CASE BRIEF : Sun Pharmaceutical Industries Limited vs Cipla Limited

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FACTS OF THE CASE

In this case, Cipla Limited, the Respondent/Plaintiff, filed a suit for permanent injunction before the Madras High Court. The suit was against Sun Pharmaceuticals Industries Limited, the Applicant/Defendant, as it infringed the Respondent/Plaintiff’s copyright and registered trademarks as follows:

  1. The Applicant/Defendant imitated and substantially reproduced the artistic packaging, trade dress and labels of the Respondent/Plaintiff’s ‘BUDECORT RESPULES’ and ‘DUOLIN RESPULES’ which amounted to infringement of their copyright in artistic works. These were Budeonide Nebuliser Suspension BP, Levosalbutamol and Ipratropium Bromide Respirator Solution which were used in treating patients with respiratory ailments.
  2. The Applicant/Defendant used the mark ‘RESPULE’ by calling their medicine “Budefex Respules” and “Duoz Respules” which amounted to infringement of Plaintiff’s registered trademark.
  3. The Applicant/Defendant used packaging identical to Respondent/Plaintiff’s packaging for ‘Budesonide Respules’ and ‘DUOLIN Levosalbutamol Respules’ which amounted to passing off of their goods.
    The aforementioned acts of the Applicant/Defendant gave it an unfair advantage in the market and proved detrimental to the well-known trademark and copyright of the Respondent/Plaintiff.

In this suit for permanent injunction against the Defendant’s infringing acts, the Respondent/Plaintiff filed three applications before the Court and prayed for the grant of an interim injunction against the Applicant/Defendant. The Court perused the averments made in the affidavit as well as the colour label of both the parties and opined that an identical colour label was adopted by the Applicant/Defendant imitating that of the Respondent/Plaintiff. Hence, the Court passed an order for an interim injunction on 30.04.2021, and restrained the Applicant from marketing its product with an identical colour, design, and wave design till 02.06.2021.

Aggrieved by the same, the Applicant/Defendant on 03.04.2021, filed three counter applications to vacate the interim order granted. The plea for vacation was based on the fact that existing stock was of a huge amount and carried an expiry date of 1 year. The Applicant/Defendant brought to the court’s notice that its drug was in demand because of the ongoing pandemic as they helped in relieving the Covid-19 symptoms, and it was directed to report to the Union Health Ministry about the stock and position. Applicant/Defendant also prayed the Court to allow it to sell its existing stock with a thoroughly different packaging in the public interest, which the Respondent/Plaintiff alleged was an attempt to infringe its intellectual property rights.

ISSUE

The issue which came before this Court was as to whether or not the ad-interim order granted in favour of the Respondent/Plaintiff should be vacated on the ground of urgency as pleaded by Applicant/Defendant.

RULING

Application filed under Order XIV Rule 8 of Original Side Rules read with Order 39 Rule 4 & Section 151 of the Civil Procedure Code, 1908.

HOLDING

The Court held that the interim injunction shall continue to remain in force subject to the final decision of the suit and dismissed the said applications filed by the Applicant/Defendants for vacation of the interim order.

ANALYSIS

The question before the Court of setting aside the interim order so granted was mooted by the Applicant/Defendant on the ground of urgency by the Respondent/Plaintiff on the ground of unfair dissolution of its rights. The Court analyzed the Applicant/Defendant’s plea for urgency and said that it could not allow violation of the Respondent/Plaintiff’s rights.

Keeping in mind the fact that the country was facing a pandemic along with a huge demand for the drugs manufactured by both the parties, even then the Applicant/Defendant should not be permitted to infringe Respondent/Plaintiff’s rights just because it was a viable opportunity for them to make heavy profits. It went on to point out that the label and the trade dress had been copied by the Applicant/Defendant to take advantage of the unprecedented demand in the market for those medicines and that it was intended to ride on the goodwill and reputation of the Respondent/Plaintiff. The court noted that although it was open for the Applicant/Defendants to recall and repack its products, no such concession could be granted in the name of the ongoing pandemic.

The Court observed that the Respondent/Plaintiff had made out a prima facie case for continuance of the interim order as the balance of convenience continued to be in favour of the Respondent/Plaintiff. The learned judge opined that no harm would be caused to the Applicant/Defendant if the interim order was allowed till the disposal, but on the other hand if they were allowed to release their products in the market, it would amount to incalculable damage to Respondent/Plaintiff’s proprietary rights. The Court, in the end, recommended the parties to take advantage of the Commercial Disputes Act, 2015 for an early dispute resolution. Additionally, under the aforementioned circumstances, the court dismissed the applications filed by the Applicant/Defendants and reiterated its previous order.

CONCLUSION

The Court remarked that they could not be a mute spectator to a party violating another person’s intellectual property rights, notwithstanding the angle of public interest due to the demand for the drugs manufactured by both. Hence, upheld the interim injunction as the balance of convenience continued to be in favour of the Respondent/Plaintiff.

RELEVANT EXCERPTS

“12….. if the Applicant/Defendant does alter the package/label as stated in the of the affidavit filed in support of these applications in Application Nos.1982 and 1983 of 2021, it is without prejudice to the Respondent/Plaintiff’s right to question the same. In my view even the proposed changes retains the words “Respule” as trademarks in the label which are prima facie deceptively similar to the trademark “Budecort Respules” and “Duolin Respules” and “Respules” of the Respondent/Plaintiff. Though not argued, the conduct of the Applicant/Defendant borders on the violation of the provisions of Drugs and Cosmetics Act, 1940 and the Rules made there under. Prima facie the attempt of the Applicant/Defendant is to trade on “spurious drugs” within the meaning of Section 17B (e) of the Act ……..

13. The Respondent/Plaintiff has made a prima facie case for the continuance of the Interim Order. In the light of the above discussion, the balance of convenience to continue the interim order granted by the court on 30.4.2021 still continues in favour of the Respondent/Plaintiff notwithstanding the fact that an attempt has been made by the dependent to nix the public interest due to the medical emergency in the country and world over with the rights of the Respondent/Plaintiff.

14. In my view, no prejudice or harm would be caused to the Applicant/Defendant if the interim order is allowed to continue until the above suit’s disposal. On the other hand, if the Applicant/Defendant is allowed to release the products in the market, it will result in incalculable damage to the proprietary rights of the Respondent/Plaintiff and by permitting the Applicant/Defendant to sell the good it will be allowing dilution of the proprietary rights of the Respondent/Plaintiff.”

Citation: Sun Pharmaceutical Industries Limited vs. Cipla Limited …, Decided by Madras High Court in May, 2021, available at: IndianKanoon link to Sun Pharmaceuticals Industries Ltd. vs. Cipla Limited, visited on 1st July, 2021.

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