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Synopsis

The Delhi High Court has recently recognized Haldiram as a well-known mark, acknowledging its dynamic nature with capacity to endow products with distinctiveness and quality assurance that transcend mere geographical boundaries.

“This Court is of the opinion that the concept of a 'well-known' mark is ‘dynamic’. A well-known mark has the ability to imbue products with distinctiveness and assurance of quality that extends beyond mere geographical confines”, the bench of Justice Pratibha M Singh held. 

Haldiram India Pvt Ltd (Haldiram) approached the high court seeking to safeguard its trademark 'HALDIRAM' and establish its recognition as 'well-known' under Section 2(1) (zg) of the Trade Marks Act, 1999 (TM Act). The main aim was to secure a permanent injunction against the defendants, preventing them from selling products under the disputed mark 'HALDIRAM'/'HALDIRAM BHUJIWALA', or any similar marks causing confusion with Haldiram’s trademark.

Representing Haldiram, Advocate Neeraj Grover argued that the mark originated in 1941 from the founders' grandfather's nickname and had been used for various edible products. Starting from a small shop in Bikaner, Rajasthan, Haldiram has grown into one of India's leading food brands with global reach. Advocate Neeraj Grover emphasized that the mark was used in two main forms: one featuring a V-shaped logo and the other an oval-shaped logo, both registered trademarks covering food product classes.

On the other hand, Berachah Sales Corporation (Berachah/ Defendants) argued that there were 36 companies registered under the Companies Act, 2013 with similar names, many operating in the same industry. Since Haldiram did not object to these companies nor contest Berachah’s use of the said mark, they argued their use of the name should not be restricted.

An ex-parte ad-interim decree was issued appointing a Local Commissioner who seized Berachah’s goods. The subsequent report confirmed Berachah’s operations in Ambala City, where banners displaying the mark were found. Investigations revealed the defendants had been marketing products under this mark since January 2019. Further scrutiny uncovered infringing products, including expired items from 'HALDIRAM INC', a subsidiary of Haldiram.

The court, considering damages, accepted the local commissioner's report as evidence and noted “The Defendants have deliberately chosen to stay away from the proceedings merely to ensure that it is not required to produce its accounts. The Defendants cannot be allowed to enjoy a premium for their dishonesty”. The court observed Berachah’s extensive use of Haldiram’s mark and their filing of trademark applications demonstrated clear illegality, warranting significant damages in favor of Haldiram.

“Exemplary damages fall within the category of punitive damages and are typically awarded in extraordinary cases, taking into account the severity of the misconduct”, the court added. It declared the 'HALDIRAM' and 'HALDIRAM BHUJIWALA' marks as well-known across India, including regions where exclusive rights were not exercised, based on broader trademark principles and the spill-over reputation doctrine. 

“The Plaintiff’s case presents a unique scenario where ‘HALDIRAM’S’ reputation demands a flexible and evolved understanding of territorial rights in the age of global connectivity and changing market dynamics”, the court continued. 

The bench ruled that Berachah’s use of the name infringed Haldiram’s rights, as their marks were identical, and the services offered were similar to Haldiram's, meeting the triple identity test. “Moreover, the fact that there may be a division between certain family members – territorially, would not affect the decision in declaring the mark as well-known, as it is the reputation and good-will of the mark across products and services that is being recognised by a well-known declaration”.

The bench noted that considering numerous registrations and extensive usage of the mark by Haldiram, coupled with its goodwill, the court granted a permanent injunction in favor of Haldiram. Berachah was instructed to surrender all materials bearing the impugned marks for destruction within one week.

The court held, “A decree of declaration declaring the mark 'HALDIRAM', as well as the Ovalshaped mark, as a ‘well-known’ mark in respect of food items as well as in respect of restaurants and eateries, is granted”. Accordingly, the court allowed the suit and directed the registrar of trademarks to dismiss the trademark application filed by Berachah for ‘HALDIRAM’ and ‘HALDIRAM BHUJIYAWALA’.

Case title: Haldiram India Pvt. Ltd v Berachah Sales Corporation & Ors. (2024:DHC:2517)