Recently, the Delhi High Court in the case Ferrero Spa & Nr vs M/S Ruchi International & Anr[CS(COMM) 76/2018] has ruled in favor of the Ferrero Spa (hereinafter referred to as the ‘Plaintiffs’). A suit was filed for permanent injunction and related reliefs against the infringement of the Plaintiff’s product and trade dress of FERRERO ROCHER chocolate. Defendant no. 1, who was an importer and marketer of chocolates under the brand name ‘Golden Passion’ settled the matter amicably outside Court, however, Defendant no. 2, manufacturer of the chocolates under the mark Golden Passion in China, did not appear before the Court, and an ex parte interim order was passed against him. Despite service of the same, Defendant no. 2 had not ceased the sale of the impugned product. The Court found in favor of the Plaintiff and imposed costs and damages worth INR 10 Lakhs (USD 14989 approx.).
In the above case, the Plaintiff is a part of the Ferrero Group, founded in 1946. Being ranked amongst the 4 biggest confectionary producers worldwide, it is the most reputable company in the world, according to the Reputation Institute Survey of 2009, as reported in the Economist and Forbes Magazines. However, the Plaintiffs conduct their business in India officially through Ferrero India Private Limited (hereinafter referred to as Plaintiff No. 2), incorporated in the year 2008.
During the pendency of the suit, there was a settlement reached between the Plaintiff and the Defendant No. 1, an importer and marketer of chocolates under the brand-name Golden Passion in India which are also look-alikes of Plaintiff’s chocolates sold under the FERRERO ROCHER trademark. Vide the settlement, a compromise decree was passed vide order dated May 26, 2016. Whereas, none appeared on behalf of Defendant No. 2, which is the entity manufacturing and exporting chocolates under the brand Golden Passion to India, the suit proceeded being treated ex- parte against him.
Major Contentions by the Plaintiffs
- The Plaintiff’s mark FERRERO ROCHER has been declared as a well-known mark by the Delhi High Court vide order dated March 13, 2004 in CS (OS) 404/2012.
- Further, the Plaintiff’s contend that the label, shape and other characteristic features of the packaging of the Plaintiff’s ‘FERRERO ROCHER’ chocolate specialties, which constitute its trade-dress are entitled to protection as being well-known marks as they satisfy the criteria mentioned in Section 11 (6) of the Trade Marks Act, 1999. The chocolate products sold by the Defendants and the packaging in which they are sold are identical to that of the packaging of the Plaintiff’s FERRERO ROCHER chocolate specialties and the striking similarity between the Plaintiff’s FERRERO ROCHER chocolates and those of the Defendant’s has been enumerated in the plaint.
- Such misuse by the Defendants of the identical and/or deceptively similar trademarks, trade dress creates a mistaken impression in the minds of consumers that:
- the Defendants products/services emanate from the Plaintiff’s themselves;
- the Defendants are permitted and authorized users of the Plaintiff’s trademark; and
- there is a nexus between the Defendants and the Plaintiffs.
- The Court vide order dated March 26, 2014, had restrained the Defendants from
- manufacturing, selling, offering for sale, advertising, directly or indirectly, dealing in any manner with the impugned Golden Chocolate product or any other product leading to infringement of the Plaintiff’s trademarks and trade-dress;
- using the trade-dress, packaging, color combination, layout, get-up designed to imitate the Plaintiffs’ FERRERO ROCHER trademark and trade-dress leading to dilution of the Plaintiff’s trademark and trade-dress and unfair competition vis-a-vis the Plaintiff’s business under the FERRERO ROCHER trademarks and trade-dress.
- Even though, an injunction order was passed against Defendant No.2, it is still continuing to sell its Golden Passion chocolates in India, as is evident from the documents. The Defendant No.2 is continuing to sell numerous products which are a look alike of the FERRERO ROCHER chocolates under the brand ROWANSA and as part of its Golden Series of chocolates.
- The acts of the Defendants in adopting and using the identical/deceptively similar impugned mark and dress in respect of identical goods has caused and will continue to cause irreparable damage and loss to the Plaintiffs business. Further, the impugned mark which forms a part of their trading name, infringes the rights of the Plaintiffs under Section 29 (5) of the Act. The Defendant No.2 is rather dealing in the goods which are identical to the goods of the Plaintiffs.
- It was initially submitted by the Plaintiffs that the Court must also grant punitive damages taking into account the mala fide conduct of the Defendants, which is clearly not proportional to the quantum of actual damages that the Plaintiff has proven through documentary evidence filed in the suit on the following factors, i.e., Defendant No.2 despite service, chose not to contest the present proceedings; and it has been in contempt of the injunction order dated May 09, .2014, and has been exporting infringing chocolates to India and making them available for sale through online websites.
Contentions by the Defendants
The Defendants did not file any written statement in the suit. They also failed to admit or deny the documents of the Plaintiffs, and thus the Court proceeded to decide the case ex parte.
Observations by the Court
The Plaintiff has suffered immense loss to goodwill and reputation and hence, is entitled to a grant of damages not only in terms of compensatory damages but also in the form of punitive damages.
The Court held that since Defendant No.2 reclused itself from the proceedings, it cannot be permitted to enjoy the benefits of evasion or covert priorities as they have been selling the goods and continuing to infringe the Plaintiff’s mark. The Court passed a permanent injunction in favour of the Plaintiff and awarded damages to the Defendant No.2. where a decree for a sum of INR 10 Lakhs (USD 14989 approx.) was passed against Defendant No.2, on account of infringing the registered marks, trade dress and violating the interim order. The Plaintiffs were also entitled to interest @ 10% per annum on the damages so awarded from the date of filing of the suit till the date of realization. Proportionate costs of the suit were also awarded to the Plaintiffs and against the Defendant No.2.