The recent trademark dispute between Paragon Polymer Products Pvt. Ltd. and Sumar Chand Nahar[1] brings to light a crucial question in Indian trademark law: Does a well-known trademark holder have absolute exclusivity across all product classes, or should honest and concurrent use be protected? This case, adjudicated by the Madras High Court, revolved around the use of the word “PARAGON”, a mark that both parties have been using in different industries for decades.
Paragon Polymer, a leading footwear manufacturer, has used the “PARAGON” trademark since 1975 and successfully established it as a well-known mark in 2017. On the other hand, Sumar Chand Nahar, engaged in the business of electric motors and related products since 1977, had been using “PARAGON” in its domain and sought registration under Class 9. Paragon Polymer opposed this move, arguing that their well-known mark entitled them to exclusive protection, even beyond their original product category.
This case presents a legal and commercial dilemma: Should a trademark’s well-known status allow its owner to block others from using it in unrelated industries, even if they have been honest and long-standing concurrent users? The court’s ruling, which upheld coexistence over monopolization, raises significant implications for the boundaries of trademark exclusivity, fair competition, and consumer confusion in Indian intellectual property law.
| Appellant’s mark | Respondent’s mark |
Background of the Case
The dispute in Paragon Polymer Products Pvt. Ltd. v. Sumar Chand Nahar revolves around the use of the trademark “PARAGON” by two companies operating in entirely different industries.
Paragon Polymer Products Pvt. Ltd., a well-known footwear manufacturer, has been using the mark “PARAGON” since 1975 and holds multiple registrations, including under Class 25 (footwear and related goods). Over the years, the company has built substantial brand recognition, eventually securing a well-known mark status in 2017.
Sumar Chand Nahar, trading as M/s. Paragon Engineers, has been in the business of electrical motors and related equipment since 1977. It had previously obtained a trademark registration under Class 7 (which covers machinery and parts) for its mark “PARAGON” with a bird device in 1986. Later, in 2001, it applied for registration under Class 9, which includes electric motor starters and similar products.
Paragon Polymer opposed this registration, arguing that allowing the respondent to use the mark “PARAGON” in another class would create consumer confusion and lead to brand dilution. It contended that its well-known mark should prevent any usage of “PARAGON” in any class by other businesses.
The Trade Marks Registry rejected the opposition, ruling in favour of Sumar Chand Nahar, stating that:
- PARAGON is a dictionary word and not exclusively owned by Paragon Polymer.
- The respondent’s use was honest and concurrent since it had been in business for decades.
- The product categories were different, reducing the likelihood of confusion.
- Paragon Polymer’s well-known mark status (granted in 2017) could not retroactively override Nahar’s prior usage.
Dissatisfied with the decision, Paragon Polymer appealed before the Madras High Court, leading to this litigation.
Legal Issues at Play
The dispute in Paragon Polymer v. Sumar Chand Nahar brings forth three critical legal issues under the Trade Marks Act, 1999:
- Well-Known Marks & Cross-Class Protection (Section 11)
Under Section 11[2] of the Trade Marks Act, a well-known trademark is entitled to protection beyond its registered class, preventing its unauthorized use in any category of goods and services. Paragon Polymer argued that since its trademark “PARAGON” was declared a well-known mark in 2017, it should be protected from registration in any other class, including Class 9, where Sumar Chand Nahar sought registration.
However, the court questioned whether a well-known mark status could be applied retrospectively. The first respondent had been using the mark since 1977, long before Paragon Polymer secured its well-known status. The judgment emphasized that a well-known mark cannot erase pre-existing legitimate users who have been using the trademark in good faith.
- Honest and Concurrent Use (Section 12)
Section 12[3] of the Act recognizes honest and concurrent use as a defence against trademark opposition. Sumar Chand Nahar successfully argued that:
- It had been using “PARAGON” for decades (since 1977) in electrical products.
- It had already registered “PARAGON” under Class 7 in 1986, and Paragon Polymer had not opposed it then.
- Its mark included a bird device, differentiating it from Paragon Polymer’s word mark.
The court upheld that honest concurrent use must be respected, especially when a brand has established itself in a separate industry.
- Likelihood of Confusion vs. Market Differentiation
A key factor in trademark disputes is whether the coexistence of two similar marks could cause consumer confusion. Paragon Polymer claimed that consumers might assume Sumar Chand Nahar’s electric products were linked to its footwear brand.
The court rejected this claim, emphasizing:
- The industries were distinct (footwear vs. electrical products).
- Target customers were different (general consumers for footwear vs. industrial buyers for electrical goods).
- The marks were distinguishable (Paragon Polymer’s word mark vs. the respondent’s composite mark with a bird device).
Thus, the court ruled that coexistence was possible, rejecting a blanket monopoly over “PARAGON.”
Court’s Reasoning and Judgment
The Madras High Court delivered a well-reasoned judgment that balanced intellectual property protection with fair competition. The court dismissed Paragon Polymer’s appeal and upheld Sumar Chand Nahar’s right to continue using the “PARAGON” mark for electrical goods under Class 9, citing the following key points:
- Retrospective Protection Cannot Apply to Well-Known Marks
- The court noted that Paragon Polymer’s mark was only declared a well-known trademark in 2017.
- Since Sumar Chand Nahar had been using the mark since 1977, the well-known status could not retroactively invalidate a long-standing, legitimate user.
- If retrospective enforcement were allowed, it would create monopolistic control over common words, unfairly affecting businesses with established goodwill.
- Honest and Concurrent Use Must Be Respected
- Sumar Chand Nahar had honestly adopted and continuously used the mark “PARAGON” for electrical goods since 1977.
- The respondent had already secured a Class 7 trademark registration in 1986, which Paragon Polymer had not opposed at the time.
- Since the respondent was not an infringer but a prior user in its own domain, its right to continue operating was protected under Section 12 of the Trade Marks Act.
- No Likelihood of Consumer Confusion
- The court emphasized that footwear (Class 25) and electrical goods (Class 9) belong to entirely different industries.
- Consumers of electrical motors and related products are professionals and industrial buyers, who would not confuse it with a footwear brand.
- Moreover, the respondent’s mark included a bird device, making it visually distinct from Paragon Polymer’s word mark.
Court’s Directive: Ensuring Coexistence
The court remanded the matter to the Trademark Registrar, directing it to:
- Impose necessary conditions and limitations to ensure that both parties could continue using their respective marks without conflict.
- Restrict both businesses from expanding into each other’s product categories, ensuring that Paragon Polymer remains in footwear and Sumar Chand Nahar remains in electrical goods.
Thus, the court upheld coexistence over monopolization, reaffirming that trademark protection must balance exclusivity with fair competition.
The Paragon Polymer v. Sumar Chand Nahar case raises significant questions about the scope of well-known trademarks, fair competition, and the risks of monopolization in trademark law. While the ruling favours a balanced approach, it also sets a precedent that could shape future intellectual property disputes.
- Balancing Trademark Protection with Fair Competition
One of the key takeaways from this case is the potential overreach of well-known trademark protection. Paragon Polymer attempted to retroactively enforce its well-known status across multiple classes, which would have effectively monopolized the word “PARAGON” in all industries. However, the court’s decision rightly limited the exclusive rights of well-known trademarks to prevent unfair advantages.
Had the court ruled in Favor of Paragon Polymer, it would have created a dangerous precedent where any company with a well-known mark could erase long-standing businesses in unrelated fields. This would stifle competition, harm businesses with legitimate claims, and create an unjust power imbalance in trademark law.
- Judicial Approach: Pragmatic or Problematic?
The Madras High Court took a pragmatic approach, ensuring that both parties could continue their businesses without unfair restrictions. By focusing on honest and concurrent use, the court reaffirmed the principle that a well-known trademark does not automatically override prior rights of other users. However, some might argue that this decision weakens the strength of well-known marks, making it harder for brand owners to enforce cross-class protection.
Companies invest millions in brand identity, and allowing others to use an identical or similar mark even in different industries; could weaken brand exclusivity. While the court attempted to strike a balance, it remains to be seen whether this ruling might encourage more disputes over cross-class registration in the future.
- Consumer Impact: Is There Real Confusion?
A crucial element in any trademark dispute is whether consumers will be confused. Paragon Polymer argued that allowing “PARAGON” for electrical goods could mislead consumers into thinking the products were related. However, this argument appears weak for several reasons:
- The industries are vastly different—footwear vs. electrical goods.
- The consumer base does not overlap—footwear buyers are general consumers, while electric motor buyers are technical professionals.
- The trademarks themselves differ—Sumar Chand Nahar’s mark includes a bird device, whereas Paragon Polymer’s mark is a word mark.
Given these factors, it is highly unlikely that an average consumer would mistake electrical motors for footwear products, making Paragon Polymer’s claim of consumer confusion questionable.
- Future Implications on Trademark Law
This case highlights a growing need for clear legal guidelines on:
- How and when well-known trademark status should apply across classes.
- What level of concurrent use is acceptable before it becomes infringement.
- How businesses can protect their marks without unfairly restricting legitimate players.
One possible reform could be stricter criteria for well-known trademarks, such as requiring proof of actual consumer confusion in unrelated fields before granting exclusive rights. Additionally, businesses should be encouraged to proactively oppose trademarks in related fields rather than allowing them to be used for decades before challenging them.
While this ruling promotes coexistence over monopolization, it also questions the strength of well-known trademarks. Intellectual property law should protect brands without allowing them to dominate unrelated industries unfairly. Ultimately, the court’s balanced approach ensures that both parties can continue operating without unnecessary restrictions, making it a landmark decision in Indian trademark law.
Conclusion
The Paragon Polymer v. Sumar Chand Nahar case underscores a critical balance between brand protection and fair competition in trademark law. The Madras High Court’s ruling reaffirms that a well-known trademark does not grant absolute exclusivity across all product categories, especially when another party has been using the mark honestly and concurrently for decades. The decision highlights that intellectual property law should not be used as a tool for monopolization, but rather as a framework to ensure fair and equitable market practices.
This case also raises an important discussion about the retrospective application of well-known marks. If the court had ruled in favour of Paragon Polymer, it could have set a dangerous precedent, allowing companies to invalidate long-standing businesses simply because they later obtained well-known status. Instead, the judgment rightly ensures coexistence, allowing both parties to continue operating while safeguarding consumer interests.
Moving forward, Indian trademark law must clearly define the limits of well-known marks to prevent similar disputes. Should trademark protection be industry-specific, or should it extend across classes? Should courts prioritize business longevity over brand dominance? These are questions that need deeper examination. As businesses grow globally, India must adapt its IP laws to balance exclusivity with fairness.
[1] Paragon Polymer Products Pvt. Ltd. and Sumar Chand Nahar, (T)CMA(TM) No.80 of 2023.
[2] The Trade Marks Act, 1999, § 11, No. 47, Acts of Parliament, 1999 (India).
[3] The Trade Marks Act, 1999, § 12, No. 47, Acts of Parliament, 1999 (India).
Authored by: Aeshita Marwah
Blogger, The IP Press
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