (supra) and Mathias v. Accor Economy Lodging (supra).
23. In the case of Microsoft Corporation v. Rajendra Pawar reported as (2008) 36 PTC 697 (Del.), considering the aspect of punitive damages, it was held as below:—
24. In a suit filed by the plaintiffs herein in the year 2008, entitled M/s Inter Ikea Systems BV v. M/s Ikea Furniture Pvt. Ltd. [CS(OS) 523/2008] that was decided on 26.3.2014, and where, despite service, the defendant therein had deliberately stayed away from the suit proceedings, following the principle laid down in the case of Tata Sons Ltd. v. Hoop Anin, reported as (2012) 188 DLT 327: (2012) 49 PTC 373 (Del), where punitive damages to the tune of Rs. 5 lacs were awarded in favour of the plaintiff, the court had proceeded to award punitive damages.
25. In the case of Cartier International AG v. Gaurav Bhatia reported as (2016) 226 DLT 662, echoing the view taken in the captioned case, it was held that where a defendant chooses to stay away from the court proceedings, he should not be permitted to enjoy the benefits of evasion of the said proceedings, had imposed punitive damages on the defendant therein to the tune of Rs. 1 crore.
26. Another salutary object behind awarding punitive damages is to ensure that it acts as a deterrent against fence sitters who may find it lucrative to imitate registered trademarks of leading and established brands in the industry. It is with the said purpose that those who are brought before the court must be made to feel the pinch of coughing up damages from their illegal gains. If only token damages are imposed on them, than it would hardly hurt them and they would continue indulging in infringing activities. India has leaped into the league of those countries that have made giant economic advances. Several companies from all over the world have entered the Indian markets to tap its large consumer base and have made substantial investments with the idea of earning profit, promoting and establishing their business. The said business helps in generating employment and earning revenue for the country. If the courts do not extend adequate protection to them in respect of their intellectual property rights including patents, trademarks and copyrights, they are bound to have serious second thoughts about doing business here. xxx xxx xxx” (Emphasis Supplied)
31. It is to be noted that the plaintiff has calculated its losses by making reasonable assumptions, which are not disputed and have remained uncontroverted. In such a case, this Court can adopt a rough and ready way of calculating the award of costs and damages. Thus, in the case of Inter Ikea Systems BV and Another Versus Sham Murari and Others[2], this Court has held, as follows: “xxx xxx xxx
20. In Hindustan Unilever Limited v. Reckitt Benckiser India Limited, ILR (2014) 2 Del 1288, a Division Bench of this Court has laid down the tests for award of damages, though in the context of disparaging advertisements. The Court has specifically upheld the 2018 SCC OnLine Del 11221 procedure of using “rough and ready calculations” for award of damages. The relevant observation of the court is as under:
xxx xxx xxx” (Emphasis Supplied)
32. Accordingly, it is directed as follows: 32.[1] The suit is decreed in favour of the plaintiff and against the defendant in terms of Paragraph 48 (i) to (iii) of the Prayer Clause in the plaint. 32.[2] The plaintiff is entitled to damages of Rs. 27,00,000/-. 32.[3] The plaintiff is entitled to costs of Rs. 8,92,451/-.
33. Decree sheet be drawn up accordingly.
34. The present suit, along with the pending application, is disposed of.
JUDGE OCTOBER 23, 2024/kr/ak/au