Unit -III TRADE MARK

A trademark is a brand name or logo associated with the company’s goods, products or
services. The consumers who buy the goods or avail of the services recognise it with its brand.
The brand or trademark may consist of words or numerals, designs or a combination of all.

A trademark can distinguish the goods or services of one person or company from those of
others. They are intellectual property rights in India. The Trademarks Act, 1999, regulates the
registration and functions of a trademark.

A trademark is a symbol, slogan, design, word, or combination of elements that identifies a

party's goods or services. The purpose of a trademark is to distinguish these goods or services
from someone else's. A trademark can be almost anything in terms of design as long as it makes
it easy for the consumer to identify it with a particular service or product.
Examples of popular trademarks include the NBC three-toned chime "G E C," the Nike
"swoosh," the McDonald's "golden arches," and the shape of the Coca-Cola bottle.

Purpose of a Trademark
The main purpose of a trademark is to prevent unfair competition between companies that use
consumer confusion to get more business. For example, if an independent diner used a golden,
arched "M" as its logo, it could confuse customers who think the establishment is a
McDonald's. Causing this type of confusion is against trademark law.
The purpose of trademark law is twofold:

 A trademark helps customers distinguish between products

 A trademark protects the owner's investment and reputation

In the 1995 case of Qualitex Co. v. Jacobson Products Co., the Supreme Court described
trademark law as "preventing others from copying a source-identifying mark" and assisting the
customer in making purchasing decisions. The law also helps make sure the producer will get
all the reputation-related and financial rewards associated with its product.
It's important to remember that having a registered trademark doesn't give you blanket rights
to that particular name. For example, "Delta" is both a sink manufacturer and airline, among a
few other businesses, and yet nobody confuses them. There is enough distinction between the
products and services that no customer would confuse Delta sinks with Delta flights.
If the USPTO doesn't believe a customer can confuse your trademark with someone else's, your
registration will be allowed to mature. However, the USPTO has a 30-day period in which it
posts a "Notice of Publication," allowing anyone to challenge the trademark application.
Certain applicants are required to file what's called a "specimen of use," which is an example
of your trademark being used in the real world. If your application fails to include all
requirements, including a specimen of use when requested, it will be returned along with a
filing fee refund.

Why is a Trademark Important?

As well as serving as a roadmap for customers, a trademark prevents theft. If you've created a
trademark, you enjoy certain legal protections and preventive measures. These preventive
measures include:

 Trademark registration at the federal and state level. You don't need to register a
trademark to keep others from using it or from creating a similarly confusing mark.
Still, registration gives you multiple legal advantages you wouldn't otherwise have
when pursuing those who have used your mark. The biggest advantage is being able to
give a constructive notice to the public, preventing anyone from claiming they were
unaware of the trademark's existence. You can also register a trademark federally if you
want to use it for interstate commerce.

 Use of notices. Using the TM or SM symbol is another way of giving enough notice to
the public, further cementing your legal protections.
 Pursuing infringers. Unless you take action against a thief, your trademark could be
lost. Registering your trademark is more likely to dissuade someone from using your
mark without your permission, although this isn't always the case.
 Controlled licensing. Trademark law allows you to license your trademark as long as
the owner requesting the license controls the quality of services and goods bearing the
trademark. Maintaining the quality of services and goods is important for maintaining
customer confidence in the brand and for building the trademark's reputation.

Primary Functions of Trademarks

A trademark primarily serves the purpose of identifying the origin or source of goods, products
or services. In India, a trademark performs the following functions:

 It identifies the product and its origin

 It proposes to guarantee the quality of the product
 It advertises the product as it represents the product
 It creates the image of a product in the minds of the public, especially the
consumers or the prospective consumers of the product

Product Differentiation Function

Trademarks serve as the basic means of achieving product or service differentiation. The
trademarks enable a customer to distinguish goods, products or services in the market without
confusion and make him/her arrive at a decision on what to purchase.

In perfect competition, trademarked services or products of various sellers are the perfect
substitutes for a buyer. But in product differentiation competition, such trademarked services
or products are just close substitutes. The competition takes place in building brand loyalty and
advertising effort based on the non-substitutability of the services or products.

For example: The advertisers of the brand ‘Surf’ seek to build an image that the ‘Surf’ brand
has qualities that cannot be replaced by any other detergent and all the other detergents like
‘Ariel’ or ‘RIN’ possess different quality or characteristics. A message is built up that the
customer is looking for the product ‘Surf’ and not just a detergent.

Identification of Source and Origin Function

One of the most important functions of a trademark is to serve as information to the customers
for identifying the origin or source of a product. The trademark guarantees the identity of the
origin of the trademarked services or goods to the consumer or end-user. It enables the
consumer to distinguish the trademarked goods or services from others with another origin
without confusion.

Under the Trademarks Act, 1999, a trademark must be distinctive to fulfil its identification of
origin function. When the trademark is distinctive, it is granted registration and protection
under the trademarks law in India. The Registrar of Trademarks can only accept the trademark
registration when the mark is distinctive; thus, the trademark will fail to identify the source.
Trademarks get legal protection under the Trademarks Act, thus making it difficult for third
parties to intimate or copy the product.

The Trademarks Act also safeguards the trademark since it prohibits any identical or similar
use of the trademark by its competitors in the market, who may take advantage of the reputation
and position of the trademark.

For example: The trademark ‘Brooke Bond’ identifies tea originating from a company
manufacturing tea and marketing it under that trademark.

Quality Function

A trademark ensures customers of the quality of the trademarked products or services.

Customers select goods or services known for their quality. Thus, trademarks help the
customers decide the products they need to purchase or the service they need to avail of.
Reputation and identification of quality are the key features of trademarks.
Customers often use trademarks to identify and choose products or services with quality. When
a customer has a good experience with a trademarked product, he/she will prefer to use the
same product having the same trademark. A customer will re-purchase a product again as
he/she will believe the trademarked product will have the same high quality that it had when it
was purchased previously.

For example: The quality of tea sold in the packs trademarked as ‘Brooke Bond’ would be
similar, but they would be different from tea labelled with the trademark ‘Taj Mahal’.

Advertising Function

The trademark represents a product or service. Another significant function of trademarks is

promoting products and services, thus providing an effective mode of advertising them. The
intention of the use of trademarks is to make consumers aware of the trademark and attract
their attention to the trademarked products or services. Customers can be attracted through
advertisements, which reinforce the image of a product or service.

Trademarks are used in marketing and advertising campaigns to establish positive associations
and brand recognition. The trademark or logos act as a visual cue for the services and goods of
a company and thus set it apart from its competitors. Companies can achieve brand recognition
successfully by using a logo or slogan.

For example: The trademark of ‘Sony’ is associated with electronic items. Thus, customers
associate the trademark ‘Sony’ with a particular quality of a particular class of goods. It
advertises the product while distinguishing them from the products of Sony’s competitors.

Creation of Image Function

Trademarks create an image of the product or service they are associated with. Trademarks
essentially function to create goodwill for the company. The goodwill embodied in a trademark
constitutes a company’s intellectual property or asset. The prolonged usage of a trademark
associated with a particular business helps the business gain reputation and goodwill regarding
its particular trademark.

In due course of time, the general public gains the knowledge and is aware of the trade name
or brand name and associates the particular trademark with the specific services or goods. Thus,
trademarks gain reputation and goodwill, which eventually expands to a larger area making the
trademarks known globally.
For example: The mark ‘M’ which represents the food items originating from the American
fast-food chain ‘McDonalds’, creates a reputation and image for food items offered by it for
sale in the market.4

TYPES OF TRADEMARKS

A trademark may be divided into the following categories:

1. Word marks: They may be words, letters or numerals. Eg: COCO CHANEL and
APPLE
2. Device marks: These marks consist of exclusive representation of a word, letter or
numerical. Eg: The way in which AMAZON is written or EBAY is written.
3. Figurative marks / logos consist of a figure or logo. Eg: The YELLOW M of Mc
Donlads or the SWOOSH sign of Nike.
4. Service Marks: A service mark differentiates the services (and not goods) of one
person from that of another. For example, the name UNITED AIRLINES, the FLY
THE FRIENDLY SKIES tagline, and the world map logo are service marks. This is
because United provides a service: airline flights around the world.
5. Collective Marks: Marks being used by a group of companies. The owner of such
marks may be an association, public institution, or cooperative. Eg: CA is used by the
Institute of Chartered Accountants and the mark CPA to indicate members of the
Society of Certified Public Accountants.
6. Certification Marks: Certification marks are used to define standards. They assure the
consumers that the product meets specific prescribed standards. Eg: ISI mark and
FSSAI mark.
7. Well-known marks: When a mark is easily recognised among a large percentage of
the population, it achieves the status of a well-known mark. Example: ROLEX,
CARTIER, FERRARI.
8. Unconventional Trademarks: Unconventional trademarks are those trademarks
which get recognition for their inherently distinctive feature:

 Colour Trademark: Purple colour trademark of Cadbury

Chocolates
 Sound Marks: The Hemglass ice cream van jingle is a well-known sound
trademark.
 Shape Marks (3D marks): The Coca-Cola bottle.
 Smell Marks: Brazilian footwear company Grendene successfully
trademarked their line of bubble gum-scented jelly sandals in June, 2015

Rights and protection

Ownership
Is ownership of a trademark in your jurisdiction determined on a first-to-file or first-to-
use basis?
Ownership of a trademark in India is determined on a first-to-use basis. Unlike the law on
patents or designs, the trademark law mandates the first-to-use rule over the first-to-file rule.
Unregistered trademarks
What legal protections are available to unregistered trademarks?
As a first-to-use country, unregistered trademarks with prior use can be protected under
common law in India. The passing off of trademarks is a tort actionable under common law
and is mainly used to protect the goodwill attached to unregistered trademarks. It is founded
on the basic tenet of law that one party should not benefit from the labour of another. Various
judicial decisions have established that a passing-off action is a misrepresentation made by a
person in the course of trade to prospective customers of the manufacturer or the ultimate
consumers of the goods or services that it supplies:

 which is calculated to injure the business or goodwill of another party; and

 which causes actual damage to the business or goodwill of the party which has brought
or is likely to bring the action.

Rights of Registered, Unregistered and Foreign Trademarks

How are rights in unregistered marks established?

In a typical passing-off suit, the courts will generally consider the following issues:

 whether the plaintiff is a prior user of the mark;

 whether the plaintiff’s goods have acquired distinctiveness and are associated in the
minds of the general public with the plaintiff’s mark; and

 whether there is a misrepresentation by the defendant with regard to its goods and such
misrepresentation is likely to lead to confusion in the minds of consumers, with the
result that they may treat the defendant’s goods as those of the plaintiff.

Are any special rights and protections afforded to owners of well-known and famous
marks?
The trademark law accords extraordinary protection to trademarks that are ‘well known’ and
safeguards them from infringement or passing off. The Trademarks Registry recognises well-
known trademarks in India on the basis of international, national and cross-border reputation.
The Trademarks Act 1999 protects well-known trademarks in two ways:

 an action against the registration of similar marks; and

 an action against the misuse of the well-known mark.

To what extent are foreign trademark registrations recognised in your jurisdiction?
Foreign trademark registrations have persuasive value in support of:

 an application for registration of an identical mark by the same applicant;

 an opposition by the rights holder against an application for a similar mark; and

 infringement and passing-off actions.

Registered trademarks
What legal rights and protections are accorded to registered trademarks?
A trademark registration:

 provides prima facie evidence of ownership and validity;

 provides statutory protection in India;

 helps to deter others from using the trademark unlawfully; and

 allows a suit for infringement to be brought.

In contrast, in the case of an unregistered mark, a passing-off suit can be filed. As passing off
is a common law remedy, the burden of proof is more severe on the plaintiff than in an
infringement action.
Who may register trademarks?
A party which claims to be the owner of a trademark can apply to register its mark for goods
and services. A party may apply to register a trademark with the trademark office under whose
jurisdiction the principal place of the applicant’s business falls. However, if the principal place
of business is outside India, the application should be filed with the trademark office under
whose jurisdiction the office of the applicant’s agent or lawyer falls.
What marks are registrable (including any non-traditional marks)?
According to the definition of a ‘trademark’, a mark is registrable if it is capable of being
represented graphically and of distinguishing the goods or services of one party from those of
another. This can include the shape of goods, their packaging and a colour or combination of
colours.
Can a mark acquire distinctiveness through use?
Yes. A trademark can acquire distinctiveness through use. Even if a mark lacks inherent
distinctiveness, it can still be registered if it acquires distinctiveness and secondary significance
due to continuous and extensive use.
Under Section 9 of the Trademarks Act, if a mark itself lacks distinctiveness, it can still be
registered if it has acquired distinctiveness through use.
On what grounds will a mark be refused registration (ie, absolute and relative grounds)?
The registrar may accept or refuse an application for registration subject to the Trademarks
Act. An application can be refused by the registrar on absolute or relative grounds.
Absolute grounds Section 9 of the Trademarks Act provides the following absolute grounds
for refusal of a trademark:

 The trademark is devoid of any distinctive character – that is, it is not capable of
distinguishing the goods or services of one party from those of another.

 The mark consists exclusively of marks or indications which may serve in trade to
designate the kind, quality, quantity, intended purpose, values, geographical origin or
time of production of the goods or rendering of the service or other characteristics of
the goods or services.

 The mark consists exclusively of marks or indications which have become customary
in the language or established practices of the trade.

 The mark is of such nature as to deceive the public or cause confusion.

 The mark comprises material likely to offend the religious susceptibilities of a class or
section of Indian citizens.

 The mark comprises or contains scandalous or obscene matter.

 Use of the mark is prohibited under the Emblems and Names (Prevention of Improper
Use) Act 1950.

 The mark consists exclusively of-

o the shape of goods which results from the nature of the goods themselves;

o the shape of goods which is necessary to obtain a technical result; or

o the shape which gives substantial value to the goods.

However, a trademark which may initially be refused on absolute grounds can be registered if
it acquires a distinctive character or secondary significance as a result of extensive and
continuous use.
Relative grounds Section 11 of the Trademarks Act provides the following for refusal of a
trademark:

 A mark cannot be registered if there is a likelihood of confusion due to:

o its identity with an earlier mark for similar goods or services; or

o its similarity to an earlier mark for identical or similar goods or services.

 A mark cannot be registered if it is identical or similar to an earlier trademark and is to

be registered by a different owner for goods or services which are different from those
 for which the earlier mark is registered if the earlier mark is a well-known mark in
India.

 A mark cannot be registered if its use in India is liable to be prevented by any law.

REGISTRATION OF TRADEMARKS

On filing a Trademark application, the registry issues an official receipt that

has the filing date and application number. Then the Indian Trademarks
Office examines the application, as to ensure it can be registered under the
Trademarks Act and if any objection to registration is raised, registry issues
an examination report to the applicant. The applicant is then required to file
a written response or to give evidence of acquired distinctiveness , and after
that, a hearing with the examiner is posted.

 If the registrar believes that the trademark can be allowed post examination
and hearing, a Letter of Acceptance is issued to the applicant after which
the trademark is published in the Trademark Journal. Post publication, it is
open for opposition for 4 months from date of publication. If no objection
is raised in these 4 months, certificate is issued and in case of objection,
both parties are given opportunities to be heard.

 Trademark Registration is a tedious process and it usually takes around 1 8-

24 months to acquire registration in cases with no objections or oppositions.

 Once the trademark is registered, it is valid for 10 years from the date of
application. The registration can then be renewed indefinitely if the renewal
fees are paid every 10 years.