We have a guest post, on “Exhaustion of Trade Mark Rights in India”, by Ms. Jasneet Kaur. Jasneet did her law from Government Law College, Mumbai and is currently working in the IP division of a leading law firm. Jasneet focusses on copyright and trademark issues and has represented serveral leading Indian and Multi National Organizations before various courts and tribunals.
Exhaustion of Trade Mark Rights in India
Much has been discussed about exhaustion of trade mark rights in India, post litigation proceedings arising from the dispute between Samsung Electronics and Champion Computers relating to parallel import of printers and cartridges bearing the SAMSUNG trade mark.
On 3.10.2012, the Division Bench of the Delhi High Court had dismissed the finding of the Single Judge in favour of national exhaustion of trade mark rights in a suit for trade mark infringement and passing off instituted by Samsung Electronics against Kapil Wadhwa and Champion Computers. The Division Bench ruled in favour of international exhaustion under the scheme of Trade Marks Act, 1999.
Samsung Electronics preferred a special leave petition before the Supreme Court of India against the order of the division bench. On the last date of hearing on 20.09.2013, the supreme court via a bench comprising of. Justice H.L. Gokhale and. Justice J. Chelameswar were of the finding that the instant case involves the question concerning interpretation of Sections 29 and 30 of the Trade Marks Act, 1999. The matter has now been posted for further hearing on 7.01.2013.
The fundamental idea behind the ‘Doctrine of Exhaustion’ is that once an economic return has accrued to the right holder from the ‘first sale’ of the goods bearing a trade mark by placing them on the ‘market’, he is said to have ‘exhausted’ all rights in relation to those goods. Exhaustion in context of intellectual property rights is largely a market-driven phenomenon, and any disputes arising therefrom must be dealt in accordance with the governing laws of a particular geographical dimension. This is in consonance with Article 6 of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement), which leaves it upon the members to decide their geographical extent of exhaustion. The Exhaustion Principle, thus, is critical in determining the way intellectual property laws would govern movement of goods and services in the sphere of international trade.
Although the doctrine of exhaustion in trade marks is well settled in certain other jurisdictions, this is the first time the question of exhaustion has been raised in context of the Indian trade marks law. The Indian Trade Marks Act, 1999, however, does not define the geographical form of exhaustion, whether national or international.
The impending verdict of the Apex Court on the profound issue of exhaustion in India would largely determine the scope of rights of the registered proprietors in India in respect of parallel imports.