The Delhi High Court ruled that the Plaintiff’s Marks, ‘SOCIAL’ have acquired the status of Well-Known Marks within the meaning and scope of Section 2(1)(zg) of the Trade Marks Act, 1999, and therefore, decreed the trade mark infringement suit in favour of the Plaintiff. Based on the continuous use since 2014, enormous revenue, significant promotional expenditure, and substantial recognition in the hospitality industry, the Court found that the marks have acquired the status of “Well-Known Marks”.
The Court noted that the Plaintiff’s consistent enforcement of its rights in various courts reinforces the marks’ distinctiveness and reputation. Further, the Defendant is capitalising on the substantial goodwill and reputation established by the Plaintiff, and is seeking to create an association or connection with the Plaintiff where none exists.
Therefore, the Court emphasised that there is a significant risk that consumers may mistakenly engage the services of the Defendant under the impression they originate from the Plaintiff, which adversely effects both the Plaintiff’s reputation and the interests of consumers who may be misled into utilising potentially inferior services.
A Single Judge Bench of Justice Tejas Karia observed that the Defendant offers identical services, and operates through the same trade channels and serves the same consumer base as the Plaintiff. The Bench thus held that the Plaintiff had successfully made out a case for infringement and passing off of its trademarks.
The Single Judge also observed that the Defendant’s actions are likely to cause confusion in the course of trade, leading to the erosion of consumer trust and dilution of the Plaintiff’s goodwill and reputation.
Since the records demonstrate that the Plaintiff’s Marks have been actively used and promoted, with significant investment in marketing activities and consistent visibility within India’s hospitality sector, the Bench concluded that the Defendant offers identical services through the same trade channels to the same consumer base, and has dishonestly adopted the impugned mark without any plausible explanation.
Briefly, the Plaintiff, engaged in the restaurant and hospitality business, conceived a unique concept blending an office and a café, offering a collaborative workspace with a multi-cuisine menu, for which the ‘SOCIAL’ trademarks were adopted in 2011-12. The first restaurant under this mark was opened in Bengaluru in 2014. The Plaintiff has invested in a unique manner of food and beverage presentation, which has become exclusively associated with its brand.
In the Financial Year 2023-24, the Plaintiff’s promotional expenditure was Rs. 29.93 Crores and the total turnover from goods and services under the Plaintiff’s marks was Rs. 475.17 Crores. The Plaintiff claims that due to extensive and exclusive use, the marks have acquired immense goodwill and reputation, such that any use of a deceptively similar mark by another trader is bound to cause confusion.
In August 2022, the Plaintiff discovered the Defendant was operating a restaurant/cafe in Valsad, Gujarat, under the mark ‘THE SHAKE SOCIAL’ and an infringing logo. The Defendant was promoting its services on restaurant search engines like Zomato and Swiggy, and social media platforms like Facebook and Instagram. The Plaintiff also noted that reviews of the Defendant’s products indicated they were of substandard quality, which could adversely affect the Plaintiff’s goodwill.
The Plaintiff found that the Defendant had applied for registration of the impugned mark under Trade Mark Application No. 5567507 in Class 43. Despite legal notices from the Plaintiff to cease and desist, the Defendant refused to comply.
Appearances:
Advocates Shikha Sachdeva, Kriti Rathi, and Annie Jacob, for the Plaintiff
None, for the Defendant
