Tesla Inc., a globally renowned manufacturer of electric vehicles (“EVs”) and sustainable energy solutions, instituted a suit before the Delhi High Court against Tesla Power India Private Limited and its affiliates, alleging trademark infringement, passing off, and allied reliefs. Along with the suit, Tesla Inc. sought an interim injunction restraining the Defendants from using the marks “TESLA POWER”, “TESLA POWER USA”, or any other deceptively similar marks, including the domain names www.teslapowerusa.com, www.teslapowersusa.in, www.teslapowerusa.ae, and www.teslahealthylife.com.

The dispute raises significant questions concerning the scope of protection accorded to well-known trademarks, trans-border reputation, allied and cognate goods, and the limits of defences based on “common to trade” and delay. This article analyses the rival contentions and the order passed by the High Court.

Plaintiff’s Contentions

Tesla Inc. submitted that it is an award-winning, multinational corporation engaged in the manufacture of electric vehicles and sustainable energy products, including batteries and energy storage systems. Since adopting the “TESLA” mark in 2003, it has acquired a global reputation as a pioneer in zero-emission transportation.

The Plaintiff asserted proprietary rights over the well-known trademark “TESLA”, forming part of its trade name and used along with its distinctive “T” logo. It holds valid and subsisting trademark registrations worldwide, including in India. Through extensive sales, marketing investments, and media exposure, the TESLA marks have acquired immense goodwill and trans-border reputation, including in India.

It argued that the impugned marks “TESLA POWER” and “TESLA POWER USA” wholly incorporate the Plaintiff’s mark “TESLA” as their dominant element. The addition of descriptive terms such as “POWER” or “USA” does not distinguish the marks, particularly as they are used for identical or allied goods such as batteries, inverters, and EV-related products. The Defendants’ use across websites, domain names, and social media accessible in India was likely to cause consumer confusion.

The Plaintiff relied on the Defendants’ trademark applications in Class 9, noting that when the Plaintiff’s mark was cited in February 2021, Defendant No. 3 sought to distinguish the marks on grounds of different markets, thereby evidencing prior knowledge of the Plaintiff’s trademark.

The Plaintiff contended that the Defendants’ explanations for adopting “TESLA” whether as an acronym, “The Energy Storage on Leased Assets” or inspiration from Nikola Tesla were afterthoughts and did not negate infringement. The plea that “TESLA” is common to trade was untenable, particularly as the Defendants themselves sought registration of marks containing “TESLA” as a dominant element.

Advertisements released by the Defendants announcing EV launches with claims of “American Technology” and a “PAN India” network were relied upon to demonstrate dishonest adoption. It was further submitted that batteries constitute structural automobile parts, falling within the Plaintiff’s registrations in Classes 12 and 37, thereby establishing a strong prima facie case, balance of convenience, and irreparable harm.

Defendants’ Defence

The Defendants opposed the injunction, claiming honest and bona fide adoption of the marks “TESLA POWER” and “TESLA POWER USA” since 2020 for Class 9 products such as lead-acid batteries, inverters, and UPS systems. They relied on domain registration and alleged continuous use in India.

It was contended that “TESLA” is a surname associated with the scientist Nikola Tesla and is neither coined nor capable of exclusive use, especially in light of third-party registrations worldwide. The Defendants argued that the parties operate in different fields, with the Plaintiff focusing on EVs and solar solutions, while the Defendants deal in conventional power products.

The Defendants further submitted that the Plaintiff does not own a word mark registration for “TESLA” in Class 9, and that its registrations in that class are limited to device marks filed on a “proposed to be used” basis. They claimed prior use in India and asserted that the Plaintiff had not demonstrated actual commercial use, relying instead on global reputation and sporadic references.

Allegations of suppression were raised on the ground that the Plaintiff failed to disclose its responses to examination reports citing third-party TESLA marks. The Defendants also emphasised delay, contending that despite issuing a cease-and-desist notice in April 2022, the Plaintiff approached the Court after more than two years, during which the Defendants’ business expanded substantially.

Court’s Analysis and Findings

The High Court rejected the Defendants’ contentions and granted an interim injunction in favour of Tesla Inc. The Court recognised the Plaintiff as a leading global EV manufacturer with substantial involvement in battery technologies and held that the Defendants’ products were allied and cognate goods.

The Court noted that the Plaintiff is the registered proprietor of the “TESLA” trademark in India since 2013 in Classes 12 and 37. Batteries for EVs were held to constitute structural automobile parts, while the Plaintiff’s Class 9 registrations covering inverters directly overlapped with the Defendants’ goods, establishing a prima facie case of infringement.

The Court accepted the Plaintiff’s evidence of extensive goodwill and trans-border reputation in India, supported by global revenues, online presence, and widespread Indian media coverage. Considering this reputation, the Court found it implausible that the Defendants were unaware of the Plaintiff’s marks. The adoption of “TESLA POWER USA”, despite no US business presence, was held to be deceptive and indicative of dishonest intent.

The Court also noted the Defendants’ inconsistent explanations for adopting “TESLA” and held that having sought trademark registration themselves, they were estopped from arguing that the mark was generic or common to trade. Applying the dominant feature test, the Court held that “TESLA” is the essential feature of the impugned marks and that the addition of “POWER” or “USA” did not dispel confusion.

The defence of delay was rejected, with the Court observing that delay does not defeat injunctive relief in cases of dishonest adoption and well-known marks. The Court characterised the matter as one of triple identity, i.e., identity of marks, goods, and trade channels.

Order passed by the Court

In light of the above findings, the Court restrained the Defendants from manufacturing, marketing, or dealing in EVs and allied products under the marks “TESLA POWER”, “TESLA POWER USA”, the trade name “TESLA POWER USA”, or any deceptively similar mark, including use of the word “TESLA”. The Defendants were also prohibited from issuing promotional material or using the Plaintiff’s registered device marks and logos until disposal of the suit.

Comment

The decision underscores the preventive role of trademark law in curbing the opportunistic appropriation of globally reputed marks within allied and cognate markets. By emphasising trans-border reputation, the dominant feature test, and the doctrine of triple identity, the Court reaffirmed that descriptive additions and claims of generic character cannot legitimise a tainted adoption.