Doctrine Of Dilution in Trademark

Introduction

Trademark protection is essential in the current scenario, when consumers often purchase goods based more on the brand name and trade sign attached to them than on their usefulness or quality.

A well-known trademark owner may assert brand dilution as a defence to prevent third parties from using the mark in a manner that lessens its perceived value or uniqueness or tarnishes its reputation.

One must show that there is a "likely of confusion," leading one to believe that the goods being offered are those of someone else, in order to prevent someone from using a mark. Even if there is little chance of confusion, spotting trademark dilution protects the mark's repute or originality.

Types of Trademark Dilution

There are two types of dilution: blurring and tarnishing.

When a third party's mark makes it more difficult for customers to connect a well-known mark to the plaintiff's goods or services, this is referred to as "blurring," or when a well-known mark's distinctiveness has been compromised because it has been or is likely to be linked to a similar mark or trade name. The Supreme Court in Mead Data Central v. Toyota stated that trademark infringement includes "the degradation of an established trademark's selling force via its unauthorised use by others on dissimilar items ".

A brand's value eroding as a result of its affiliation with inferior or even dubious products is referred to as "tarnishing." For example, Toys 'R' Us won a lawsuit against a pornographic production business that had used its trademark in one of its DVDs.

Doctrine of Trademark Dilution in India

The doctrine's fundamental goal is to establish a presumption that the pertinent Customers start to connect the trademark with a fresh supply of goods and services. A trademark is protected from all types of disintegration under trademark law thanks to the doctrine of dilution of trademarks. According to the theory, the plaintiff must demonstrate one of the following in order to establish dilution of the trademark:

1. The infringer is using the mark that is extremely similar to the well-known brand to capitalise on or profit from its goodwill and reputation.
2. The value of the well-known brand has decreased, causing financial harm.

Trademark dilution is acknowledged by the Indian courts since the case of Daimler Benz Aktiegesellschaft vs Hybo Hindustan in 1990. The case is related to the issue whether the defendant could use the mark ‘BENZ’ on underwear. However the case did not give any explanation or used the words dilution in the judgment, except once where it used the word dilute to state that “in my view, the defendant cannot dilute, that by user of the name “Benz” with respect to a product like under-wears.”

Later, the Delhi High Court examined the notion of dilution in the matter of ITC Limited v. Philip Morris Products SA and Others, stating that – “Dilution of trademark is a species of infringement. Although trademarks are concerned with protecting marks that have become distinctive in relation to specific goods and services, courts have recognised over the years that in marks that have become well-known enough to have a reputation about the quality of products the manufacturer, or services the originator (of the mark), then, even in relation to dissimilar goods - or unrelated products, protection of such brand name, mark, or acquired distinctiveness.This measure of protection to marks in connection to comparable junior markings, but for differing goods, is essentially the protection against the mark's dilution (or blurring or tarnishment).”

The judgement cited Section 29 (4) of the Trade Marks Act of 1999 (the Act), which recognised the following as the necessary conditions for dilution:

(1) The impugned mark must be identical or similar to the injured mark;
(2) The one claiming injury due to dilution must prove that her/his mark has a reputation in India;
(3) The use of the impugned mark is without due cause;
(4) The use of the impugned mark (amounts to) taking unfair advantage of or is detrimental to, the distinctive character or repute of the registered trade mark.

In this case, Indian courts have adopted a more lenient stance than American courts. In contrast to US law, which mandates that a mark be famous, the judgement only stipulates that the mark must have "a reputation in India." The Trademark Dilution Revision Act (TDRA) of 2006, a specific piece of legislation dealing with the issue, was passed in the United States. According to this Act, the following elements, which are an exception to the doctrine of dilution, must be taken into consideration when deciding whether the contested mark fulfils the "necessary degrees of recognition." For instance, instances in which the mark is utilised for satire, news reporting, commentary, entertainment, or educational purposes. Such circumstances might be covered by descriptive or nominative fair use, so they cannot be regarded as trademark dilution.

However The Delhi High Court merely noted that the mark must be damaging to the distinctive character or reputation of the registered trade mark when defining the fundamentals of a claim of dilution. The burden of proof issue was not extensively discussed. Additionally, the mark must disadvantage the registered mark or take unfair advantage of it, according to Section 24 of the Act. Section 24 of the Act does not allow for such an exception, and the term "detrimental" can refer to even parodies, criticism or comments.

 

For this reason, there has been a wide opinion that it is necessary to make an exception for criticisms, parodies, and remarks. Because of the broad reach of Section 24 of the Act, users of well-known marks may abuse the provision. This is particularly hazardous given the fact that prominent mark users are often corporate behemoths that may utilise Section 24's broad protection to harass smaller enterprises, and for the purpose the criteria laid down by TDRA can be used.