Generic Trademarks: Towards Establishing a Comprehensive Judicial Formulation

Generic Trademarks: Towards Establishing a Comprehensive Judicial Formulation

Author: Sanjeev Kumar,
3rd year B.A.LL.B (Hons.),
 Christ Deemed to be University, Bengaluru.

Abstract
In recent times India has started to witness an increasing number of cases with respect to generic trademarks. Since the laws concerning generic trademarks in the country are not very well equipped it poses a threat to the country. One cannot deny the fact that there exists arbitrariness in past judgments rendered by the courts and the primary reason for the same is the non-existence of any uniform set of rules and guidelines to determine whether a trademark is generic in nature or not. The present paper is an attempt made by the author in this regard by demonstrating a very unique idea which if developed upon could resolve the present crisis. Notwithstanding the fact that every case is unique in itself, there always exists something that is common in all the cases if not some. It is here that the author suggests that cases should be thoroughly analyzed and accordingly questions that proved vital in determining the generic nature of a product must be codified. This would not only be beneficial in providing us with a set of comprehensive guidelines on the point but would also help the judiciary in numerous ways as mentioned in the paper.


Further, when these questions are coupled with the current position of international law on the point, itcan prove to be decisive in finding an answer to the existing difficulty. Accordingly, while researching on international guidelines emphasis has been on the United States and the four Common Law countries of United Kingdom, Australia, Canada, and New Zealand. Therefore, the paper aims to engage in a comparative analysis of the existing global and domestic legal framework to suggest reforms in the present ecosystem governing generic trademarks in India.

Keywords– Generic trademarks, Trademarks Act, 1999.


Introduction
There exists a void in the current law to deal with generic trademarks. To put it in simple words, there exists no uniform set of rules or guidelines to determine whether a mark is generic in nature or not. This leads to arbitrariness in the courts decisions thereby necessitating the need to formulate such guidelines at the earliest. The paper indulges in this particular exercise and attempts to furnish a comprehensive set of guidelines, as extracted from the case laws under scrutiny, which may serve as a guide for forthcoming cases.

Chapter I of the paper introduces the problem of genericideand its implications with the help of numerous case laws and examples. In doing so the effects of protection as provided togeneric trademarks will be duly analyzed, emphasizing the need for formulating rules and guidelines to deal with generic trademarks.

Chapter II of the paper will contain an in-depth analysis of Indian cases on generic trademarks. This examination wi
ll attempt to cull out and compilecertain identifiable common grounds underlying each of these judgments in the form of questions.Thereafter, the Chapter shall underscore the possible implications of such a compilation.

Chapter III of the paper will be dealing with international guidelines concerning generic trademarks. The focus will be particularly on the United States and four Common Law countries i.e. United Kingdom, Australia, Canada, and New Zealand. It will take into consideration the early developments in this field along with the current position of the law on the point.

Chapter IV of the paper in its conclusion signifies the essence of the paper by suggesting that the government legislate on the subject matter of generic trademarks. It showcases how the research is done in the paper can be of help in formulating such a set of rules and guidelines and how it can help the government to tackle the present problem of genericide.

Chapter I

Understanding Genericide: The Problem of Trademarks Becoming Generic


No matter how strong a trademark is, it can become generic and lose protection over time. This can usually be seen in cases where a trademark which once enjoyed protection becomes an indicator of a kind of goods and not a particular product due to its common usage. For example, Aspirin, yo-yo’s, cellophane, etc. The same can also be seen in the case of Hunt Masters Incorporated v. Landry’s Seafood Restaurant Inc.[1] wherein it was observed that certain marks that began life as a coined term may become generic depending upon the consumers’ understanding of the goods. This means that the term has become customary in the current language or the bonafide and established practices of the trade.[2]

As a result of this, the trademark law does notallow someone to have exclusive rights over the use of a term that denotes what a good or service is. An example of the same would be called a brand of shoes as “shoes”.

Generic Marks- An Economic Analysis


The fundamental requirement for a mark to be registered under the Act is that it must be distinctive i.e. goods or services of one undertaking should be capable of being distinguished from those of other undertakings. The importance of the same was also stressed in Canon Kabushiki Kaisha v Metro Goldwyn Mayer Inc.[3]It is not necessary that the signs or indications must have become a direct description of the goods or services concerned and that they describe their essential elements or characteristics; it is sufficient that the signs or indications bring the goods or services to the mind of the average consumer.[4]An
example of this is the case of 
Enrique Bernat FSA v. Guadalajara Inc.[5]wherein the term “Chupa” was understood as a common word and not a trade-mark for a lollipop.

To prevent unfair competition trade-marks have been protected by law. But, to avoid the creation of monopolies, such protection has been withheld where the words used are descriptive of the quality or ingredients of an article.[6]For example, the term “crystallized egg” for preserved eggs, has been held invalid as a trade-mark. When a mark becomes generic, it not only loses its distinctive characteristic but also becomes a common name for the kind of goods. In such a scenario it cannot be protected and should be left available for other traders to useand in public interest i.e. it restricts competition.[7]For example, several manufacturers can manufacture “cereal” and each of them is entitled to use the generic term “cereal” to refer to their product.

Addressing Problems of Absence of Guidelines Regulating Generic Marks


At present, there exists no uniform set of rules or guidelines in the Indian law bases on which one could conclude whether a mark is generic or not. It is left to the discretion of the judges to decide the same on case to case basis, thereby leading to arbitrariness. An example of the same is the case of Cooke & Cobb Co. v. Miller[8] where it was held that the word “favorite”, when applied to a letter-file, was descriptive of its quality and therefore not a valid trade-mark. However, the same court in Waterman v. Shipman[9] held that the term “ideal” when applied to fountain pens, could be used as a trade-mark as it was not descriptive of its quality.

Chapter II

Formulating Guidelines for Generic Marks: Analyzing cases from 2014-2019


At present instances involving generic trademarks are decided by the court ona case to case basis due to the absence of any uniform set of rules and guidelines on the subject. However, it is important to understand that not all cases require such individual and in-depth dealings. The reason for the same is that there are grounds which are common to several cases,the same grounds if codified in the formof questions would make the deciding of cases easier and less time-consuming. In light of the same, some recent case laws have been analyzed and an attempt is made to codify discernible common groundsin the form of questions. These questions were put forth by the courts to arrive at the respective conclusions. Hence, this would reduce the burden of the courts and would make the justice delivery system faster. The cases are as follows:

  • Mr. B.V. IlangoHimachalapathy v. M/s Rank Xerox Ltd. And Ors.[10]

The applicant in the case did not say that the mark was generic at its inception, his case was that by continued usage it had become generic. Listening to the detailed list of claims made by both the
parties, the court was of the opinion that the term “Xerox” has not become generic. Some of the questions that were raised in the case and which made it easier for the court to decide the case were:
  1. Whether the competitors are compelled to use the mark to sell their goods?
  2. Whether there exists a synonym for the public to apply to an unfamiliar product?
  3. Whether there exists uniform acknowledge of the fact that the owner of the trademark was the respondent?
  4. Whether the competitors business is being hampered by the existence of the trademark?

  • Three-N-Products Pvt. Ltd. v. Kairali Exports and Ors.[11]

In the present case, the plaintiff has based his suit primarily on the ground that his mark “Ayur” is an invented word and had no meaning whatsoever. However, the defendant contended that the plaintiff had no exclusive right in the word “Ayur” as the same being an abbreviation of “Ayurveda” which signifies the product is of Ayurvedic qualities. The court decided in favour of the defendants taking into account the following questions:
  1. What is the nature of the trademark being adopted?
  2. Whether the mark is distinctive?
  3. Whether it can be shown that the defendant was motivated by the desire to cash on the opportunity, reputation, and goodwill of the plaintiff’s trademark?
  4. Whether the use of the trademark is likely to deceive the public?
  • Sunil Mittal and Ors. v. Darzi on Call[12]
The plaintiffs claimed to be the registered proprietors of the label containing the words ‘The Darzi: The Suit People, 1981’ and had sued the defendants to prevent them from using the mark ‘Darzi’. The defendants were at first restrained by the court from using the word ‘Darzi’ as they found ‘D’ to be written in the same style as in plaintiff’s trademark but were later allowed. The court believedthat the word ‘Darzi’ was not generic and the reasoning was based on the answers to the following questions:
  1. Whether the word is generally used as descriptive of the services rendered?
  2. Whether the defendant has himself applied for the registration of the mark?
  3. Whether humans see the two marks similar to each other?
  • Parveen Kumar Jain v. Rajan Seth and Ors.[13]
The question in the present case was whether there can be any monopoly in the expression ‘ChurChur Naan’ or ‘AmritsariChurChur Naan’. The court was of the opinion that the word ‘churchur’ merely means crushed and ‘churchur naan’ means crushed naan and nothing more. The court further stated that if registrations are wrongly granted or applied for in respect of completely generic expressions, the court cannot ignore the generic nature of the marks and confer a monopoly on the same. One of the primary and most important questions raised the case was the following:
  1. Whether the rights of a registered trademark holder are absolute?
  • Arun Chopra v. Kaka-KaDhaba Pvt. Ltd. and Ors.[14]
In the present case, the plaintiff owned a food outlet by the name ‘Kake-Da-Hotel’ in Delhi whereas the defendant owned three outlets by the names ‘Kake-KaDhaba’, ‘Kaka-Ka Restaurant’ and ‘Kaka-Ka Garden’ in Nashik, Maharashtra. It was claimed by the plaintiff that the use of the mark ‘Kaka-ka’ for food outlets infringes his right as a legal trademark holder. However, the court was of the opinion that the balance of convenience would not justify directions to close down or change the name of the existing restaurants of the defendants which were running for over 20 years and that too not in Delhi, but Nashik. The reasoning of the court was primarily based on the following question:
  1. Whether the reputation and goodwill can be limited in nature i.e. confined to territorial limits?
  • Zari v. ZARI Silk India Pvt. Ltd.[15]
The applicant-company was a leading
manufacturer, trader, and retailer of a variety of garments. It was alleged by the applicant that the non-applicant-firm has adopted a similar trademark to gain an unfair advantage and cause loss to the applicant-company. However, it was claimed by the non-applicant-firm that the word ‘ZARI’ was generic and it simply meant a thread traditionally made of fine gold and silver for use on traditional garments. The trail court had at first granted injunction to the applicant but on appeal to the High Court the following questions were raised:
  1. Whether the generic word has acquired a distinctive or secondary meaning?
  2. Whether the trademark is being used for the same category of products for which it is registered?
  3. Whether the registration made is for a label mark or a word mark?
Chapter III

International Scenario Governing Generic Marks


Around the world, a large number of countries confer exclusive rights to words claimed as trademarks.[16] This is primarily done keeping in mind the sound economic reasons, for example, reduction in distribution and transaction cost whereby helping in distinguishing the products of one producer from those of another.[17] Apart from this it also encourages manufacturers to maintain a constant quality of products being sold under their trademark.Although the protection provided is justified for the economic benefits but the legal systems providing such protection are faced with the following two problems:
  1. First, a properly functioning trademark may become generic, and[18]
  2. Second, a manufacturer may attempt to remove an existing generic product name from the public domain by extensive use.[19]
There arises a conflict in the above two cases when the trademark owners seek to enforce their rights for the trademarks in question. As on the one hand, it might seem unfair to deprive the trademark holder of the goodwill associated with the mark. Whereas on the other hand allowing a generic mark to function would lead to a lot of confusion among the consumers.[20]The author through this paper will becomparing the approaches adopted to tackle the problem of genericide by the United States and four commonwealth countries i.e. the United Kingdom, Australia, Canada, and New Zealand. The primary reason for choosing these countries is that they share a common heritage and each of these jurisdictions has addressed problems associated with trademarked generic words in a similar context.

Comparative Analysis- United States and Common Law Countries


If we look at the early developments concerning the problem of genericide in the United States and the Common Law countries we can see several rules, tests, methods, etc. that were laid down to resolve the problem. Some examples of the same arethe legal test of Genericness, Eureka test, Patent-Expiry rule, Primary Significance test, etc. Let us now compare the early developments under the following subheads.

Evaluation of Genericness Issues and Deception Rationale


Historically, the only reason for courts of equity in intervening in tradema
rk cases was to protect property rights. But later it was realized that there is no such thing as monopoly or property in the nature of copyright.
[21] With the change in time the property interest in the goodwill associated with the mark used by the manufacturers to identify their goods was recognized. This made the courts to deny competitors from using the marks which would deceive the purchasing public at large.The outcome of this was that search cost was reduced, constant level of quality beingpromoted and it also facilitated advertising.

Now when it comes to granting exclusive trademark rights the common law courts were very stringent. They required two things to be shown precisely i.e. a clear show of secondary meaning and a high probability of deception. Whereas, the United States was of the opinion that ‘when a trademark ceased to perform beneficial functions, legal protection ought to be denied, even at the expense of the loss of some goodwill’.[22]Also when we compare the laws on genericness between the United States and Common Law countries, it is noteworthy that United States courts have often failed to adequately distinguish generic marks from descriptive marks. It is also important to understand that the overlap will be inevitable when descriptive trademarked words have also become product names. An example of the same is ‘Shredded Wheat”.

Looking at the tests adopted, the ‘Eureka test’ of the common law countries which was applied to invented or fancy words worked on a simple principle i.e. “whether the mark has come to be so public and in such universal use that nobody can be deceived”.[23]Whereas, the ‘primary significance test’ adopted by the United States was somehow flawed as it might perform a hybrid function i.e. identifying both the source and the name of the product.[24]

Patent-Expiry Rules


Even though the patent-expiry rule is clear and easy to administer for the benefit of the inventor, it has the potential of being over-inclusive. For example, it may result in misuse of a trademarked word by patent holders, no alternative name to call the product, etc. In simple terms, this rule can be seen as a fight for creating a monopoly. Looking at both sides i.e. the United States and the Common Law countries it was seen as preferable to not rely on such a rule and to retain more flexibility in deciding such cases. The need to have a separate statutory test was emphasized just like in New Zealand and the United Kingdom.

Trade Versus Public Use


When we talk of trade versus public use for a generic mark, we can rely on decisions from the United States. For example, Judge Hand’s Aspirin decision preserving Bayer’s trademark rights in sales to pharmacists and physicians but not in sales to the general public.[25] This approach has merits and it is important to understand that exclusive rights needs to be evaluated keeping in mind all the consumers who would rely on the trademark while making purchasing decisions. But when we look at the common law countries, we see that their provisions on the matter are protective and whereby eliminating the general public.

The solution to this was suggested to the manufacturers which required them to introduce a short and easily used word along with its trademark so that the p
robability of the public adopting the mark as a generic term is reduced to a large extent.
[26] This would help the manufacturer to save his mark from getting removed from the register.

Analyzing Judicial and Legislative Trends in the U.S.A


As we know global trade is increasing and one very important aspect of global trade is intellectual property which includes patents, copyrights, and trademarks. Earlier the laws governing such trade remained highly isolated but the same has started to change with the coming of The North American Free Trade Agreement (NAFTA)[27] and The General Agreement on Tariffs and Trade (GATT).[28] While prior required Canada, the United States and, Mexico to harmonize some of their laws governing intellectual property to facilitate free trade, the later contained provisions requiring the signatories to conform to certain minimum standards. Apart from this, the European Community is attempting to harmonize the laws of its member nations[29] and the United States has been changing its laws to match those of other nations.[30]It is important to understand that historically the trademark law, in particular, has been very territorially oriented. This was because the countries viewed the trademark law as protecting the marks that are used within the country.[31]

When we compare the laws of two countries, it can point out various ways in which the laws of the two countries can be similar and different from other countries. For example, sometimes the procedure can be as important to protectas substance. Hence, it is high time for countries across the world to come together to confront the challenges put forth by generic trademarks. It would be wise if a single platform can be created wherein the various countries can put forth their views and taking all the views into consideration, suitable guidelines can be framed. This would not only solve the problem by providing suitable guidelines but would ensure the member countries enacting uniform guidelines.

Chapter IV

Conclusion

The author through his paper has emphasized the need of having a uniform set of rules and guidelines pertaining to generic trademarks. Accordingly, through the various chapters of the paper, an attempt has been made to exhibit the problem of genericide, the consequences of the same if left unregulated and why there exists a need to regulate the same.

It is high time for a country like India which had begun to experience an increasing number of cases pertaining to generic trademarks to look beyond the discretion of the judges in deciding cases. The fundamental flaw in leaving such cases to the discretion of judges knowing the fact that there exist no uniform rules and guidelines on the subject matter gives birth to arbitrariness. To put it simply, a majority would agree that when laws are codified or uniform rules and guidelines exist on a subject matter, it is easier for the courts to deliver judgments thereby curbing arbitrariness and it also satisfies the parties to a greater extent. However, the status quowith respect to generic trademarks in India tends to do the exact opposite, leading to grave uncertainty for all the stakeholders involved.

Therefore, the present paper can act as a stepping stone for the government to develop on the subject matter and accordingly fill the existing void in the legislation. This would not only help the government in eliminating arbitrariness in judgments rendered by the courts but would also provide a long term solution for the existing problem of genericide. Apart from this, it will also help the judiciary in segregating cases based on the questions involved and accordingly assignsimilar cases to one court for their speedy disposal. Hence, the author is optimistic about his research being helpful to the government and it contributing to future developments in the area.


[1]240 F.3d 251.

[2]S. 9(c), Trade Marks Act, 1999, No. 47, Acts of Parliament, 1999 (India).

[3]1999 FSR 332

[4]PAUL TORREMANS, INTELLECTUAL PROPERTY LAW, 421-25 (9th ed., 2019).

[5]240 F.3d 439

[6]Roy M Porter Jr., Generic Words as Trade-Marks, Columbia Law Rev., Jun. 2005, 406

[7]TANYA APLIN & JENNIFER DAVIS, INTELLECTUAL PROPERTY LAW, 385-387 (2nd ed., 2017).

[8]169 N.Y. 475

[9] 130 N.Y. 301

[10]M.P. No. 115 & 116/2011 and 17

[11]246 (2018) DLT 691

[12]242 (2017) DLT 62

[13]CS (COMM) 213/2019

[14]2019 (78) PTC 48 (Del)

[15]2014 (59) PTC 62 (Raj)

[16]J. Gilson, Trademark Protection and Practice, 9-2

[17]Folsom &Teply, Trademarked Generic Words, 89 Yale L.J. 1323, 1333-46 (1980)

[18]L. Holmqvist, Degenration of Trade Marks (1971)

[19] J. McCarthy, Trademarks Under Unfair Competition, 96 (1973)

[20]King-Seeley Thermos Co. v. Aladdin Indus., 321 F.2d 577

[21]Singer Mfg. Co. v. Loog, 18 Ch. D. 395, 412(Ch. App. 1879)

[22]Folsom & Teply, Trademarked Generic Words, 89 Yale L.J. 1336, 1359 (1980)

[23]Burberrys v. J.C. Cording & Co., 1909 R.P.D. & T.M. Cas. 693, 699 (Ch.).

[24]Supra 17

[25]Bayer Co. v. United Drug Co., 272 F. 505, 510, 513-15, (S.D.N.Y. 1921)

[26]E. VandenBurgh, Trademark Law and Procedure, Part 6.20 (2nd ed. 1968)

[27]North American Free Trade Agreement Implementation Act, Subtitle C-Intellectual Property, Pub. L. No. 103-182, 107 Stat. 2114 (1993).

[28]Agreement on Trade Related Aspects of Intellectual Property Rights, Including Trade in Counterfeit Goods of the General Agreement on Tariffs and Trade, Pub. L. No. 103-465, 108 Stat. 4809, Title V.

[29]First Council Directive 89/104/EEC of 21 December 1988 to Approximate the Laws of the Member States Relating to Trade Marks.

[30]Trademark Law Revision Act of 1988, Pub. L. No. 100-667, 102 Stat. 3935.

[31]Person’s Co. v. Christman, 900 F.2d 1565 (Fed. Cir. 1990) .
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