A lawsuit for trademark infringement was filed against the defendant, Saraswati Trading Company, by LT Foods, a well-known food manufacturing and processing company recognised for its rice products, including for its well-known names Daawat, Daawat Devaya, Daawat Bestow, and Chef's Secret. The Plaintiff learned of the Defendant's sales, storage, and distribution of fake "Daawat" goods in August 2021. Examining the product found that it was inferior jawaphool rice marketed as basmati rice under the name "Daawat Chef's Secrets Basmati Rice," with packaging that was identical to that of the Plaintiff. According to the plaintiff, these actions were willful and dishonest, constituting infringement, diluting its brand, and harming its business.
The plaintiff asserted that its registered "Dawat" and "Daawat" word and device marks have acquired significant goodwill and recognition, contributing to sales of over Rs. 700 crores in 2020–21, with a sizeable amount of Rs. 33 crores spent on brand promotion. Several nations, including Australia, Canada, the European Union, and the United Kingdom, have registered its marks. The plaintiff identified instances in which it had been successful in defending its trademarks from infringement by different parties.
DecisionOn September 7, 2021, the Honourable High Court of Delhi issued an ex parte interim injunction. A Local Commissioner was additionally chosen in accordance with Order 26 of the Code of Civil Procedure (1908) to look into the Defendant's premises and create an inventory of the contraband items. The Commissioner found 89 packets of rice, including both empty and packed Daawat and Daawat's Chef's Secretz rice bags, bearing the Plaintiff's mark after inspecting the Defendant's premises in addition to 3 other premises. The parcels were obviously forgeries of the Plaintiff's renowned Daawat items, the Commissioner's report made clear.
Considering the considerable volume of fake items confiscated, the Court was of the unmistakable judgement that the defendant had engaged in acts of infringement with purpose and malice. There was no need for any ex parte evidence because the Commissioner's report, which was accepted as evidence, was uncontested. The Defendant failed to provide their written statement by the deadline, which further satisfied the Court that no other evidence was required. The Court placed reliance on ML Brother LLP v. Mahesh Kumar Bhrualal Tanna [ 2022 SCC OnLine Del 1452], where it was held that the report submitted by the Commissioner and the evidence taken by him shall be evidence in the suit. The Court also took into consideration the decision in Levi Strauss & Co. v. Rajesh Agarwal [ 2018 SCC OnLine Del 6421] which said that the Commissioner was chosen to act as the Court's representative, that the evidence gathered and the report produced would be used as evidence in the lawsuit, and that parties with concerns about the evidence had the option of questioning the Commissioner face-to-face in open court.
The Plaintiff's business and reputation suffered irreparable loss as a result of the Defendant intentionally misleading customers, the Court ruled. As a result, the Court gave the Plaintiff damages and costs of INR 25,00,000 due to the Defendant's infringement activities. In awarding damages to the Plaintiff, the Court relied on Procter & Gamble Company v. Joy Creators [ (2011) 450 PTC 541], where it was stated that owners of trademarks and copyrights expend a lot of time and money pursuing legal action against infringers. Failure to grant punitive damages in these situations may give dishonest people the confidence to misappropriate the goodwill of well-known brands, passing off their own products and services as those of the well-known brand, profit from the deception, and evade payment by failing to appear in court. This would prevent the plaintiff from demonstrating the precise amount of the infringer's profit.
ConclusionThe significance of defending registered trademarks against infringement and passing off is shown by the LT Foods v. Saraswati Trading Company case. The Court's ruling emphasised the importance of the testimony provided by the Commissioners chosen in accordance with CPC Order 26. Punitive damages may be granted to deter infringers and fairly recompense the plaintiff, as stated in the judgement as well. The case serves as a cautionary tale to potential infringers that the Court would take severe action against wilful and dishonest infringement, and the absence of a written statement or presence will not preclude the Court from awarding damages to the aggrieved party.
