Important RulingsRulings

In counterfeit matter onus of conducting investigation is on Plaintiff, allows to withdraw the suit after paying damages, states HC

Me n Moms Pvt. Ltd. vs Sandeep Gupta

Me N Moms Private Limited(Plaintiff) has filed this suit seeking an injunction restraining infringement of trademark, passing off, misrepresentation, unfair competition, delivery up etc. Plaintiff manufacture, import, export and retail variety of infant and mother care products under the trademark ‘MEE MEE’ and also operates retail stores under the name ‘Me N Moms’. ‘MEE MEE’ is a registered trademark and plaintiff had filed this suit alleging that Mr. Sandeep Gupta (Defendant) is involved in selling counterfeit goods under the trademark ‘MEE MEE’. 

Plaintiff alleged that a customer had complained regarding a baby cot bearing ‘MEE MEE’ trademark which was purchased from the defendant’s store. Defendant had informed the customer that this product was imported from China and no after-sales service will be provided. Plaintiff, in its plaint, has claimed this to be a counterfeit product. 

On the basis of these pleadings, plaintiff sought an ex parte injunction against the use of its brand and also sought appointment of Local Commissioner. The Court vide order dated 14th October 2015 appointed Mr. Subhiksh Vasudev as Local Commissioner and granted the injunction. 

Single Judge, on the basis of the report submitted by the Local Commissioner, recorded that all seized products were genuine products. This was confirmed by the plaintiff as well. On the basis of this observation defendant was allowed to sell the genuine products of the plaintiff. 

Defendant has filed a counter claim stating that no cause of action has been made out against him and that the plaintiff brought a false case before this Court. Defendant claims that he has never sold counterfeit and fake products of plaintiff’s brand. He further claimed damages of INR 10,00,000 against the plaintiff along with interest.

Plaintiff later moved an application under Order XXIII Rule 1 to withdraw the suit to which defendant countered that there cannot be unconditional withdrawal and costs should be paid to the defendant as he has been put to enormous embarrassment and loss due to this suit, execution of commission and seizure of the products.

Although plaintiff agreed that all the seized products were genuine, but it still claims that plaintiff was indulging in clandestine sale of counterfeit products. Court observed that in such cases onus of conducting investigation is on the plaintiff before making such allegations. Plaintiff shared notarial certificate to argue that there is evidence of counterfeiting. However, perusal of that certificate shows that it does not mention that the products were not genuine. 

Court went on to observe that plaintiff is free to withdraw the suit but since it has obtained an ex-parte injunction and executed the commission at the defendant’s premises, it has led to the legal costs, expenditure of labour and capital. Hence, although withdrawal of the suit is allowed but it shall have to pay INR 2,00,000 as damages to defendant within 6 weeks. Court also held that plaintiff is free to file a fresh suit against the defendant if found selling counterfeit or fake product.  

 

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