Trademark Battle: ITC Limited vs. Britannia Industries Ltd. in Madras High Court

ITC Limited Vs Britannia Industries Ltd. (Madras High Court)

Madras HC Grants Injunction Against Sunfeast Mom’s Magic Butter Cookies in Trademark Infringement Case

Introduction: The legal battleground of intellectual property rights witnessed a significant clash as ITC Limited and Britannia Industries Ltd. engaged in a trademark infringement dispute before the Madras High Court. The contentious issue revolved around the alleged imitation of Britannia’s renowned ‘Good Day’ Butter Cookies by ITC’s ‘Sunfeast Mom’s Magic Butter Cookies.’ This article delves into the key aspects of the case, the arguments presented by both parties, and the Madras High Court’s ruling.

Also Read SC Interim Order: SC Recommends Mediation for Britannia-ITC Biscuit Color Dispute

A. The Appeals: The Original Side Appeals were filed against the order of the learned Single Judge in response to Britannia Industries Limited’s (plaintiff) plea for an interim injunction. The plaintiff sought protection from ITC Limited (defendant) for unfair competition, trademark infringement, passing off, copyright infringement, and dilution of goodwill and reputation.

B. The Case of the Plaintiff: 2.1. Britannia Industries Limited, a well-established food company since 1892, asserted its high reputation and goodwill, particularly in the Butter Cookies segment under the ‘GOOD DAY’ mark. The plaintiff emphasized its extensive advertising expenditure, unique trade dress, and color scheme associated with the product.

2.2. The plaintiff contended that ITC, with its ‘Sunfeast Mom’s Magic Butter Cookies,’ deliberately adopted a confusingly similar blue color wrapper, infringing trademarks, and causing potential consumer confusion.

2.3. Britannia sought permanent injunctions, delivery of offending materials, and damages of Rs.65,00,000, alleging ITC’s actions amounted to unfair competition and trademark infringement.

C. The Case of the Defendant: 3.1. ITC, a leading private sector company, defended its position by highlighting its substantial presence in the market and the success of its ‘Sunfeast’ brand. The defendant argued that the blue color used for its Butter Cookies was a common industry practice for dairy products.

3.2. ITC asserted its registration of the ‘Mom’s Magic’ trademark and emphasized the differences in packaging elements between the two products. The defendant claimed that its use of the blue color was not dishonest and did not intend to infringe on Britannia’s rights.

3.3. ITC contended that Britannia’s lawsuit was an attempt to stifle market competition and that the sudden adoption of blue color in South India was a legitimate business decision.

D. The Order of the Learned Single Judge: 4. The Single Judge acknowledged Britannia’s prior use of the distinctive blue color scheme for over two decades, associating it with ‘GOOD DAY’ Butter Cookies. The judge found that ITC’s adoption of the blue color appeared dishonest, leading to potential trademark infringement and passing off.

4.1. The court granted an interim injunction, restraining ITC from marketing its ‘Sunfeast Mom’s Magic Butter Cookies’ in the blue color wrapper. The judge considered the potential confusion in the market and the lack of a satisfactory explanation for the sudden shift in ITC’s packaging.

E. The Submissions: 5. Legal arguments were presented by both parties during the appeals. ITC’s counsel emphasized the differences in packaging elements and challenged Britannia’s claim of exclusive use of the blue color. Britannia’s legal team maintained that the overall combination of elements in the packaging created a distinctive trade dress and copyright.

F. The Discussion & Findings: 6. The appellate court considered the arguments, summarized applicable legal principles, and examined the visual elements of the packaging. It affirmed the Single Judge’s decision, emphasizing the potential for consumer confusion and the prima facie case of trademark infringement.

6.1. The court rejected ITC’s contention that Britannia sought exclusive rights over the blue color alone, emphasizing that the proprietary claim extended to the overall combination of elements constituting the trade dress.

6.2. The court recognized the nuanced nature of trademark disputes, stressing the importance of considering deceptive similarity from the perspective of an ordinary consumer.

G. The Result: 7. The appeals were partly allowed, confirming the Single Judge’s order for an interim injunction against ITC. However, the court granted permission for ITC to sell its existing stock packed in the blue color wrapper, with conditions to inform the court about the stock’s status.

Conclusion: The Madras High Court’s decision in favor of Britannia Industries Limited reinforces the significance of protecting trade dress and trademarks. The case serves as a reminder to businesses about the careful consideration needed when adopting packaging elements to avoid potential infringement and consumer confusion. As the legal battle continues, the final resolution will shape the landscape of trademark protection in the Indian food industry.

Key Takeaways:

• The case underscores the significance of trade dress and color schemes in establishing trademark infringement and passing off.
• Courts consider the likelihood of confusion among consumers when assessing deceptive similarity.
• The decision reflects the court’s role in balancing the protection of intellectual property rights with fair market competition.

FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT

A. The Appeals:

These Original Side Appeals are directed against the order of the learned Single Judge, dated 10.10.2023 in O.A.Nos.551 to 555 of 2023 in C.S.(Comm Div).No.153 of 2023.

1.1. In the above applications, the respondent herein has prayed for interim injunction restraining the appellant herein from (i) indulging in unfair competition; (ii) infringement of their registered trademarks, (iii) passing off their goods as that of the plaintiff; (iv) infringement of copyright in the original artistic work in the wrapper; and (v) from diluting the goodwill and reputation of the plaintiff’s trade dress and colour scheme. In this judgment the parties are referred to as per their array in the suit.

B. The Case of the Plaintiff :

2. The plaintiff, Britannia Industries Limited, filed the above suit pleading that it was established in the year 1892, from which date, it has been manufacturing biscuits in India. It started from a small house in Central Kolkata and now, it is a leading food Company with approximately Rs.13,000 crores as revenue. It’s name itself has gained high reputation and goodwill and it has several products in the market which are very well known among the consuming public. While so, it has also adopted the mark ‘GOOD DAY‘ in the year 1986 and by virtue of continuous extensive use, advertisement and maintenance of high quality, GOOD DAY biscuits is a well known trademark throughout the country. Under the said umbrella mark, they are making and selling Butter Cookies, Cashew Cookies, Nut Cookies, Pista Badam Cookies, Choco Chunkies etc.

2.1. The plaintiff has been spending huge amounts for advertisements and sales promotion. For the year 2022-2023, it had spent Rs.255 crores for advertisement of the said brand. It has specifically designed and adopted the trade dress / wrapper for packaging the biscuits with distinct style, colour scheme and getup. The colour scheme, style and getup are adopted with variations in respect of the different flavours.

2.2. As far as the Butter Cookies are concerned, the petitioner uses the trade dress / wrapper in blue colour with the brand name ‘GOOD DAY‘ and the other devices contained therein. The plaintiff’s mark has been registered in different combinations vide Application Nos.4182344, 5186937, 5186938, 5186939, 5186940 in respect of Clause – 30. The consuming public connect the very trade dress, colour dress and getup with that of the plaintiff and the plaintiff’s product namely, Good Day Butter Cookies. Good day Butter Cookies alone was sold for a total sum of Rs.1,889 crores in the year 2022-2023 and the plaintiff has spent a sum of Rs.137.27 crores for advertisements and sales promotion for its product Butter Cookies alone.

2.3. The plaintiff’s mark, along with colour scheme, getup and style, has been recognised as well known mark by the Intellectual Appellate Board and also by the Delhi High Court in the connected litigations.

2.4. The defendant is selling their similar products under their brand name ‘SUNFEAST‘ by adopting the trademark Mom’s Magic. Whileso, with a dishonest intention to cash in on the goodwill and reputation of the plaintiff and to pass off its products as that of the plaintiff, suddenly, in the month of March, 2023, started selling their products also in an identical blue colour trade dress / wrapper. If the products are placed side by side, it would be difficult to differentiate even with a careful observation. When the products are in shelves of various supermarkets and shops, they are absolutely bound to create confusion and even though the defendant was selling their product in red colour wrapper, only recently, in respect of South India alone, with a dishonest intention to cause confusion among the consuming public and to get unlawful gain from and out of the goodwill and reputation of the plaintiff, the defendant has adopted the blue colour wrapper with their brand and devices. Its action amounts to infringement of the plaintiff’s mark, passing off its goods as that of the plaintiff, violation of the copyright of the plaintiff in their artistic works, dilution of the goodwill and reputation of the plaintiff’s trade dress and amounts to unfair competition and hence, the suit is filed for permanent injunction praying for the above reliefs and for a decree for delivery of the offending materials and for rendition of accounts and for damages to a tune of Rs.65,00,000/-. Pending the above appeal, the above interim injunctions were prayed for.

C. The Case of the Defendant :

3. The applications for injunctions were resisted by the defendant by filing a common counter-affidavit. It is the case of the defendant that it is one of the India’s leading private sector Companies having formidable presence in diversified fields. Its branded packaged food business is one of the fastest growing food businesses in India and it has several leading brands including that of ‘SUNFEAST ‘. The defendant had a total income of Rs.62,336 crores for the financial year 2021-2022 and its market capitalisation as on 31.03.2022 was about Rs.3,08,882 crores. It is into foods business from the year 2001. The biscuits under the brand name ‘SUNFEAST‘ were started in the year 2003 and it is one of the top brands in India.

3.1. The present mark in question namely, Mom’s Magic was adopted in the year 2014 under the Umbrella mark Sunfeast. It has also obtained the registration of its trademark Mom’s Magic vide registration No.1062044 in respect of Clause – 30. The defendant is the proprietor of the registered mark in No.2934217 in respect of Mom’s Magic Butter, in No.2934214 in respect of Mom’s Magic Cashew and Almond, in No.3550265 in respect of Mom’s Magic Fruit and Milk. The registrations are valid and subsisting.

3.2. It has adopted the visual elements and packaging in tune with its consumer preferences over a period of time and such modifications were made lastly in the year 2020. The defendant, with the same visual elements, has been selling the product in red based wrapper from the year 2020. Without altering the lay out or getup and packaging and not modifying the trade dress in any manner whatsoever, the defendant merely and simply changed the packaging colour of Sunfeast Mom’s Magic Butter Cookies to blue in line with the packaging colours of its Butter Cookies.

3.3. As per the common industrial practice blue colour is commonly used for butter and diary derivative products, more specifically, for Butter Cookies. It has no necessity to cash in on the reputation and goodwill as that of the plaintiff. A comparison of the products would show that both the wrappers are not at all similar in any manner whatosever. Majority of the diary products of all the manufacturers and market players are blue in colour only. While so, just because the defendant’s rival product in the market was getting more sales instead of genuinely facing the market competition, the suit is filed to scuttle the sales of the defendant’s product.

3.4. The defendant’s use of its trade dress is neither similar nor it will dilute the plaintiff’s mark and customers will not be confused and the adoption of the defendant of its mark, colour scheme, getup is not dishonest and therefore prayed for dismissal of the applications for injunction.

D. The Order of the Learned Single Judge :

4. The learned Single Judge considered the case of the parties and found that the plaintiff has been using the trade dress with elements and colour combination since 1997 for its Butter Cookies and has built a considerable consumer base. Though the arguments relating to monopoly over a colour are raised by the defendant at the first blush appears to be correct, since the product has been sold in the said colour combination for over two decades, the same has to become associated with that of the plaintiff’s product and therefore, the plaintiff is entitled to protect its trademark. The defendant started selling Butter Cookies in the year 2014, but it has been selling only in red wrapper.

4.1. There is no explanation as to why they suddenly adopted the blue colour and the adoption appears to be dishonest with an intention to infringe trade mark of the plaintiff and pass off their goods. The defendant even now continues to pack its product in red wrapper in North India, but, the blue colour has now been introduced only in South India. The argument that the blue colour is common for the trade is not proved by them and the plaintiff has demonstrated that the other popular brands are selling in different shades. Prima facie case is made out on behalf of the plaintiff and finding so, the learned Single Judge injuncted the defendant from marking its product Sunfeast Mom’s Magic Butter Cookies in the blue colour wrapper and allowed the applications in O.A.Nos.551 to 555 of 2023. The aggrieved defendant is on appeal before us.

E. The Submissions:

5. Heard Mr.A.L.Somayaji and Mr.Vijay Narayan, learned Senior Counsels appearing on behalf of the appellant / defendant and Mr.P.S.Raman and Mr.Satish Parasaran, learned Senior Counsels appearing on behalf of the respondent / plaintiff.

5.1. Mr.A.L.Somayaji, learned Senior Counsel appearing on behalf of the defendant took this Court through the wrappers used in respect of both the products and submitted that the defendant has clearly pointed out the differences between both the products by a tabular column in their counter-affidavit which is extracted hereunder for ready reference :-

5.2. He would submit that the defendant itself is leading manufacturer for popular brands and there was no need for it to imitate or copy the plaintiff and it is also spending huge amount by way of advertisements and sales promotion in popularising its brand Sunfeast Mom’s Magic. That being the situation, the alleged dishonest adoption and passing off on the part of the defendant is too far-fetched. As a matter of fact, with the same  devices, pictures, logos and in an identical combination, the plaintiff has been selling the products all along from the year 2020. He would submit that the following picture would depict that the defendant did not make any alteration whatsoever of the product.

5.3. He would submit that the learned Single Judge erred in finding that there was no explanation on behalf of the defendant in adopting the blue colour in the year 2023. As a matter of fact, it has been specifically pleaded that as far as the Butter Cookies are concerned, in consonance with the common practice of depicting the diary products in blue colour, the same was adopted. Several examples of various diary products being sold in blue colour packaging are brought to our notice including Milk, Milk Chocolates, Butter, Butter Cookies, Butter Biscuits etc. There are various other leading brands having considerable market share who are also using the blue colour wrapper. Therefore, there is absolutely no prima facie case and the learned Single Judge ought not to have granted the interim reliefs. He would submit that this is an attempt to avoid genuine competition in the market. Finally, he would submit that with the sudden grant of interim order, at present, the defendant has a stock of its products already wrapped in the blue colour wrappers and a huge amount of blue colour wrappers which are already printed by the defendant would also lying waste.

5.4. Mr.Vijay Narayan, learned Senior Counsel also appearing on behalf of the defendant, carrying the arguments further, would submit that the entire crux of the claim of the plaintiff was in respect of the blue colour. They cannot claim any right over blue colour either under the Trade Marks Act, 1999 or the Copyright Act, 1957 or in common law. Nobody can claim any proprietary right over the colour blue. The learned Senior Counsel pointing out to the following picture, would submit that the various components used in the wrappers of the defendant and plaintiff is compared without the colour back ground, it can be seen that the plaintiff and the defendant are totally different.

5.5. The use of butter in the background or foreground in respect of Cookies is common to the trade. The defendant is only portraying its Umbrella mark Sunfeast and the well known mark Mom’s Magic and a picture of its Cookies. Thus, it can be seen that the only grievance which can be portrayed by the plaintiff is that of the colour. The law does not confer exclusive use of a particular colour on the plaintiff. Therefore, he would also submit that the order of the learned Single Judge requires interference.

5.6. Both the learned Senior Counsels appearing on behalf of the appellant / defendant would rely upon the following judgments :-

5.7. Per contra, Mr.P.S.Raman, learned Senior Counsel appearing on behalf of the respondent / plaintiff would submit that if the products are kept together, even from a shorter distance, it would take some effort on any person to find out which is that of the plaintiff and which is that of the defendant. When the products are kept in shelves of stores, shops etc., there can be no two arguments that there will be absolutely confusion and the defendant’s products are deceptively similar than that of the plaintiff. Each and every component in the defendant’s wrapper though poses to be different, it is crafted carefully so as to imitate the product of the plaintiff.

5.8. Admittedly, the plaintiff is the prior user, using the current wrapper in its form from the year 1997. Admittedly, the defendant started using the current scheme of things from the year 2020. Even though the same is similar to that of the plaintiff, in view of the colour of the wrapper being red in colour, the same reduced the mischief and therefore, the plaintiff did not sue the defendant. But, now, intentionally, it is adopting some shade of blue colour and the only reason is to encash on the good will and reputation of the plaintiff. He would submit that the learned Single Judge has rightly considered the issue and granted the interim order. As a matter of fact, the injunction is granted only with the blue colur wrapper and the defendant can very well sell its products with the red colour wrapper which was all along used by them. As far as the existing products, which are already packed by the defendant, are concerend, he would submit that the same can be considered by this Court if the defendant has to be permitted to sell the said products. But, however, he would submit that merely because the wrappers have been printed, the defendant cannot be further permitted to use the same for packaging their products and further sale of their products.

5.9. Mr.Satish Parasaran, learned Senior Counsel, also appearing on behalf of the plaintiff, would submit that when the plaintiff is crying foul of the blue colour, it is not by way of claiming exclusive use of the colour by itself, but, the colour forms a unique scheme along with the other devices and depiction in the wrapper so as to create an unique artistic copyright and distinctive trade dress in the combination of the registered marks of the plaintiff. The tabular column demonstration on behalf of the defendant has been decried by the Hon’ble Supreme Court of India and this Court repeatedly. He would submit that the test for deceptive similarities cannot be the kind of comparison as advocated on behalf of the defendant. He would therefore submit that the order of the learned Single Judge does not need interference.

5.10. Both the learned Senior Counsel would also point out to the various judgments relied upon by them before the learned Single Judge in support of their propositions.

F. The Discussion & Findings :

6. We have considered the rival submissions made on either side and perused the material records of the case. The parties are contesting the suit and the rights of the parties have to be finally determined in the main suit. The question that arises is that whether or not interim protection need to be granted to the plaintiff pending the suit and if so, on what terms ?

6.1. On a perusal of the decisions cited on either side, for the limited purpose of deciding the appeals, the law on the point can be summarised as follows :-

(i) In cases of this nature complaining infringement of proprietary rights in the trademark and passing off etc., whenever a prima facie case is made out, interim injunction should normally follow;

(ii) To satisfy as to the prima facie case of infringement or passing off, it has to be decided as to whether there is deceptive similarity between the products of the plaintiff and the defendant and if so, whether the plaintiff is the prior user and whether prima facie, the adoption of the mark by the defendant is dishonest;

(iii) In order to arrive at a conclusion as to whether the products are deceptively similar or not, it cannot be from the view point of a reasonable man but, by adopting the standard of an ordinary gullible customer;

(iv) The similarity or otherwise cannot be determined by factor-wise comparison or by forensic analysis, but, by wholesome consideration of the offending marks / labels / trade dress in question and the test varies upon the nature of the marks, its use etc.,

6.2. Thus, the point to be considered is that whether the defendant’s trade dress / wrapper is deceptively similar to that of the plaintiff. The picture of the product of the plaintiff as well as the defendant is shown in paragraph 5.4 above.

6.3. Even on a careful consideration thereof, it can be seen that though the brand name, trademark, device of the biscuit, swoosh of butter are portrayed to be different, yet, it is carefully and meticulously designed and combined at appropriate place in the wrapper so as to absolutely to be similar than that of the plaintiff. Admittedly, the plaintiff is the prior user of the present colour scheme, getup, combination of the picture of biscuit, butter etc. One would be too naive to believe that this is just a coincidence. Even the manner in which the defendant’s mark, Mom’s Magic which appears on both the ends of the wrapper clearly resembles that of the plaintiff’s depiction of its mark ‘GOOD DAY‘ at the same place. Thus, even though from the picture portrayed in the paragraph No 5.4 above, the learned Counsel for the defendant would demonstrate that each and every component is different, yet, they are very similar even on a careful comparison.

6.4. On a casual look or glance, there can be no doubt whatsoever that both the products are absolutely similar to each other. There will be confusion in the market. Especially, in the nature of the product being Cookies, being sold in the shelves of supermarkets, shops etc., any ordinary customer looking at the shelf is bound to be deceived and therefore, the product of the defendant is deceptively similar than that of the plaintiff. Admittedly, the plaintiff is the prior user and logically copying and dishonest adoption can only be attributed only to the defendant.

6.5. The arguments of the learned Senior Counsel on behalf of the defendant in demonstrating as to each and every component and stating that the plaintiff cannot claim the exclusively use of the picture of the biscuit, swoosh of butter, the colour of butter, the colour of wrapper, the roughly heart shape pattern of the mark GOOD DAY is written, the place in which the trademark umbrella mark is placed, the place in which the trade mark is placed in the middle and side words etc., is like a person after copying a story claiming that his story is made up of alphabets a,b,c,d, etc., and the other side cannot claim exclusivity of usage of those letters. The fact of the matter is that its use in such a combination forms words and sentences that it shows the same story as that of the plaintiff. Similarly, the copyright in the artistic work lies in the effort to put in each and every element together in a particular manner and style. The trademark and the trade dress get distinctiveness in the combination of the colour scheme, getup thereof and not in individual bits and pieces. Therefore, we reject the submissions of the learned Senior Counsel appearing on behalf of the defendant in this regard.

6.6. The next point for consideration is that since the plaintiff is not aggrieved by using the same set of devices, pictures and combinations in red colour wrap, whether the plaintiff’s claim is to be rejected as claiming exclusivity of blue colour? The submission on the part of the defendant that the plaintiff is claiming exclusivity to blue colour is unacceptable to us as the said contention does violence to the context in which the claim is made. It is the colour per se alone but the colour scheme and getup which gives rise to the proprietary right of the exclusive use.

6.7. When the other similarly coined and adopted devices of the defendant used in red wrapper, it would still pass the test of distinctiveness and identifiability by the customer by a casual look or in racks and shelves of supermarkets and shops etc. Only in that context, the claim of the plaintiff is in respect of injuncting the defendant from selling its product as depicted above in blue wrapper. Use of blue colour as the back ground in wrapper is the last straw on the camel, and make the defendant’s product offending the proprietary rights of the plaintiff to their trademarks and trade dress and their copyright. The same also leads to the inference of dishonest adoption on the part of the defendant in order to pass off its goods so as to unjustly enrich itself.

6.8. Under the said circumstances, we are in agreement with the findings rendered by the learned Single Judge, prima facie for consideration of the grant of interim injunctions as prayed for by the plaintiff. When the learned Single Judge has taken into account the relevant factors for consideration and has exercised the discretion to grant interim reliefs pending trial, the same cannot be interfered with merely because there is a possibility for the Appellate Court to take another view. However, we are inclined to grant the prayer of the learned Senior Counsel appearing on behalf of the defendant that the existing stock which is already packed in the offending blue colour wrappers alone, can be permitted to be sold.

G. The Result:

7. In the result, the Original Side Appeals in O.S.A.(CAD).Nos.134 to 138 of 2023 shall stand partly allowed on the following terms :-

(i) The order of the learned Single Judge, dated 10.10.2023 in O.A.Nos.551 to 555 of 2023 in C.S.(Comm Div).No.153 of 2023 shall stand confirmed;

(ii) However, the defendant is permitted to sell existing stock of their products packed in offending blue colour wrap and the status of the current stock, their movement and sale thereof shall be informed in writing and the exemption is only in respect of current stock of the quantity of 23.7 tonnes as prayed by the learned Senior Counsel and nothing more or further;

(iii) However, there will be no order as to costs;

(iv) Consequently, C.M.P.Nos.24144, 24146, 24148, 24147 and 24151 of 2023 are closed.