Subway Vs. Suberb: The Deceptive Similarity In Trademark Law

Section 2(1)(h) of the Trade Marks Act, 1999 defines the word “deceptively similar” as “A mark shall be deemed to be deceptively similar to another mark if it so nearly resembles that other mark as to be likely to deceive or cause confusion”. It implies that two enterprises may be labeled as deceptively similar if the company's mark is so close to an already established trademark that utilizing it will lead customers to inaccurately identify the two companies.

Standards For Determination Of Deceptive Similarity

The criteria for detecting deceptive similarity were established long ago by the Hon'ble Supreme Court in the matter of Cadila Healthcare Ltd v. Cadila Pharmaceutical Ltd. in 2001. The court established specific guidelines for this particular scenario. It ruled that the following factors should be taken into account in determining whether a mark is deceptive: a) the nature of the products or services the mark relates to; b) the degree of resemblance between the two marks, and c) The type of mark—whether it be a word, symbol, or phrase, and the target audience that the company offers are also significant factors.

In another case of Parle Products (P) Ltd. v. JP Co. Mysore, the Hon'ble Supreme Court established a standard to evaluate whether two trademarks are deceptively similar. It said that a thorough examination of both marks was not required. Instead, the degree of general resemblance should be assessed based on the possibility of customer misunderstanding that it could result.

Subway Vs Suberb: A Case Study

• Background

“Subway” was a business established in the United States that operated a well-known international network of restaurants with the name “SUBWAY.” It possessed registrations in India for the terms “SUBWAY CLUB” and “VEGGIE DELITE,” which were utilized by them, to describe its club sandwich and veggie sandwich, respectively.

The defendants, Infinity Food & Ors., were a joint-venture business, and were the owners of the Plaintiff's licences, to which the Plaintiff had authorized franchise rights for its shops. Beginning in 2019, the Defendants supplied the Plaintiff's products via its shops.

The Plaintiff has accused the Defendant of infringing its Intellectual Property Rights by the following actions:

1. The use of the “SUBWAY” brand name and logo, with a corresponding yellow and green scheme of colors, to identify the two restaurants controlled by the Defendants;

2. The utilization of the phrases "VEGGIE DELICIOUS" and "SUB ON A CLUB," which were both deceptively similar to the Plaintiff's registered trademarks "VEGGIE DELITE" and "SUBWAY CLUB";

3. Use of the same or comparable food menus as well as paper napkins, in addition to similar or identical signs, outlet designs, menu cards, and employee outfits. Use of images and wall art at their outlets that were identical to the plaintiff's registered trademarks.

The Delhi High Court gave the opportunity to the Defendants, to ensure that they could figure out and make any adjustments in order to satisfy the Plaintiff that they were no longer breaching the Plaintiff’s IPR. The Defendants adjusted the colour combination of the emblem and modified the names of the items subject to the dispute. However, the Plaintiff was not happy with the adjustments and filed a petition for interim injunction.

Ø The Issue

Even after the adjustments that the Defendants carried out, whether it could still be alleged that the Defendants were violating a registered trademark of the Plaintiff.

Ø Arguments Put Forth By The Parties

The Plaintiff stated that the Defendants' flaws were obvious before they gave their approval for the aforementioned alterations. Plaintiff further claimed that the Defendants' main objective was to claim copyright over the Plaintiff's goodwill.

The Plaintiff claimed that despite the word marks, the names SUBWAY and SUBERB were misleading to one another citing Ruston and Hornsby Ltd v. The Zamindra Engineering Co. (1969) 2 SCC 727 and Parle Products (P) Ltd v. J.P.& Co. [(1972) 1 SCC 618]. Therefore, even if the color scheme of the abovementioned markings were changed, they would still appear to be quite similar. In addition, Plaintiff asserted that since the Defendants held its franchises, this constituted an instance of wilful deception, giving rise to an automatic right to an injunctive remedy.

The Defendants, on the other hand, asserted that the Plaintiff's claims of infringement and passing off are no more legitimate as a result of the modifications they have made. The Defendants further informed the High Court that they had altered the colour of their logo, and the decor of their stores, and that they had removed the photographs and artwork that Plaintiff was opposed to being displayed on the walls. They also argued that staff uniforms and menu cards were also changed to be different from those sported by the Plaintiff. The Defendants further claimed that the change in a colour scheme made the "S" in Defendant's mark no longer resemble the "S" in Plaintiff's logo. The defendants cited the judgments of the Supreme Court in J.R. Kapoor v. Micronix India, [1994 Supp (3) SCC 215] and Bigtree Entertainment Pvt Ltd v. Brain Seed Sportainment Pvt Ltd. [2018 (73) PTC 115 (Del)] in support of their arguments.

Decision And Findings

Although the fact both of the terms contained two syllables, the High Court held that "SUBERB" and "SUBWAY" were not phonetically comparable, and concluded that none of the Plaintiff's word marks or device marks were infringed upon by the Defendants' mark "SUBERB." The name "SUB" in its original form was frequently used, and it was generally known that when used in reference to sandwiches, "SUB" stood for "Submarine," a well-known variant of long-bodied sandwiches which were normally Six or nine inches in length.

Because "SUB" was publici juris when used in connection with these restaurant chains, the Plaintiff cannot be given exclusivity over the "SUB" element of its registered "SUBWAY" mark. Furthermore, after the "SUB" portion of the "SUBWAY" mark was removed, it appeared that "WAY" and "ERB" had nothing in common.

The High Court additionally noted that only registered trademarks may be infringed upon in accordance with Section 29 of the Trade Marks Act, 1999. Owing to the Plaintiff's prior registrations, both, the word mark and the device mark "SUBWAY" became eligible for protection. It was obliged to defend the Plaintiff's trademark against infringement since it didn't have any other registered trademarks. The High Court further noted that because Section 17(2) of the Act forbids the breakdown of a trademark, it is not possible to assert exclusivity for a particular aspect of the mark or claim infringement for any element that is widespread in the market or otherwise lacks distinctiveness.

The High Court ruled that the red and white "SUBERB" mark used by the Defendants after making changes could not have been mistaken for the Plaintiff's device mark. Owing to the terms "CLUB" and "VEG" being publici juris, the alterations made to the two marks, "VEG LOADED REGULAR" and "TORTA CLUB," would additionally disprove any infringement allegations. Based on the adjustments made by the Defendants, the High Court ruled that the Plaintiff's motion for an interim injunction cannot be accepted since no substance supports the request for an injunction and passing off.

Landmark Judicial Decisions On Deceptive Similarity

1) Starbucks Corporation vs Sardarbuksh Coffee and Co. & Ors.

In this case, the plaintiff possessed the registered trademark "STARBUCKS". The name of the company the defendants formed was "Sardarbuksh Coffee & Co." The defendant and the plaintiff both provided the same sorts of goods and services. In the opinion of the Delhi High Court, the name Sardarbuksh Company resembled the "Starbucks" logo both visually and phonologically, qualifying it as having "Deceptively Similarity." The Court ordered Sardarbuksh to change the name of its business to "SARDAR-JI-BAKSH" or "SARDAR-JI-BAKSH COFFEE & CO" as well as alter its logo. Further instructions were issued to Sardarbuksh to use a new name when filing a new trademark registration application. It was agreed that if a third party had been found employing the mark "BAKSH" with no authorization, the defendant could bring a lawsuit against them.

2) M/S Allied Blenders and Distillers Pvt. Ltd. vs Govind Yadav & Anr.

In this particular case, the plaintiff owned the "Officer's Choice" trademark and claimed that the defendant's trademark "Fauji" is deceptively similar to his trademark "Officer's Choice" since "Fauji" is a Hindi term that, when translated, refers to a military officer. The defendant and the plaintiff were both employed in the alcoholic beverage sector. The bottle's appearance was the same as well. Since the court found that the marks "Officer's Choice" and "Fauji" were not deceptively similar, the trademark violation action was denied.

3) M/S Lakme Ltd. vs M/S Subhash Trading

In the present case, the plaintiff was a cosmetics dealer who sold his goods under the "Lakme" registered trademark. Under the name "LikeMe," the defendant likewise offered the same kind of goods for sale. As a result, the plaintiff filed a trademark infringement lawsuit. The Delhi High Court found that the brand names "Lakme" and "LikeMe" were extremely similar. Due to their similar phonetic sounds, there was a strong likelihood that customers would be misled and confused about the plaintiff's products. Thus, an injunction was approved.

4) Ranbaxy Laboratories Ltd. vs Dua Pharmaceuticals Pvt. Ltd.

The plaintiff in this case was the owner of the mark "CALMPOSE" for a medicinal product. He said that the defendant started making a similar medicine called "CALMPROSE" following him. The court found that the names "CALMPOSE" and "CALMPROSE" were utilized for an identical group of products and that they share characteristics both phonetically and visually, giving the impression that they were the same.

5) M/S Mahashian Di Hatti Ltd. vs Mr. Raj Niwas

Since 1991, the plaintiff has manufactured and sold spices under the registered trademark MDH printed in three hexagonal devices on a red background. The defendant began utilizing the logo, which was "MHS" printed within a hexagonal device on an identical red backdrop. This was said to be deceptively similar to the trademark of the complainant. It was determined that both emblems were highly similar, which could lead to customer misunderstanding and misinformation about the plaintiff's products. As a result of the trademark's deceptive similarity, the court determined that trademark infringement had occurred.

To conclude, it could potentially be said that the trademark act’s application of deceptive similarity as a counterclaim against rejection of trademark registration, alongside the other measures featured within the term, is its most fundamental element. The proof of an intent to establish an impression of deceptive similarity in such circumstances is insignificant.

It is sufficient to prove that a trademark is being violated if it is deceptively similar to or substantially close to an already protected mark to establish a trademark infringement; no additional proof is required. Also, it is insufficient to simply establish that the markings are identical or deceptively similar in a passing-off claim. The use of the mark shouldn't be uncertain or deceptive. Furthermore, the plaintiff need not experience any harm as a result of the defendant's usage of the mark in order to be eligible for a trademark infringement claim to triumph. Conversely, it is essential to establish in a passing-off case that the defendant's use of the trademark has the potential to harm the plaintiff's reputation. This gives a sense of understanding that an individual is prohibited from using another individual's trademark, or modify or use a mark that was developed by someone else with a strong reputation as well as goodwill if doing so would deceive or confuse consumers.

The author is a student at Institute of Law, Nirma University. Views are personal.