Coca Cola Company v. Bisleri International Pvt Ltd & Others

Estimated Reading Time: 9 minutes

Plaintiff – Coca Cola Company

Defendants – Bisleri International Pvt. Ltd & Others.

Decided by – Hon’ble Justice Manmohan Singh

Decided on – 20th October, 2009

Introduction

The case of Coca Cola Company v. Bisleri International Pvt Ltd & Others[1] is a landmark case of trademark, which throws into limelight various questions of law namely jurisdictional intent of the court, the breach of contract between the parties and the trademark infringement which was committed by the defendants and the plaintiff was granted injunction for the same. The article further discusses the facts, issues, arguments and the judgment of the case.

Facts

The plaintiff i.e., the coca cola company, which being the largest brand of the soft and carbonated drinks operating in 200 countries, granted licenses and designated bottlers to the franchise, in order to use those trademarks for the selling of the beverages. It also gave the authority to the third parties to manufacture beverage bases for their sales.

The defendants i.e., the Bisleri international private limited, earlier known as Acqua Minerals Private Limited, was a part of Parle Group of Industries and thereby sold its respective trademarks, formulations rights and know-how and intellectual Property Rights and goodwill of its products namely- Thumbs Up , Limca, gold spot, Citra and Maaza to the plaintiff company by a Master Agreement of India (a type of an agreement or a document between the two parties, that sets out certain terms and conditions to all the transactions between them. Though the defendant was the proprietor of the trademark (Maaza, as the area of dispute is in respect of Maaza), but the secret formula for the manufacturing of Maaza was with an affiliated company of the defendant i.e. Golden Agro Products Limited. So, subsequently Bisleri International Private Limited amalgamated with the affiliated company i.e. Golden Agro Products Limited. 

So eventually, on November 12, 1993 in the process of acquisition of mazaa by the coca cola company, there was a deed of contract between the plaintiff and the defendant. The agreements made between them were:- 

  1. Deed of assignment for transferring and assigning the trademark for Maaza in India.
  2. The assignment of goodwill agreement.
  3. Transferring of know-how for a trademark.
  4. Confidentiality and non-use agreement.
  5. Agreement for general assignment.
  6. Agreement in respect of relinquishment of franchise rights for compensation.

The existing franchise agreements were cancelled by the affiliated company of the Parle Group and executed a new license agreement with the plaintiff and entered into an agreement for the relinquishment of franchise rights . 

  1. License agreement.

In October, 1994 all the Intellectual Property Rights pertaining to the transfer of trademark and the formula for the manufacture of maaza were permanently accorded to the plaintiffs.

So on March, 2008 there arose a series dispute between the plaintiff and the defendant, when it came under the notice of defendant that the plaintiff had filed for the registration of trademark for mazaa in Turkey, and consequently sent a legal notice to the plaintiff stating that the company had breached the licensing agreement between the parties, in which the former had permitted to the plaintiff to use Maaza in India only and not in other countries. So the plaintiff  filed a suit seeking injunction and compensation for infringement and passing off of the trademark, and claimed that the defendant had actually ignored the terms and conditions of the contract, which accorded  all the IPR related rights for maaza to the company from the registration of trademark to the formula behind the manufacture of maaza.

The plaintiff contended that the defendants had actually infringed the exclusive usage rights of the registered trademark to the company.

Issues

  1. Whether the exports of the products of the trademark ‘Maaza’ can be considered as an infringement as claimed by the defendant.
  2. Does the Delhi High Court have territorial jurisdiction to deal with the matter?
  3. Is there any infringement of the trademark or passing-off?
  4. Is the plaintiff entitled to get a permanent injunction?

Arguments

  1. The plaintiff’s learned counsel argued that any restriction by the defendant on the use of the trademark ‘Maaza’ and its manufacturing formula after a licensing agreement had already been made between the parties, and then repudiating it whenever and wherever required, will be considered as a part of infringement of Plaintiff’s right. The defendant’s learned counsel argued that in accordance with the licensing agreement, they had allowed the use of the trademark of ‘Maaza’ to the plaintiffs only in India.
  1. The defendant’s learned counsel contended and stated that the plaintiff filed by the plaintiff in the Delhi High Court has no territorial jurisdiction to try the case. The plaintiff on the other hand stated in the plaint that the court had jurisdiction to try the case in its respective court on the basis that the defendant is carrying on business within its jurisdiction (Delhi), the defendant had intention use the infringing trademark within its jurisdiction and the legal notice that conveyed illegal intention originating in New Delhi, and also published its intention to use the trademark in the Delhi’s newspaper ‘Times of India. The learned counsel of the plaintiff denied the arguments submitted by the defendant and stated that the pleadings and reports submitted by the local commissioners clearly establish that the court had jurisdiction to entertain the suits for infringement of trademark under Section-134(2) of the Trademarks Act, 1999 and under Section-20( c) of the Code of Civil procedure, 1908. The plaintiff also stated the diplomacy of the defendant wherein the latter actually wanted to use the trademark all over India and other foreign nation states, which acted as a threat to the jurisdiction of the court.
  2. The learned counsel for the plaintiff stated that there is an infringement of his exclusive usage rights of its registered trademark in respect of ‘Maaza’ as they had the sole and exclusive right to use the trademark within and outside India. The defendant allegedly contended that, in accordance with the terms and conditions of the licensing agreement, the former had given the authority to the latter to use the trademark, Intellectual Property Rights, know-how and its formulation only in India.
  3. The plaintiff has stated that the suit filed by the company for injunction lies within the jurisdiction of the Delhi High Court, and hence stated that the maintainability of the suit is a part of cause of action and had accrued within the jurisdiction of the court on the ground that the defendant has been carrying his business in Delhi, also has issued new articles in the Delhi based newspaper ‘Times of India’ and also had a factory at Shivaji Marg.

It was also alleged by the plaintiff that the defendant had threatened them in Delhi, therefore at the prima facie stage, the Court also has the jurisdiction to try the case and thus filed a suit for infringement under Section-134(2) of the Trademarks Act, 1999 and Section 20(c) of the code of Civil Procedure. The defendant thus contended that it did not have any intention of infringing the trademark, and also stated that said trademark is the registered trademark of the plaintiff. As far as the notice is concerned which was sent to the plaintiff’s company was from the Mumbai address and the plaintiff was actually trying to mislead the court.

Judgement

The court passed an order on 28th October, 2008 restraining the defendant and its officers, agents, and other employers from using the trademark ‘Maaza’ and any other deceptively similar trademark with relations to mineral water alcoholic drinks and other aerated drinks and any other preparation of beverage bases. They were also restrained from using and and disclosing the know-how, formulations, and Intellectual Property Rights to any other persons. Two local commissioners were also appointed by the court to keep a check on the activities by the plaintiff and the defendant.

  1. The court also opined that there was a deed of assignment between the plaintiff and the defendant and the parties are under a mandatory provision to follow it, and if there is any breach in the contract then the aggrieved party has the right to sue the other party for damages.
  2. Pertaining to the jurisdiction of the court, it was held that the court has the prima facie view of the matter and therefore under Section-134 (2) of the Trademarks Act, 1999, there was no bar in filing of the suit in the Delhi High Court. The issue of jurisdiction has been discussed in the case of Tata Iron & Steel Co. Ltd. v. Mahavir Steels & Ors.; 47(1992) DLT 412[2], wherein it was held that question can only be raised after the evidence is recorded in the case, and thus the court can only arrive at the conclusion after hearing to the averments made in the plaint.

It was also held in the case of LG Corporation & Anr. v. Intermarket  Electroplasters (P) Ltd. and Anr.; 2006 (32) PTC 429[3], that the question to decide the jurisdiction of the court depends on the basis of the averments of the plaint.

  1. The court granted the ex parte interim order against the defendant , and also held the defendant liable for the breach of the contract, as in accordance with the terms and conditions of the contract, when the plaintiff has been given the authority to use the trademark by the defendant than the defendant cannot use that trademark, and this will subsequently result in an  infringement. Thus, the court held that the plaintiff being the registered owner of the trademark has developed a prima facie case for grant of an injunction.

Analysis

After discussing the case in brief, there are few points that are required to be discussed by the author. The Delhi High court’s decision in the case was lawful and gave justice to both the parties, in accordance with the various provisions of the act, because the first and the foremost step of the case was to decide the case in terms of contractual obligations of both the parties. The next issue that was taken into consideration was the trademark infringement which was caused by the defendants, and awarding an appropriate interim relief in the form of injunctions actually gave justice to the registered owner of the trademark.

Laws Involved

Section -20 deals with Advertisement of Application

Section- 29 deals with Infringement of registered trademarks. 

Section – 41 deals with Restriction on assignment or transmission when exclusive rights would be created in different parts of India. 

Section – 134 deals with Suit for infringement, etc., to be instituted before District Court. 

Section – 41 (h) deals with Injunction when not be granted.

Suggestion

According to the criminal law, i.e., when looked upon from the perspective of Indian Penal Code, the court has the power to exercise extra-territorial jurisdiction meaning if an Indian commits the crime outside the territory of India, it can still be tried under Section  3 and 4 of the Indian Penal Code. 

There should also have been the discussion for the breach of contract committed by the parties under Section 73 of the Indian Contract Act, 1872. Section 73 of the Act states that “When a contract has been broken, the party who suffers by such breach is entitled to receive, from the party who has broken the contract, compensation for any loss or damage caused to him thereby, which naturally arose in the usual course of things from such breach, or which the parties knew, when they made the contract, to be likely to result from the breach of it. Such compensation is not to be given for any remote and indirect loss of damage sustained by reason of the breach.”

It further stated that “When an obligation resembling those created by contract has been incurred and has not been discharged, any person injured by the failure to discharge it is entitled to receive the same compensation from the party in default, as if such person had contracted to discharge it and had broken his contract.” The explanation to Section 73 states that “In estimating the loss or damage arising from a breach of contract, the means which existed of remedying the inconvenience caused by non-performance of the contract must be taken into account.”

Conclusion

Thus, it can be concluded by saying that, Trademark is one of the most important aspects of the Intellectual Property Rights determining the protection for any word, name, symbol, configuration, device, shape of goods, packaging, combination of colors and the brand name. The concept protects the exclusive rights of the original registered proprietor, giving the protection to his registered trademark. 

The following case also gave an insight into the various relevant sections of The Trademarks Act, 1999, The Specific Relief Act, 1963 and The Code of Civil Procedure, 1908. The case also states that Trademark is a global phenomenon which also protects the proprietor outside the limits of India, and will subsequently also punish the wrongdoers in cases of infringement and passing off.


[1] Coca Cola Company v. Bisleri International Pvt Ltd & Others, On 20th October, 2009.

[2] 47(1992) DLT 412.

[3] 2006 (32) PTC 429.

[4] The Trademarks Act, 1999.

[5] The Specific relief act, 1963.

Leave a Reply

Your email address will not be published. Required fields are marked *