In the trademark dispute between A.O. Smith Corporation and Star Smith Export Pvt. Ltd over the marks AO Smith and Start Smith, the Delhi High Court held the marks to be similar and use of Star Smith to be trademark infringement. The court also emphasized the significance of the dominant portion of the mark and anti-dissection rule while restraining Star Smith from using the mark.

Background

A.O. Smith Corporation, a renowned global entity in geysers and water heaters, air purifiers has garnered substantial goodwill through its trademarks ‘A.O. SMITH’ and ‘BLUE DIAMOND’. Conversely, Star Smith Export Pvt. Ltd. emerged as a competitor, raising concerns with its pursuit to register ‘STAR SMITH’/’STARSMITH’ for similar products, purportedly bearing close resemblance to A.O. Smith’s marks and launched water heaters under the mark STAR SMITH.

Legal Proceedings

The legal landscape unfolded as A.O. Smith Corporation initiated legal proceedings, filing suit for trademark infringement and passing off seeking a preliminary injunction restraining from using the brand name STAR SMITH. The court at the admission stage found a prima facie case and granted an ad-interim injunction. In response, Star Smith Export Pvt. Ltd. countered with an application to set aside the injunction.

Plaintiff’s Argument

A.O. Smith Corporation presented comprehensive arguments

1. highlighting their extensive use of the ‘A.O. SMITH’ mark internationally since 1874 and in India since 2006.
2. ‘SMITH’ was the predominant element of their mark, originating from the names of the company’s co-founders.
3. the defendants’ adoption of similar marks was malicious and intended to exploit the goodwill associated with the plaintiffs’ brand.
4. No other product was available in the ‘water heater’ and ‘water purifier’ category with reference to SMITH mark.
5. the adoption and use of ‘STAR SMITH’ constituted a deliberate attempt to leverage the plaintiffs’ brand equity and reputation, thus constituting a clear infringement upon their intellectual property rights.

Defendant’s Argument

1. ‘SMITH’ was a common surname and not subject to exclusive ownership by AO Smith.
2. that ‘AO’ was the dominant component of the plaintiff’s mark, thus minimizing any potential confusion.
3. the defendants claimed prior usage of ‘Aero Star’ and ‘Star Enterprises’ before adopting ‘STAR SMITH’, further asserting their right to the mark.
4. the defendants emphasized their legitimate use of ‘STAR SMITH’, contending that the inclusion of ‘STAR’ sufficiently differentiated their mark from that of A.O. Smith Corporation. In essence, the defendant opposed the plaintiff’s allegations of infringement, maintaining that their usage of ‘STAR SMITH’ fell within acceptable trademark parameters.

Court’s Ruling

Following thorough examination of arguments and evidence, the Delhi High Court rendered its verdict in favor of A.O. Smith Corporation. The court issued an injunction against the defendants, restraining them from further use of the mark and determined that ‘SMITH’ was predominant element in both marks, leading to the conclusion that Star Smith Export Pvt. Ltd.’s adoption could cause confusion among consumers.

Our Comment

As the businesses jostle to garner market share, the trend of copying certain elements of a mark that enjoys a larger market share will be resorted to by a new entrant. The balance between what would constitute infringement and what is a fair use will be constantly tested. Ultimately it is the consumer confusion that should be avoided.

RNA represented AO SMITH in this lawsuit.