Delhi High Court Asks Two Shopkeepers To Pay ₹4 Lakh In Damages To SanDisk For Selling Counterfeit MicroSDHC Cards, USB Flash Drives

Passing a permanent injunction against two shopkeepers for selling counterfeit microSDHC cards and USB flash drives under 'SanDisk' name, the Delhi High Court has held them liable to pay damages of Rs 4 Lakh to SanDisk LLC and SanDisk India Device Design Centre.

Justice Sanjeev Narula in a ruling said the photographs of goods seized by the Local Commissioners from the shopkeepers in Trichy, Tamil Nadu demonstrate that they were indulging in sale and distribution of products which display identical marks as that of SanDisk's.

The images reveal that the defendants' product packaging is nothing but a counterfeit packaging of SanDisk products and they are clearly in indulging in blatant violation of SanDisk's statutory and common law rights in the trademarks, said the court.

"In view of the pleadings, documents as well as Reports of the Local Commissioners on record, the Court is of the view that affixation of Plaintiffs’ registered marks on Defendants’ goods has been done with the intention to unlawfully profit from the goodwill and reputation enjoyed by Plaintiffs. Defendants were deceiving public into purchasing their counterfeit products. The likelihood of confusion and deception is clearly made out. Defendants have made use of identical trademarks, in relation to identical goods (counterfeit microSDHC cards and USB flash drives), and are sold to the same end-use consumer base. It is obvious that there is a dishonest adoption by the Defendants, and a clear case for trademark infringement and passing off is made out," said the court.

The court also said that the use of SanDisk's marks by the two shopkeepers is bound to cause palpable losses, harm and injury to SanDisk as well as to the public.

"The goods seized by Local Commissioners, which are lying in superdari with Defendants, details whereof are recorded in the Reports of Local Commissioners dated 18th November, 2019 and 23rd November, 2019, are directed to be handed over to counsel for Plaintiffs and/or authorized representative for Plaintiffs, forthwith. The same shall thereafter be destroyed by Plaintiffs’ representative(s), in compliance with extant rules/ regulations," said the court, while granting relief to SanDisk.

SanDisk in the suit filed in 2019 had sought permanent injunction restraining infringement of its registered trademark, and copyright. The US-based company is in the business of providing data storage solution and one of the world's largest providers of flash memory storage solutions. 

In the suit, they alleged that defendants were indulging in unauthorized third-party distribution of counterfeit microSDHC cards and USB flash drives bearing its registered trademarks and also the Red Frame Logo, under identical packaging. The court was told that the defendants Laxmi Mobiles and Mahadev Mobile are wholesalers of impugned products.

In October 2019, the court had passed an ex parte ad-interim injunction against the defendants and appointed Local Commissioners to visit their premises. Local Commissioners confirmed the allegations and seized more than 1100 impugned products. The final order was also passed ex-parte as the defendants did not enter appearance or file written statement.

"Plaintiffs are registered proprietors of the trademarks noted-above, and their registrations are valid and subsisting. No evidence to the contrary has been produced by Defendants. By virtue of provisions of Section 28 of the Trade Marks Act, Plaintiffs have the exclusive right to use the trademarks in relation to the goods in respect of they have registration as well as to obtain relief in respect of infringement," said the court.

Title: SANDISK LLC & ANR versus LAXMI MOBILES & ORS

Citation: 2023 LiveLaw (Del) 98

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