Infosys Limited (Infosys) brought an action against Southern Infosys Limited (SIL) seeking to restrain SIL from using Infosys’s registered trademark “INFOSYS” as part of its trade name. Infosys alleged that SIL’s use of its registered trademark risks misleading consumers and eroding Infosys’s unique brand identity. This case summary will provide an overview of the facts, submissions made by both parties, the outcome of the case, and a conclusion

Infosys sought an injunction on the following grounds:

1. They are the prior adopter and user of the trademark INFOSYS, with the mark having been coined and adopted in 1981 and being continuously and uninterruptedly being used since then.
2. They have secured multiple registrations for the mark INFOSYS and its variants, with the earliest registration dating back to July 15, 1987.
3. Infosys’s website, www.infosys.com, has been operational since 1992.
4. That the Courts have held that INFOSYS is a well-known trademark, which enhances the protection afforded to Infosys.
5. That the mark INFOSYS has amassed considerable goodwill and reputation both in India and abroad and is exclusively associated with them.
6. The adoption and use of its trademark INFOSYS by SIL as a part of its trade name constituted infringement under Section 29(5) of the Trademarks Act, 1999.
7. SIL’s adoption and use of the mark INFOSYS was dishonest and malafide with the intention to capitalize on the goodwill and reputation of Infosys trademark.
8. That dishonest adoption of a mark by SIL would not gain legitimacy through prolonged use.

SIL countered the injunction sought by Infosys on the following grounds:

1. Infosys had concealed material facts from the Court by not disclosing that it had sent Cease and Desist notices in 2001 and on April 27, 2020 to SIL, and this omission was a tactic adopted by Infosys to secure an interim injunction based on incomplete disclosures and to sidestep potential objections which could jeopardize their request for such immediate relief.
2. SIL contended that such non-disclosures and omissions disentitled Infosys from obtaining an injunction since it is a settled principle of law that any party approaching the Court must do so with clean hands.
3. SIL contended that Infosys is not entitled to an injunction on the grounds of delay, laches, and acquiescence. SIL stated that it was incorporated under the name Disha Financial Services Ltd. in January/February 1997 and changed its name to “Southern Infosys Limited” in 1998. SIL is listed under the said name in the Bombay Stock Exchange since 2016 along with Infosys, and as such, it could not have been possible for Infosys to be unaware about their presence.
4. SIL contended that an inordinate delay of more than 20 years in instituting this action rendered the suit non-maintainable. Further, by remaining inactive for 20 years, Infosys has tacitly consented to SIL’s use of INFOSYS as a part of its trade name.
5. The term INFOSYS is an abbreviation of the words “Information” and “Systems;” therefore, the mark is generic and descriptive of the services provided by Infosys. In this regard, Southern Infosys placed reliance on a circular dated May 13, 1999 issued by the Department of Company Affairs, Central Government wherein the Registrar of Companies was advised to allow inclusion of “Infosys”, “Software”, “System”, etc. subject to a substantial portion of the company’s income coming from the said activities.
6. SIL contended the rival marks are dissimilar and there is no likelihood of confusion amongst the public.
7. There is a substantial difference in the nature of the business of the two parties, and thus there does not exist any likelihood of confusion.

After considering the pleadings, arguments and Case laws, the Hon’ble Court held:

1. Given that Infosys was incorporated on July 02, 1981, and secured registration of INFOSYS as a word mark in class 09 on July 15, 1987, SIL’s adoption of the mark INFOSYS postdated use and registration of Infosys trademarks. Thus, it is an established fact that SIL is the subsequent user/adopter of the mark INFOSYS.
2. Pursuant to its incorporation as Disha Financial Services Limited, SIL shifted its business focus to the technology sector after incorporating INFOSYS in its trade name. SIL’s business activities significantly intersected and overlapped with the technological areas protected under the INFOSYS mark, presenting a clear case of trademark infringement.
3. The rival marks were held to be visually, phonetically and conceptually similar to one another such that SIL’s trade name had the propensity to mislead consumers into believing that SIL is a branch office or affiliated entity of Infosys, since the mere addition of “Southern” as a prefix does not mitigate the strong similarities between the marks, especially when the rival marks suggest an affiliation with information systems or technology related services. Thus, the present case was a clear case of infringement.
4. On the aspect of concealment, SIL did not identify any legal or factual deficiencies in the notice purportedly concealed by Infosys which would materially influence the outcome of the case, more so when the justification of operational disruptions caused due to the pandemic put forth by Infosys in response to allegations of concealment appeared to be credible and does not reflect intentional concealment. In deciding cases for substantive justice, particularly where evidence of trademark infringement is evident and forthcoming, procedural missteps which are not adequately explained ought not to adversely impact the merits of the case.
5. On the aspect of delay and laches, SIL adopted the mark INFOSYS as a part of its trade name 17 years after Infosys’s adoption, use and subsequent registration of the said mark. By virtue of operating in the same industry and the public listing of both companies, SIL had constructive notice of IL’s registered and well-known trademark and ought to have undertaken due diligence prior to adopting the said mark/name. Lack of due diligence by SIL suggested a lack of good faith in the adoption of the mark, which appeared to be a deliberate attempt to capitalize on the goodwill and reputation of Infosys.
6. Further, in trademark jurisprudence, delay and laches can mitigate the remedies available to a trademark owner but does not negate the right to object and seek protection against infringement.
7. On the aspect of acquiescence, there was no evidence which conclusively showed that Infosys explicitly or implicitly approved SIL’s use of the INFOSYS mark. Without any positive encouragement or explicit consent, the passage of time before initiating legal proceedings would not automatically bar Infosys from asserting its rights in the trademark INFOSYS.
8. On the aspect of INFOSYS being generic and descriptive, the mark INFOSYS is in use since 1981, much prior to the circular issued in 1999 which was relied on by Southern Infosys. Further, mere inclusion of certain names/marks in the circular would not preclude the said marks/names from acquiring distinctiveness as trademarks. Accordingly, the mark INFOSYS has transcended its descriptive origins and transformed into a unique identifier for only Infosys goods and services, undoubtedly acquiring secondary meaning linking it indelibly with Infosys. The mark can neither be stated to be generic nor descriptive.

Considering the above, the Court held that SIL’s use of the mark INFOSYS as part of its trade name not only infringes the Infosys trademark rights, but also risks causing confusion amongst consumers and diluting the trademark’s commercial value. In view thereof, SIL was injuncted from using the mark INFOSYS as a part of its trade name/corporate name or in any other manner amounting to infringement of Infosys trademarks.

Comment:

The court’s ruling reaffirms the importance of acquired distinctiveness and the need to respect established trademarks. This above judgement clearly shows that mere delay will not be sufficient to defeat infringement remedies being sought by the registered proprietor, and other factors such as honest adoption of the mark would also be relevant in deciding what reliefs would be granted by the Court.