FDC Limited v. TAS MED (INDIA) PRIVATE LIMITED AND ANR.

1. This order will dispose of the application filed by the plaintiff seeking interim prayers of the following nature: - I.A. 7214/2021 (by the plaintiff under Order XXXIX Rules 1 & 2 read with Section 151 CPC for an ad-interim order of injunction) “a. Restraining the Defendants, its directors, principal officers, partners, servants, representatives and agents or any of them, from manufacturing, marketing or selling pharmaceutical and medicinal preparations under the mark CINZINE, CINZITAS or any deceptively similar variant of the Plaintiff’s registered trademark CINZAN or in any 2021:DHC:4137 manner whatsoever amounting to an infringement of the Plaintiff’s registered trademark CINZAN; b. Restraining the Defendant, its directors, principal officers, partners, servants, representatives and agents or any of them, from manufacturing, marketing or selling pharmaceutical and medicinal preparations under the mark CINZINE, CINZITAS or any deceptively similar variant of the Plaintiff’s registered trademark CINZAN or in any manner whatsoever, thereby passing off their pharmaceutical products as those of the Plaintiff; c. That the above order may be granted ex-parte; d. Any further order as this Hon’ble Court may deem fit and proper facts and circumstances of the present case may also be passed in favour of the Plaintiff.”

2. The plaintiff/FDC Limited is a company incorporated on 23rd September, 1940 under the name of the ‘Fairdeal Corporation (Pvt.) Ltd., with its registered office at B-8, MIDC Waluj, District Aurangabad 431136, Maharashtra with a Delhi Branch Office at A-41, Phase-I, Okhla Industrial Area, New Delhi-110020. Subsequently, on 24th June, 1985, the plaintiff’s name was changed to ‘FDC Private Limited’ and a fresh Certificate of Incorporation was issued on 2nd May, 1986. It is stated that the plaintiff had commenced operations much before its incorporation, in the year 1936, marketing vitamins and a range of prescription formulations. It set up its first manufacturing facility in the year 1949. In 1963, the plaintiff claims to have become the first organization to start the manufacture of specialized ophthalmic formulations in India and the first to introduce the BFS (Blow-Fill-Seal) technology for ophthalmics in South East Asia. In 1972, the plaintiff pioneered the concept of Oral Rehydration Salts (ORS) under its iconic brand ‘Electral’. It has a distinct presence in numerous therapeutic segments such as anti-infective, dermatological, respiratory, hematinic and claims to be the undisputed leader in ORS and ophthalmic. It has 6 manufacturing facilities in India with several distribution centers across the country and it is also available on leading e-commerce pharmacy stores, such as, PharmEasy, 1MG, Apollo Pharmacy, Netmeds etc.. It has four separate R&D Laboratories for formulations and food products, Active Pharmaceutical Ingredients (API), biotech and genetic research. It has also received the “National Award for R&D effort in the industry” by the Department of Scientific Affairs, Ministry of Commerce, Government of India for its contribution in the development of Flurbiprofen and Timolol Maleate. The plaintiff claims to have an annual turnover of Rs.1,331 crores (approx.) in the year 2019-2020.

3. The present suit has been filed against the defendant No.1 alleging infringement by it of trademark “CINZAN”, registered in the name of the plaintiff in respect of its product launched in 1989. The product sold under the trademark and brand name of “CINZAN” is used to treat motion sickness, nausea due to motion sickness, vertigo or Meniere’s disease. The plaintiff claims that “CINZAN” has met with a remarkable success and currently holds a prominent market share. The plaintiff had obtained trademark registration for the word mark “CINZAN” w.e.f. 6th October, 1987, which is valid and subsisting. The plaintiff claims to have also spent more than Rs.15 lakhs on promotional activities to popularize the products under the trademark “CINZAN”. The details of the sales figure have been mentioned in para No.10 of the plaint to show the performance of the product “CINZAN”.

4. It is stated by the plaintiff that the defendant No.1, which is a private limited company, had dishonestly adopted the trademark “CINZINE”, which was deceptively, phonetically and structurally similar to the plaintiff’s prior adopted and registered trademark “CINZAN”. Ms. Shwetasree Majumder, learned counsel appearing on behalf of the plaintiff, submitted that initially when the plaintiff had noticed the use of “CINZINE” by the defendants, legal notices had been issued in 2006 and 2007, after which the defendants had abandoned its application for registration of trademark “CINZINE” and the impugned products were also not seen in the market. However, in November, 2020, the representative of the plaintiff came across a fresh sample of the impugned products “CINZINE” in the market, but this time, not manufactured by the defendant No.1, but by defendant No.2. However, the defendants are apparently connected as both the defendants have two common Directors, namely, Harjinder Singh and Kuljeet Kaur and the registered offices of both the entities are also the same. Learned counsel for the plaintiff submitted that a Legal Notice was sent on 9th November, 2020, which was replied to by the defendant No.1 indicating that they were changing their mark to “CINZITAS”. However, the plaintiff had objection to the defendants using the mark as “CINZITAS”, as that too is deceptively similar to the plaintiff’s trademark “CINZAN”.

5. It was the further submission of the learned counsel for the plaintiff that the defendants had repeatedly infringed the trademark of the plaintiff. Their act was a deliberate attempt to dilute the distinctive character of the plaintiff’s trademark. It was submitted by learned counsel for the plaintiff that the mark sought to be used by the defendants was phonetically similar to that of the plaintiff’s trademark. Reliance has been placed on the judgment of the Supreme Court in Cadila Health Care Ltd. v. Cadila Pharmaceuticals Ltd., (2001) 5 SCC 73, to submit that a far stricter approach was required to restrain the unauthorized use of deceptively similar marks with respect to pharmaceuticals preparations. Reliance has been also placed on judgments/orders in Win-Medicare Limited v. Somacare Laboratories Ltd., 1996 SCC OnLine Del 844, Emcure Pharmaceuticals Ltd. v. Corona Remedies Pvt. Ltd., 2014 SCC OnLine Bom 1064, Ranbaxy Laboratories Ltd. v. Dua Pharmaceuticals Pvt. Ltd., 1988 SCC OnLine Del 149, Stiefel Laboratories v. Ajanta Pharma Ltd., (2014) SCC OnLine Del 3405, Amba Lal Sarabhai Enterprises Ltd.

V. Sara Pharmaceuticals and Ors. [order dt. 08th April, 1982 in Suit NO. 1133/1981], Syncom Formulations (India) Ltd. v. Sas Pharmaceuticals, 2004 SCC OnLine Del 364, Sun Pharma Laboratories Ltd. v. Intas Pharmaceuticals Limited, 2019 SCC OnLine Del 8899, Himalaya Drug Company v. S.B.L. Limited, 2012 SCC OnLine Del 5701, Wyeth Holdings Corporation v. Burnet Pharmaceuticals (Pvt.) Ltd., 2008 SCC OnLine Bom 76, Luxembourg Brands S.A. R.L. v. G.M. Pens International Pvt. Ltd., 2018 SCC OnLine Del 12541, Novartis AG v. Crest Pharma Pvt. Ltd. And Ors. [Order dt. 24th July, 2009 in CS(OS) 851/2008], Bade Miya v. Mubin Ahmed Zahurislam, 2011 SCC OnLine Bom 430, Biochem Pharmaceutical Industries v. Biochem Synergy Limited, 1997 SCC OnLine Bom 639, Anchor Health and Beauty Care Pvt. Ltd. v. Procter & Gamble Manufacturing (Tianjin) Co. Ltd., 2014 SCC OnLine Del 2968, Timken Company v. Timken Services Private Ltd., 2013 SCC OnLine Del 2237 and GSK Consumer Healthcare S.A. v. EG Pharmaceuticals, 2019 SCC OnLine Del 10796.

6. It was also contended by learned counsel for the plaintiff that the word “CINZAN” had to be considered as a whole and could not be split into two, nor could be the mark of the defendants “CINZITAS” split into “CINZI” and “TAS”, to assess whether the two trademarks were similar or not. It was also submitted that the defendants have not been able to establish that since December, 2020, they had any sale of “CINZITAS” nor have they disclosed when they had launched their product. Thus, they had no right in equity to continue such use of the name “CINZITAS”. It was thus submitted that the plaintiff had disclosed a prima facie case in its favour, as having a registered trademark, being the prior user since 1989 and having built a solid market reputation, they would suffer irreparable loss and injury, if no injunction was granted. The balance of convenience was also in favour of the plaintiff, inasmuch as the defendants have not yet built any market for their product “CINZITAS”.

7. Mr. Ajay Sahni, learned counsel for the defendants, submitted that as regards the trademark “CINZINE”, they had already stopped its use since December, 2020. It has been submitted that as regards “CINZITAS”, the mark had been coined by the defendant No.1 by combining the salt/compound from which the drug had been derived with the suffix of the name of the defendant No.1. Thus, in the name “CINZITAS”, “CINZI” has been derived from the generic salt “CINNARIZINE” and “TAS” has been derived from the name of the defendant No.1 “TAS MED INDIA PVT. LTD.”. Learned counsel submitted that various products had been similarly named by the defendant No.1, which had been duly registered. 30 such products have been listed in para No.9 of the written statement. It is further submitted that in fact, the name of the plaintiff’s product “CINZINE” has also been derived from the salt “CINNARIZINE”. It was submitted by the learned counsel that the practice of joining the company name and the disease for which the product was to be used or the salt/compound from which the product was manufactured, was a standard industry practice, as is clearly evident from the name of the plaintiff’s own product. No one could seek to register the name of the compound which was ‘publici juris’.

8. It has been further argued by learned counsel for the defendants that the two names had no phonetic similarity. The drugs were ‘Scheduled-H’ drugs to be sold only on prescription and so, no chemist would get confused. Therefore, the cited cases relied upon by the learned counsel for the plaintiff were inapplicable as, in those cases, the drugs could be bought over the counter. Thus, there was no infringement of the trademark of the plaintiff.

9. As regards passing off, it was contended by learned counsel for the defendants that the packaging had no similarity as the product of the defendants was yet to be produced. Reliance has been placed on the judgments of the Coordinate Benches of this Court in Panacea Biotec Ltd. v. Recon Ltd., 1996 SCC OnLine Del 508, Ranbaxy Laboratories Limited v. Intas Pharmaceuticals Ltd., 2011 SCC OnLine Del 3527 and Schering Corporation v. Alkem Laboratories Ltd., 2009 SCC OnLine Del 3886. Thus, the learned counsel for the defendants has prayed that the application be dismissed and no injunction as prayed for be granted.

10. Learned counsel for the plaintiff, in rejoinder submitted that if the contention of the learned counsel for the defendants was right, then there was no explanation for the defendant No.1 to have withdrawn/abandoned its application for registration of mark “CINZINE” in 2006 when the plaintiff had opposed the registration. Therefore, the defendant No.1 was estopped from now claiming any right to use even a derivative from the salt from which the product was to be manufactured. It was further submitted that the trademark of the plaintiff had been registered with effect from 1987. The name of the product of the plaintiff was coined by taking different alphabets from the compound and the defendants had taken the same set of letters to coin the name of its product. Thus, this was a clear case of infringement.

11. In response to the claim that there were 30 products of the defendant No.1 with suffix “TAS”, learned counsel for the plaintiff has submitted that there were 140 other products which had no such suffix of “TAS”. Thus, when the defendant No.1 had once sought to fraudulently adopt a trademark deceptively similar to that of the plaintiff and the plaintiff had successfully opposed the same way back in the year 2006, the defendant No.1 had again sought to re-use the same deceptively similar mark of “CINZINE” in 2020 and would have succeeded, but for the vigil of the plaintiff. Therefore, the defendants were compelled to use a slightly modified version by adding the letters “TAS” as a suffix. It was also submitted that the judgment of the Supreme Court in Cadila Health Care Ltd. (supra) overrules the judgment in Panacea Biotec Ltd. (supra). It was further submitted that the judgment in Cadila Health Care Ltd. (supra) related to a ‘Scheduled-H’ medicine and the court had specifically highlighted the fact that there could be confusion due to handwriting. The observations of the court in Himalaya Drug Company (supra) were reiterated to submit that the use of the mark “CINZITAS” would also create confusion, as there was a possibility of people mistaking the defendants’ product to be that of the plaintiff.

12. Before proceeding further, it may be noted that on 18th August, 2021, in view of the contents of para No.3 of the written statement, the defendants, its directors, principal officers, partners, servants, representatives and agents or any of them, were restrained from manufacturing, marketing or selling pharmaceutical and medicinal preparations under the mark “CINZINE”. Thus, the issue now before this Court is whether a similar injunction is to be issued against the defendants restraining them from using the proposed mark “CINZITAS”. DISCUSSION

13. The courts have, in several cases, recognized the trade practice of combining either the name of the disease for which the medicine has been prepared or the compound/salt from which the medicine has been made, with the name of the company producing it. At the same time, the courts have discouraged the use of the words that are ‘publici juris’. Whether a medical term is a ‘publici juris’, and whether it has become so in respect of an ailment or compound/salt, is a fact to be determined at trial. Adopting the name of the basic drug has thus been discouraged. Words that are commonly used in the trade or are descriptive in nature or laudatory of the quality of the good, cannot also be used as a trademark by one entity to exclude such use by others. But this does not appear to be the rule of the thumb. In other words, it is not as if the courts have not protected the trademarks, which entail a certain level of creativity and uniqueness even if drawn from the compound/salt, or those which have, through long use, gained a reputation of representing the compound/salt itself. When such names are coined, then if somebody else subsequently, imitates these names, the courts have compared the two marks to determine whether there was a deceptive similarity or not. Ordinarily, the complete word is taken for comparison and not the parts of the words.

14. In Cadila Health Care Ltd. (supra), the Supreme Court went on to observe that the real question to be decided in cases involving medicinal preparations is to see how a purchaser, being an average man of ordinary intelligence, would connect the trademark with the goods. A nuanced understanding of phonetics will not determine whether there is confusion or not when similar sounding words are used by competitors. To say that the medicinal preparations in the present case being ‘Scheduled-H’ drugs requiring a prescription, no confusion would arise, would be limiting the test. As observed in several other cases, such as USV Limited v. IPCA Laboratories Limited, 2002 SCC OnLine Mad 870, a mistake can occur while reading the prescription on account of the similarity of the names.