Amul’s Victory in Canada: Comparative Analysis with Indian Trademark Law

Hailed as one of the major wins for the homegrown brand, Amul Dairy won a major trademark battle in the Federal Court of Canada. As per the facts, Kaira District Co-Operative Milk Producers’ Union Limited (‘Kaira’), established in 1946 in India, was involved in the business of manufacture and marketing of milk products, with 3.2 million producer members with a milk collection average of 14.85 million litres per day. Along with being widely known in India, the products under the mark ‘AMUL’ are also marketed internationally, including in Canada. Kaira has also undertaken extensive advertising and promotion in Canada, allowing the brand to become well-known and distinctive in the country. It was also stated by the plaintiff that owing to immense goodwill in India, the brand has also acquired the same goodwill amongst the Canadians of Indian origin. The mark ‘AMUL’ is registered by Kaira in Canada and the expression “Amul The Taste of India” has been in use in India since June 2010.

Kaira had come across a proprietary named Amul Canada that was marketing and selling dairy products in Canada under the mark AMUL and a LinkedIn account by the name Amul Canada Limited. The defendant entity was not the exact marks and designs belonging to Kaira, but it also claimed to be Kaira by blatantly copying the information from Kaira’s websites. Consequently, a suit for breach of trademark and copyright in Canada was filed against the defendant by Kaira. The Federal Court of Canada analysed the case on the basis of passing off, trademark infringement and copyright infringement, delving into the essential ingredients of each. On satisfaction of the essentials of each claim, the Court ruled in favour of Kaira. This article deals with a comparative analysis of the law between Canada and India regarding passing off and trademark infringement.

Passing Off

The Section 7(b) of the Trademarks Act of Canada codifies the common law remedy of passing off, under the heading of ‘Unfair Competition and Prohibited Signs’. The Section 7 lays down acts that are prohibited as unfair competition, of which, 7(c) provides that no person shall pass off other goods and services. In the Indian context, passing off is recognised as a right of remedy, under Section 27(2) of the Trade Marks Act, 1999. The section provides that the Act does not affect rights of actions available to persons against passing off of their goods and services.

Passing off is a common law action under the law of torts that prohibits any form of imitation, be it implicit or explicit, done with a calculated intent of deceiving or causing confusion to the consumers in relation to trademarks. A species of unfair trade competition, the law against passing off is based on the general proposition that no man is entitled to represent his goods as being the goods of another. Lord Diplock, in the celebrated case of Erven Warnink B.V. v. J. Townend & Sons (Hull) Ltd,. [1980] R.P.C. 31 had laid down five essential characters of passing off, which were, there must be (1) misrepresentation (2) by a trader in the course of trade (3) to prospective customers of his or ultimate consumers of goods or services supplied by him, (4) which is calculated to injure the business or goodwill of another trader, and (5) which causes actual damage to the business or goodwill of the trader bringing the action. This was the first case in the arena of passing off. In Reckitt & Colman Products Ltd. v. Borden Inc., [1990] 1 All E.R. 873, a recent and often cited case in contemporary passing off suits, the five essentials by Lord Diplock were condensed into three, by Lord Oliver, namely,

1. establishment of goodwill or reputation attached to the goods or services by the plaintiff
2. misrepresentation to the consumers by the defendant, leading to or likely to cause confusion in the minds of the consumers
3. actual damage to business or goodwill of the plaintiff

Given the fact that the brand ‘AMUL’ has been around for over 50 years, been extensively advertised around the globe via online and offline channels and is extensively imported in Canada, it has acquired distinctiveness and goodwill. The Court found that products of Amul have a reputation within at least a certain segment of consumers of its dairy products in Canada.

The Court further noted that the conduct of the defendant amounted to intentional misconduct and deliberate deceitful conduct. Far from being an act of innocent misrepresentation, the actions of the defendant were clearly aimed at creating confusion among the consumers of Canada with regards to their products and those of the plaintiff.

In terms of the third requirement, the Court stated that there must be some evidence of actual damage or likelihood of damage in order to fulfil passing off. Damage has to be real and cannot be just presumed. Loss of control over one’s mark and harm to the goodwill resulting out of defendant’s conduct is considered a valid form of damage. In the present case, the court held that there was clear threat to the goodwill and damage through sales, marketing, distribution, and/or recruiting employees, through the unauthorized guise of Amul Canada.

Infringement

The Section 19 of the Trademarks Act of Canada gives owners of a registered trademark exclusive right to use the same throughout the country. The Section 20(1)(a) of the Canadian Trademarks Act deals with infringement of right of the owner of a registered mark when a person not entitled to its use under this Act sells, distributes, or advertises any goods or services in association with a confusing trademark or trade name as that of owner.

In the Indian context, the provision regarding infringement of registered trademark is given under Section 29 of the Trade Marks Act, 1999. The subsection (1) states that a registered trademark is infringed when a person who is not authorised, uses in a course of trade a mark deceptively similar to or identical with the registered mark.

In present case, the Court held that while it is unclear as to what the defendants hoped to achieve by unauthorised advertisement of the mark ‘AMUL’, it is sufficient to attract the provision of infringement under Section 20(1)(a) of the Trademark Act of Canada.  

Well-Known Trademark and Dilution

The Court also scanned the case through the lens of Section 22 of the Canadian Trademarks Act that deals with the depreciation of goodwill. The section prohibits use of a registered trademark by another in a manner that is likely to have the effect of depreciating the value of the goodwill attached with the mark. It must be noted that Canadian trademark law does not have a specific provision or legislation regarding well known trademarks, nor have the courts drawn a well-defined precedent for the same, unlike India. The concept of well-known trademarks was briefly recognised by the Supreme Court of Canada in Veuve Clicquot Ponsardin v Boutiques Cliquot (2006 SCC 23), where a definition of “famous trademarks” was stated as those marks that transcend limitations of field of wares, services and businesses. Owing to this transcendence, owners of such marks must be given remedies against depreciation of goodwill.

While the judgment touched upon the concept of well-known trademarks briefly, it is also important to note that there is no absolute protection for well-known trademarks in Canada. In terms of Section 22 of the Act, there are four elements that plaintiffs are required to prove,

• their registered trademark was used by the Defendants in connection with the goods
• their trademark is sufficiently well known and enjoys significant goodwill attached to it
• the defendant used their mark in a manner likely to have the effect on that goodwill
• the likely effect would be to depreciate the value of its goods

Hence, while well-known marks are not specifically protected by statutory provisions in Canada, protection can still be sought. However, fame, although important, is one of the factors that isanalysed in the context of other surrounding factors. Owners of the mark will have to provide evidences for other elements as well, including consumer confusion and the connection between the goods and services of the interested parties.

In the Indian context, the protection given to well-known trademarks under the Trade Marks Act, 1999 and the approach taken by Indian judiciary is of a wider import. Factors that need to be shown include, public recognition and knowledge about the mark and its promotion; the duration, extent, the geographical area of any use and promotion of the mark, including advertising or publicity and presentation and the record of successful enforcement of the mark. Once recognized as a Well-Known Trademark, the mark is entitled to a wide range of protection, in not only identical goods or services but in dissimilar or entirely different goods or services as well. Further, AMUL is recognised as a well-known trademark in India by registry, featuring in the list that consists of 97 other such famous marks.

In the present case, the Court stated that yardsticks for measurement of goodwill under depreciation under Section 22 are distinct from those under Section 7(b). While the requirements for goodwill for passing off under Section 7(b), the same is not true for Section 22. Relevant factors to be analysed under Section 22 include, fame, degree of recognition, volume of sales, depth of market penetration, extent and duration of advertising and publicity, geographic reach, inherent or acquired distinctiveness, channels of trade, and the extent to which the mark is identified with a particular quality. The plaintiff, Kaira did not meet the test under Section 22, depreciation of goodwill.

Holding the defendant liable for passing off and infringement of trademark of Kaira, the Court granted a permanent injunction in favour of Kaira restraining Amul Canada from infringing Kaira’s trademark and copyright. Damages amounting to $10,000 for trademark infringement and $5,000 for copyright infringement was also awarded to Kaira.