Sun Pharma Gets Interim Court Relief in Pantocid Trademark Dispute

The Division Bench set aside the earlier order of a Single Judge that had refused interim injunction despite finding prima facie infringement, observing that the reasons relied upon for denying relief, including doubts over the validity of Sun Pharma's trademark registration, alleged suppression of facts, and delay in filing the suit, could not be sustained.

The dispute concerns Sun Pharma's anti-acidity medicine sold under the registered trademark "PANTOCID," which has been in use since 1999 for Pantoprazole-based pharmaceutical formulations used in treating acidity, acid reflux, peptic ulcers, and related gastric disorders. Sun Pharma's trademark application dates back to February 19, 1998, and the company asserted that the brand has acquired substantial goodwill, recording annual sales exceeding ₹513 crore during the financial year 2021-22. The company also relied upon several previous injunctions granted in its favour against alleged infringers of the PANTOCID mark.

Finecure Pharmaceuticals, on the other hand, adopted the mark "PANTOPACID" for an identical Pantoprazole formulation, claiming use since June 15, 2007, and filed a trademark application in April 2009. Sun Pharma opposed the application before the Trade Marks Registry in 2010, and the opposition proceedings remain pending. According to Sun Pharma, it discovered the commercial sale of PANTOPACID products in April 2023 on e-commerce platforms and in Delhi, following which it instituted a trademark infringement suit seeking a permanent injunction. Although the Single Judge concluded that PANTOPACID prima facie infringed PANTOCID, interim relief was refused on the grounds that there was a credible challenge to Sun Pharma's trademark registration, alleged suppression of material facts, and an unexplained delay in approaching the Court.

Sun Pharma contended that it has continuously used the trademark PANTOCID since 1999 and had produced invoices evidencing such use. It argued that it had opposed Finecure's trademark application in October 2010 and had also issued a communication asking Finecure to substantiate its claim of prior use. According to the company, Finecure failed to produce any documentary evidence either before the Trade Marks Registry or in response to its communications.

The company further submitted that the Single Judge wrongly doubted the validity of its registered trademark by relying upon an earlier registration held by Takeda. Sun Pharma pointed out that Takeda's opposition to its trademark application had already been dismissed by the Registrar of Trade Marks in December 2010 after finding that Takeda had failed to establish actual use of the mark. That order attained finality as it was never challenged. Subsequently, Takeda's own registration lapsed and was removed from the Register in 2019. Therefore, Sun Pharma argued that its registration enjoyed the statutory presumption of validity under Section 31(1) of the Trade Marks Act and that no exceptional circumstances existed to disregard that presumption.

Sun Pharma also denied suppressing any material facts. It argued that the pending opposition proceedings against Finecure had already been disclosed in the plaint and that omission to annex the September 2010 correspondence could not amount to concealment. Likewise, it maintained that there was no obligation to disclose the earlier Takeda proceedings because those proceedings had already concluded in its favour years before the present suit was filed.

On the issue of delay, Sun Pharma argued that delay alone cannot defeat an infringement action. It submitted that despite learning of Finecure's trademark application in 2010, Finecure had failed to establish actual commercial use of the mark, and therefore immediate litigation was unnecessary. The company relied on settled legal principles that injunctions ordinarily follow once infringement of a registered trademark is established, irrespective of delay. It further argued that in an infringement action based upon a registered trademark, independent proof of prior use is not essential because registration itself confers enforceable statutory rights.

Finecure defended the Single Judge's order, contending that trademark registration alone does not automatically entitle a proprietor to an injunction and that Sun Pharma was also required to establish the validity of its registration and entitlement to equitable relief. According to Finecure, the earlier registration of the identical mark by Takeda diluted the statutory presumption attached to Sun Pharma's registration, and a challenge to that registration remained alive through proceedings initiated under Section 124 of the Trade Marks Act.

The respondents further argued that Sun Pharma had approached the Court without making complete and truthful disclosures. They alleged that Sun Pharma falsely projected itself as the original adopter of the mark while concealing Takeda's earlier registration. Finecure also contended that Sun Pharma failed to disclose its September 2010 communication and related correspondence, which showed that Sun Pharma had knowledge of Finecure's mark more than a decade before filing the present suit.

Finecure questioned Sun Pharma's claim of prior use by attacking the authenticity of invoices relied upon by the company. It alleged that several invoices contained inconsistencies, including references to Value Added Tax before the VAT regime had come into force, and claimed that many transactions involved entities operating from the same premises. It also referred to previous whistleblower complaints before SEBI relating to certain transactions involving those entities and pointed out that proceedings under Section 340 CrPC had been initiated concerning the disputed documents.

The respondents additionally argued that Sun Pharma had remained inactive for approximately fourteen years despite being aware of Finecure's trademark application since 2009, thereby allowing Finecure to build a substantial business under the PANTOPACID brand. According to them, the balance of convenience therefore favoured maintaining the status quo. Finecure also maintained that the competing marks were not deceptively similar and asserted that PANTOPACID had been honestly coined by combining elements derived from Pantoprazole, Proton Pump Inhibitor, and Acidity. Finally, it argued that appellate interference with a discretionary order refusing an interim injunction should be exercised only in exceptional circumstances.

The Division Bench noted that the Single Judge had already concluded that PANTOPACID and PANTOCID are structurally, visually and phonetically confusingly similar and that Finecure's mark prima facie infringed Sun Pharma's registered trademark. The Bench agreed with those findings and observed that they had not even been challenged by Finecure through cross-objections. The Court emphasized that both products are pharmaceutical preparations containing the same active ingredient, Pantoprazole, making the possibility of confusion particularly serious from a public health perspective.

The Court held that the Single Judge erred in questioning the validity of Sun Pharma's registration on the basis of Takeda's earlier trademark. It observed that Takeda's opposition had been dismissed in 2010, the order had attained finality, and Takeda's registration itself had been removed from the Register in 2019. Consequently, when Sun Pharma instituted the suit in 2023, its registration enjoyed the statutory presumption of validity under Section 31(1) of the Trade Marks Act, and there was no sustainable basis to disregard that presumption at the interim stage.

The Bench also rejected the finding that Sun Pharma had suppressed material facts. It held that the Takeda proceedings had already concluded before the present suit and therefore did not constitute a material fact requiring disclosure in the litigation against Finecure. Regarding the September 2010 letter, the Court observed that it merely called upon Finecure to withdraw its trademark application and expressly recorded Sun Pharma's belief that Finecure was not using the mark commercially at that stage. Since Sun Pharma had already disclosed the pending opposition proceedings in its plaint, omission of the letter itself did not amount to concealment sufficient to deny equitable relief.

While considering delay, the Bench observed that the Single Judge appeared to have applied principles governing passing-off rather than statutory trademark infringement. It reiterated that once infringement of a registered trademark is established, injunction ordinarily follows. The Court further found that the record did not support the conclusion that Finecure had grown into a "formidable market player," noting that its annual sales were approximately ₹28 lakh compared with Sun Pharma's sales exceeding ₹513 crore. Moreover, Finecure had been aware since 2010 that Sun Pharma objected to its use of the impugned mark through the pending opposition proceedings. Accordingly, the Court concluded that the balance of convenience favoured Sun Pharma and that public interest required preventing confusion between pharmaceutical products.

However, the Bench clarified that allegations regarding the genuineness of certain invoices and the Chartered Accountant's certificate relied upon by Sun Pharma remained open for adjudication during trial, and those issues would be decided independently without affecting the grant of interim injunction.

Allowing the appeal, the Division Bench set aside the Single Judge's findings that there existed a credible challenge to the validity of Sun Pharma's trademark registration, as well as the findings relating to suppression of material facts, proof of prior use, and balance of convenience. The Court granted an interim injunction restraining Finecure, its proprietors, partners, distributors, dealers, stockists, retailers, agents, and all persons acting on its behalf from manufacturing, selling, advertising, or dealing in medicinal products under the trademarks "PANTOPACID", "PANTOPACID D", "PANTOPACID SR" or any other deceptively similar mark amounting to infringement of Sun Pharma's registered trademark "PANTOCID."

The Court nevertheless permitted Finecure to dispose of its existing stock for a limited period of four months, subject to filing an affidavit detailing existing inventory, including batch numbers and manufacturing dates. It directed that no further manufacturing or packaging under the impugned marks would be permissible from the date of the judgment. The Court also observed that although Sun Pharma's delay in approaching the Court would not defeat its claim for interim injunction, it could affect the company's claim for damages, holding that damages for the period prior to 2023 would not be available. Finally, the Court directed the parties to assist the Single Judge in framing issues and proceeding with trial on the next scheduled date.

The Division Bench ordered:

"In view of the findings of infringement returned by the learned Single Judge and upheld by this Court, the Respondents, their proprietors/partners, its assignees in business, its distributors, dealers, stockists, retailers/chemists, servants and agents are hereby restrained from manufacturing, selling, offering for sale, advertising, directly or indirectly dealing in medicinal and pharmaceutical preparations under the impugned mark 'PANTOPACID', 'PANTOPACID D', and 'PANTOPACID SR' or any other trade mark as may be deceptively similar to the Appellant's trade mark 'PANTOCID' amounting to infringement of Appellant's registered trade mark."

"The Respondents are granted liberty for limited period for disposing of its existing stock within a period of four (4) months... However, effective as on the date of this order, no further manufacturing or packaging of its drugs under the impugned mark 'PANTOPACID' and other formative marks will be permissible."

To view the order, click the link below: