Delhi Court slams Pharma company for copycat packaging, issues permanent injunction against its brand

Justice Amit Kumar found that SGS Pharmaceuticals' packaging infringed Laborate's copyright, closely imitating the design and presentation of "Labdic Relief," leading to consumer confusion. Alongside the permanent injunction, the court awarded Laborate Pharmaceuticals nominal damages of Rs. 5,00,000.

The case involved a lawsuit filed by Laborate Pharmaceuticals (plaintiff) seeking a permanent injunction to prevent the infringement of its registered trademarks, copyrights, trade dress passing off, and more.

Laborate Pharma has been operating since 1990. It has registered the trademark "Labdic Relief" for its anti-inflammatory product, and its unique packaging design, including the term "Fast Dissolving" and the "FD" acronym, is also copyrighted. The artistic work on the packaging was created by an in-house employee, reinforcing the drugmaker's exclusive rights.

In November 2019, the Laborate discovered that SGS Pharma (defendant) was marketing a pharmaceutical product under the trade name "Relief" prefixed with "Diclozen," which closely resembled it's packaging and design. The defendant's product, an analgesic, was found to be almost identical in appearance, raising concerns of trademark infringement and passing off.

The plaintiff filed a suit seeking an injunction, claiming that the defendant copied essential features, such as color combination and packaging design, intending to deceive consumers and profit from the plaintiff’s goodwill. The counsel for Laborate cited multiple judgments, including United Bank of India vs. Naresh Kumar and Sahana Pal Vs. UK Samanta, among others, to support their claims.

Meanwhile, the defendant's counsel argued that the trademark "Relief" is generic in the pharmaceutical field, claiming the plaintiff cannot monopolize common words or shapes used in medicines. They also questioned the validity of the suit, arguing procedural errors regarding resolutions and company authorizations. The defendant supported their defense with cases such as Macleods Pharmaceuticals Ltd. vs. Swisskem Healthcare.

Examining the issue, the court took note that the plaintiff's trademark, "Labdic Relief," is registered and not disputed by the defendant. The defendant, however, argued that the word "Relief" is generic and cannot be monopolized under Section 17 (2) (b) of the Trademark Act. Despite this, the plaintiff claimed that the word has acquired goodwill and reputation for its product. The comparison of both products revealed striking similarities in packaging, color combination, and the depiction of contents, leading the plaintiff to seek an injunction against the defendant's use of "Diclozen Relief."

The court observed that the defendant failed to file a written statement, and the right to file one was closed by law. The plaintiff's claims, therefore, remain uncontested, with no dispute over its registered trademark, "Labdic Relief." The defendant's use of "Diclozen Relief" on similar packaging has led the plaintiff to seek an injunction for trademark infringement and passing off. The plaintiff has demonstrated that the term "Relief" has acquired goodwill in relation to its product, and the overall similarity of the defendant's packaging raises concerns about consumer confusion. It said;

"The comparison of two products show that the entire packaging, colour combination, use of the words in the defendant's products is identical to that of the plaintiff's product. The manner in which the words Relief and FD are written in both the products is same. The colour combination is same. Though none can claim proprietary over a colour but certainly on combination of colours used in a particular manner. The plaintiff adopted the trademark Labdic Relief in the year 2001 in respect of anti inflammatory analgesic and is in continuous use since then. A bare perusal of the competing dispenser packs of the plaintiff and defendant clearly demonstrate that the distinctive literally and artistic features, their placement, get up, layout colour combination are deceptively similar to each other except of the upper back of a person shown on pack of defendant. It appears that the defendant has kept the pack of the plaintiff in front while preparing its pack."

"The adoption and use of the packaging of the plaintiff by the defendant is actuated by malafide and is likely to lead to immense confusion and create an impression that the defendant's product is connected to the plaintiff product. The defendant did not contest the matter seriously on the facts of the case. The written statement was not filed. The FAO filed before Hon'ble High Court was withdrawn and no steps were taken to place the written statement on record. The contents of the written arguments on factual aspect of the case can not be relied and referred upon more so when there is no evidence. The product of the defendant is so similar that the same is likely to cause confusion among the consumer."

Subsequently, the court found the plaintiff's trademark "Labdic Relief" to have acquired distinctiveness over time. The defendant's use of the mark "Diclozen Relief" and its similar packaging were deemed infringing and misleading, leading to a decree for permanent injunction. The defendant was ordered to cease using the infringing trademark and packaging, and to deliver up any materials for destruction. Although the plaintiff did not establish specific damages, nominal damages of Rs 5,00,000 were awarded. It held;

"In view of my findings given on the above issues, the suit is decreed and a decree for permanent injunction is passed in favour of the plaintiff and against the defendant thereby restraining the defendant itself and through its proprietors, partners, directors, agents, representatives, assigns, heirs, successors, stockist for and on its behalf manufacturing, marketing, using, selling, soliciting, exporting, displaying advertising or in any other manner dealing in the impugned trademark Diclozen Relief or any other trade label deceptively similar to the trademark of the plaintiff Labdic Relief, which amounts to infringement of the plaintiff trademark, passing off and violation of plaintiff trademark and trade label, violation of the plaintiff's trade name and infringement of plaintiff copyright in its art work of its blister/dispenser pack. Defendant is also restrained from using the identical blister packaging having same colour combination, outlook,design as that of plaintiff's blister pack. Defendants are further directed to deliver up all the finished and unfinished material bearing the impugned and violative trademark and label to the plaintiff for the purpose of destruction."

"As far as the prayer for rendition of accounts is concerned, the plaintiff has valued its suit at Rs. 5 Lac. However, there is no material on record to ascertain the sale of the defendant from the relevant product and as a matter of fact, the plaintiff did not take any steps during the trail seeking production of books of account by the defendant. The plaintiff therefore is not entitled to rendition of account as prayed but is entitled to damages as defendant malafidely infringed the trademark and copy right of plaintiff in packaging and tried to pass off its product as that of plaintiff's. Plaintiff is given nominal damages of Rs. 5,00,000/- in lieu of its prayer for rendition of accounts. The plaintiff shall also be entitled to the cost of the suit."

To view original order, click on the link below:

https://indiankanoon.org/doc/158677760/