Neon Laboratories Ltd vs Medical Technologies Ltd & Ors

Neon Laboratories Ltd vs Medical Technologies Ltd & Ors

Brief Facts:

Respondents through their predecessors in interest were using the mark ‘Profol’ in India since 1998 for pharmaceutical product. In 2005, Respondents came to know that the Defendant have launched a drug called ‘ROFOL’ for identical product. Respondents filed a suit for passing off against the Appellant.

The Trial Court granted a temporary injunction in favour of the Respondents on account of prior use of the mark ‘PROFOL’. The same was confirmed by the High Court. Against the order of the Single Judge of the Hon’ble High Court of Gujarat, the present appeal was filed.

Court’s Observation:

The Hon’ble Court relied on Section 34 of the Trade Marks Act, 1999 which protects a prior user and observed as follows:

‘….A proprietor of a trade mark does not have the right to prevent the use by another party of an identical or similar mark where that user commenced prior to the user or date of registration of the proprietor. This “first user” rule is a seminal part of the Act…’.

Held, Section 34 of Act, stated that a proprietor of a trade mark did not have right to prevent use by another party of an identical or similar mark where that user commenced prior to user or date of registration of proprietor. This “first user” rule was a seminal part of the Act. Since Respondents had alleged, and had prima facie supported with proof, that they had already been using their trade mark well before attempted user of an identical or closely similar trade mark by Appellant, former would be entitled to a temporary injunction, in light of ‘first in the market’ test. Respondents had made out a prima facie case. Two other factors in an interim injunction, namely balance of convenience and an irreparable loss, were both in favour of Respondents given the potential loss of goodwill and business they could suffer should an injunction be denied. Appellant had been injuncted from using the mark ROFOL since 2005, after having launched products bearing the mark only in the previous year, so the balance of convenience is in favour of allowing the injunction to continue. Decision of Trial Court, as affirmed by First Appellate Court, was reasonable and judicious, and did not suffer from perversity by any dialectic that, Appellant might proffer. Appeal dismissed.

Ratio Decidendi:

Proprietor of a trade mark does not have the right to prevent use by another party of an identical or similar mark where that use commenced prior to use or registration by proprietor.