Delhi High Court awards ten lacs damages in a TM infringement and passing off suit filed by Puma
The Court, in its judgment, noted:
- A perusal of the inventory prepared by the Court-appointed Local Commissioner would show that the quantum of goods seized is substantial and that the Defendant is running a full-scale manufacturing operation concerning counterfeit PUMA shoes.
- The inventory, which the Local Commissioner prepared on a particular day, shows that approximately 156 pieces were lying fully manufactured and certain shoes were semi-manufactured. Thus, if the stock of approximately 200 pairs of shoes is taken as an estimate of products manufactured in a week, it would mean that Defendant would be manufacturing and selling approximately 800 to 1000 pairs of PUMA shoes in a month.
- In the opinion of this Court, the Defendant has deliberately chosen to stay away from the proceedings merely to ensure that it is not required to produce its accounts. The Plaintiff is entitled to be monetarily compensated for the infringement committed by the Defendant.
- The nature of the Defendant’s activities leaves no doubt in the mind of the Court that proper assessment of the sale and profit earned may also not be determinable. Defendant is aware of the brand equity enjoyed by the ‘PUMA’ mark and has deliberately chosen to manufacture and sell counterfeit products under the mark and ride piggyback on Plaintiff’s goodwill and reputation.
- As per the Delhi High Court Intellectual Property Division (IPD) Rules, the Court can consider the following two factors while granting damages: –
- Profit earned by the infringing party; and
- Duration of income.
The Court Concluded
The use of the ‘PUMA’ mark and logo by Defendant on inferior quality products would not only violate Plaintiff’s statutory and common law rights but will also lead to erosion of Plaintiff’s brand equity and result in dilution of the marks. If left unchecked, such infringement would also be contrary to the consumer’s interests since the consuming public may purchase the counterfeit products and pay a higher price, presuming the same to be the Plaintiff’s branded products. Thus, the sale of such counterfeit products is even contrary to the public interest.
The Court passed a final decree in favour of Puma and awarded:
- Damages to the tune of Rs.10,00,000/- (approx. US $ 12,500)
- Costs of Rs. 2,00,000/- (approx. US $ 2500)