Case Analysis of H&M & Anr v. HM Megabrands Pvt. Ltd. & Ors

Written by:

Mrunalini Srinivasan, SASTRA University Abhinav Akash, NLU, Visakhapatnam


Introduction

Trademark Law is a branch of Intellectual Property Rights to maintain ownership rights of the innovative product or the mark and identity of a company. Introduced in 1940 to overcome the difficulties arising because of infringement of trademarks but after this law the demand for protection of trademarks increased leading to the rise of trade and commerce.[1]

A petition was filed in the Delhi High contending for the logo which overlapped between a Spanish company, H&M Hennes & Mauritz and the Indian Company, HM Megabrands Pvt. Ltd. With the two companies being in the same field of garments, the logo was of immense relevance to both the parties so as to avoid any kind of confusion between their customers. It practically amounted to the appropriation of the reputation and marketing of the other company. The High Court of Delhi issued a permanent injunction against the defendants and confirmed that prior adoption of a mark overseas can be superior to prior use of the mark in India.[2] The present case provides for a different view in the field of Trademark Laws that for having a reputation and mark in India, it does not require a shop in India, the online base market can also prove significant in determining the goodwill and reputation of the product or service in India.[3]


Facts of the case

The plaintiff owns a trademark, H&M which was first registered in the United Kingdom, and later became a very famous clothing brand, and soon enough started to expand its business of garments in India as well. While their popularity surged in this regard, it wasn’t until 2015 they established any registered brick shop in India, marketing mostly through various web portals. The defendants, HM Megabrands started using the same trademark in the year 2011 and were also in the same business field of garments as the H&M were. The trademark was very similar and being in the same field started creating confusion between the customers of both the companies and the website of HM Megabrands even gave the same goods and similar customer service which when came to the notice of the plaintiff, they filed an infringement suit.

The plaintiff was of the view that the letter H and M inserted in the defendant’s mark was intentional and they wanted to gain the goodwill of the plaintiff's company. The alphabets ‘H’ and ‘M’ were present in the defendant’s brand’s corporate name, and had purposely been designed in such a manner that they looked similar to the trademark of the plaintiffs.[4] The plaintiff’s company was highly popular and famous among the younger generations across the world, and the website had more number of visitors than the defendant’s website. The defendants are in the same field so they could not contend that they were not aware of a competitive company with a similar logo and thus, using the same logo could not have been without prior knowledge. The plaintiff had also registered the logo in 1985 - far earlier than the defendant’s enterprise came to be - and this factor was also taken into account.

The defendants arguments were such that they used the alphabets ‘H’ and ‘M’ because those letters were the initials of their directors, namely, Hashim Merchant and Hamza Merchant, and the word ‘Megabrands’ is also added after the letters H and M in the logo, that may distinguish itself from the plaintiff’s mark. The plaintiff did not have any store in India till 2015 and they have not used their trademark for the 5 years from 2005 to 2010, so the distinctiveness of the logo does not exist. The word “Megabrands” after the letter is quite enough for anyone to differentiate between the two companies and the customer won’t find any confusion in this.[5]

Judgement

After hearing the contentions of both the parties, the Court decided the issue of jurisdiction. It was held that as long as the effect of infringement by the defendants, of the trademark of the plaintiff could be felt in Delhi, the Hon’ble High Court of Delhi had the jurisdiction to entertain the suit.

As for the defendants’ contention, with respect to the stance taken by the plaintiffs before the Trademark Registry, the Court held that the proprietors’ businesses receiving the trademark ‘HMT’ or ‘HMV’ was not related to the plaintiff’s and it was the abbreviation of other proprietors. It was observed that the defendants did not set up the business in their full names - Hashim Merchant and Hamza Merchant and over a period of time it became ‘HM’. It was found that the defendants chose to have their brand name as their initials and therefore, they could not claim that the people who were transacting business with them would know that they were Hashim Merchant or Hamza Merchant.

The court rejected the defendants’ argument that the word ‘Megabrands’ in the defendant’s trademark made their trademark different from that of the plaintiff’s. The judge was of the view that adding a suffix or a prefix to ‘H&M’ will create distinctiveness between the trademarks. The court observed that both the businesses were same in nature i.e., selling, manufacturing and marketing garments, etc., and that it would create confusion among the consumers. The court also held that the meaning of the word ‘mega’ means ‘successful’ or ‘huge’ and the word ‘brand’ means a name given to a product or service. The usage of the suffix ‘megabrand’ is a generic word and it implies association and affiliation with H&M. The other difference was the character ‘&’. The court held that the patrons of the plaintiffs and the defendants remembered and recollected only the alphabets ‘H&M’ from the plaintiffs brand and not the symbol ‘&’ between the two alphabets because it was written in a smaller font. The presence of the symbol ‘&’ did not differ the mark of the plaintiffs from the defendants[6].

The Ld. Single Judge relied on Christopher Wadlow’s Law of Passing Off and held that if the defendant is found to have adopted the plaintiff’s distinctive trademark, an injunction should be granted. In Mahendra & Mahendra Paper Mills Ltd. v. Mahindra & Mahindra Ltd[7], it was held that the plaintiff was using the word ‘Mahindra’ for a long time and acquired distinctiveness and secondary meaning in business and trade circles. Even though it was the surname of the defendants that was ‘Mahendra’, it was held that the use of the word ‘Mahendra’ by the defendant would create an impression of a connection with the plaintiff.

In S.B.L. Limited v. The Himalaya Drug Co.[8], the main issue was whether the mark ‘LIV-T’ was similar to the mark ‘LIV-52’. The court observed that though nobody could claim exclusive right to use any word, abbreviation or acronym, which becomes publici juris, if the trademarks used by both the plaintiff and defendant is a generic word common to both trademarks, it has to be shown whether the customers would be guided by using such words or ignore it and give emphasis to prefixes or suffixes.

The Ld. Single Judge rejected the defendants’ contention that the marks were not used by the plaintiffs in India for 5 years from the date of registration and did not acquire distinctiveness. The court held that the plaintiffs had sales since 2015 before the registration of the suit. It was observed that as the economy was opened up since 1991, many people have been travelling outside the country and as many Indians interacted with foreigners, there was an increase in online shopping which led to the rise in having a good reputation and opening a shop in India wasn’t necessary. In Cadbury UK Ltd. v. Lotte India Corporation Ltd.[9], it was held that for establishing reputation, visibility in India of webpages showing the product was sufficient to show that buyers traveling abroad were aware of the product and they could associate with the plaintiffs.

The court ruled in favor of the plaintiffs and as they were the prior users of the mark ‘H&M’. The Ld. Single Judge observed that the defendants should not be allowed to continue their business as they would develop goodwill under the impugned mark and will cause injury and loss to the plaintiff. The interim application of the plaintiff was granted and the defendants were restrained in using the marks in any manner[10].

[1] Diva Rai, Trademark Law in India, ipleaders (June 8, 2019). https://blog.ipleaders.in/trademark-law-in-india/. [2]Mohan Dewan, Mega Clash: Hennes & Mauritz Ab V. HM Megabrands Pvt. Ltd. , Mondaq (Mar 1, 2019). https://www.mondaq.com/india/trademark/785332/mega-clash-hennes-mauritz-ab-anr-v-hm-megabrands-pvt-ltd. [3]Ashna Pruthi, Goodwill and Reputation of Trademark in India- Worldwide Prior use plays Significant Role, Lakshmisri (July 16, 2018). https://www.lakshmisri.com/insights/articles/goodwill-and-reputation-of-trademark-in-india-worldwide-prior-use-plays-significant-role/# [4]Vandya Nallamothu, Hennes & Mauritz Ab & Anr. Vs HM Megabrands Pvt. Ltd. & Ors., Khurana and Khurana (Feb 24, 2020) https://www.khuranaandkhurana.com/2020/02/24/hennes-mauritz-ab-anr-v-hm-megabrands-pvt-ltd-ors/. [5] H&M scores Victory Against Similarly Named “HM Megabrands” in India, The Fashion Law (Aug 28, 2018) https://www.thefashionlaw.com/hm-scores-victory-against-copycat-hm-megabrands-in-india/. [6] India: Delhi High Court grants injunction to Hennes & Mauritz for infringement of their mark H&M, S.S. Rana & Co. (20 August 2018). www.ssrana.in/articles/india-delhi-high-court-grants-injunction-to-hennes-mauritz-for-infringement-of-their-mark-hm/. [7] (2002) 2 SCC 147. [8] 194(2012) DLT 536. [9] 2014 (57) PTC 422 (Del). [10] Ashna Pruthi, Goodwill and reputation of trademark in India - Worldwide prior use plays significant role (July 16, 2018). https://www.lakshmisri.com/insights/articles/goodwill-and-reputation-of-trademark-in-india-worldwide-prior-use-plays-significant-role/.

195 views0 comments
 

©2020 by JURIS COGNITIONIS. Proudly created with Wix.com