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Penalties for Trademark Infringement

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If someone uses a trade mark without the owner’s consent and it appears to be confusingly similar to one that has already been registered, it is deemed to be infringed upon.

As branding becomes increasingly important in today’s business world, trademarks have become among the most highly valued intellectual property rights. This IP is dual-edged, though, primarily because as many people vying for trademark registration as there are those trying to steal it. As a result, the Trademark Act of India was established to shield trademark owners from trademark infringement.

As a result, this article goes beyond just listing the penalties and punishments for violating the law.

Interpretation of “Trademark infringement”

When someone uses a trademark illegally and strikingly resembles exact copies of another individual’s previously registered trademark without the owner’s consent, it is known as trademark infringement. To look for such theft, use the following criteria:

  • The mark provides identical service as the trademark owner and is strikingly similar to the mark of another person.
  • The process of creating a trademark that customers could mistake for one that has already been approved.

In India, Section 29 of the Trade Marks Act addresses trademark infringement. In a nutshell, trademark infringement is the violation of the owner’s exclusive rights.  An application for a trademark may be submitted by someone with an existing registered mark; in this case, only the person who has it can apply for one. When a trademark owner utilizes it in the course of doing business without permission, it is understood that the outsider’s rights have been violated.

The Trademark Act’s Section 30 discusses some circumstances that are not deemed to constitute trademark infringement. Since the license is permitted by an assignment agreement, it is not covered by infringement if someone possesses a license from the registered trademark owner. However, the licensee may claim illegal use if they use the trademark for goods and services that are not covered by the assignment agreement.

Indian Law Concerning Trademark Violation

The Controller General of Patents, Designs and Trademarks, a federal department reporting to the Ministry of Commerce and Industry’s Department of Industrial Policy and Promotion (DIPP), oversees the legal protection of registered trademarks.

Types of Violations of Trademarks

Trademark infringements fall into two categories, which are as follows:

  1. Direct Infringement

The Trademark Act of 1999 defines direct infringement under Section 29. A direct breach can only happen if certain conditions are met.

  • Use by an Unauthorized Party – Accordingly, a trademark is only violated when it is used by someone without permission from the registered trademark owner. It does not amount to infringement when the mark is utilized with permission from the registered trademark proprietor.
  • Comparable or same – The brand used without permission must be the exact duplicate of the registered trademark or strikingly similar. ‘Deceptively similar’ means that the average customer could be misled by the marks and think they are the same. Here, the operational term is “may,” and what has to be shown is that this is a likelihood as opposed to proof that it has happened. In the case that there is an option for the marks to be an error in recognition, proof of infringement is adequate.
  • Registration of trademarks – Trademarks registered with the trademark registrar of India are the only ones protected by the Act. In the event that an unregistered mark is violated, issues are resolved under the common law of passing off.
  • Goods and services fall under these categories – Unauthorized use of the mark for the promotion of products or services that are in the same class as the registered brand is necessary in cases of trademark infringement.
  1. Indirect Infringement

In contrast to direct infringement, which is covered under the Act specifically, indirect infringement is not. That being said, you are still accountable for any indirect infringement.  The concept of indirect violation is based on the idea of universal law. It makes everyone who helps or encourages the prime infringer, both the primary offender and other infringers, held accountable. There are two kinds of indirect violations:

  • Vicarious responsibility – According to Section 114 of the TM Act, if a company violates this Act, the entire company is liable. Therefore, unless they behaved in good faith and were unaware of the infringement, the principal offender and every person answerable to the company would be held accountable for indirect infringement. The following conditions must be met for vicarious liability: – The person needs to control the major infringer’s actions; – The individual must be aware of the infringement and take part in it. – When the infraction could result in financial gain for the offender. A business’s vicarious liability for infringement is only exempted in situations where it acted in good faith and was unaware of the violation.
  • Contributory violation – Contributory infringement is made up of just these three essential elements: When someone is aware of a violation, when a person materially contributes to a direct violation, or when someone forces the main offender to engage in illegal activity. There is no exception in the situation of contributory infringement, given that there is no chance that the contributing infringer will act honourably.

Trademark Infringement Penalties and Punishment

India may levy different penalties for trademark infringement based on the seriousness of the breach. The following penalties are typically achievable to apply:

Civil Remedies:

  1. Injunctions: To stop the party from exploiting the trademark in a way that violates trademarks, courts may grant injunctions. Stopping this legal remedy safeguards the integrity of the original trademark from subsequent unlawful use.
  2. Damages: Compensation for economic losses or reputational injury resulting from the violation is referred to as damages. This may consist of:
  • Actual Damages: Compensation for quantifiable losses, including missing revenue or earnings.
  • Additional Damages: Payment for non-tangible losses such as destroyed brand reputation or goodwill.
  • Account of earnings: A court order compelling the party violating your trademark to disclose and give up any and all earnings made from using it in violation.

Criminal Remedies:

  • Prison Time: Imprisonment for a minimum of six months and a maximum of three years
  • Penalty: A fine that starts at Rs. 50,000 and may exceed up to Rs. 2 lakhs.

Reasons to Consult a Trademark Attorney

Getting legal representation and having others who cover the costs of the losses can seem more expensive than handling this yourself. Ultimately, getting a legal attorney could help you get more money, and you may not be able to take appropriate action against infringers if you can’t defend yourself effectively.

It’s possible that you don’t have the time or finances to prepare your own legal defence because you have your own business and tasks ahead of you. Alternatively, your attorney can compile the requisite evidence and put together a case on your behalf. With a lawyer on your side, you may also address any inquiries you might have about your circumstances. Having a lawyer on hand who is ready to help you at each stage of the process is crucial to ensuring the protection of the trademarks you have tirelessly created.

Conclusion

Violations of trademarks have an impact on the owner’s company’s market share as well as brand value. Trademark infringement may occur in subtle ways in addition to prominent ones. There are obligations that follow the universal law idea. However, there are no laws pertaining to the indirect violation. People must, therefore, take immediate legal action to resolve any potential infringement and be aware of the consequences involved with trademark infringement on their merchandise. Speak with Kanakkupillai professionals for experienced advice on how to resolve your notice of trademark infringement.

FAQS

  1. How can I find out whether my trademark is being violated?

Analyze the unauthorized use of your trademark by other parties in similar goods or services. Marks that are identical to one another and cause confusion for consumers are signs of infringement.

  1. What are the defences against the infringement of trademarks?

The most frequently used defences in lawsuits alleging trademark infringement, unfair competition, and dilution are negligence, descriptive and nominative fair use, unclean hands and trademark misuse, fraud in gaining registration, and First Amendment applicability.

  1. The trademark isn’t registered, but I still want to sue someone for infringement. Is it possible?

Certainly, common law rights apply to unregistered trademarks.  Nonetheless, greater protection and extra-legal benefits are offered by possessing a trademark that is federally registered.

  1. Is it possible to violate international trademarks?

Indeed, trademarks are territorial, meaning that there may be international infringement. Think about utilizing international agreements to enforce rights and registering trademarks in pertinent nations.

  1. Where should I file a complaint alleging trademark infringement?

The general law bases the determination of geographical jurisdiction on the following:

  • The defendant’s home;
  • The location of their business;
  • The area where they labour for pay or
  • The location of the cause of action, at least partially.
  1. What is the legal consequence for violating someone else’s trademark?

Criminal defence: Section 103 of the Act outlines the criminal remedy for breaching the trademark of any person or business. Infringing on someone else’s trademark carries a six-month jail sentence, with a three-year extension possible.

G.Durghasree B.A.B.L (Hons)

G Durghasree B.A.B.L (Hons) is a registered trademark attorney with extensive experience as an Advocate for a period of 8 years. She possesses expertise in trademark law, including trademark filing and trademark hearings. Additionally, she is skilled in contract drafting and reviewing, providing legal advice and opinions, particularly in the areas of Company Law, Insolvency and Bankruptcy Code (IBC), and Goods and Service Tax Law (GST). Her experience encompasses both litigation and non-litigation aspects of these laws.