Delhi High Court
Crocodile International Pte. Ltd vs La Chemise Lacoste And Anr on 9 March, 2026
Author: C. Hari Shankar
Bench: C. Hari Shankar
$~
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ RFA(OS)(COMM) 18/2024 & CM APPL. 56314/2024
Judgment reserved on: 08.01.2026
Judgment pronounced on:09.03.2026
CROCODILE INTERNATIONAL PTE. LTD. .....Appellant
Through: Mr. Saif Khan, Mr. Shobhit
Agarwal, Mr. Prajjwal Kushwaha and Ms.
Shayal Anand, Advs.
versus
LA CHEMISE LACOSTE AND ANR ....Respondents
Through: Mr. Chander M Lall, Sr. Adv.
with Ms. Nancy Roy and Ms. Prakriti
Varshney, Advs.
+ RFA(OS)(COMM) 10/2025 & CM APPL. 26249/2025
LACOSTE .....Appellant
Through: Mr. Chander M Lall, Sr. Adv.
with Ms. Nancy Roy and Ms. Prakriti
Varshney, Advs.
versus
CROCODILE INTERNATIONAL
PTE. LTD. & ANR. .....Respondents
Through: Mr. Saif Khan, Mr. Shobhit
Agarwal, Mr. Prajjwal Kushwaha and Ms.
Shayal Anand, Advs.
CORAM:
HON'BLE MR. JUSTICE C. HARI SHANKAR
HON'BLE MR. JUSTICE OM PRAKASH SHUKLA
JUDGMENT
% 09.03.2026
OM PRAKASH SHUKLA, J.
Facilitative Index
S. Particulars Pg.
No. No.
1. Introduction 3
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2. Factual Background 5
3. Proceedings Before the Ld. Single Judge 7
3.1 The Plaint
3.2 The Written Statement
3.2.1 Pre-198 Agreement
3.2.2 1983 Agreement
3.2.3 1985 Agreement/Letter
3.2.4 1985 till Date
3.3 Other Miscellaneous Proceedings
3.4 The Impugned Judgment
4. Proceedings Before this Court 27
4.1 Contentions on Behalf of
Appellants/Defendants
4.2 Contentions on Behalf of the
Respondents/Plaintiffs
5. Findings and Analysis 42
5.1 Scope of Review
5.2 Issue No. 1: Whether the use of the impugned
mark by Crocodile International amounts to
infringement of the copyright of Lacoste?
5.3 Issue No. 2: Whether the Agreements dated
17.06.1983 and 22.08.1985 between Lacoste and
Crocodile International extend to India? Whether the
aforesaid Agreements entitle Crocodile International
to use the impugned mark in India?
5.3.1 The 1983 Agreement
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5.3.2 Whether the 1983 Agreement included
the impugned mark in its Schedule A?
5.3.3 The 1985 Agreement/Letter
5.3.4 Permissive Use Under Indian
Trademark Law
5.4 Issue No. 3: Whether the use of the impugned
mark by Crocodile International in India amounts to
infringement of trademark rights of Lacoste?
5.5 Issue No. 4: Whether the use of the impugned
mark by Crocodile International in India amounts to
passing off?
5.6 Issue No. 5: Whether the suit suffers from
acquiescence on behalf of Lacoste?
5.7 Issue No. 6: Whether the learned Single Judge
erred in granting rendition of accounts to Lacoste?
5.8 Issue No. 7: Whether the learned Single Judge
erred in awarding costs to Lacoste?
6. Conclusion and Relief 96
INTRODUCTION
1. The present cross appeals are filed under Section 96 of the Code
of Civil Procedure, 19081 read with Section 13 of the Commercial
Courts Act, 2015 and Section 10 of the Delhi High Court Act, 1966
assailing the impugned judgment dated 14.08.2024 passed by learned
Single Judge of this Court in CS (OS) No. 894 of 2001 (subsequently
renumbered as CS (Comm) No. 1550 of 2016).
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1
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2. For the sake of convenience, RFA (OS) (Comm) No. 18 of 2024
is treated as the lead matter. The parties herein are referred to by the
same name and status as before the learned Single Judge in the civil
suit. Thus, Appellant Nos. 1 and 2 in RFA (OS) (Comm) No. 18 of
2024 are referred to as “Defendant No. 1” and “Defendant No. 2”
respectively, whereas the respondents are referred to as “Plaintiff No.
1” and “Plaintiff No. 2” respectively.
3. The present appeal concerns the issue of intellectual property
rights pertaining to a crocodile emblem. Plaintiff No.1, is a French
company, internationally renowned for its apparel and other products.
Plaintiff No. 2 is a company incorporated in India and serves as the
licensee of Plaintiff No. 1 in India by virtue of a User Agreement (Ex.
PW 2/4) dated 23.07.1994.
4. Defendant No. 1, Crocodile International Pte. Ltd. (formerly
known as “Li Seng Min Company Ltd.”), is a company incorporated
under the laws of Singapore by Dr. Tan Hian Tsing (“Dr. Tan”).
Defendant No. 2, i.e., Crocodile Products Pvt. Ltd., was initially
incorporated on 21.04.1994 by K.L. Narayansa and Associates (a joint
venture and predecessor of Defendant No. 2) and is based in
Bangalore, India. Defendant No. 2 allegedly began selling products
bearing these marks in India around 1998.
5. The parties herein have been involved in a protracted cross-
border legal dispute, with litigation and proceedings ongoing in
various jurisdictions. The present controversy is neither recent nor
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obscure, but one of significant international recognition in the realm
of intellectual property law. The present dispute is also part of an
ongoing series of litigation between the parties. This judgment aims to
effectively adjudicate the issues between the parties within the
jurisdiction of India.
FACTUAL BACKGROUND
6. The defendant’s trademark was first registered in India in 1952,
i.e., ” ” and then ” ” was registered in 1990.
Subsequently, the defendants commenced the use of their trademark
in India around the year 1998. Defendant No. 2 allegedly began the
sale of products bearing these marks since around 1998 in India.
However, the core issue in India arose when the defendants began
using the impugned standalone saurian device mark, ” ”
(“impugned mark”), without the accompanying word mark
“CROCODILE”.
7. According to plaintiffs, the impugned mark is deceptively
similar to their registered crocodile device mark, ” ”
which bears registration No. 400267 in Class 25.
8. It is pertinent to clarify that while both parties use various
versions of the crocodile logo and emblems, the present dispute
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specifically pertains to the use of the unregistered standalone crocodile
mark (impugned) by the defendants, which is allegedly deceptively
similar to the registered mark of the plaintiffs. For clarity and better
understanding, illustrations of both marks are provided below:
9. Aggrieved by the defendants’ use of the impugned mark, the
plaintiffs instituted a civil suit against the defendants. The defendants
strongly relied on a Letter/Agreement of 1985, contending that it
extends an agreement dated 17.06.19832 of mutual co-existence
between the parties to India and, thus, authorising their use of the
impugned mark in India.
10. The plaintiffs categorically denied the defendants’ position,
arguing that the 1985 instrument constitutes no more than a unilateral
communication from the defendants and does not confer any
enforceable right upon the defendants to use the impugned mark in
India.
11. The learned Single Judge of this Court partly decreed the suit in
favour of plaintiffs and against the defendants vide judgment dated
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2
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14.08.2024. It is against this judgment that the parties have filed the
present cross-appeals.
12. The parties to the present appeals seek the following reliefs:
In RFA (OS) (Comm) No. 18 of 2024:
“(a) Set aside the order and judgment/partial decree dated 14.08.2024
passed by the Ld. Single Judge in CS (Comm) No. 1550/2016 and dismiss
the present suit with costs in favour of the Appellant and against the
Respondent;”
In RFA (OS) (Comm) No. 10 of 2025:
“A. Allow the present appeal thereby setting aside the Impugned Judgment
dated 14thAugust 2024 passed by the Ld. Single Judge in CS (COMM)
1550 of 2016 to the limited extent of findings on passing off and copyright
infringement;
B. Set aside the findings of the Ld. Single Judge in relation to the goodwill
and reputation of the Appellant at the relevant time in India;
C. Pass an order of permanent injunction against the Respondents
restraining them from passing off their goods as that of the Appellant;
D. Pass an order of permanent injunction against the Respondents
restraining them from infringing the copyright of the Appellant;
E. Reimbursement of costs of the present appeal be given to the
Appellant;”
PROCEEDINGS BEFORE THE LD. SINGLE JUDGE
THE PLAINT
12.1 The plaintiffs aver that the crocodile device was first registered
as a trademark on 27.04.1933 in the Office of Clerk of the Commercial
Court of Troyes (France), under registration No. 207916. This was
followed by registration of the trademarks “LACOSTE” and
“CHEMISE LACOSTE” in France on 22.06.1933 and 19.07.1935
under registration Nos. 287668 and 302681, respectively.
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12.2 In India, the plaintiffs claim prior registration of their trademark
in 1983 and assert proprietorship over various trademarks that are
valid under Section 32 of the Trade and Merchandise Marks Act of
19583 in India. They contend that these marks (“LACOSTE” and the
crocodile device mark) are globally well-known and possess
international reputation due to superior product quality. These marks
are reproduced below:
S. Trademark Registration Date Class and
No. No. Goods
Description
i. CROCODILE 400265B 19.01.1983 25 - Clothing
device (Lacoste including
Label) (Proposed to be boots, shoes
Used) and slippers.
332. Registration to be conclusive as to validity after seven years.
Subject to the provisions of section 35 and section 46, in all legal proceedings relating to a trade mark
registered in Part A of the register (including applications under section 56), the original registration of the
trade mark shall, after the expiration of seven years from the date of such registration, be taken to be valid in
all respects unless it is proved–
(a) that the original registration was obtained by fraud; or
(b) that the trade mark was registered in contravention of the provisions of section 11 or offends against the
provisions of that section on the date of commencement of the proceedings; or
(c) that the trade mark was not, at the commencement of the proceedings, distinctive of the goods of the
Signature Not Verified registered proprietor.
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ii. CROCODILE 400267 19.01.1983 25 – Clothing
device including
(Proposed to be boots, shoes
Used) and slippers.
12.3 Plaintiff No. 1 allegedly commenced commercial activities in
India in 1993 through Plaintiff No. 2, after applying for trademark
registration in 1983. The plaintiffs assert that they have established
significant goodwill in India, and their trademarks have acquired a
secondary meaning. As a result, consumers associate these marks
exclusively with the plaintiffs’ enterprise. They rely on their sale
figures of approximately Rs. 25.10 crores and promotional
expenditure of about Rs. 1.29 crores between 1993 to 1999 as reflected
in their books of accounts maintained in the ordinary course of
business to substantiate this claim.
12.4 The plaintiffs aver that the cause of action arose when they
discovered that the defendants were selling products bearing the
standalone crocodile device mark, without the “CROCODILE” word
mark, i.e., , which was alleged to be deceptively and
confusingly similar to plaintiff’s registered crocodile device mark, i.e.,
” “. Further, it was averred that the defendants were
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wrongfully using the symbol ® with the infringing crocodile device.
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12.5 Aggrieved, the plaintiffs issued a letter dated 13.12.1999,
seeking to prevent the defendants from using the impugned mark and
followed up with further communications but to no avail. The
defendants denied the plaintiff’s objections by relying on the 1983
Agreement between Plaintiff No. 1 and Dr. Tan. The defendants
claimed that the said instrument permitted coexistence between the
defendants and plaintiffs and authorised the former to use the
impugned mark in India.
12.6 However, the plaintiffs denied the applicability of the 1983
Agreement to India and contended that it did not allow the defendants
to use the impugned mark without the “CROCODILE” word mark.
The plaintiffs asserted exclusive rights in India over their registered
saurian device, i.e., ” “.
12.7 The plaint sets out the manner in which the cause of action
arose, specifically the defendants’ continued use of the impugned
mark despite objections from the plaintiffs, in paragraph nos. 31 and
36 as follows:
“31. The cause of action in the present suit arose when the
Plaintiffs recently discovered that the second Defendant has
started using in respect its goods a device of a crocodile which is
deceptively and confusingly similar to the “crocodile device” of
the plaintiffs. This device is also at variance with the logo in
respect of which the first Defendant is the registered proprietor.
***
36. The cause of action first accrued to the Plaintiff in December
1999 when they came to know of the Defendant’s activities
aforesaid. The cause of action thereafter accrued against the
Defendants in January 2001 when the Plaintiff became aware that
the Defendants were continuing to use a device of a crocodile
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which is deceptively and confusingly similar to the “crocodile
device” of the Plaintiffs despite having been warned against the
same. The cause of action thereafter accrued in March 2001 when
the Plaintiffs were informed in no uncertain terms that the
Defendants had no intention of giving up their offending activities.
The cause of action is a continuing one and accrues each time the
Defendants sell goods bearing a device deceptively and
confusingly similar to the Plaintiffs “crocodile device”, which
device is also at variance with the logo in respect of which the first
Defendant is the registered proprietor. The suit is within time.”
12.8 Due to the defendants’ failure to desist from using the standalone
saurian device, the plaintiffs filed CS (Comm) No. 1550 of 2016 before
learned Single Judge of this Court seeking, inter alia, permanent
injunction and mandatory injunctions against the defendants.
THE WRITTEN STATEMENT
13. In their written statement, the defendants asserted that the
saurian trademark was created and first adopted in 1947 in Singapore
by Dato Dr. Tan Hian Tsin (“Dr. Tan”), the founder of Defendant No.
1, and has been in continuous use since then. Owing to its long-
standing use and extensive, Dr. Tan is allegedly known as “Mr.
Crocodile” in Singapore and certain other countries.
13.1 Dr. Tan initially carried on business as “Li Seng Min Company
Ltd.”, which was subsequently renamed as “Crocodile International
Pte. Ltd.” on 15.09.1983. The defendants asserted that the saurian
trademark was first registered in Singapore in 1949, and that
Defendant No. 1 has consistently used both the word mark
“CROCODILE” and the standalone saurian device mark on a wide
range of products over the years.
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13.2 With respect to India, the defendants claimed that Dr. Tan
registered the saurian trademark in India on 12.06.1952 under
registration No. 154397 in Class 25 for shirts and singlets. This
registration was later assigned to Li Seng Min Co. Ltd., and by virtue
of this assignment, the mark currently vests in Defendant No.1.
Subsequently, the word mark “CROCODILE” along with the device
mark was registered by Defendant No.1 in Class 25 bearing No.
540315 for clothing accessories. The written statement sets out the
following registrations of the defendants, as follows:
13.3 The defendants claimed that they commenced advertising using
the “CROCODILE” word and device marks in 1997. Additionally,
they began their operations in India in August 1998, with the opening
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of showrooms in Southern India under the name “Crocodile
Galleries”.
13.4 The defendants contended that their long and uninterrupted use
of the mark, along with substantial promotional expenses, has
conferred upon them exclusive rights to use the impugned mark in
India. To establish the extent of recognition, the defendants’ relied on
a survey conducted by “ORG MARG”, which purportedly ranked the
“Crocodile” brand among the top 15 brands in India, allegedly ranking
higher than the plaintiffs’ brand.
Pre-1983 Agreement
13.5 By way of their Written Statement, the defendants contended
that historically, the plaintiffs operated mainly in European markets,
whereas Defendant No.1 had a significant presence in Asian markets,
and that this balance was disturbed in 1971 when the plaintiffs sought
to enter Japanese markets. Defendant No. 1 challenged that plaintiff’s
use of a crocodile device mark before the District Court of Osaka. In
those proceedings, the plaintiffs maintained that their mark comprised
both the word “LACOSTE” and the saurian device, thereby
distinguishing their mark from Defendant No. 1’s mark, and that
consumers primarily associated their products with the name
“LACOSTE” rather than the device alone. The Osaka District Court
accepted this contention and dismissed Defendant No.1’s claim, ruling
that there was no likelihood of confusion.
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13.6 Subsequently, on 16.07.1980, the first defendant issued a cease-
and-desist notice to Royal Sporting House, the Plaintiff No.1’s
licensee, objecting to the use of the saurian device in Singapore. In
response, the plaintiffs reiterated that their device was an alligator, not
a crocodile, and that their brand identity was primarily associated by
the word “LACOSTE”, thus negating any likelihood of confusion.
Thereafter, on 09.12.1980, the plaintiffs offered to settle all legal
disputes with the defendants, and by letter dated 21.01.1983, proposed
a formal co-existence arrangement and offered USD 1 million as
compensation.
The 1983 Agreement (Ex. PW 1/8)
13.7 The aforesaid proposal resulted in an agreement dated
17.06.1983 between the Plaintiff No.1 and Li Seng Min Company Ltd.
(predecessor of Defendant No. 1) to, inter alia, amicably resolve legal
disputes between the parties, to co-exist in certain territories, and co-
operate against third-party infringers. The defendants claim that this
1983 Agreement grants them permissive use and forms the basis for
amicable co-existence in the present dispute.
13.8 Under the 1983 Agreement, the parties agreed that the marks
specified in Schedule A and B of the Agreement could co-exist in the
mutually agreed territories, including Taiwan, Singapore, Indonesia,
Malaysia and Brunei. They are reproduced as follows:
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13.9 The defendants contended that Schedule A of this Agreement
included five distinct marks owned by Defendant No.1, with the fourth
mark being the impugned mark in the present dispute. It is further
asserted that these five marks have been in use by the defendants in
various countries since 1983.
13.10 The defendants claim that this Agreement expressly authorised
their use of the impugned mark, thereby, precluding the plaintiffs from
pursuing any legal action against them. They further assert that they
consciously undertook to differentiate their marks from those of the
plaintiffs and confined their use to the marks specified in Schedule A
of the said Agreement, hence, following the principles of co-operation
and coexistence.
The 1985 Agreement/Letter (Ex. DW 1/80)
13.11 The defendants rely on a communication dated 22.08.1985,
wherein Defendant No.1 informed Plaintiff No.1 that the spirit of co-
operation established vide the 1983 Agreement, also extended to other
territories, including Korea, India, Bangladesh and Pakistan. The
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Defendant No.1 therein also undertook to not oppose Plaintiff No.1’s
trademark applications in Korea and issue consent letters for India,
Bangladesh and Pakistan. The defendants view this communication as
an extension of the 1983 Agreement.
13.12 The defendants claim that the plaintiffs initially proposed a
territorial exchange, offering Korea in exchange for India, and that Dr.
Tan, as a gesture of goodwill, further included Pakistan and
Bangladesh in this arrangement. The defendants rely on letters dated
16.09.1993 and 15.06.1990 to substantiate this claim.
13.13 The defendants assert that, but for the 1985 arrangement, the
plaintiffs would have been unable to secure trademark registrations in
India, Bangladesh, and Pakistan, due to Defendant No. 1’s prior rights.
They assert that both parties acted in conformity with the 1985
instrument, treating it as a binding agreement rather than a mere
consent letter. They rely on multiple letters, including those dated
13.02.1989, 22.06.1990, 08.01.1991, 28.07.1995, 02.02.1998,
28.05.1998 and 13.12.1999, wherein the plaintiffs allegedly
acknowledged this position.
13.14 More specifically, the defendants claim independent use of the
impugned mark, i.e., saurian device without the word mark. To
substantiate, they rely on a letter dated 10.02.1983, which they
contend led to the 1983 Agreement, and assert that this letter depicted
the impugned mark as an independent and distinct mark, thereby
justifying their use of the standalone saurian device mark.
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1985 till Date
13.15 The defendants assert that in furtherance of the 1983 and 1985
Agreements, they refrained from opposing the plaintiff’s trademark
registration in India and co-operated in protecting their marks from
third party infringement. By letter dated 24.02.1994, the defendants
undertook to create distinctions between their products and the
plaintiffs’ to facilitate co-existence. Reliance was placed on various
letters, wherein Plaintiff No. 1 allegedly acted in accordance with the
1983 and 1985 Agreements by consenting to the registration of the
defendants’ marks in Pakistan. Further reliance was placed on a letter
dated 13.02.1989, wherein Plaintiff No. 1 allegedly acknowledged Dr.
Tan’s letter of consent for India dated 10.02.1989 while referring to
the 1985 Agreement. The defendants also relied on a letter dated
13.11.1997, wherein Plaintiff No.1 allegedly reiterated that the
defendants were permitted to use the marks listed in Schedule A of the
1983 Agreement, which purportedly included the impugned mark.
13.16 The defendants claim that the plaintiffs’ letter dated 13.12.1999
failed to specify the nature or extent of their objections raised, thereby
depriving the defendants of a reasonable opportunity to respond. In
response to the subsequent letter dated 25.02.2000, the defendants
claimed that they had timely replied to the plaintiffs objections.
However, the defendants asserted that the plaintiffs took more than a
year to respond. During this period, the defendants expanded their
business under the bona fide belief that no further objections subsisted.
It was also contended that although the plaintiffs first raised an
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objection to the use of the impugned mark on 18.12.1998, the
substance of such objection was only elaborated in their letter dated
13.12.1999.
13.17 The defendants raised several preliminary objections based on
the grounds of delay, laches, and acquiescence, asserting that they had
openly used and advertised the impugned mark in India since 1997
with the plaintiffs’ knowledge, as evidenced by their letter dated
18.12.1998; yet the suit was instituted after approximately three years.
The defendants contended that the plaintiffs’ delay in initiating the
suit, coupled with their failure to object at an earlier stage implied
acquiescence to their use of the impugned mark. Additionally, it was
averred that the suit did not disclose a cause of action as required under
Order VII Rule 11 CPC and challenged the territorial jurisdiction of
the Court.
OTHER MISCELLANEOUS PROCEEDINGS
13.18 The plaintiff’s chose not to file replication to the defendants’
written statement.
13.19 Thereafter, vide order dated 14.01.2005, the learned Single
Judge framed 11 issues for adjudication. The following were the
eleven issues adjudicated upon by the learned Single Judge:
(i) Whether the plaintiff is the owner of the copyright in the
“crocodile device”? Decided in favour of P.
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(ii) Whether plaintiff is the proprietor of the ‘crocodile
device’ in India by virtue of registrations and use? Decided in
favour of P.
(iii) Whether the suit suffers from gross and unexplained
delay and is hit by laches and acquiescence? Decided in favour
of P.
(iv) Whether the defendant is entitled to use the ‘crocodile
device’ attached as Annexure ‘A’ to the plaint in India by virtue
of an agreement dated 17.06.1983 between the parties? Decided
in favour of P.
(v) Whether this Court doesn’t have territorial jurisdiction to
entertain and try the present suit? Decided in favour of P.
(vi) Whether the plaintiffs are not entitled to any relief as they
are guilty of concealing (SIC) vital facts and documents?
Decided in favour of P.
(vii) Whether the plaint if liable to be dismissed on account of
it being fictious with an intention of thwarting the legitimate
business of the defendant? Decided in favour of P.
(viii) Whether the use of ‘crocodile device’ attached as
Annexure ‘A’ to the plaint by the defendant violates the
plaintiff’s copyright and trademark rights in India? Decided in
favour of D.
(ix) Whether the defendant is liable to be prosecuted and non-
suited on account of use of the symbol ® with a view to
misrepresent the members of the trade and public that the
‘crocodile device’ is a registered trademark in India? Decided
in favour of D.
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(x) Whether the first defendant is the prior adopter and user
of the saurian device and the owner of the trademark rights in
the same? Decided in favour of P.
(xi) Whether the first plaintiff and the first defendant signed
and entered into co-existence agreement dated 17.06.1983 and
22.08.1985 for the respective territories? If so, whether such co-
existence extends to Annexure A device in India? Decided in
favour of P.
13.20 The plaintiffs deposed two witnesses, namely, Mr. Christian
London [PW1] and Mr. S.S. Negi [PW2]. The Defendants also
examined two witnesses, namely, Mr. Trisno Kemat Leono [DW1]
and Mr. Ramesh Babu [DW2].
THE IMPUGNED JUDGEMENT
14. By way of the impugned judgment, the learned Single Judge
partly decreed the suit in favour of the plaintiffs and granted a
permanent injunction in favour of the plaintiffs and against the
defendants.
14.1 Out of eleven issues frames by the learned Single Judge, Issue
Nos. 8 and 9 were decided in favour of the defendants.
14.2 The learned Single Judge held that the defendants had infringed
the plaintiff’s trademark and consequently permanently injuncted the
defendants from using the impugned device mark in India. While the
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Court recognised Plaintiff No.1’s exclusive copyright, it did not award
damages on account of the doctrine of merger. The passing off claim
was decided in favour of the defendants since the plaintiffs failed to
provide cogent evidence establishing the goodwill and reputation.
14.3 The learned Single Judge also took upon himself the arduous
task of adjudicating the defendants’ objection to the territorial
jurisdiction of the Court. The defendants’ objection was rejected by
holding that under Section 62(2) of the Copyright Act, the suit was
maintainable in Delhi since Plaintiff No. 2 carried on business within
the Court’s jurisdiction. Additionally, the sale of impugned goods in
Delhi attracted jurisdiction under Section 20(c) of CPC. The Court
further held that the defendants’ commercial activities in Delhi were
sufficient to confer territorial jurisdiction for trademark infringement
and passing off claims.
14.4 With respect to Issue No. 1, the Court held that Plaintiff No. 1,
being the registered proprietor of a valid and subsisting copyright
registration bearing No. 62692/2002 dated 16.01.2002 (Ex. PW 1/10),
i.e., ” “, possessed exclusive rights to control the
reproduction of its artwork. The Court further noted that as per the
registration, the first publication of the artwork took place in France
in 1927 and in 1992 in India.
14.5 Pertaining to copyright infringement, the learned Single Judge
applied the doctrine of merger and held that no infringement was made
out. The Court analysed the originality and expression of Plaintiff
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No.1’s artwork and opined that mere similarity capable of causing
consumer confusion, does not automatically constitute infringement
of copyright, especially if the manner of expression is limited. The
Court held that the impugned mark was an independent creation
derived from the general idea of a crocodile.
14.6 While dealing with Issue No. 2, the learned Single Judge noted
that the plaintiffs asserted ownership of the saurian device based on
their trademark registrations and use since October 1993, which was
not disputed by the defendants. The Court observed that Plaintiff No.
1 held a valid trademark registration bearing no. 400367 dated
19.01.1983 for a standalone saurian mark in India, i.e., ”
“. It was reasoned that the said registrations along with the
uncontroverted evidence of use by the plaintiffs, established the
plaintiffs’ exclusive rights over the impugned device mark.
14.7 In relation to Issue No. 10, the Court took note of the
defendants’ claim of use of various crocodile marks since 1947, their
registrations bearing Nos. 154397 and 540315 dated 12.06.1952 and
21.11.1990 respectively, and their commercial use (advertising) in
India since 1997 along with their documented sales activity from
August 1998. It was observed that the defendants’ advertisements
depicted the impugned mark alongside the “CROCODILE/
CROCODILE INTERNATIONAL” word mark and there was no
specific pleading of prior adoption or use of the impugned standalone
saurian mark. It was held that though Defendant No. 1’s composite
mark was registered in 1952 and the same predated the plaintiff’s 1983
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registration, with respect to the impugned mark, the plaintiffs were the
prior adopters and users. It was reasoned that the plaintiffs held valid
registration for the standalone saurian device mark since 1983 and had
launched it commercially in 1993.
14.8 Addressing Issue Nos. 4, 8, and 11 together, the Court
undertook a detailed analysis. The learned Single Judge analysed
individual elements of both marks, such as posture, angle, limbs, and
overall appearance. The Court also took in account, the testimonies of
DW1 and DW2, who acknowledged the similarities between the two
marks. Thus, the Court concluded that the marks were, “conceptually
identical and leaving little room for dispute on the point of similarity”
and that, “The near-exact duplication of the specific posture of the
crocodile and other features by Crocodile International exacerbates
the deceptive similarity between the two marks, creating a substantial
likelihood of consumer confusion”. Thus, the Court found the marks
to be deceptively similar and likely to cause confusion among
consumers. The Court acknowledged that while the parties had agreed
to co-exist in certain countries, a closer examination of the marks was
required in light of the present dispute.
14.9 The learned Single Judge also analysed various judicial
precedents cited by the defendants involving the present parties in
other jurisdictions and assessed their relevance to the present
proceedings. The Court reasoned that the marks involved in those
cases were distinct from the rival marks herein and did not have any
direct bearing on the issue before this Court.
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14.10 The Court further examined the 1983 and 1985 Agreements
(Ex. PW 1/8 and Ex. DW 1/80, respectively). While the existence of
the 1983 Agreement was undisputed, the Court noted that the sole
controversy pertained to its applicability in India. It was held that as
per Article I of the said Agreement did not extend to India, as the
territories for co-existence were explicitly specified. The Court further
observed that the plaintiffs’ conduct of pursuing litigation in
jurisdictions beyond those specified in the Agreement supported the
conclusion that co-existence did not extend beyond the specified
territories.
14.11 The Court also considered the Partial Award dated 15.08.2011
(Ex. P-1) passed in Singapore, which examined the territorial
applicability of the 1983 Agreement. The Tribunal held that the
Agreement was explicit and did not apply to jurisdictions other than
the ones stipulated in Article I. The Court relied on the cross-
examination of DW1 dated 22.02.2018, wherein DW1 admitted that
the 1983 Agreement did not extend to India.
14.12 The Court referred to the decision of the Supreme Court of
China in a dispute between the same parties where despite holding that
the 1983 Agreement did not apply to China, the Court considered its
impact and directed the defendants to distinguish their marks from
those of the plaintiffs. The learned Single Judge disagreed with this
decision and reaffirmed the territorial limitation of the 1983
Agreement. With respect to the 1985 Agreement/Letter, the Court
found it vague, ambiguous, and lacking mutual consent, and held that
it did not confer any right to use the impugned mark. The Court relied
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on letters issued by Plaintiff No. 1 dated 29.03.1995 (Ex. DW 1/36)
and 28.05.1998 (Ex. DW 1/44), which objected to the use of the
saurian device without the “CROCODILE” word mark in Korea. The
Court concluded that the plaintiffs had not consented to the use of the
impugned mark in India.
14.13 The Court also examined the probative value of the documents
submitted by the defendants and noted the absence of any explanation
for the non-production of originals or proof that the copies were true
copies, as required under Section 65 of the Indian Evidence Act,
18724. In light of the aforesaid and by placing reliance on Prem
Chandra Jain (Deceased) represented by LRs v. Sri Ram (Deceased)
represented by LRs5 and Vijay v. Union of India & Ors.6, it was held
that Ex. DW 1/18 to Ex. DW 1/23, Ex. DW 1/24 to Ex. DW 1/35, Ex.
DW 1/37 to Ex. DW 1/40 and Ex. DW 1/45 to Ex. DW 1/79 were not
proved in accordance with law. Notwithstanding the aforesaid, the
learned Single Judge examined the said documents to determine their
relevance to the suit.
14.14 The learned Single Judge applied the classic trinity test for
passing off and held that the plaintiffs failed to prove their reputation
and consumer association with the impugned mark in India at the time
of the defendants’ adoption of the mark in 1998. The plaintiffs’ survey
report was deemed unreliable, as it pertained to the market in 2004 and
lacked proper background documentation. Additionally, the chartered
4 “IEA” hereinafter
5 2009 SCC OnLine Del 3202.
6
Signature Not Verified2023 INSC 1030.
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accountant’s certificate7 (Ex. PW 2/5) was held to be unreliable due to
the absence of supporting document. The lack of testimony of the
concerned CA was also noted by the Court.
14.15 Succinctly, the learned Single Judge held as follows:
(i) The 1983 Agreement did not extend to India.
(ii) The 1985 Letter/Agreement lacked mutual consent and
specificity regarding India and the impugned mark.
(iii) No mutual consent existed for the use of impugned mark
in India.
(iv) The impugned mark, ” “, was found to be
infringing due to its deceptive similarity to the plaintiffs’ mark,
” “..
(v) The plaintiffs failed to prove passing off due to lack of
goodwill in India.
(vi) Copyright infringement was not found as the defendants'
artwork, " " was an independent creation.
(viii) The plaintiffs were not barred by delay, laches and
acquiescence.
(ix) The defendants’ use of the ® symbol was deemed an
honest oversight.
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14.16 Aggrieved, both the plaintiffs and defendants filed cross appeals
seeking to set aside the impugned judgment dated 14.08.2024 passed
in CS (Comm) No. 1550 of 2016 titled as “Lacoste & Anr. v.
Crocodile International Pte. Ltd. & Anr.”.
PROCEEDINGS BEFORE THIS COURT
15. RFA (OS)(COMM) 18 of 2024 was first listed on 24.09.2025,
whereby the Court issued a direction that the enforcement of the
impugned judgment would remain stayed, subject to the defendant
depositing the costs as determined by the Registry of this Court.
15.1 Subsequently, vide order dated 12.12.2024, this Court noted that
there was scope for an amicable resolution between the parties;
however, such resolution did not materialise.
15.2 Following this, both sides were heard, and the matter was
reserved for judgment.
CONTENTIONS ON BEHALF OF THE
APPELLANTS/DEFENDANTS
16. Mr. Saif Khan, the learned Counsel appearing on behalf of the
appellants/defendants, premised the case on the assertion that they
were not dishonest users and, therefore, had not infringed the
plaintiffs’ rights. Rather, it was emphasized that the defendants’ use
of the mark was bona fide and in light of the 1983 and 1985
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Agreements, which provided for co-existence between the plaintiffs
and defendants in India as well.
16.1 It was emphasised that the present dispute was unique and arose
from an intricate chain of communications regarding the permission
of the plaintiffs. The appellants/defendants contended that had the
marks not been similar, the need for a co-existence arrangement would
not have arisen in the first place.
16.2 The learned Counsel presented two major prongs of their case.
The first prong was that the defendants’ right to use the impugned
mark arose from the 1983 Agreement of co-existence and its extension
to India vide the 1985 Agreement, and subsequent letters
acknowledging the same. The second prong focused on the alleged
errors in the impugned judgment, thereby warranting interference by
this Court. Besides these contentions, detailed submissions were
advanced challenging the findings in the impugned judgment
regarding copyright infringement and passing off.
16.3 With respect to the first prong, learned Counsel submitted that
the impugned judgment suffered from lapses in both law and facts. It
was submitted that Defendant No. 1 was a renowned international
clothing brand that used a left-facing crocodile device mark with and
without any accompanying “CROCODILE” word mark and that its
first registration in India dated back to 1952, whereas the Plaintiff No.
1 used a right-facing crocodile with a registration in India from 1983.
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16.4 The learned Counsel traced the history of both brands, asserting
that it was the defendants who initially objected to the plaintiffs’ use
of the saurian device and in response, the plaintiffs asserted that their
rival marks were distinct, primarily associating their brand with
“LACOSTE” rather than the ‘crocodile’ device alone. This dispute
ended with the 1983 Agreement of co-existence between Plaintiff No.
1 and Defendant No. 1.
16.5 It was argued that the 1983 agreement explicitly included the
impugned mark, ” ” as one of the marks use by the
defendants. Furthermore, the 1985 agreement was presented as an
extension of the 1983 Agreement, which extended to certain other
territories, including India.
16.6 It was submitted that subsequent letters acknowledged the 1985
Agreement. Specific reliance was placed on the letter dated
10.12.1989, wherein defendant No.1 undertook not to oppose Plaintiff
No.1’s registration application in India and offered assistance in
obtaining registration in Pakistan. Reliance was also placed on letter
dated 13.02.1989 from Plaintiff No. 1, which acknowledged the 1985
Agreement with respect to India and confirmed receipt Defendant No.
1’s letter, and allegedly consented to the use of the impugned mark by
defendant in India.
16.7 For the second prong, the learned Counsel identified four
alleged errors in the impugned judgment that warranted interference.
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Firstly, it was submitted learned Single Judge erred in holding that the
letters depicting an enforceable co-existence relationship between the
parties were inadmissible. It was submitted that under Indian contract
law, an agreement does not need to be “clear, specific, and mutually
acknowledged” to be binding by relying on Section 4 of the Indian
Contract Act, 1872, to contend that the letter dated 10.02.1989 (Ex.
DW 1/24), even if considered a unilateral proposal, was accepted by
Plaintiff No.1 through the letter dated 13.02.1989 (Ex. DW 1/25), and
there was no revocation of this acceptance placed on record. The
learned Counsel further argued that the aforementioned letters (Ex.
DW 1/24-1/25), read with the 1985 Agreement formed part of a series
of transactions that, under Section 6 of the Indian Contract Act, 1872,
established the existence of an overarching agreement of mutual co-
operation and co-existence. These documents must, therefore, be read
together.
16.8 The learned Counsel further contended that the learned Single
Judge applied an unduly high threshold of proof akin to beyond
reasonable doubt instead of preponderance of probabilities while
examining documentary evidence. It was argued that the letters were
sent by fax, rendering production of originals impossible, and further
submitted that the plaintiffs did not challenge the veracity or existence
of said documents which should have been considered by the learned
Single Judge while assessing their evidentiary value.
16.9 The second error, as submitted by the learned Counsel, pertains
to the erroneous application of trademark law. It was argued that co-
existence agreement between the parties necessarily implies a degree
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of similarity between their marks, and the learned Single Judge erred
in reversing the impugned mark and comparing it with the mirror
image of the plaintiffs’ mark. It was contended that the plaintiffs failed
to provide evidence of actual consumer confusion. It was also
contended that the plaintiffs had benefitted from the 1985 Agreement
by securing trademark registration without opposition by the
defendants but failed to fulfil their reciprocal obligations. To bring out
the mala fides, reliance was placed on Plaintiff No.1’s attempt to
register the “CROCODILE” word mark, the said application was later
deemed fraudulent by the appellate court and the Supreme Court in
France (Ex. DW 1/96 and Ex. DW 1/97). It was also submitted that
the learned Single Judge had failed to consider the various
international judicial decisions concerning plaintiffs and defendant.
16.10 The third error in the impugned judgment, as highlighted by the
learned Counsel, was the lack of consideration of the defence of
acquiescence. It was argued that defendants’ use of the impugned
mark was honest and concurrent, arising out of the understanding of
co-existence and mutual co-operation between the parties established
by the 1983 and 1985 Agreements and subsequent consent letters. The
defendants further urged that the marks were not confusing or
deceptively similar and that Defendant No. 1 honestly adopted the
impugned mark.
16.11 As the fourth alleged error in the impugned judgment, the
learned Counsel highlighted the disregard of the letter dated
10.02.1989 (Ex. DW 1/24) and its reply dated 13.02.1989 (Ex. DW
1/25). It was pointed out that Plaintiff No. 1 had applied for trademark
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registrations bearing Nos. 400265 and 400267 on 19.01.1983 which
were granted in 1990. Following the first application in Journal No.
949 on 16.12.1988, the three-month opposition period was set to
expire in March of 1989. It was contended the decision to not oppose
the applications that during this period was consistent with the 1985
Agreement to co-exist in India, which was communicated to the
plaintiffs vide letter dated 10.02.1989 and acknowledged by Plaintiff
No.1 on 13.02.1989. The plaintiffs’ contention that they did not need
such consent since they already held a registration prior to the 1985
Agreement, was argued to be incorrect, as the registrations were only
granted in 1990. It was therefore submitted that the learned Single
Judge erred in disregarding these letters merely on the ground that the
applications were filed in 1983.
16.12 Regarding copyright infringement, the learned Counsel
submitted that while the threshold in trademark law is based on the
likelihood of confusion between marks, copyright law prohibits the
reproduction or substantial reproduction of another’s work. It was
contended that the learned Single Judge did not make any finding that
the rival marks are identical. It was submitted that copyright law
operates without territorial limits, meaning that once an artistic work
is independently created anywhere in the world, it does not become a
reproduction for the purposes of copyright infringement merely by use
in another jurisdiction, even if such use is deemed infringing under
trademark law in that jurisdiction. The learned Counsel further argued
that the impugned mark could not be considered a reproduction of the
plaintiffs’ mark because it had been recognised as Defendant No.1’s
mark under the 1983 Agreement.
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16.13 The learned Counsel submitted that the artwork protected under
Plaintiff No.1’s copyright registration, ” ” (Ex. PW
1/10) substantially differed from their device mark, ”
“. It was pointed out that the plaintiffs failed to
provide specifics of the copyright registration, such as the authorship
and creation details, in the plaint. Furthermore, the copyright
registration, which was granted in 2002, was obtained after the filing
of the present suit, and no amendment was made to the plaint to reflect
this fact.
16.14 The learned Counsel submitted that, as per the plaintiffs’ claim,
the artwork was created in 1927, and thus, the protection was likely to
have expired. It was further argued that the plaintiffs failed to establish
the authorship of the artwork through evidence and did not assert that
the impugned mark was a copy or a reproduction of their copyrighted
work, either in India or anywhere. It was contended that had the
impugned mark been infringing, it could not have survived in other
jurisdictions.
16.15 It was submitted that while the similarity between the marks
may constitute trademark infringement, it should not amount to
copyright infringement, as it is not a reproduction of the plaintiffs’
work, but rather an independent creation. The learned Counsel
supported and reiterated the finding of the learned Single Judge that
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the impugned mark was an independent creation. It was submitted that
there are limited ways to depict a strong and ferocious crocodile, and
the learned Single Judge correctly observed that copyright does not
protect ideas, only their expression. Thus, independent creations of the
same subject matter, such as a leaping tiger, may share inherent
similarities without constituting copyright infringement.
16.16 It was submitted that the learned Single Judge rightly held that
the plaintiffs failed to establish goodwill in India as of 1998, when the
defendants began commercial use of the impugned mark. It was
argued that by 1998, the plaintiffs had only been operating for
approximately 5 years in India and did not provide sufficient proof of
the goodwill and repute for the relevant year. Further, no evidence of
actual consumer confusion or any demonstrable damage caused to
plaintiffs was furnished. It was emphasised that therefore the essential
elements of the classic trinity test to establish passing off were not
sufficiently proved.
16.17 The learned Counsel further contended that the learned Single
Judge correctly excluded certain evidence due to the lack of a
certificate as under Section 65B of IEA. It was pointed out that the CA
Certificate (Ex. PW 2/5) presented by the plaintiffs contained figures
that differed from those stipulated in the plaint, and that the concerned
Chartered Accountant8 was not examined to verify the accuracy of the
certificate. Instead, only PW2, who was not a chartered Accountant,
was examined in relation thereto.
Signature Not Verified”CA” hereinafter
8
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16.18 The learned Counsel highlighted a typographical error in
Plaintiff No.1’s letter dated 13.02.1989 (Ex. DW 1/25), which referred
to an agreement of 27.08.1985. The actual agreement was dated
22.08.1985 (Ex. DW. 1/80), and the learned Counsel argued that such
a clerical error could not be used to dispute the authenticity of the
agreement, especially when no such objection had been raised by the
plaintiffs during the pendency of the suit for over two decades, and
therefore, the plaintiffs must be estopped from raising this objection at
a belated stage.
16.19 It was also argued that although the 1983 Agreement did not
apply to India, it remained relevant for understanding the specific
marks belonging to the parties. It was contended that the 1983
Agreement explicitly referred to 5 marks of the defendants, including
the standalone impugned mark. The plaintiffs’ claim that Schedule A
of the 1983 Agreement only included 3 of the defendants’ mark was
contested, especially since the standalone device mark had been used
and registered in five other countries covered by the Agreement. The
learned Counsel relied on paragraph nos. 106, 108 and 132 of the
arbitral award of Singapore, which acknowledged the existence of the
standalone marks.
16.20 The learned Counsel relied upon Rule 20 of the Delhi High
Court Intellectual Property Rights Division Rules of 20229 to contend9 20. Damages/Account of profits- A party seeking damages/account of profits, shall give a reasonable
estimate of the amounts claimed and the foundational facts/account statements in respect thereof along with
any evidence, documentary and/or oral led by the parties to support such a claim. In addition, the Court shall
consider the following factors while determining the
quantum of damages:
(i) Lost profits suffered by the injured party;
(ii) Profits earned by the infringing party;
(iii) Quantum of income which the injured party may have earned through royalties/license fees, had the use
of the subject IPR been duly authorized;
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that the learned Single Judge erred in directing the examination of the
defendants’ accounts without the plaintiffs first proving that they had
suffered any loss. It was also submitted that the prolonged pendency
of the suit was attributable to the plaintiffs’, since they took 11 years
to present and examine their witnesses. It was argued that the learned
Single Judge erred in awarding costs against the defendants,
emphasizing the “conduct of party” criteria under Section 35(3)(a) of
the Commercial Courts Act of 2015.
CONTENTIONS ON BEHALF OF THE
RESPONDENTS/PLAINTIFFS
16.21 Per contra, Mr. Lall, the learned Senior Counsel appearing for
the respondents/plaintiffs, submitted that their challenge to the
impugned judgment rested on three major premises: (i) the finding of
the learned Single Judge on copyright infringement, (ii) the claim of
passing off, and (iii) the finding that the plaintiffs failed to establish
their goodwill and reputation.
16.22 It was urged that the defendants were attempting to characterize
the letter dated 22.08.1985 as an agreement. The plaintiffs vehemently
denied that any letter/agreement existed whereby they gave consent to
the defendants’ use of the impugned mark. It was argued that the 1983
Agreement and the 1985 letter were distinct and that the latter lacked
the necessary signatures of Plaintiff No. 1 to constitute a binding
(iv) The duration of the infringement;
(v) Degree of intention/neglect underlying the infringement;
(vi) Conduct of the infringing party to mitigate the damages being incurred by the injured party;
In the computation of damages, the Court may take the assistance of an expert as provided for under Rule 31
of these Rules.
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agreement. The learned Senior Counsel reiterated the learned Single
Judge’s conclusion that the 1985 instrument was merely a unilateral
communication, not a bilateral binding contract, and it did not specify
which of the plaintiffs’ marks Defendant No. 1 was permitted to use.
16.23 The learned Senior Counsel contended that the plaintiffs had
successfully established their copyright ownership, which was duly
recognised by the learned Single Judge. It was submitted that even if
the defendants’ adoption of the mark was honest, substantial similarity
between the marks would still amount to copyright infringement. It
was argued that if the conceptually identical crocodile mark was found
to infringe the plaintiffs’ trademark, it would necessarily violate their
copyright as well.
16.24 The learned Senior Counsel supported findings of the learned
Single Judge that the 1983 Agreement did not extend to India, relying
on the Arbitral Award dated 15.08.2011, which confined the 1983
Agreement to the territories explicitly mentioned in the agreement. It
was noted that the Tribunal had denied Defendant No. 1 rights over ”
” in Indonesia, which was part of the 1983
Agreement. This, it was argued, demonstrated that even in countries
covered by the 1983 Agreement, the defendants could not use or
register the standalone impugned mark. With respect to Plaintiff No.
1’s trademark, it was pointed out that the defendants had never
challenged the registration of the mark.
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16.25 Reference was made to paragraph nos. 43, 44, 46, 47, 49 and 50
of the impugned judgment to submit that the impugned mark was
rightly found to be conceptually identical, giving rise to a likelihood
of consumer confusion.
16.26 It was further submitted that the learned Single Judge relied on
the cross-examination of DW1 and DW2, whereby they
acknowledged the similarities between the rival marks, the only
distinction being the direction of the crocodile. It was argued that the
learned Single Judge rightly held that the impugned mark was not an
independent creation but a copy of the plaintiffs’ mark, with no honest
adoption by the defendants.
16.27 With respect to passing off, it was contended that the plaintiffs’
goodwill was never disputed. Plaintiff No. 1 was the first to create anduse the following marks since 1927 ” ” (copyright
artwork), ” “, ” ” (the mark
plaintiffs’ herein seek to protect) and . In contrast,
Defendant No. 1 adopted their mark only in 1947, being ”
“. It was strongly contended that the defendants
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were well-aware of the plaintiffs’ use of the mark ” ” as
early as 1980, having issued a cease-and-desist notice to the Plaintiff
No. 1 in Singapore. It was submitted that this led to negotiations
culminating in the 1983 Agreement, which was limited to five
countries, and it expressly included the plaintiff’s mark ”
“. Plaintiff No.1 applied for registration of in India in
1983 and commenced commercial use in 1993, while Defendant No.
1 began using the impugned mark in India in 1998 and applied for
registration in 1999 on a proposed-to-be-used basis, which remains
pending due to the plaintiff’s opposition.
16.28 It was further submitted that the plaintiffs were able to establish
their reputation and goodwill in the Indian market within 5 years (by
1998), i.e., by the time the defendants entered the Indian market with
the impugned mark. This was substantiated by the following evidence:
(i) Sales figures of the plaintiffs between 1993-98 amounted
to approximately Rs. 22,84,86,256/- as reflected in the CA
certificate (PW 2/5).
(ii) Promotional expenditure between 1993-98 was around
Rs. 1,10,64,607/- as verified by the same CA certificate (PW
2/5).
(iii) The plaintiffs’ trademark registrations in other parts of
the world prior to the defendants’ entry into the Indian market
were detailed in Exhibit PW 1/14A to PW 1/14K.
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(iv) 14 Orders of this Court granted ex-parte ad interim and
interim injunctions in favour of the plaintiffs prior to the
institution of the suit (Ex. PW 1/17), further substantiated their
claim of established goodwill.
(v) The plaintiff’s “LACOSTE” word mark and crocodile
device had been extensively advertised since 1933 in India, and
their products were available at various international airports.
Hence, the plaintiffs had acquired significant goodwill and
reputation by 1998.
16.29 The learned Senior Counsel contested the rejection by the
learned Single Judge of several crucial documents, including the CA
certificate (PW 2/5), interim orders passed by this Court, worldwide
trademark registration certificates of the plaintiffs, and Lacoste’s book
showcasing advertisements with the crocodile device mark since
1933, solely for the want of a Section 65B certificate under IEA, even
though the plaintiffs had established the existence of dishonesty and
misrepresentation by the defendants. It was further argued that the
learned Single Judge incorrectly applied the test of significant
reputation and consumer recognition, as conceptually similarity itself
warranted the consideration of the injury to the plaintiffs.
16.30 Addressing the defendants’ challenge to the plaintiffs’ 1983
Indian trademark application, it was submitted that since the
application for registration was filed in 1983, defendant’s consent was
not required. The defendant’s non-opposition could not be construed
as consent under the 1985 agreement.
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16.31 On rendition of accounts, it was submitted that the learned
Single Judge had correctly directed a separate trial to ascertain the
profits incurred from sale of infringing goods, but the defendants had
deliberately delayed proceedings by failing to file their evidence
affidavit.
16.32 The learned Senior Counsel drew the Court’s attention to an
error in a document where the date “22.08.1985” was stipulated. It was
submitted that the actual date was 27.08.1985, which was smudged
and “22.08.1985” was mentioned. It was submitted that as per court
record, the actual date was 27.08.1985, and that this letter was not
placed on record.
16.33 With respect to the defendants’ claim that the 1983 Agreement
referred to only 3 marks of the defendants and not 5, it was argued that
the markings A1, A2, etc. in Schedule A of the Agreement were not
part of the original document but had been subsequently added by the
defendants themselves. The learned Senior Counsel urged the Court to
consider the entire context of the Agreement, which reflected that the
defendant’s standalone impugned mark was not agreed upon for co-
existence.
16.34 The learned Senior Counsel assailed the rejection of the CA
certificate (PW 2/5) on the ground that supporting invoices were
unnecessary since the very purpose of a CA certificate is that such
documents need not be exhibited, as they have already been audited.
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16.35 In rejoinder, the learned Counsel on behalf of the defendants
argued that copyright infringement required substantial copying of the
protected artwork. It was further argued that the defendants did not
have access to the plaintiffs’ accounts and, as such, the concerned CA
should have been deposed to validate the financial figures presented.
With respect to the rendition of accounts, it was contended that there
was no fiduciary or direct commercial relationship between the
defendants and the plaintiffs. The defendants maintained that they
were honest users of their mark, and thus, the rendition of accounts
was not warranted in this case.
16.36 In sur-rejoinder, reliance was placed on Section 35(2) of the
Commercial Courts Act, 2015, to submit that the general rule
regarding the award of costs is that the unsuccessful party shall be
ordered to pay the costs of the successful party. It was further
submitted that as per Section 135 of the Trade Marks Act, 1999 there
is no requirement of a fiduciary or direct commercial relationship
between the parties for awarding damages and rendering accounts.
Honesty was argued to be irrelevant once infringement was
established. Thus, the plaintiffs contended that the defendants honest
use of the mark was immaterial if their use was found to constitute
infringement, and that the rendition of accounts was indeed warranted
in the present case.
FINDINGS AND ANALYSIS
17. We have carefully considered the present lis in its entirety,
heard the learned Counsels appearing on behalf of both parties at
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length, meticulously examined the material placed on record and
thoroughly analysed the impugned judgment.
17.1 For the sake of convenience, the appellants/defendants will be
collectively referred to as “Crocodile International” and the
respondents/plaintiffs as “Lacoste”.
SCOPE OF REVIEW
17.2 It is needless to say that the first appellate court functions as the
final court of fact and, and it is permissible for the appellate court to
independently review and consider the evidence presented at the
appeal stage.
17.3 It is equally well-settled that an appellate court’s judgment must
reflect a conscious application of mind and must provide clear findings
supported by reasoned analysis on every issue that arises, as well as
on the contentions raised and pressed by the parties for its
determination.
17.4 Further, where an appellate court proposes to reverse a finding
of fact, it must engage with the reasoning of the Trial Court and clearly
articulate its own reasoning for arriving at a different conclusion.
17.5 In accordance with Order XLI Rule 31 of CPC, it is crucial to
identify the points of determination in the present dispute. These
points are as follows:
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(i) Whether the use of the impugned mark by Crocodile
International amounts to infringement of the copyright of
Lacoste?
(ii) Whether the Agreements dated 17.06.1983 and
22.08.1985 between Lacoste and Crocodile International extend
to India? Whether these Agreements entitle Crocodile
International to use the impugned mark in India?
(iii) Whether the use of the impugned mark by Crocodile
International in India amounts to infringement of Lacoste’s
trademark rights?
(iv) Whether the use of the impugned mark by Crocodile
International in India amounts to passing off?
(v) Whether the suit suffers from acquiescence on the part of
Lacoste?
(vi) Whether the learned Single Judge erred in awarding the
rendition of accounts to Lacoste?
(vii) Whether the learned Single Judge erred in awarding costs
to Lacoste?
17.6 In light of the above, we shall independently examine the
findings of the learned Single Judge on each of the issues and address
the submissions made by both the parties.
Issue 1: Whether the use of the impugned mark by Crocodile
International amounts to infringement of the copyright of Lacoste?
17.7 To begin, it is essential to outline the relevant statutory
framework applicable to the present issue.
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17.8 The subject of copyright is well-articulated by the Supreme
Court in Engineering Analysis Centre of Excellence (P) Ltd. v.
CIT10, the same reads as follows:
“128.1. Copyright is an exclusive right, which is negative in
nature, being a right to restrict others from doing certain acts.
128.2. Copyright is an intangible, incorporeal right, in the nature
of a privilege, which is quite independent of any material
substance. Ownership of copyright in a work is different from the
ownership of the physical material in which the copyrighted work
may happen to be embodied. An obvious example is the purchaser
of a book or a CD/DVD, who becomes the owner of the physical
article, but does not become the owner of the copyright inherent in
the work, such copyright remaining exclusively with the owner.
128.3. Parting with copyright entails parting with the right to do
any of the acts mentioned in Section 14 of the Copyright Act. The
transfer of the material substance does not, of itself, serve to
transfer the copyright therein. The transfer of the ownership of the
physical substance, in which copyright subsists, gives the
purchaser the right to do with it whatever he pleases, except the
right to reproduce the same and issue it to the public, unless such
copies are already in circulation, and the other acts mentioned in
Section 14 of the Copyright Act.”
17.9 Section 14(c) of the Copyright Act, 1957 defines “copyright” as
the exclusive right to, inter alia, reproduce a work, issue copies of the
work to the public, and communicate the work to the public. The
author of the work is the first owner of the copyright under Section 17
of the Act. Section 54 defines the “owner of copyright” as including
the author of a literary, dramatic, musical or artistic work, whether
known or unknown. The Act does not mandate compulsory
registration of copyright, as evidenced by employing the term “may”
in Section 45. This is further supported by Section 51, which stipulates
the circumstances under which a copyright is said to have been
infringed. The said provision does not impose any explicit requirement
10
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of copyright registration to seek remedies. Section 55 and 63 outline
civil and criminal remedies for copyright infringement.
17.10 Therefore, the Copyright Act, 1957 does not restrict protection
solely to registered copyright holders. This view was also upheld by a
co-ordinate Bench of this Court in Rajesh Masrani v. Tahiliani
Design (P) Ltd.11 as follows:
“33. A person has an inherent copyright in an original
composition or compilation without the necessity of its
registration. [Satsang v. Kiron Chandra Mukhopadhyay, AIR
1972 Calcutta 533 (V 59 C 114)]. Registration of the work under
the Act is not compulsory and registration is not a condition
precedent for maintaining a suit for damages for infringement of
copyright. The safest test to determine whether or not there has
been a violation of copyright is to find out if the reader, spectator
or viewer after having read or seen both the works can get an
impression that the impugned work or film is an imitation of the
other. In the instant case, no prudent man who has seen the film
and read the novel Alayazhi will come with an impression that the
former is an imitation of the latter. (R. Madhavan v. S.K. Nayar,
AIR 1988 Kerala 39). Registration of such right under Sec. 44 of
the Act is not a condition precedent for availing the remedy, such
as suing for an injunction restraining infringement of the right,
damages and for accounting. Provision for registration under
Section 44 is not mandatory but only intended to provide for prima
facie proof of the particulars regarding the right as stated in
Section 48. (Nav Sahitya Prakash v. Anand Kumar, AIR 1981
Allahabad 200).”
(emphasis supplied)
17.11 Section 13 of the Act provides that only “original” literary,
artistic, dramatic, and musical works can be protected by copyright.
The threshold for “originality” has evolved, as seen in Eastern Book
11
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Company v. DB Modak12, where the Supreme Court adopted a middle
ground between ‘sweat of the brow’ doctrine13 and the ‘modicum of
creativity’14 standard.
17.12 Copyright law is rooted in the principle that “no man is entitled
to steal or appropriate the result of another man’s brain, skill or
labour.”15 Copyright does not protect ideas, but rather their
expression.16 However, not every expression of an idea is protected.
17.13 One exception to copyright protection is the doctrine of merger.
This doctrine holds that if an idea and its expression are so intrinsically
connected that the expression becomes indistinguishable from the
idea, the expression is not entitled to copyright protection to avoid
monopolizing general ideas17.
17.14 In relation to copyright infringement, the Supreme Court in
R.G. Anand v. Delux Films18 laid down the following test for
infringement, which shall serve as a guiding principle in assessing
infringement in the present case. The same merits reproduction, as
follows:
“46. Thus, on a careful consideration and elucidation of the
various authorities and the case law on the subject discussed
above, the following propositions emerge:
1. There can be no copyright in an idea, subject-matter, themes,
plots or historical or legendary facts and violation of the copyright12 (2008) 1 SCC 1
13 University London Press v. University Tutorial Press, [1916] 2 Ch. 601
14 Fiest Publication Inc. v. Rural Telephone Service, 199 US 340 (1991)
15 Eastern Book Company v. D.B. Modak, (2008) 1 SCC 1
16 Baker v. Seldon, 101 US 99 [1879], Nichols v. Universal Pictures Corp., 45 F.2d (2d Cir. 1930), RGAnand v. Delux Films, (1978) 4 SCC 118
17 Herbert Rosenthal Jewelry Corporation v. Kalpakian, 446 F.2d 738 (1971); Mattel, Inc. v. JayantAgarwalla, 2008 SCC OnLine Del 1059
18
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in such cases is confined to the form, manner and arrangement and
expression of the idea by the author of the copyrighted work.
2. Where the same idea is being developed in a different manner,
it is manifest that the source being common, similarities are
bound to occur. In such a case the courts should determine
whether or not the similarities are on fundamental or substantial
aspects of the mode of expression adopted in the copyrighted
work. If the defendant’s work is nothing but a literal imitation of
the copyrighted work with some variations here and there it
would amount to violation of the copyright. In other words, in
order to be actionable the copy must be a substantial and material
one which at once leads to the conclusion that the defendant is
guilty of an act of piracy.
3. One of the surest and the safest test to determine whether or not
there has been a violation of copyright is to see if the reader,
spectator or the viewer after having read or seen both the works
is clearly of the opinion and gets an unmistakable impression
that the subsequent work appears to be a copy of the original.
4. Where the theme is the same but is presented and treated
differently so that the subsequent work becomes a completely new
work, no question of violation of copyright arises.
5. Where however apart from the similarities appearing in the
two works there are also material and broad dissimilarities which
negative the intention to copy the original and the coincidences
appearing in the two works are clearly incidental no
infringement of the copyright comes into existence.
6. As a violation of copyright amounts to an act of piracy it must
be proved by clear and cogent evidence after applying the various
tests laid down by the case-law discussed above.
7. Where however the question is of the violation of the copyright
of stage play by a film producer or a director the task of the
plaintiff becomes more difficult to prove piracy. It is manifest that
unlike a stage play a film has a much broader prospective, wider
field and a bigger background where the defendants can by
introducing a variety of incidents give a colour and complexion
different from the manner in which the copyrighted work has
expressed the idea. Even so, if the viewer after seeing the film gets
a totality of impression that the film is by and large a copy of the
original play, violation of the copyright may be said to be proved.”
(emphasis supplied)
17.15 A copyright registration does not automatically entitle the
registered proprietor to a remedy for infringement. A remedy follows
if copyright subsists, i.e., authorship and originality of the expression
of an idea is proved and infringement under Section 51 is established.
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Hence, the aforesaid test is to be employed in order to determine
whether the similarities between the defendants’ work and the
plaintiffs’ work are substantial enough to cause readers to believe that
the defendant’s work is a copy of the plaintiff’s, or whether the
defendants’ work is merely a literal copy of the plaintiffs’ work.
17.16 Upon applying the test laid down in R.G. Anand (supra), this
Court observes that Lacoste holds a valid and subsisting copyright
registration bearing No. A-62692/2002 in the artwork, ” “
(Ex. PW 1/10). The registration reveals Mr. Robert George as the
author of the work. Lacoste contended that their saurian device was
created by Mr. George in France back in 1927 and that Mr. George
thereafter conferred his rights onto Lacoste (Plaintiff No. 1). This was
duly supported by the testimony of PW1, which was notably not
challenged by the Crocodile International. Therefore, by virtue of
conveyance of rights, Lacoste (Plaintiff No.1) is the exclusive
copyright owner of the said artwork and has the right to control its
reproduction. It is also noted that this artwork functions as the logo of
the Lacoste brand.
17.17 The learned Single Judge applied the doctrine of merger and
concluded that there were a limited number of ways to express a fierce
crocodile. The unique constituent elements of both works were
examined, and it was concluded that the impugned mark was an
independent creation. Consequently, both marks were deemed entitled
to legal protection. The relevant excerpt reads as follows:
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“138. The crocodile devices of Plaintiff No. 1 and Defendant No.1
are independent creations, flowing from the same abstract. Both
parties have convincingly elucidated their narratives of having
opted for an artwork of a crocodile, initially intended for
commercial use in territories of origin. In these circumstances, the
Court is unable to draw an inference of ‘copying’ of Plaintiff No.
1’s design by Defendant No. 1. Similarities between the two
designs, arising from the same underlying idea with limited means
of manifestation, cannot constitute infringement of Lacoste’s
copyright. In the case of Allen v. Academic Games League of Am.
(89 F.3d 614 (9th Cir. 1996), the Court held that “ideas contained
in a copyrighted work may be freely used so long as the
copyrighted expression is not wholly appropriated.” Theimpugned artistic work ” ” exhibits novel independent
artistic qualities that do not support Lacoste’s allegations of
imitation of their design, as the creator was at liberty to draw from
the general idea of a crocodile.”
(emphasis supplied)
17.18 We respectfully disagree with the finding of the learned Single
Judge for the following reasons.
17.19 The present case is unique due to findings of conceptual and
visual similarity of the rival marks for the purposes of trademark
infringement by the learned Single Judge. This peculiarity is further
heightened by the application of the doctrine of merger for copyright
infringement. It is pertinent that the said doctrine should only be
applied in cases where there are no meaningful alternative ways to
express an idea. If alternative expression exists, the doctrine of merger
should not apply.
17.20 On the issue of independent creation, it is important to note that
Crocodile International was aware of Lacoste’s use of the mark as
early as 16.07.1980, when they issued a cease-and-desist notice (Ex.
DW 1/19) to Lacoste. This suggests that the defendants had reasonable
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access to and knowledge of Lacoste’s mark. While the doctrine of
merger does not dependent on intent, in situations where access and
near identity are present, courts should be hesitant to apply the
doctrine of merger, especially where the work is used in trade and
strongly associated with a particular brand.
17.21 The following is a comparison of the rival marks:
LACOSTE CROCODILE INTERNATIONAL
17.22 This Court is in agreement with the view taken by the learned
Single Judge on the issue of similarity between the rival marks. The
findings on similarity between the two marks by the learned Single
Judge is as follows:
“44. The visual analysis of the two trademarks ” ”
and ” ” reveals identical shape and posture. Both
crocodiles are depicted in a horizontal position with an upwardly
curved tail. Their body postures are quite similar, with both
showing a side view portraying the legs and tail in a similar
fashion. The depiction of the feet and claws is also similar,
entailing a detailed and realistic representation of a crocodile.
Although there are certain distinctions in the limbs and other
features of the impugned mark, the positioning mirrors that of
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Lacoste’s logo, reinforcing the overall visual similarity. Both the
devices feature an open mouth with visible teeth, whose shape and
placement are nearly alike. The detailed portrayal of the teeth and
shape of the mouth are critical visual elements that consumers
associate with Lacoste’s mark. The arrangement and pattern of
scale on the back of both reptiles is very similar, further
contributing to visual resemblance. Besides, the overall silhouette
of both crocodiles, including the head shape, body curvature, and
tail positioning, is almost indistinguishable. Both designs convey
a similar aggressive stance, enhancing the conceptual similarity.
This congruence in the overall silhouette not only heightens the
visual similarity, but also strengthens the conceptual
resemblance. These elements are crucial in the holistic assessment
of the marks, as they contribute to the overall impression retained
by the average consumer. The near-exact duplication of the
specific posture of the crocodile and other features by Crocodile
International exacerbates the deceptive similarity between the
two marks, creating a substantial likelihood of consumer
confusion.
45. Under Section 2(1)(d) of the Trade Marks Act, 1958, a mark is
considered to be deceptively similar if it “so nearly resembles that
other mark as to be likely to deceive or cause confusion.” This
principle of ‘likelihood of confusion,’ as elucidated by judicial
precedents, warrants an examination of the contesting marks with
a focus on their similarities, rather than their differences. In Cadila
Healthcare Ltd. v. Cadila Pharmaceuticals Ltd. ((2001) 5 SCC
73) reinforcing the holding in Amritdhara Pharmacy v. Satya Deo
Gupta (1962 SCC OnLine SC 13), the Supreme Court held that the
assessment of deceptive similarity extends beyond a side-by-side
comparison, entailing a consideration of the overall impression
delivered by the marks and the imperfect recollection of an average
consumer. In James Chadwick and Bros. Ltd. v. National Sewing
Thread Co. Ltd. (1951 SCC OnLine Bom 33), the conflicting
trademarks were a “representation of a bird perching on a
cylinder of cotton sewing thread with its wings fully spread out”
alongside the name ‘Eagle brand’ of the Respondent therein and
“representation of an eagle with its wings half opened trying to
stand erect on some flat object” with the brand name ‘Eagley
Sewing Machine Thread’ of the Appellant therein. In these
proceedings, arising out of grant of opposition to Respondent’s
trademark application, the Division Bench of High Court of
Bombay held that in ascertaining the possibility of confusion,
courts must evaluate the resemblances in the distinguishing
features of the trademark, rather than undertaking a meticulous
examination to discover their points of differences. In these
circumstances, irrespective of the differences in the posture, poise
and positioning of the birds and their wings, the Court ruled in
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favour of the Appellant therein, finding that a person of ordinary
intelligence would mistake the impugned mark to be of the
Appellant therein.
46. Having carefully compared the distinctive elements of both the
Plaintiffs’ and Defendants’ crocodile logos, it becomes clear that
the similarities are not only numerous, but also substantial.
Bearing the aforementioned principles of evaluation in mind, the
noticeable difference in the orientation of the crocodiles – with
Lacoste’s crocodile facing right, and Crocodile International’s
facing left – carries minimal weight and is likely to be perceived
as insignificant by the average consumer. The dominant visual
similarities between the two marks discussed previously, create a
strong overall ocular and conceptual resemblance. These elements
are so closely mirrored that they overshadow the minute
directional difference of the logos. To gain a deeper
understanding, a comparison is made below between the reversed
version of the Annexure-A device, oriented to face right, with
Lacoste’s crocodile device is drawn below:
Lacoste's Crocodile
crocodile device International's
device
47. Controverting the allegations of consumer misperception,
Crocodile International stated in their defence that it is standard
industry practice to emboss only the logo on the front pockets of t-
shirts, while the tags and labels clearly identify Crocodile
International as the manufacturer. Despite the apparent lack of
supporting evidence, the Court finds that the striking
resemblance between Lacoste’s crocodile mark and the
Annexure-A device across multiple key visual aspects, augments
the prospects of ‘initial interest confusion.’ This means that an
average consumer might initially believe that the goods are from
Lacoste based on the prominent and recognizable features of the
impugned mark, even though this confusion may not persist
throughout the transaction.19 Thus, this substantial resemblance
strongly supports a finding of deceptive similarity.”
(emphasis supplied)
19 Vol. 4, J. THOMASMCCARTHY,MCCARTHY ON TRADEMARKS AND UNFAIR COMPETITION,
⸹23:6 (5th edn., 2023).
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17.23 Upon reviewing the rival marks, we conclude that the
impugned mark reflects a specific choice of expression rather than an
inevitable or dictated one. The defendants had alternative options for
depicting a crocodile, as evidenced by the use of different crocodile
depictions in other marks since 1952. The existence of other effective
ways of expression of a crocodile is substantiated by the various marks
already in use by Crocodile International, as follows:
17.24 We find that the expression used in the impugned mark was a
choice, not a necessity. The mark’s specific posture and visual
characteristics are peculiar and not generic. The other marks in use by
Crocodile International demonstrate that the defendants could have
chosen a different representation of a crocodile.
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17.25 Given the substantial similarity between the marks, the
existence of other ways to depict a fierce crocodile, and the reasonable
likelihood that the defendants had access to Lacoste’s mark, we
conclude that independent creation cannot be established. The marks
are conceptually identical, and hence, the issue of copyright
infringement is decided in favour of Lacoste (plaintiffs) and against
Crocodile International (defendants).
17.26 Section 55(1) of the Copyright Act, 1957 provides for civil
remedies for copyright infringement, which Lacoste may be entitled
to.
17.27 Mr. Khan, the learned Counsel for the defendants argued that
the plaint did not provide particulars of original creation, authorship,
or date of creation. They also pointed out that the artwork had been
recognised as Crocodile International’s mark under 1983 Agreement.
17.28 However, upon reviewing the record, we note that PW1
provided a detailed deposition affirming the creation and publication
history of the artwork. This position is further corroborated by the
copyright registration bearing No. A-62692/2002 (Ex. PW-1/10) dated
16.01.2002, which records the initial publication date as 1927 in
France. The said testimony of PW-1 and the claim of copyright were
uncontested during the trial.
17.29 Therefore, we find that the submission of the learned Counsel
for the appellant cannot be accepted, and the issue of copyright
infringement is decided in favour of the plaintiffs.
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Issue No. 2: Whether the Agreements dated 17.06.1983 and
22.08.1985 between Lacoste and Crocodile International extend to
India? Whether the aforesaid Agreements entitle Crocodile
International to use the impugned mark in India?
17.30 At the core of this dispute are two agreements under which
Crocodile International, as the unregistered party, was purportedly
authorised by Lacoste to commercially use the impugned mark in
India. Although the present cross appeals arise out of allegations of
copyright and trademark infringement, the dispute fundamentally
revolves around questions of contract law. The determination of the
extent of applicability of the aforementioned Agreements, particularly
whether they extend to India, is critical to resolving this dispute.
17.31 In order to effectively address the issue of whether the co-
existence agreement applies to India, it is first necessary to examine
the relevant statutory provisions and guiding principles of contract law
which are germane to the adjudication of the present controversy.
17.32 Section 2 of the Indian Contract Act, 1872, provides that a
proposal must be accepted in order to constitute a promise. Upon the
performance of the promise with the requisite consideration, it forms
an enforceable agreement, thus creating a contract.
17.33 Section 7 of the Act provides that the acceptance of a proposal
must be absolute and unqualified for it to become a binding promise.
Section 8 further provides that acceptance may be communicated
through actions. Section 10 of the Act establishes that an agreement
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becomes a contract if the contracting parties enter it with free consent,
lawful consideration, and a lawful object. As per Section 29,
agreements whose terms are uncertain or incapable of being made
certain are void.
17.34 A contract is based on the mutual understanding between
parties, and it must be interpreted by giving the actual meaning to the
words used in the agreement. It is impermissible for a court to rewrite
or essentially create a new contract.20 The terms of the contract must
govern the dispute, and it is not within the jurisdiction of the court to
amend or reinterpret these terms unless they are vague or ambiguous.
Explicit terms of a contract always act as the final word with regard to
intention of parties21.
17.35 In Nabha Power Limited (NPL) v. Punjab State Power
Corporation Limited (PSPCL) & Anr.22, the Supreme Court clarified
the principles of interpreting commercial contracts. The Court referred
to Trollope and Colls Ltd. v. North West Metropolitan Regl. Hospital
Board23, underlining the importance of strict adherence to the terms of
the contract, the relevant excerpt merits reproduction:
“… the court does not make a contract for the parties. The court
will not even improve the contract which the parties have made for
themselves, however desirable the improvement might be. The
court’s function is to interpret and apply the contract which the
parties have made for themselves. If the express terms are perfectly
clear and free from ambiguity, there is no choice to be made
between different possible meanings: the clear terms must be20 Rajasthan State Industrial Development & Investment Corpn. v. Diamond & Gem Development
Corporation Ltd., (2013) 5 SCC 470 : (2013) 3 SCC (Civ) 153; Shree Ambica Medical Stores v. Surat
People‘s Coop. Bank Ltd., (2020) 13 SCC 564
21 GMR Warora Energy Ltd. v. CERC, (2023) 10 SCC 401
22 (2018) 11 SCC 508.
23
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applied even if the court thinks some other terms would have been
more suitable. An unexpressed term can be implied if and only if
the court finds that the parties must have intended that term to form
part of their contract: it is not enough for the court to find that such
a term would have been adopted by the parties as reasonable men
if it had been suggested to them: it must have been a term that went
without saying, a term necessary to give business efficacy to the
contract, a term which, though tacit, formed part of the contract
which the parties made for themselves.”
17.36 It is also crucial to examine the principle of territoriality
under trademark law.
17.37 Intellectual property rights, including trademarks, are territorial
in nature. Trademark rights are enforceable only within the
jurisdiction of the territory where they are registered and is not
automatically extended globally. A mark may have goodwill in one
country/jurisdiction/territory but be completely unknown in another.
Granting worldwide exclusivity for such mark, without market
presence or recognition, would be unjustified and may operate in an
anti-competitive manner. Such territorial confines often lead to
international disputes, as seen in the present case. The Supreme Court,
in Toyota Jidosha Kabushiki Kaisha v. Prius Auto Industries Ltd.24
reiterated that trademark rights are inherently territorial and cannot be
extended beyond the territory of registration.
17.38 Having established the principles of contract and trademark
law, we now proceed to analyse the 1983 and 1985
Agreements/Letters in light of the above discussed principles.
24
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1983 Agreement
17.39 The nature of the 1983 Agreement is undisputed, i.e., it is a co-
existence agreement aimed at ensuring mutual co-operation between
Lacoste and Crocodile International. However, the applicability of this
agreement to India and the use of the impugned mark in India remains
contentious in this lis.
17.40 The following sequence of communications precedes the 1983
Agreement:
(i) 16.07.1980 (Ex. DW 1/19) – A cease-and-desist notice
was issued to Lacoste’s licensee in Singapore.
(ii) 30.07.1980 (Ex. DW 1/20) – The licensee responded by
asserting that their logo featured an alligator, not a crocodile,
and that the marks were distinguishable, with consumers
associating the brand with the name “LACOSTE”.
(iii) 09.12.1980 (Ex. DW 1/21) – Lacoste proposed a
settlement, including compensation to resolve the legal
disputes.
(iv) 21.01.1983 (Ex. DW 1/18) – Lacoste offered a draft
settlement proposal, including compensation of USD 1 million
to cover expenses arising from the disputes.
(v) 10.02.1983 (Ex. DW 1/22) – Crocodile International’s
licensee in Singapore submitted three marks being, ”
“, ” ” and ” ” for
clarification regarding the scope of their registrations.
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(vi) 17.06.1983 (Ex. PW 1/8) – Following further
negotiations, the 1983 Agreement was finalized, establishing
co-existence in 5 countries, Taiwan, Singapore, Indonesia,
Malaysia (Malaya, Sabah, Sarawak) and Brunei.
17.41 The 1983 Agreement refers to Plaintiff No. 1 as “LCL” and
Defendant No. 1 as “LSM”. For the sake of convenience, the excerpt
of this Agreement is as follows:
“…WHEREAS LSM and LCL wish to cooperate in the countries
listed in Article -1 of this Agreement.
***
WHEREAS LSM and LCL agree that their respective emblem
marks as shown in Schedule A and B can co-exist in the market
concerned without confusion.
WHEREAS it is also the intention of the parties to cooperate in
other parts of the world wherever possible.
***
ARTICLE I – TERRITORY
This Agreement shall cover the following countries:
– TAIWAN
– SINGAPORE
– INDONESIA
– MALAYSIA (Malaya, Sabah, Sarawak)
– BRUNEI
Herein referred to as the Territory.
ARTICLE II – TRADEMARK REGSITRATIONS
…3. LSM shall permit LCL to apply for the registration within the
Territory of its various emblem trademarks as shown in Schedule
B appended hereto and shall give LCL all possible assistance to
obtain such registrations in the various classes of products and
services under which LCL wishes to do business. However, it is
hereby agreed between the parties that LCL shall not use nor apply
for the registration in the Territory of any Saurianlike trademark
other than those shown in the said Schedule B and shall take all
necessary steps to cancel and/or withdraw registrations and/or
applications, if any, for any Saurian-like trademark other than
those shown in that Schedule B.
***
4. Likewise, LCL shall give all possible assistance to LSM to apply
for the registration within the Territory of its own emblem
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trademarks as shown in Schedule A appended hereto in the various
classes of products and services under which LSM wishes to do
business.
LSM shall not use nor apply for the registration in the Territory of
any Saurian-like trademark other than those shown in the said
Schedule A and shall take all necessary steps to cancel and/or
withdraw registrations and/or applications, if any, for Saurian-like
trademarks other than that shown in Schedule A.
***
ARTICLE III – COMPENSATION
In order to compensate LSM for the expenses incurred in the past
for protection and defense of Saurian Trademarks within the
Territory, LCL shall pay LSM the annual payments indicated in
Schedule C appended hereto over the next 15 years commencing
in 1982.
***
ARTICLE IV – COOPERATION
1. Both parties undertake to cooperate technically in every possible
manner within their own means and rights in the defense of the
Saurian Trademarks against any third party infringers.
2. However, a decision taken by either party not to join in any legal
action against such infringers shall not prevent the other party
from proceeding alone at its own expense.
ARTICLE V – TERMINATION OF EXISTING LEGAL
PROCEEDINGS AND RELEASES
1. LSM and LCL agree that all law suits, legal actions,
controversies, disputes and claims which are the subject of legal
proceedings between them pending before any court or
administrative body in any jurisdiction within the Territory shall
be settled and discharged.
2. LSM and LCL therefore waive and abandon hereby any and all
claims and counter-claims at any time made by them in respect of
the use by either party of their respective Saurian Trademarks.
3. As a consequence of the foregoing, LSM and LCL shall take all
steps to execute such documents as may be necessary to
discontinue, with prejudice, all pending proceedings.”
(emphasis added)
17.42 Lacoste argues that the 1983 Agreement does not apply to
India, while Crocodile International asserts that it grants them
permissive use of the impugned mark in India.
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17.43 Upon examining the explicit terms of the 1983 Agreement,
Article I clearly lists five countries within its scope, without any
reference to India. The Agreement’s application is limited to these five
countries, and there is no mention of India. Therefore, the Agreement
cannot be construed as extending its applicability to India.
17.44 Although Article I also indicates that the parties may co-operate
in other regions if possible, this clause is merely indicative of goodwill
and does not provide for enforceable legal obligations. It fails to meet
the threshold of precision and certainty required under Indian contract
law to be enforceable.
17.45 Further, while two communications, i.e., Letter dated
02.08.1995 (Ex. DW 1/40) and Letter dated 28.07.1995 (Ex. DW 1/39)
are not admissible under Section 65 of IEA, they nonetheless support
Lacoste’s position. In these communications, Lacoste raised concerns
regarding the use of the marks outside the agreed territories, such as
in China, which was not a covered territory under the 1985 Agreement.
This supports the view that the parties intended to limit their
agreements to the explicitly stated territories.
17.46 After a thorough review of the case materials, this Court is
convinced that the parties intended the 1983 Agreement to apply only
to the five countries explicitly mentioned. This interpretation is
reinforced by legal disputes in other territories outside the scope of the
Agreement, such as China, Sri Lanka, and Myanmar. Notably, DW1
admitted during cross-examination conducted on 22.02.2018 that the
1983 Agreement did not extend to India. There is no evidence of an
amendment to include India or any other supporting documentation to
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suggest that the parties ever agreed to extend the Agreement’s scope
to India. Accordingly, the 1983 Agreement does not apply to India.
17.47 An ancillary question arises from the above discussion, whether
the 1983 Agreement, although not applicable to India per se, could
nevertheless be extended to India through a subsequent instrument.
17.48 Before addressing this issue, it is imperative to first determine
whether the 1983 Agreement included the use of the impugned mark
within its Schedule A. This is a foundational question that must be
resolved before considering any subsequent extension.
Whether the 1983 Agreement included the impugned mark in its
Schedule A?
17.49 The Schedules A and B, as appended to the 1983 Agreement
are critical to understanding its scope and intent, are as follows:
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17.50 Crocodile International contended that vide their letter dated
10.02.1983 (Ex. DW 1/22), they enclosed the impugned mark to be
included in the 1983 Agreement. They assert that Schedule A lists five
of their marks, not three, as argued by Lacoste. In the copy of the
Agreement on record, there are demarcations indicating marks as A1,
A2, etc., which is claimed to have been added by Crocodile
International. Although Ex. DW 1/22 was deemed inadmissible due to
lack of proper foundational evidence, the central issue remains what
the parties intended the Agreement to protect.
17.51 Lacoste, through various communications dated 29.03.1995
(Ex. DW 1/36), 13.11.1997 (Ex. DW 1/42) and 02.02.1998 (Ex. DW
1/43), raised objections to Crocodile International’s use of the
standalone impugned mark in Korea, Taiwan, and Myanmar
respectively. These objections indicate that Lacoste did not consent to
the use of the impugned mark even in the territories covered by the
1983 Agreement. Further, vide letter dated 28.05.1998 (Ex. DW 1/44),
Lacoste expressed concerns regarding Crocodile International’s use ofthe right-facing saurian device mark, ” “, reiterating that
they had only consented to the Crocodile International’s use of ”
” mark within specific bounds. By way of letter dated
18.12.1998 (Ex, DW 1/45), Lacoste alleged infringement in China and
India, due to the use of the left-facing saurian device. From these
communications, it can be inferred that Lacoste did not consent to the
standalone impugned mark’s use without the distinguishing word
“CROCODILE”. Thus, it is apparent that Lacoste did not permit the
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use of the impugned mark by Crocodile International, either in the
territories covered by the Agreement or beyond.
The 1985 Agreement/Letter
17.52 There exists a divergence of opinion regarding the nature and
intent of the Agreement/Letter dated 22.08.1985 (Ex. DW 1/80). Its
contents are as follows:
“22 August 1985
I, Tan Hian Tsin, acting in my own name and on behalf of
CROCODILE INTERNATIONAL PTE LTD of 89 Neil Road,
Singapore 0208 (formerly known as LI SENG MIN CO SDN BHD)
and/or of any individual or corporate body controlling, controlled
by or under common control or affiliated with CROCODILE
INTERNATIONAL PTE LTD, hereby undertake:
1. Not to oppose to present or future applications filed by LA
CHEMISE LACOSTE for the hereunder LA CHEMISE
LACOSTE’s emblem marks or marks containing said emblems in
Korea.
2. Should CROCODILE INTERNATIONAL’s application or
registration in Korea be opposed or in conflict with LA CHEMISE
LACOSTE application(s) as defined in paragraph 1 hereabove, to
supply LA CHEMISE LACOSTE upon its requests with the
appropriate consent letter.
3. To withdraw in Korea oppositions eventually filed against LA
CHEMISE LACOSTE’s applications as defined in paragraph 1
hereabove and never filed, directly or indirectly, any invalidation
or cancellation actions against said defined marks.
4. To supply LA CHEMISE LACOSTE, upon its request, with the
appropriate consent letter(s), that LCL might need to register the
hereunder LA CHEMISE LACOSTE’s emblem marks or marks
containing said emblem in BANGLADESH, INDIA and
PAKISTAN.
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Yours faithfully
For and on behalf of
CROCODILE INTERNATIONAL PTE LTD
TAN HIAN TSIN”
(emphasis supplied)
17.53 Crocodile International‘s case largely hinges on this alleged
instrument, asserting that it extended the 1983 Agreement to India. On
the other hand, Lacoste disputes its applicability, maintaining its
unilateral nature since it was neither addressed to nor signed by them.
17.54 Crocodile International submitted that the 1985 letter was a
response to an offer made by Lacoste for market access in Korea in
exchange for market presence in India. Furthermore, it was contended
that Dr. Tan, acting out of goodwill, included Pakistan and Bangladesh
in this arrangement. Crocodile International relies on multiple
correspondences, being Ex. DW-1/24 to DW-1/79, to demonstrate
Lacoste’s acknowledgment of the 1985 Agreement. They also claim
that Lacoste’s failure to object to Crocodile International’s trademark
application in India, filed in 1983, allowed the latter to secure its
registration in 1990. They assert that the learned Single Judge erred in
stating that Lacoste had obtained a registered trademark prior to the
1985 Agreement/Letter.
17.55 Crocodile International also contended that the plaintiff’s letter
dated 10.02.1989 (Ex. DW-1/24) was erroneously rejected by the
learned Single Judge. They argued that this letter was crucial evidence
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to demonstrate that the co-existence agreement was extended to India
and Pakistan. It was further contended that the learned Single Judge
wrongly concluded that Ex. DW-1/24 and Ex. DW-1/25 were not
legally sound evidence of an agreement. It was argued that such a
conclusion was contrary to Section 4 of the Indian Contract Act, 1872,
which provides that a proposal becomes binding upon acceptance.
17.56 Crocodile International contended that the offer of mutual co-
existence was accepted through letter dated 13.02.1989 (Ex. DW-
1/25), and that there was no revocation of this acceptance.
17.57 However, upon reviewing the record, we find that the learned
Single Judge meticulously examined both Ex. DW-1/24 and Ex. DW-
1/25 and duly held as follows:
“93. Ex. DW1/24 is the letter dated 10th February, 1989
addressed by Defendant No. 1 to Plaintiff No. 1, which Crocodile
International cites as evidence of the ongoing spirit of co-
existence between the parties in Asia. This letter references to
Defendant No. 1’s intention to not oppose Plaintiff No. 1’s
trademark application in India, and a reciprocal offer to seek
assistance of Plaintiff No. 1 in registering the “CROCODILE”
mark in the Middle Eastern countries. Ex. DW 1/24 was responded
to by Defendant No. 1 on 13th February, 1989 [Ex. DW 1/25],
recognizing that Defendant No. 1’s choice to not oppose Plaintiff
No. 1’s application was in line with the arrangement arrived at in
1985. The Defendants asserted that Ex. DW 1/25 contains an
express acknowledgment of the ‘1985 agreement,’ suggesting a
mutual recognition of extension of terms beyond the specific
territories initially outlined in the 1983 Agreement.
94. Lacoste, on the other hand, contested the implications that
Crocodile International seeks to draw fromthese documents. They
pointed out that while Ex. DW 1/24 expresses a willingness from
Defendant No. 1 not to oppose Plaintiff No. 1’s mark in India, it
lacks details about which particular mark the consent pertains to.
Additionally, Lacoste argued that Ex. DW 1/24 is CC’d to Mr.
Bernard Lacoste, linking it to an earlier correspondence dated
21st January, 1983, which initially proposed co-existence between
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the parties. This connection is being misused by Crocodile
International to argue that there was a consistent, mutual
understanding aimed at supporting each other’s trademark
registrations across various jurisdictions, including India.
95. In the opinion of the Court, these documents do not establish
any binding agreement that was formally signed in 1985 in
relation to India pertaining to the Annexure-A device. The
reference to a general spirit of coexistence in Ex. DW 1/24 is
insufficient to establish a binding agreement applicable to new
territories, such as India. For an agreement to be enforceable, it
must be clear, specific, and mutually acknowledged, which this
letter fails to achieve, rendering it ineffective as a basis for use of
Annexure- A device in India. Likewise, Ex. DW 1/25, even if
taken at face value, does not constitute legal evidence of an
enforceable co-existence agreement vis-Ã -vis Annexure-A device,
and is thus, irrelevant to the instant lawsuit.”
(emphasis supplied)
17.58 A plain reading of the impugned judgment indicates that the
learned Single Judge did not blindly reject the letters dated 10.02.1989
(Ex. DW-1/24) and 13.02.1989 (Ex. DW 1/25). Instead, the learned
Single Judge carefully considered the submissions of both sides before
reaching a conclusion.
17.59 The learned Senior Counsel for the defendants relies on Section
4 of the Indian Contract Act, 1872, to argue that the letter dated
13.02.1989 (Ex. DW 1/25) constituted an acceptance of a unilateral
offer. According to the learned Senior Counsel, this acceptance made
the proposal binding, as per Section 4.
17.60 However, we find that Section 4 must be read in conjunction
with Section 7 of the Indian Contract Act, 1872 which stipulates that
an acceptance must be absolute and unqualified.
17.61 Upon perusal of the letter dated 13.02.1989 (Ex. DW 1/25), we
do not find any unequivocal or unqualified acceptance of any offer.
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The letter merely reflects the defendants’ intention not to oppose the
plaintiffs’ trademark application, but it lacks the clarity required for it
to constitute a binding acceptance.
17.62 The Supreme Court, in Padia Timber Co. (P) Ltd. v.
Visakhapatnam Port Trust25, underscored the principle that offer and
acceptance must rest on certainty, commitment, and communication.
The relevant excerpt is as follows:
“54. It is a cardinal principle of the law of contract that the offer
and acceptance of an offer must be absolute. It can give no room
for doubt. The offer and acceptance must be based or founded on
three components, that is, certainty, commitment and
communication. However, when the acceptor puts in a new
condition while accepting the contract already signed by the
proposer, the contract is not complete until the proposer accepts
that condition, as held by this Court in Haridwar Singh v. Bagun
Sumbrui [Haridwar Singh v. Bagun Sumbrui, (1973) 3 SCC 889].
An acceptance with a variation is no acceptance. It is, in effect and
substance, simply a counter-proposal which must be accepted fully
by the original proposer, before a contract is made.
55. In Union of India v. Bhim Sen Walaiti Ram [Union of
India v. Bhim Sen Walaiti Ram, (1969) 3 SCC 146], a three-Judge
Bench of this Court held that acceptance of an offer may be either
absolute or conditional. If the acceptance is conditional, offer can
be withdrawn at any moment until absolute acceptance has taken
place.”
(emphasis supplied)
17.63 Therefore, an acceptance of an offer under Section 7 of the
Contract Act must be absolute, unconditional and unqualified.
17.64 In view of the above, this Court notes that the letter dated
10.02.1989 (Ex. DW-1/24) only expressed Defendant No.1’s intention
25
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not to oppose the plaintiffs’ trademark application, which cannot be
regarded as an absolute and unqualified acceptance of any offer.
17.65 Both Ex. DW-1/24 and Ex. DW-1/25 fail to exhibit the
necessary commitment or certainty that would signify a binding
acceptance. Mere reference of non-opposition does not establish an
unequivocal agreement enforceable by law.
17.66 Therefore, the submissions advanced by the learned Senior
Counsel regarding the acceptance of the proposal cannot be sustained.
17.67 In addition, we turn our attention to the documents heavily
relied upon by Crocodile International to prove Lacoste’s
acknowledgement of the 1985 Agreement.
17.68 Out of the documents listed, Ex. DW 1/13 to Ex. DW 1/35, Ex.
1/37 to Ex. DW 1/40 and Ex. DW 1/45 to Ex. DW 1/79, Lacoste
admitted only Ex. DW 1/36 and Ex. DW 1/44. The rest were objected
to for the want of original documents or secondary evidence or
certificate under Section 65B of IEA. The learned Single Judge rightly
observed that no explanation was offered in the Written Statement to
account for the absence of original documents. In the absence of such
explanation, and in accordance with Sections 65 of IEA, the
documents were deemed inadmissible.
17.69 Nevertheless, the learned Single Judge reviewed these
documents to assess the merit of Crocodile International’s claim. It
was correctly concluded that even if these documents were taken at
face value, they did not sufficiently establish Lacoste’s
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acknowledgment of the 1985 Agreement in relation to the use of the
standalone impugned mark in India. Ultimately, the admissible
exhibits namely, Ex. DW 1/1 to 1/12, Ex. DW 1/36, Ex. DW 41 to Ex.
DW 46, were considered, and the Court found them insufficient to
support Crocodile International’s position.
17.70 Revisiting the 1985 Agreement/letter, it is evident that this
document does not refer to or incorporate the 1983 Agreement or the
impugned mark in question. As rightly observed by the learned Single
Judge, there must be explicit and unambiguous terms that define the
obligations, rights and liabilities of the parties, especially in “complex
legal landscape like trademark registration in foreign jurisdictions”.
For a contract to be legally binding, an offer must be unequivocally
accepted and supported by valid consideration. Upon scrutiny of the
1985 letter, it is clear that:
(i) The letter is not addressed to Plaintiff No. 1, nor it is
attested by them;
(ii) The letter is unilateral in nature;
(iii) There is no evidence of an unqualified acceptance of the
offer contained in the letter;
(iv) It is not apparent whether the letter pertains to the
impugned mark;
(v) Paragraph 4 of the letter merely provides that Crocodile
International may consent upon request, but there is no evidence
to suggest that such consent was either sought or granted.
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Therefore, this 1985 letter cannot be construed as a bilateral
agreement, nor can it create binding rights and obligations for the
parties involved. This is further substantiated by Lacoste’s repeated
objections to Crocodile International’s use of the standalone saurian
device mark.
17.71 With respect to Crocodile International’s contention that it
refrained from objecting to Lacoste’s trademark application in India
based on the 1985 letter, and the learned Single Judge’s observation
that consent from Crocodile International was not required since
Lacoste was already a registered user in 1985, this Court finds that
such a position is not fatal to Lacoste‘s case.
17.72 Assuming, for the sake of argument, that Lacoste was not a
registered user in India in 1985, and that Crocodile International did
not formally oppose Lacoste’s application, such non-opposition or
forbearance does not, by itself, translate into a legally enforceable
agreement. The 1985 letter, for reasons outlined above, lacks the
essential characteristics of a binding contract. Moreover, as the 1985
letter does not pertain to the impugned mark, any possible extension
of the 1983 Agreement to India would be irrelevant to the current
dispute. Thus, the learned Single Judge’s observation regarding the
lack of a requirement for Crocodile International’s consent is not fatal
to Lacoste’s claim, as Lacoste’s trademark application was not
contingent on such consent.
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Permissive Use Under Indian Trademark Law
17.73 Under Indian trademark law, permissive use refers to the legal
use of a registered trademark by a party other than the registered
proprietor, provided such use does not amount to trademark
infringement. The consent of the registered proprietor may be express
or implied, as outlined under the Trade Mark Act of 199926.
17.74 Section 2(r) of the TM Act defines “permitted use”, which is
critical in determining whether the use of a trademark is authorized.
The provision is as follows:
“(r) “permitted use”, in relation to a registered trade mark,
means the use of trade mark–
(i) by a registered user of the trade mark in relation to goods or
services–
(a) with which he is connected in the course of trade; and
(b) in respect of which the trade mark remains registered for the
time being; and
(c) for which he is registered as registered user; and
(d) which complies with any conditions or limitations to which the
registration of registered user is subject; or
(ii) by a person other than the registered proprietor and registered
user in relation to goods or services–
(a) with which he is connected in the course of trade; and
(b) in respect of which the trade mark remains registered for the
time being; and
(c) by consent of such registered proprietor in a written
agreement; and
(d) which complies with any conditions or limitations to which such
user is subject and to which the registration of the trade”
(emphasis supplied)
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17.75 Additionally, Section 30(c)(i) of the Act outlines the limits on
the effect of a registered trademark, providing important boundaries
within which a trademark may be used by a third party without
constituting infringement. The provision is as follows:
“30. Limits on effect of registered trade mark.– (1) Nothing in
section 29 shall be construed as preventing the use of a registered
trade mark by any person for the purposes of identifying goods or
services as those of the proprietor provided the use–
***
(c) the use by a person of a trade mark–
(i) in relation to goods connected in the course of trade with the
proprietor or a registered user of the trade mark if, as to those
goods or a bulk of which they form part, the registered proprietor
or the registered user conforming to the permitted use has applied
the trade mark and has not subsequently removed or obliterated it,
or has at any time expressly or impliedly consented to the use of
the trade mark; or…”
(emphasis supplied)
17.76 Crocodile International’s reliance on Ex. DW-1/25 is
unavailing. This letter, upon review, shows that Crocodile
International itself conditioned its consent to two specific device
marks of Lacoste, which were listed in Schedule B of the 1983
Agreement. As such, the 1985 letter cannot be construed as extending
any rights related to the impugned mark.
17.77 Crocodile International also placed reliance on several
correspondences to establish that Lacoste acknowledged the 1985
letter as an extension of the 1983 Agreement. However, these
documents were rightly deemed to be inadmissible due to the absence
of originals and secondary evidence, and upon closer scrutiny, they
fail to demonstrate that the 1983 Agreement was extended to India via
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the 1985 communication. Moreover, the correspondence did not
substantiate that the 1985 communication concerned the impugned
device mark. Even the alleged acknowledgment by Lacoste remains
ambiguous and unsubstantiated.
17.78 In light of the foregoing discussion, neither the 1983
Agreement, the 1985 letter, nor the documentary evidence on record
establishes that Lacoste granted either explicit or implicit permission
to Crocodile International for the use the impugned mark in India.
17.79 In conclusion, while the 1983 Agreement is binding between
the parties, its scope is limited to the five countries explicitly
mentioned in Article I and does not extend to India. The 1985 letter
fails to demonstrate an extension of the 1983 Agreement to India, and
it does not pertain to the impugned mark. Accordingly, the 1983
Agreement and the 1985 letter do not entitle Crocodile International
to use the impugned mark in India. Lacoste is not bound by the 1985
letter and retains the right to object to Crocodile International’s use of
the impugned mark in India. The evidence on record supports
Lacoste’s claim that they only consented to the use of the saurian
device by Crocodile International when accompanied by the word
mark “CROCODILE”. As such, Crocodile International is not entitled
to use the impugned mark in India. This issue is decided in favour of
the plaintiffs and against the defendants.
Issue No. 3: Whether the use of the impugned mark by Crocodile
International in India amounts to infringement of trademark rights
of Lacoste?
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17.80 Section 2(h) of the TM Act defines a “deceptively similar” mark
as one which “so nearly resembles that other mark as to be likely to
deceive or cause confusion”. Such marks are not entitled to protection
under the Act, as specified in Section 9(2)(a)27. Section 28 of the Act
vests exclusive rights in the proprietor of a registered trademark,
including the right to seek relief in cases of infringement.
17.81 Under Section 29 of the Act, only registered trademarks are
protected against infringement. It is pertinent to note that innocence is
not a valid defence under this provision. Section 30 of the Act lays
down certain exceptions to the provisions of Section 29, as follows:
“29. Infringement of registered trade marks.–
***
(2) A registered trade mark is infringed by a person who, not being
a registered proprietor or a person using by way of permitted use,
uses in the course of trade, a mark which because of–
(a) its identity with the registered trade mark and the similarity of
the goods or services covered by such registered trade mark; or
(b) its similarity to the registered trade mark and the identity or
similarity of the goods or services covered by such registered
trade mark; or
(c) its identity with the registered trade mark and the identity of the
goods or services covered by such registered trade mark,
is likely to cause confusion on the part of the public, or which is
likely to have an association with the registered trade mark….
***
30. Limits on effect of registered trade mark.–
(1) Nothing in section 29 shall be construed as preventing the use
of a registered trade mark by any person for the purposes of
27 “9. Absolute grounds for refusal of registration.– (1) The trade marks–
***
(2) A mark shall not be registered as a trade mark if– (a) it is of such nature as to deceive the public or
cause confusion;…”
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identifying goods or services as those of the proprietor provided
the use–
(a) is in accordance with honest practices in industrial or
commercial matters, and
(b) is not such as to take unfair advantage of or be detrimental to
the distinctive character or repute of the trade mark.
***
(c) the use by a person of a trade mark–
(i) in relation to goods connected in the course of trade with the
proprietor or a registered user of the trade mark if, as to those
goods or a bulk of which they form part, the registered proprietor
or the registered user conforming to the permitted use has applied
the trade mark and has not subsequently removed or obliterated it,
or has at any time expressly or impliedly consented to the use of
the trade mark; or…”
(emphasis supplied)
17.82 Section 135(1) of the Act provides for relief in cases of
infringement, including injunctive relief, damages, an account of
profits and/or the delivery of the infringing goods for destruction.
Section 135(3) outlines certain exceptions to these remedies, as
follows:
“…(3) Notwithstanding anything contained in sub-section (1), the
court shall not grant relief by way of damages (other than nominal
damages) or on account of profits in any case–
(a) where in a suit for infringement of a trade mark, the
infringement complained of is in relation to a certification trade
mark or collective mark;
(b) where in a suit for infringement the defendant satisfies the
court–
(i) that at the time he commenced to use the trade mark complained
of in the suit, he was unaware and had no reasonable ground for
believing that the trade mark of the plaintiff was on the register or
that the plaintiff was a registered user using by way of permitted
use; and
(ii) that when he became aware of the existence and nature of the
plaintiff’s right in the trade mark, he forthwith ceased to use the
trade mark in relation to goods or services in respect of which it
was registered; or
(c) where in a suit for passing off, the defendant satisfies the
court–
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(i) that at the time he commenced to use the trade mark complained
of in the suit, he was unaware and had no reasonable ground for
believing that the trade mark for the plaintiff was in use; and
(ii) that when he became aware of the existence and nature of the
plaintiff’s trade mark he forthwith ceased to use the trade mark
complained of.”
17.83 The Supreme Court in Amritdhara Pharmacy v. Satya Deo
Gupta28 set out the test of “overall similarity” to determine whether
there is a likelihood of confusion amongst consumers. The inquiry
must be conducted from the perspective of an ordinary consumer of
average intelligence and imperfect recollection. It was emphasised
that while undertaking the enquiry to ascertain similarity and
confusion thereof, marks should be assessed in their entirety rather
than just focusing on their differences. This principle was reiterated in
Corn Products Refining Co. v. Shangrila Food Products Ltd29.
17.84 Further, the Supreme Court, in the celebrated decision of Parle
Products (P) Ltd. v. J.P. and Co.30, had outlined the factors to be
considered when determining infringement in cases of deceptively
similar marks. It emphasized that the broad and essential features of
the rival marks should be evaluated, and the overall similarity between
the marks should be judged to determine whether one could be
mistaken for the other. The relevant excerpt is as follows:
“9. It is, therefore, clear that in order to come to the conclusion
whether one mark is deceptively similar to another, the broad and
essential features of the two are to be considered. They should not
be placed side by side to find out if there are any differences in the
design and if so, whether they are of such character as to prevent
one design from being mistaken for the other. It would be enough28 1962 SCC OnLine SC 13
29 1959 SCC OnLine SC 11
30
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if the impugned mark bears such an overall similarity to the
registered mark as would be likely to mislead a person usually
dealing with one to accept the other if offered to him. In this case
we find that the packets are practically of the same size, the colour
scheme of the two wrappers is almost the same; the design on both
though not identical bears such a close resemblance that one can
essily be mistaken for the other. The essential features of both are
that there is a girl with one arm raised and carrying something in
the other with a cow or cows near her and hens or chickens in the
foreground. In the background there is a farm house with a fence.
The word “Gluco Biscuits” in one and “Glucose Biscuits” on the
other occupy a prominent place at the top with a good deal of
similarity between the two writings. Anyone in our opinion who
has a look at one of the packets today may easily mistake the
other if shown on another day as being the same article which he
had seen before. If one was not careful enough to note the
peculiar features of the wrapper on the plaintiffs’ goods, he might
easily mistake the defendants’ wrapper for the plaintiffs’ if shown
to him some time after he had seen the plaintiffs’. After all, an
ordinary purchaser is not gifted with the powers of observation of
a Sherlock Homes. We have therefore no doubt that the defendants’
wrapper is deceptively similar to the plaintiffs’ which was
registered. We do not think it necessary to refer to the decisions
referred to at the bar as in our view each case will have to be
judged on its own features and it would be of no use to note on how
many points there was similarity and in how many others there was
absence of it.”
(emphasis supplied)
17.85 Similarly, in Cadila Health Care Ltd. v. Cadila
Pharmaceuticals Ltd.31, the factors for determining deceptive
similarity were laid down. These include considering the similarity in
the nature of the goods, the class of consumers, and the marks’ visual
and phonetic resemblance. These factors were delineated in paragraph
35 of the said decision, as follows:
“…(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.
31
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(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.
(g) Any other surrounding circumstances which may be relevant in
the extent of dissimilarity between the competing marks.”
(emphasis supplied)
17.86 The Supreme Court in Renaissance Hotel Holdings Inc. v. B.
Vijaya Sai32, held that where the marks and the goods/services are
identical, the plaintiff is not required to provide actual proof of the
likelihood of confusion. The legislative scheme under the TM Act
operates on the premise that the mere existence of similarity between
the marks and the goods/services may lead to confusion, thereby
justifying a claim for infringement. The relevant excerpt is as follows:
“48. The legislative scheme is clear that when the mark of the
defendant is identical with the registered trade mark of the plaintiff
and the goods or services covered are similar to the ones covered
by such registered trade mark, it may be necessary to prove that it
is likely to cause confusion on the part of the public, or which is
likely to have an association with the registered trade mark.
Similarly, when the trade mark of the plaintiff is similar to the
registered trade mark of the defendant and the goods or services
covered by such registered trade mark are identical or similar to
the goods or services covered by such registered trade mark, it may
again be necessary to establish that it is likely to cause confusion
on the part of the public. However, when the trade mark of the
defendant is identical with the registered trade mark of the plaintiff
and that the goods or services of the defendant are identical with
the goods or services covered by registered trade mark, the Court32
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shall presume that it is likely to cause confusion on the part of the
public.
***
52. It could thus be seen that this Court again reiterated that the
question to be asked in an infringement action is as to whether the
defendant is using a mark which is same as, or which is a
colourable imitation of the plaintiff’s registered trade mark. It has
further been held that though the get-up of the defendant’s goods
may be so different from the plaintiff’s goods and the prices may
also be so different that there would be no probability of
deception of the public, nevertheless even in such cases i.e. in an
infringement action, an injunction would be issued as soon as it
is proved that the defendant is improperly using the plaintiff’s
mark. It has been reiterated that no case of actual deception nor
any actual damage needs to be proved in such cases. This Court
has further held that though two actions are closely similar in some
respects, in an action for infringement, where the defendant’s trade
mark is identical with the plaintiff’s trade mark, the Court will not
enquire whether the infringement is such as is likely to deceive or
cause confusion.”
(emphasis supplied)
17.87 Having understood the test for infringement and the principles
laid down in the aforementioned decisions, we now apply these to the
present case.
17.88 The present dispute pertains to the following rival marks:
LACOSTE CROCODILE
INTERNATIONAL
17.89 In applying the principles laid down in Cadila Health Care Ltd.
(supra), we observe that the nature of the rival marks is fundamentally
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the same, i.e., both are device marks. The marks are affixed to identical
or similar classes of goods and target a similar class of consumers.
Furthermore, both crocodiles are depicted in a similar posture,
featuring a curved tail, scales and a wide-open jaw facing towards the
side, with only two limbs visible. As a result, the marks are visually
deceptively similar, particularly from the perspective of the average
consumer, who, due to imperfect recollection, would not discern a
significant difference between the leftward or rightward facing
crocodiles. This substantial level of similarity is likely to cause initial
interest confusion among consumers, which is, in itself, sufficient to
constitute an infringement under Section 29 of the Act. At the cost of
repetition, evidence of actual confusion is not required, and the mere
likelihood of confusion is sufficient to establish infringement.
17.90 We reiterate that innocence is not a valid defence to trademark
infringement under Section 29 of the Act. The key consideration is
whether the plaintiff is a registered proprietor of the mark and whether
the defendant is authorized to use the said mark. In the present case,
Lacoste is the registered proprietor of the standalone saurian device
mark. Crocodile International is neither a registered proprietor of the
impugned mark nor is a permitted user, thereby attracts liability under
Section 29. Further, Crocodile International also does not qualify for
protection under Section 30(2)(c)(i) on account of lack of express or
implied consent to use the impugned mark.
17.91 The fact that the 1983 instrument of co-existence in five other
countries was premised on the understanding that no likelihood of
confusion existed between the rival marks in those countries holds
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minimal weight for Crocodile International in the Indian context.
There is no communication or document placed on record that
demonstrates Lacoste’s acknowledgement that there is no likelihood
of confusion between the marks in India.
17.92 In conclusion, given that both marks share stark visual and
conceptual similarities, they are likely to cause confusion among
consumers. Thus, the use of the unregistered impugned mark amounts
to infringement under Section 29 of the Act. As there is no permissive
use under Section 30(2)(c)(i) of the Act, Lacoste is entitled to remedies
under Section 135 of the Act. This issue is therefore decided against
the defendants and in favour of the plaintiffs.
Issue No. 4: Whether the use of the impugned mark by Crocodile
International in India amounts to passing off?
17.93 Passing off is a wider remedy than infringement.33 An action for
passing off arises when a person misrepresents their goods or services
as those of another. Unlike a statutory infringement action, which
applies to registered marks, passing off is a common law remedy
available for unregistered trademarks, and it allows brands of
international repute to seek relief in jurisdictions where they may not
be registered. A defendant in a passing off claim, may escape liability
if they can demonstrate that they have added certain differentiating
elements which are sufficient to distinguish their goods from that of
33
Signature Not Verified S. Syed Mohideen v. P. Sulochana Bai, (2016) 2 SCC 683; Renaissance Hotel Holdings Inc. (supra)
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the plaintiff’s.34 Intent or state of mind of the defendant is irrelevant
to a cause of action for passing off.35
17.94 Under Section 135(3)(c) of the TM Act, the defendant may
evade liability for passing off if they can prove that: (i) they were
unaware of the plaintiff’s mark at the time of commencing use, and
had no reasonable grounds to believe that the plaintiff’s mark was in
use, and (ii) upon becoming aware of the plaintiff’s mark, they took
adequate steps to distinguish their goods from the plaintiff’s goods.
17.95 In Reckitt & Colman Products Ltd. v. Borden Inc. & Others36,
the classic trinity test for passing off was established, which includes:
(i) the existence of goodwill or reputation, (ii) a misrepresentation to
the public that defendants’ goods are associated with the plaintiff’s
goods, and (iii) the plaintiff suffering or being likely to suffer actual
damage due to such misrepresentation. Passing off was thus explained
as a tortious act, aimed at protecting the goodwill associated with a
mark, as follows:
“…The basic underlying principle of such an action was stated in
1842 by Lord Langdale M.R. in Perry v. Truefitt (1842) 6 Beav.
66, 73 to be: “A man is not to sell his own goods under the
pretence that they are the goods of another man ….” Accordingly,
a misrepresentation achieving such a result is actionable because
it constitutes an invasion of proprietary rights vested in the
plaintiff. However, it is a prerequisite of any successful passing
off action that the plaintiff’s goods have acquired a reputation in
the market and are known by some distinguishing feature. It is also
a prerequisite that the misrepresentation has deceived or is likely
to deceive and that the plaintiff is likely to suffer damage by such
deception. Mere confusion which does not lead to a sale is not34 Renaissance Hotel Holdings Inc. (supra)
35 Wockhardt Ltd. v. Torrent Pharmaceuticals Ltd., (2018) 18 SCC 346
36
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sufficient. Thus, if a customer asks for a tin of black shoe polish
without specifying any brand and is offered the product of A which
he mistakenly believes to be that of B, he may be confused as to
what he has got but he has not been deceived into getting it.
Misrepresentation has played no part in his purchase.”
17.96 In Laxmikant V. Patel v. Chetanbhai Shah37, the Supreme
court further elaborated on the concept of passing off. It was held that
the essential elements of a passing off action are the establishment of
goodwill, misrepresentation, and damage or likelihood of damage to
the plaintiff’s goodwill, as follows:
“7. Though there is overwhelming documentary evidence filed by
the plaintiff in support of his plea that he has been carrying on his
business in the name and style of Muktajivan Colour Lab since
long we would, for the purpose of this appeal, proceed on the
finding of fact arrived at by the trial court and not dislodged by the
High Court, also not seriously disputed before this Court that the
plaintiff has been doing so at least since 1995. Without entering
into controversy whether the defendants had already started using
the word “Muktajivan” as a part of their trade name on the date
of the institution of the suit we would assume that such business of
the defendants had come into existence on or a little before the
institution of the suit as contended by the defendants. The principal
issue determinative of the grant of temporary injunction would
be whether the business of the plaintiff run in a trade name of
which “Muktajivan” is a part had come into existence prior to
commencement of its user by the defendants and whether it had
acquired a goodwill creating a property in the plaintiff so as to
restrain the use of the word Muktajivan in the business name of a
similar trade by a competitor i.e. the defendants.
***
13. In an action for passing-off it is usual, rather essential, to seek
an injunction, temporary or ad interim. The principles for the grant
of such injunction are the same as in the case of any other action
against injury complained of. The plaintiff must prove a prima
facie case, availability of balance of convenience in his favour
and his suffering an irreparable injury in the absence of grant of
injunction. According to Kerly (ibid, para 16.16) passing-off cases
are often cases of deliberate and intentional misrepresentation, but37
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it is well settled that fraud is not a necessary element of the right
of action, and the absence of an intention to deceive is not a
defence, though proof of fraudulent intention may materially assist
a plaintiff in establishing probability of deception. Christopher
Wadlow in Law of Passing-Off (1995 Edn., at p. 3.06) states that
the plaintiff does not have to prove actual damage in order to
succeed in an action for passing-off. Likelihood of damage is
sufficient….”
(emphasis added)
17.97 Similarly, in Toyota Jidosha Kabushiki Kaisha (supra), the
Court emphasized that the likelihood of confusion is a key factor in
determining whether an action for passing off can be made out. The
plaintiff must demonstrate substantial goodwill in the territory where
the action is sought. If such goodwill is not established, further
examination is unnecessary.
17.98 Adverting to the facts of the present case, Lacoste provided both
documentary and oral evidence to establish its goodwill and reputation
in India. The following evidence was presented:
(i) Ex. PW 1/15 – Electronic evidence of advertisements and
articles in magazines and newspapers was rightly deemed
inadmissible due to the lack of a certificate under Section
65B of IEA, as per the principles laid down in Arjun
Panditrao Khotkar v. Kailash Kushanrao Gorantyal38.
Additionally, there were no witnesses to provide the
necessary foundational evidence for such records and
maintenance of the device concerned39.
38
(2020) 7 SCC 1
39 65B. Admissibility of electronic records. — (1) Notwithstanding anything contained in this Act, any
information contained in an electronic record which is printed on a paper, stored, recorded or copied in optical
or magnetic media produced by a computer (hereinafter referred to as the computer output) shall be deemed
to be also a document, if the conditions mentioned in this section are satisfied in relation to the information
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(ii) Ex. PW 1/16 – The Survey Report was rejected for two
reasons: (a) it pertained to 2004, whereas reputation
needed to be shown as of 1998, and (b) it lacked
information regarding the methodology, sample size, and
other relevant details.
(iii) Ex. PW 2/5 – The CA certificate was held to be
inadmissible because it lacked the accompanying invoices,
documents, ledgers etc., hence, the same were not verified
or cross-examined and because the concerned CA was also
not summoned. Instead, the plaintiffs attempted to prove
the authenticity through PW2, who is admittedly not a CA.
17.99 Hence, following the principles laid down in Laxmikat V
(supra), to sustain a passing off claim, Lacoste was required to
establish goodwill or reputation in India prior to and at the time of
commencement Crocodile International’s use of the impugned mark
in 1998.
17.100 The learned Single Judge rejected Lacoste’s claim for
passing off, primarily due to the failure to prove, with admissible and
and computer in question and shall be admissible in any proceedings, without further proof or production of
the original, as evidence or any contents of the original or of any fact stated therein of which direct evidence
would be admissible.
(2) The conditions referred to in sub-section (1) in respect of a computer output shall be the following,
namely: — (a) the computer output containing the information was produced by the computer during the
period over which the computer was used regularly to store or process information for the purposes of any
activities regularly carried on over that period by the person having lawful control over the use of the
computer;
(b) during the said period, information of the kind contained in the electronic record or of the kind from which
the information so contained is derived was regularly fed into the computer in the ordinary course of the said
activities;
(c) throughout the material part of the said period, the computer was operating properly or, if not, then in
respect of any period in which it was not operating properly or was out of operation during that part of the
period, was not such as to affect the electronic record or the accuracy of its contents; and
(d) the information contained in the electronic record reproduces or is derived from such information fed into
the computer in the ordinary course of the said activities.
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reliable evidence, that Lacoste had substantial reputation or goodwill
in India as of 1998.
17.101 The learned Single Judge held that press articles,
advertisements, photos, and the survey report were produced as
electronic records without the mandatory certificate required under
Section 65B of IEA, therefore, rendering them inadmissible and
ineffective.
17.102 Regarding the survey report (Ex. PW1/16), it was held
that it reflected public perception in 2004, whereas Lacoste was
required to establish its reputation as of 1998. Additionally, the CA
certificate pertaining to turnover and advertising was treated as
insufficient because it lacked the necessary supporting documents, and
the CA was not made available for examination or cross-examination.
17.103 Lacoste contended that requiring the CA certificate to be
supported by all the underlying documents would defeat its purpose.
However, the learned Single Judge rightfully held that the Supreme
Court, in CBI v. V.C. Shukla40, had affirmed that such documents
must be corroborated to be considered credible evidence. It was held
that “even correct and authentic entries in books of account cannot
without independent evidence of their trustworthiness, fix a liability
upon a person”.
17.104 Furthermore, the learned Single Judge rightly observed
that, at the final stage of trial, the evidence must be scrutinized more
40
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rigorously, as it directly impacts the final determination of the rights
and liabilities of the parties. The court cannot rely solely on prima
facie evidence at the final stage but must ensure that evidence
complies with relevant procedural laws.
17.105 This Court concurs with the learned Single Judge’s
finding regarding the issue of passing off. Since the evidence
presented by Lacoste relating to goodwill and reputation was found
inadmissible, the Court does not need to examine the other elements
of passing off, as per the decision in S. Syed Mohideen (supra).
17.106 Therefore, it is held that Lacoste has failed to establish a
case for passing off.
17.107 This issue is decided in favour of the defendants and
against the plaintiffs.
Issue No. 5: Whether the suit suffers from acquiescence on behalf
of Lacoste?
17.108 Acquiescence is a form of estoppel, rooted in equity and
law of evidence. It involves a positive act or deliberate inaction, where
a party, with knowledge of infringement, fails to take action within a
reasonable period. Acquiescence requires that the party actively sits
on their rights, rather than simply remaining silent or passive. Section
33 of the TM Act delineates the effect of acquiescence in the context
of trademark law as follows:
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“33. Effect of acquiescence.–
(1) Where the proprietor of an earlier trade mark has acquiesced
for a continuous period of five years in the use of a registered trade
mark, being aware of that use, he shall no longer be entitled on the
basis of that earlier trade mark–
(a) to apply for a declaration that the registration of the later trade
mark is invalid, or
(b) to oppose the use of the later trade mark in relation to the goods
or services in relation to which it has been so used, unless the
registration of the later trade mark was not applied in good faith.
(2) Where sub-section (1) applies, the proprietor of the later trade
mark is not entitled to oppose the use of the earlier trade mark, or
as the case may be, the exploitation of the earlier right,
notwithstanding that the earlier trade mark may no longer be
invoked against his later trade mark.”
17.109 In Amritdhara Pharmacy (supra), the Supreme Court
referred to Halsbury’s Laws (Vol. 32) in its discussion of
acquiescence, highlighting that a person who, with knowledge of
infringement, refrains from acting, may be precluded from asserting
their rights. The Court observed the following:
“13. …The matter has been put thus in Halsbury’s Laws of
England, Vol. 32, 2nd Edition) p. 656-57, para 966.
“‘If a trader allows another person who is acting in good faith to
build up a reputation under a trade name or mark to which he
has rights, he may lose his right to complain, and may even be
debarred from himself using such name or mark. But even long
user by another, if fraudulent, does not affect the plaintiff’s right to
a final injunction; on the other hand prompt warning or action
before the defendant has built up any goodwill may materially
assist the plaintiff’s case.”
(emphasis supplied)
17.110 This Court concurs with the learned Single Judge’s
findings on the issue to acquiescence. Crocodile International argued
that they had openly advertised the use of the impugned mark in India
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since 1997, while, Lacoste allegedly became aware of the use in 1999,
according to the plaint.
17.111 Although acquiescence can, in certain cases, undermine
the right of a party to seek relief41, the defendants have not presented
sufficient evidence to established that Lacoste, with knowledge of the
alleged infringement, remained passive or tacitly consented to the
Crocodile International’s use of the impugned mark. The purported
three-year delay in initiating the suit does not, in this instance,
prejudice the defendants, as no detriment has been proved to have
occurred during this period. As a result, this issue is decided in favour
of the plaintiffs and against the defendants.
Issue No. 6: Whether the learned Single Judge erred in granting
rendition of accounts to Lacoste?
17.112 It is well established under Indian law that a decree for
the rendition of accounts may only be granted where the plaintiff is
legally entitled to seek such relief. This entitlement can arise in the
following contexts: (i) by virtue of statute, (ii) based on fiduciary
relationship between the parties, or (iii) in equity, where the
relationship between the parties necessitates the granting of accounts
to assert the legal right42 of the plaintiff effectively.
17.113 The right to seek rendition of accounts, therefore, may
either be statutory, arise from the nature of relationship between the
41 Chairman, State Bank of India v. MJ James, 2021 SCC OnLine SC 1061
42
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parties, or be granted in equity where other forms of relief would be
inadequate.
17.114 In the present case, following the finding of trademark
infringement, the learned Single Judge directed Crocodile
International to render an account of the profits derived from the sale
of goods bearing the impugned mark. This direction is consistent with
the provisions of Section 135(1) of the TM Act which allows the
plaintiffs to seek relief, including the accounting of profits, following
an infringement of their trademark rights. For the convenience,
Section 135 is reproduced as follows:
“135. Relief in suits for infringement or for passing off.–
…(3) Notwithstanding anything contained in sub-section (1), the
court shall not grant relief by way of damages (other than nominal
damages) or on account of profits in any case–
(a) where in a suit for infringement of a trade mark, the
infringement complained of is in relation to a certification trade
mark or collective mark; or
(b) where in a suit for infringement the defendant satisfies the
court–
(i) that at the time he commenced to use the trade mark complained
of in the suit, he was unaware and had no reasonable ground for
believing that the trade mark of the plaintiff was on the register or
that the plaintiff was a registered user using by way of permitted
use; and
(ii) that when he became aware of the existence and nature of the
plaintiff’s right in the trade mark, he forthwith ceased to use the
trade mark in relation to goods or services in respect of which it
was registered;…”
17.115 It is important to note that Section 135(3) of the Act
provides certain exceptions to the obligation to account for profits or
damages. However, these exceptions are not applicable in the present
case as Lacoste is the registered proprietor of the trademark, and
Crocodile International is using a deceptively similar and unregistered
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mark, hence, a clear case of infringement is made out. Therefore, a
remedy is necessary to provide adequate redress for the infringement
of its rights; as per Section 135, Lacoste is entitled to an account of
profits.
17.116 Crocodile International contended that no fiduciary
relationship existed between the parties, which would warrant the
rendition of accounts. However, Section 135 of the Act does not
require a fiduciary relationship to grant such relief. The only criterion
to be satisfied in order to grant an account of profits is a finding that
the defendant is infringing the plaintiff’s registered trademark. The
plaintiff is then entitled to the proceeds generated from the commercial
use of the infringing mark, regardless of whether a fiduciary
relationship exists between the parties.
17.117 In the light of the above, we find no error in the learned
Single Judge’s decision to grant an account of profits to Lacoste.
Section 135 of the TM Act, when applied to the facts of this case,
justifies the aforesaid relief. Accordingly, this issue is decided in
favour of the plaintiffs and against the defendants.
Issue No. 7: Whether the learned Single Judge erred in awarding
costs to Lacoste?
17.118 In relation to the award of costs, Crocodile International
contended that the eleven-year delay in the proceedings was primarily
due to Lacoste, and therefore, the imposition of costs on them was not
justified. Crocodile International relied on Section 35(3)(a) of CPC, as
amended by the Commercial Courts Act, 2015. In contrast, Lacoste
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emphasized Section 35(2) of the CPC, which grants courts discretion
in awarding costs.
17.119 Section 35 of the CPC vests discretionary powers in the
courts with respect to the imposition of costs in commercial disputes.
It grants the court the authority to decide whether costs should be
awarded as well as the quantum of such costs. The general rule,
however, is that the unsuccessful party shall be ordered to pay the costs
of the successful party, unless the court records reasons for deviation.
In exercising this discretion, the court may consider several factors,
including: (i) the conduct of the parties during the proceedings, (ii)
whether a party has made frivolous counterclaims that have delayed
the resolution of the case, (iii) whether vexatious proceedings have
been instituted, or (iv) whether the party’s actions have unnecessarily
consumed the court’s time.
17.120 Additionally, Chapter XXIII of the Delhi High Court
(Original Side) Rules, 2018 provides guidelines for the imposition of
costs, particularly Rules 1 and 2, which lay down the principles that
courts should consider whilst determining costs. The relevant Rules
are reproduced below:
“1. Power of Court/ Registrar General/ Registrar to impose cost.-
(i) If the Court considers any party abusing the process of Court
or in any manner considered dilatory, vexatious, mala fide and
abuse of process by them, the Court shall require the delinquent
party to make deposit / payment upfront, in the manner directed by
Court of such costs as the Court deems appropriate, before
proceeding further in the matter. For the purpose of this Chapter,
the expression ―Court‖ shall mean and include the Court, the
Registrar General and the Registrar, as the case may be. (ii) In
addition to exercise of powers under Rule 1(i) above, the Court
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may impose suitable costs upon any party at any stage of the
proceedings, including at the stage of filing any interlocutory
application; framing of issues; determining order and conduct of
recording evidence etc., if it considers imposition of such costs just,
necessary and proper, according to the proceedings in the matter.
(iii) While determining costs, the Court may also take into
consideration factors, such as, inconvenience caused to parties/
witnesses/ other persons connected with the proceedings; previous
conduct of parties; the stage at which the offending conduct is
committed by the delinquent party; the probability and likelihood
of success of vexatious efforts of the delinquent party; the
relevancy of number and nature of witnesses; questions (including
depositions by way of examination-in-chief) put to the witnesses
and such other conduct as the Court considers inappropriate. (iv)
Failure of the said party in making payment/ deposit of costs may
result in all consequences provided in the Code for defaults and
adverse orders being passed against the said party, as the Court
deems appropriate and proper, besides enabling the other party to
file execution proceedings against the delinquent party for
recovery of said costs.
2. Imposition of actual costs.- In addition to imposition of costs,
as provided in Rule 1 of this Chapter, the Court shall award costs
guided by and upto actual costs as borne by the parties, even if the
same has not been quantified by parties, at the time of decreeing
or dismissing the suit. In this behalf the Court will take into
consideration all relevant factors including (but not restricted) the
actual fees paid to the Advocates/ Senior Advocates; actual
expenses for publication, citation etc.; actual costs incurred in
prosecution and conduct of suit including but not limited to costs
and expenses incurred for attending proceedings, procuring
attendance of witnesses, experts etc.; execution of commissions;
and all other legitimate expenses incurred by the party, which the
Court orders to be paid to any party. In addition to imposition of
costs as above, the Court may also pass a decree for costs as
provided in Sections 35-A and 35-B of the Code or under any
applicable law.”
17.121 In view of the aforementioned Rules and the specific
facts of this case, this Court notes that: (i) the suit was partly decreed
in favour of the defendants, and (ii) There was an eleven-year delay in
examining a key witness by Lacoste. Given these circumstances, this
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Court is of the opinion that it would not be justifiable for the
defendants to bear the entirety of the costs. Accordingly, the Court
deems it appropriate to set aside the findings of the learned Single
Judge concerning the imposition of costs. Therefore, this issue is
decided in favour of the defendants and against the plaintiffs.
CONCLUSION AND RELIEF
18. In light of the foregoing discussion, this Court is satisfied that
the plaintiffs have established infringement of their trademark ”
” and copyright in ” “. However, the plaintiffs’
claim for passing off is not maintainable due to their failure to
establish goodwill, as discussed earlier.
19. Having regard to the preceding findings, this Court upholds the
decree for a permanent injunction in favour of the plaintiffs and
against the defendants with respect to the trademark infringement.
20. This Court further finds that there is no acquiescence on the part
of the plaintiffs that would disentitle them form seeking relief.
21. Issue No. 1 pertaining to copyright infringement, the Court rules
in favour of the plaintiffs and against the defendants.
22. Since, the plaintiffs only prayed for permanent injunction with
respect to copyright infringement, a decree of permanent injunction is
granted in favour of the plaintiffs and against the defendants.
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23. Accordingly, the impugned judgment dated 14.08.2024 passed
in CS (Comm) No. 1550 of 2016 is modified in the terms outlined
hereinabove.
24. The appeals are partly allowed in the above terms.
25. All pending applications, if any, stand disposed of. No order is
made as to costs.
OM PRAKASH SHUKLA, J.
C.HARI SHANKAR, J.
MARCH 09, 2026/gunn/ss/at
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