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HUL V. EMAMI- THE SAGA OF TRADEMARK WAR CONTINUES

Introduction

Two consumer giants, Hindustan Unilever Limited and Emami Limited, are currently undergoing a battle of Trademarks. Recently on 17 August 2020, Hindustan Unilever Limited successfully obtained an order from the Bombay High Court to temporarily restrain Emami Limited from using the mark “Glow and Handsome” under the provision of “Groundless threats of legal proceedings” under Section 142 of the Trademarks Act, 1999. Section 142 of the said Act lays down certain conditions wherein the said proceedings can be initiated. For instance, where a person employing advertisements threatens the other person for initiating the proceedings of trademark infringement and many others. The reason behind the court giving such direction in the instant case was that prima facie, HUL seems to be the prior use of the mark as it already has brought its goods in the market. HUL filed its first trademark application in September 2018. On the other hand, Emami is still on its way of adopting and launching its good under this particular Trademark. Further, it adopted the “Glow and Handsome” mark in June 2020 with no commercial use of its products to date.

Issue of Trademark between the two Giants

The demise of George Floyd gave rise to public outrage against racial discrimination. The #blacklivesmatter movement further escalated the issue. Consequently, several multinational companies and brands decided to relook their brands to make them less discriminatory. Amongst them, Hindustan Unilever Limited changed the word “fair” with “glow” as there was a public criticism over the fact that the word “fair” implies racial discrimination and the incorrect cultural association of fairness with beauty.

Hindustan Unilever Limited (HUL), on 25 June 2020, changed its brand name from “fair & lovely” to “glow and lovely.” They undertook a similar re-branding exercise for their men’s range of products by including glow instead of fair, thus, renaming it as “glow and handsome.” Emami Limited then filed a threat action claiming past use of the mark “Glow and Handsome,” to which HUL replied by filing a suit under Section 142 of the Trade Marks Act, 1999 in the Bombay High Court. Both parties have filed several lawsuits to claim their sides and to prove their points. With this, the two companies became involved in a trademark war. The injunction suit might be the winning of the first round by HUL, but the war does not seem to end soon. To look for prior trademark availability, 2 steps are required to be followed,

1. A prior search related to a particular mark is required in order to form a brand portfolio and,

2. Also to maintain a brand owner’s image as diligent and sensitive to third-party IP rights.

At hand, two key contentions rose between HUL and Emami. The first is the difficulty of ownership of the mark “Glow and Handsome.” And second, being whether HUL’s use of “Glow and Handsome” amounts to unfair business practices.

Emami has contended that they had already changed their men’s product to “Emami Glow and Handsome” before HUL’s announcement. Nevertheless, they have not launched to fullest their commercial business. On the other hand, HUL has already re-branded to “Glow and Handsome” at the outset of July 2020.

Emami’s next contention was that HUL is indulged in false representation to mislead their customers being the market leader in the men’s segment of these skincare products. But the court said that whether the use of the mark by HUL amounts to an infringement of Emami’s registered Trademark is not the subject matter to be dealt in the instant case. The application for the registration of the mark “Glow and Handsome” was first initiated by HUL, subsequently followed by Emami. Also, the submission of sales figures by HUL and the expenses incurred by the advertisements and promotion inclined the court towards making such an injunction against Emami Limited.

Everything is fair in the war of Trademark

The ownership of Trademark in India is dogged on a first-to-use basis. The rule applied is the principle of “Priority in adoption and use prevails over priority in registration defined in Section 31 of the Trade Marks Act, 1999.” What it means is that a company can have a monopoly above a mark by using the mark in due course of time while trading and by former corroborating use of the mark. The legal provision for this practice is found in Section 34 of the Trademark Act, 1999 (“Act”). This provision provides that an owner of a mark cannot thwart using an indistinguishable trademark by someone who has continuously been using that mark for a long time. This principle marks its presence in common law also, where the tort of passing off (where the public is mislead and is made to believe falsely that the brand being projected is the same as the well known brand is complete wrong) may be commenced by the proprietor of a trademark against a person who, in the meantime of business, feigns about its goods or services in comportment, which makes the customers suppose that they are originating from the spring of original owner.[1]

This “first user” rule is the highlight of the Act. A proprietor can acquire quasi-proprietary rights to exclusively use a particular mark provided he uses that mark concerning their goods and thus cause it to be connected with those goods. The point to be noted here is that the date of first use must be before the date of registration of the mark by another person. Essential ingredients of this section, which were laid down in Neno Laboratories Ltd. v. Medical Technologies Ltd., are-

1. Its owner must own the Trademark;

2. The Trademark must be in ongoing use within the geographical boundaries of India by its owner;

3. The use of the Trademark must be about the goods or services covered by the registered proprietor;

4. The use of the Trademark must be before the date of use of the mark by the registered proprietor.

The foremost question that arises after this hullabaloo is whether the mere filing of former applications would be adequate to assert preceding use of the mark? Can a prior user right be claimed when the mark in question has been declined to the user claiming such rights? These questions still need to be answered and to be looked upon to determine the ownership of a mark by any person and to claim trademark rights over the use of the mark.

Conclusion

The answer to the above questions can be inferred from the expression “use” under Section 34 of the Act, which requires the commercially continuous use of the mark in case of goods and services. It also connotes that the rights will be vested in a person who puts his goods with that particular mark in the market. So, section 34 provides for certain conditions to be fulfilled to give the person the right over that mark and which are-

1. the nature of goods or services concerning which the mark is used;

2. the nature and character of the use;

3. the person who must use; and

4. the date from which the mark should have been used.

All these requirements in the instant case have been prima facie fulfilled by HUL, and that is the sole reason why the court granted the order in favour of it. HUL was the continuous use of the mark “Glow and Handsome.” The fact that the HUL already has re-branded its products and the same have been called for sale in the market was another aspect which the court looked into to arrive at the said decision. But the war between the two giants does not end here and it will be interesting to note that whether the court will affirm to the question that a prior user right can be claimed when the mark in question has been declined to the user claiming such rights or not or the contrary to the same will happen.

[1] It was laid down in the case of N. R. Dongre v. Whirlpool Corporation, (1996) 5 SCC 714.


Title Image source: Moneycontrol


The article has been written by Sherry Shukla, who is a Third-year law student at National Law University, Nagpur.