What happens if I don’t use my Trademark?

As per the Trade Marks Act, 1999, trademarks may be words, names, symbols, devices (logos), designs or any other distinctive sign or mark which helps the consumers distinguish one’s goods or services from those of others. Trademarks act as source identifiers of goods or services of a single entity and work as an advertising tool for that entity, enabling the consumers to identify the product because of its goodwill and consistent quality. Once a mark is registered, the owner of the registered trademark enjoys exclusive rights under the Act. However, with the rights come certain responsibilities as well. The proprietor of a registered trademark has the duty to use the mark and renew it from time to time. If the registered trademark is not used properly, it loses its validity and the proprietor loses its right to enforcement.

Non-use Cancellation

A trademark, once registered, must be used genuinely and honestly in trade with respect to the goods and services for which it is registered. A failure to use the trademark can lead to abandonment and cancellation for non-use. The Section 47 of the Trade Marks Act, 1999 provides for grounds for removal of a mark from the register for non-use.  As per the Section, there are two grounds for which a mark once registered can be removed,

  1. The trademark was registered without any bonafide intent to use on the part of the applicant, and the mark was not used for at least 3 months prior to the application for removal, and
  2. The mark has been on the register for 5 years or longer during which it was not used before the date of such application under this section.

To direct the removal of the registered marks the following points are to be satisfied before the Registrar:

  1. The application is by a “person aggrieved”.
  2. The trademark has not been used by the proprietor for a continuous period of at least five years and one month prior to the date of the application.
  3. There were no special circumstances which affected the use of the trade mark during this period by the proprietor.

The onus of establishing the first two lies on the applicant, the third one is on the proprietor.

Registration without bonafide intention to use

The practice of applying for registration in all or a number of classes, even the ones that are not relevant is common. This is known as defensive registration. A trademark owner without any genuine intention to use the trademark in some classes continues to get it registered in all or some classes just to prevent any other person from registering the trademark. This kind of registration may be removed as per the Section 47 of the Act.

In Kabushiki Kaisha Toshiba vs. TOSIBA Appliances, the Supreme Court held that, “The intention to use a trade mark sought to be registered must be genuine and real… when a trademark is registered, it confers a valuable right. It seeks to distinguish the goods made by one person from those made by another person. Therefore, a person who does not have any bona fide intention to use the trademark is not expected to register in all different classes just to block the trademark”.

In Vishnudas Kishandas v. Vazir Sultan Tobacco Co. Ltd., Hyderabad and Ors., famously known as the Charminar Case, it was laid down that, “a trader or manufacturer should not be permitted to enjoy monopoly in respect of all the articles which may come under such broad classification and by that process preclude the other traders or manufacturers to get registration of separate and distinct goods which may also be grouped under the broad classification.”

Non-Use for Five Years & Three Months

If post registration it is revealed that the trade mark has not been in use in any class that it has been registered for a period of five years after the registration or has not been used for a period of 3 months prior to the date of filing the application for registration, then such a mark is liable to be removed from the trademark registry. For the purpose of this section, the date of entry into the Register is the date on which the Certificate of Registration was issued.

Exception under Special Circumstances

In certain circumstances, non-use can be justified by a proprietor, wherein it could not use the mark owing to situations that had arisen not due to the fault of its own. Such circumstances include force majeure and import-export restrictions. In M J Exports Pvt. Ltd Bombay vs. Sunkist Growers, it was held that non-use due to special circumstances such as import policy, import control and tariff duty of the Government of India, outside the control of the proprietor would not attract cancellation for non-use.

What is ‘Use’ for the purpose of Section 47?

Section 2 (2) (c) of the Act, provides for a distinction between the use of the mark in relation to goods and services. It states,

“to the use of a mark, —

(i) in relation to goods, shall be construed as a reference to the use of the mark upon, or in any physical or in any other relation whatsoever, to such goods;

(ii) in relation to services, shall be construed as a reference to the use of the mark as or as part of any statement about the availability, provision or performance of such services;”

In an interesting judgment laid down in Hermes Trademark, it was held that the phrase “other relation” stands for “Something other than actually being upon goods or in physical relation to them- that would cover the use of the mark, ex, advertisements, invoices, etc… wide enough to embrace steps necessary for the production of goods as well as thee actual placing of them on the market.”

Hence, even if there is no use of the mark on an actual or physical product, it will be taken as use if it is done with the intent of or towards the direction of launching the product in the market. Further, Section 46(3) also prescribes that the intention to abandon is an essential component of non-use. In American Home Products Corporation v. Mac. Laboratories (P) Ltd, it was held that “both the intention of the proprietor not to use the trade mark at the time of registration and also the actual non-use of the trade mark subsequent thereto had to be proved… a person who intends to manufacture goods or has made preparations for the manufacture of goods but not commenced and therefore, goods have not been marketed is nonetheless entitled to get the trade mark which he proposes to use in relation to goods registered.”

Authored and contributed by Sonal Sinha, Intern.

This is post is brought to you by BananaIP’s Consulting and Strategy Department

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Please note that these case updates have been put together from different sources, primary and secondary, and BananaIP’s reporters may not have verified all the decisions published in the bulletin. You may write to [email protected]  for corrections and take down.

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