BY TIOL News Service

NEW DELHI, FEB 13, 2016: THE issue is: Whether jurisdiction of Intellectual Appellate Board is conditional upon the civil court's determination of the prima facie tenability of the invalidity plea - NO is the answer.

Facts of the case

The Infosys Technologies Limited (the Respondent) sued the sued Data Infosys Limited (the Appellant) and claimed permanent injunction against infringement of its registered trademarks in "Infosys" and allied marks and the use of its corporate name, including the use by the defendant of the domain name - www.datainfosys.net which amounted to infringement of its registered trademarks. During the pendency of this suit, the appellant's trade mark "Data Infosys" was granted registration under class 9 and 38 of the Trade Marks Act, 1999. The respondent thereafter approached the Intellectual Property Appellate Board (IPAB) and sought rectification of the registered trademark "Data Infosys" under Classes 38, 9 and 42. The appellant challenged this initial filing of rectification proceedings without seeking leave of the Court and considered it as abuse of process, but the same was dismissed by the single judge. Hence appeal came before this full bench.

Reasoning

1. The analysis of the various provisions of the Act, emphasize that the IPAB is solely charged with the duty of examining the plea of invalidity of a registered trademark. Its decision, and that of no other court or body, can lead to the striking off or retention of a mark on the register. Conversely, therefore, except while considering whether to grant interlocutory relief, or while considering whether to adjourn the proceedings by three months to enable the concerned party to move the IPAB under sections 47/57, the plea of invalidity would be prima facie evaluated by a court under Section 124(1)(b)(ii). These provisions clearly show that there is a bar to exercise of jurisdiction of civil courts on the issue of examination of merits of a plea of invalidity of a trademark.

2. The structure of Section 124 nowhere indicates that jurisdiction of IPAB (where an invalidity plea is urged in, or after filing of suit) is conditional upon the civil court's determination of the prima facie tenability of the invalidity plea. Further, there is nothing in Section 124(1) or 124(2) to suggest that either the plaintiff, or the defendant is precluded from moving an application before the Registrar /IPAB under Section 47 or 57 of the Act for removal/rectification of the registered trademark of the opposite party at any point of time, i.e. before, or after the filing of the suit for infringement by the plaintiff, or before or after the filing of the written statement by the defendant. To infer so, in this court's opinion would result in anomalous consequences, because if a proceeding under section 47/57 – urging the plea of invalidity is filed before filing of the suit, the IPAB would be obliged to consider the matter on merits having regard to all the materials, as the suit would necessarily have to be stayed (Section 124(1)(i)). However, in the other situation, access to the IPAB itself would be dependent upon the assumed 'permission' of the civil court, entirely dependent upon that court's prima facie view of the case.

3. This court is unconvinced by the arguments of the defendant and other counsel who supported the Astra Zeneca decision about its soundness also because the deemed abandonment of the invalidity plea – the consequence enacted by Section 124(3), is only in respect of the stay of the suit. There is a line of authority that a legal fiction should not be extrapolated beyond the purpose for which the legislation is brought in.

4. Applying the reasoning of various decisions, the sequitur to-either the court holding the invalidity plea to be prima facie untenable (and, therefore, not adjourning the proceedings in the suit for any length of time), or the plea of invalidity being held to be prima facie tenable, (and, consequently, the proceedings in the suit being adjourned for a period of three months to approach IPAB), and the concerned party not filing the rectification application within the period of three months, or such extended period as the court may grant, is not deemed abandonment of the right to claim rectification, but rather deemed abandonment of the defence of invalid trademark registration in the infringement suit. In other words, the right to claim rectification is never taken away. Thus, the Astra Zeneca line of thinking cannot be adopted and the same is rejected.

Conclusion

IPAB has exclusive jurisdiction to consider and decide upon the merits of a plea of trademark registration invalidity – applying Section 47 and 57 of the Act- in the context of an infringement suit based on such registered trademark. The two situations whereby the infringement action is stayed, are when the rectification proceedings are instituted before the filing of the suit (Section 124 (1) (i)) and after the plea of invalidity is held to be prima facie tenable under Section 124 (1) (ii)) to enable the party urging invalidity to approach IPAB. Where the civil court based on its prima facie assessment states the the invalidity plea is not tenable or where the litigant does not approach the IPAB within the time granted (i.e when the court holds the plea to be prima facie tenable) the only consequence is deemed abandonment of the invalidity defense in the infringement suit. However, access to IPAB to invoke its exclusive jurisdiction to test the invalidity of a trademark registration is not precluded or barred in any manner whatsoever.

(See 2016-TIOL-234-HC-DEL-MISC-LB)