Imposing a cost of Rs 10 lakh for concealment of facts on Sun Pharma, the Delhi High Court on Monday said that not only does such a practice have to be deprecated but it also has to be penalised.
The observation was made in a plea moved by Sun Pharma against DWD Pharmaceuticals Ltd for restraining them from infringing on the former’s ‘FORZEST’ trademark.
The high court in May had granted an interim injunction in favour of Sun Pharma, restraining DWD from selling its medicinal preparations under the impugned mark ‘FOLZEST’.
The plaintiff, Sun Pharma, alleged that it only learnt about DWD’s trademark in May and hence moved the high court, claiming that the adoption of a similar trademark amounts to infringement as also “passing off and unfair competition”.
While FORZEST is a medicine used to target erectile dysfunction in men, FOLZEST is a multivitamin for pregnant women for lowering the risk of pre-term birth.
The defendant, DWD pharma, argued that it had registered the trademark ‘ZEST’ since 1983, and has a family of registered trademarks, with ‘ZEST’ forming a part of them (hereafter referred to as ‘the ZEST Family of Marks’).
DWD claimed that Sun Pharma was aware of not only the registration of the mark ‘ZEST’ in DWD’s favour but also of the other marks registered and used by the defendant. DWD pointed out that Sun Pharma had earlier applied for the registration of the mark ‘EXEZEST’, which was opposed by DWD in 2009, and this matter is still pending adjudication before the Trade Marks Registry.
On Monday, the high court upheld the interim order but ruled against Sun Pharma over the concealment of facts.
A single-judge bench of Justice Navin Chawla said that Sun Pharma “cannot be allowed to escape the consequences of having concealed material facts from this court to obtain an ex-parte order of injunction”.
“Whether with the disclosure of the above-mentioned material facts, the court would have still granted the ad-interim ex-parte order of injunction or not, is not relevant and cannot absolve the plaintiff from the consequences of not making such disclosure of material facts. Such a practice not only has to be deprecated but must also be penalised,” the court said.
The high court thereafter imposed a cost of Rs 10 lakh on Sun Pharma to be deposited with the Delhi High Court Legal Services Committee within two weeks from the date of the judgment, November 22.
DWD argued that Sun Pharma thereafter applied for registration of its mark ‘TRIOLMEZEST’, which was also opposed by them on December 30, 2014, on the same grounds that DWD is the registered proprietor of the ‘ZEST’ Family of Marks. “Even for the subject-mark, that is, ‘FORZEST’, when the predecessor-in-interest of the plaintiff applied for registration, the defendant’s mark ‘FERIZEST’ was cited as a conflicting mark,” it was submitted.
DWD argued that Sun Pharma has not disclosed the reply filed by them before the Trade Mark Registry against the said examination Report. “It is the case of the defendant that the plaintiff has intentionally not disclosed the above facts in its plaint, and is, therefore, guilty of concealing material facts,” the judgment recorded.
DWD asserted that Sun Pharma had approached the high court with “unclean hands by concealing and suppressing material facts and documents”, and is not entitled to be heard on the merits of its claim and the application filed by Sun Pharma for an interim injunction must be dismissed.
Sun Pharma argued that the uses of the two medicines are different and thus, any confusion between the two trademarks can lead to wrongful consumption of the pharmaceutical goods by an unwary consumer, which in turn will lead to disastrous consequences.
On the concealment of information, Sun Pharma submitted that reply submitted by the predecessor-in-interest of Sun Pharma to the examination report of Trade Mark Registry is not relevant to be submitted before the high court as once the registration of a trademark is granted, no reliance can be placed on such correspondence.
Considering the submissions made by both parties, the high court held that material facts were concealed by Sun Pharma. The court also observed that the concealed information would have been relevant to be considered while the interim relief was granted in May.
The court, however, held that in the case of medicines, the right of not only the private litigants but also public interest has to be kept in mind, and, in fact, be given prominence. “Even a remote chance of deception or confusion arising because of similarity in the marks is to be avoided and prevented, as it may led (lead) to disastrous consequences for unwary consumers,” the high court held.
Therefore, despite the “concealment and misstatement” by Sun Pharma, the high court ruled in their favour as it “prima facie” found that the two medicines were “deceptively similar to each other”.
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(With input from news agency language)
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