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Trademark Enforcement Trends in the Virtual World
Policing trademarks online can be a challenge in terms of identifying infringers and persuading courts to exercise jurisdiction over them, as Manisha Singh and Omesh Puri of LexOrbis explain.
Trademark disputes involving the Internet and e-commerce platforms are on the rise as more consumers are buying products and services online. The infringers are using several modi operandi to deceive and cause confusion among members of the public by using domain names similar to well-known trademarks and are taking unfair advantage by designing websites to portray that they belong to or are affiliated with well-known brands.
Recently, on March 4, 2022, the Delhi High Court in granted a so-called John Doe injunction (an injunction against unnamed persons) in favor of Dabur against websites and domain names using the DABUR marks. In this case, a number of websites were using the plaintiff’s trademark DABUR, which is a well-known trademark in India. Dabur filed the suit for trademark and copyright infringement and passing off, seeking a permanent injunction and damages against various domain names and websites which were using the mark DABUR and displaying various Dabur products.
Hidden Identity
The impugned websites, www.daburdistributor.com and www.daburdistributorships.in, were describing themselves as Dabur and inviting franchisees and distributors to sell DABUR products. Dabur submitted that the details of the parties who registered these domain names are not clear, because the Registrar permitted them to avail themselves of privacy protection; therefore, the suit was filed to seek a John Doe injunction. The court acknowledged that Dabur’s trademark rights were being violated, and it granted an injunction order against the infringing use of the trademark DABUR as part of the domain names.
The court also ordered two government entities, the Department of Telecommunications and the Ministry of Electronics and Information Technology, to issue directions to all Internet service providers (ISPs) to block any other website that bears the trademark DABUR. Such John Doe orders and directions to government entities are definitely a boost for brand owners in the online world.
“The court held that the accessibility of the defendant’s website to persons within its jurisdiction did not, of itself, confer jurisdiction.”
Manisha Singh (pictured), and Omesh Puri, LexOrbis
The court, while acknowledging the brand owner’s problems with such misuse, noted that infringers are increasingly using the practice of hiding or masking the details of the registrants who hold domain names. The court observed that whenever any person or entity registers a mark, the identity of the person is openly available. However, in the case of domain names, it is not so.
Accordingly, the court directed the Department of Telecommunications and Ministry of Electronics and Information Technology to disclose their positions regarding the privacy protect feature. It will be interesting to observe what they say, as it may affect brand owners, and enforcement strategies in combating misuse in the online world.
Jurisdiction in the Internet Era
Another important question is about jurisdiction for handling disputes involving the Internet activities of a foreign entity. This issue was discussed in a dispute before the Delhi High Court in the case of Tata Sons Private Limited v. Hakunamatata Tata Founders & Ors (2021). Tata filed a suit alleging infringement of its trademark because the defendant was dealing in cryptocurrencies under the name “TATA coin/$ TATA”. The defendant was based in the U.S. and the UK with no outlets in India. Since the defendant was based outside India, the issue was whether the court had jurisdiction to grant injunctions in favor of the plaintiff.
The plaintiff relied on the following arguments in support of its case, among others:
- The defendant’s crypto currency can be purchased by any person in India, from the defendant’s website.
- There is an admission, in the “White Paper” of the defendant, that it was involved in financial activities relating to India.
- Various persons from India had posted queries on the defendant’s Twitter page, regarding the modality for purchase of its “TATA coin/$ TATA” currency.
- The defendant’s website www.hakunamatata.finance had 50 visitors from India each day.
“If there is sufficient evidence which establishes that the defendant’s intent is to target India as a market, the case may be tried in India and a preliminary injunction can be sought against the defendants.”
Manisha Singh, and Omesh Puri (pictured), LexOrbis
According to the plaintiff, online purchases within the jurisdiction of the cryptocurrency using the infringing marks adversely affected the plaintiff’s business and devalued its goodwill. The plaintiff maintained that there existed three grounds for the exercise of the court’s jurisdiction, namely the purposeful use by the defendant of the court’s jurisdiction; the cause of action arising from the defendant’s activities within the court’s jurisdiction; and a substantial connection between the acts of the defendant and their consequences, and the jurisdiction of the court.
The court held that the accessibility of the defendant’s website to persons within its jurisdiction did not, of itself, confer jurisdiction. A substantial indication of activities directed toward those within the court’s jurisdiction was necessary. Indian courts do not possess extra-territorial jurisdiction over non-resident defendants and have jurisdiction only if the defendant’s activities have a sufficient connection with India, the cause of action arises out of such activities, and the exercise of jurisdiction is reasonable. That the defendant’s website was interactive and accessible to persons located within the court’s jurisdiction, although relevant, was by itself insufficient. The court emphasized that the predominant considerations in deciding the issue were whether the defendant’s website was interactive and whether it disclosed an overt intention to target the Indian market.
In the present case, the court found that the evidence submitted by the plaintiff prima facie does not establish the defendant’s conscious intention to target India as a potential market. The mere accessibility of the website in India was insufficient, and the court therefore refused to grant an interim injunction to the plaintiff. This case clarifies that if there is sufficient evidence which establishes that the defendant’s intent is to target India as a market, the case may be tried in India and a preliminary injunction can be sought against the defendants.
The Internet era has brought various enforcement challenges to brand owners, and it is important to strategize in order to handle novel issues such as unknown infringers and jurisdiction of foreign-seated defendants.
Manisha Singh is a partner at LexOrbis in New Delhi, India. She can be contacted at manisha@lexorbis.com
Omeshi Puri is a partner and head of the trademark, design and copyright practice at LexOrbis in New Delhi, India. He can be contacted at omesh@lexorbis.com
Video courtesy of Adobe Stock / Adobe Stock / AA+W
Tuesday, May 3, 2022
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