Saving the day in the face of apparent judicial error: The Supreme Court in Renaissance Hotel Holdings Inc

The recent judgment of the Supreme Court of India in Renaissance Hotel Holdings Inc v. B Vijaya Sai on January 19 highlights the misinterpretation that sometimes creeps in when specialized laws are applied.

This case dealt with the infringement of the RENAISSANCE trademark owned by the appellant Renaissance Hotel Holdings by the respondent’s use of SAI RENAISSANCE, both marks used in the hospitality industry.

Renaissance Holdings is a luxury hotel brand of Marriott International, founded in 1981 as Ramada Renaissance, relaunched in 1989 as Renaissance Hotels and changed hands to Marriott in 1997. The appellant owned the word mark RENAISSANCE (Trade Mark No: 1241271), applied for and with a usage date from October 2003. The appellant also owns the logo mark containing the word RENAISSANCE in Class 43, (Trade Mark No: 1907394) applied in 2010 under Classes 36 and 16.

The appellant stated that it chanced upon the respondent’s website at www.sairenaissance.com. Once it was known that the respondents were running two hotels, one in Bangalore and another one in Puttaparthi under the name SAI RENAISSANCE, they filed action against the respondents in 2012.

The respondent claimed that he was named Vijaya Sai by his parents as they believed that he was born as a result of the prayers made to Sri Sai Baba. He further submitted that RENAISSANCE means re-birth and that the name SAI RENAISSANCE was adopted for his hotel to signify the birth of Sri Puttaparthi Sai Baba as a reincarnation of Sri Shirdi Sai Baba and that the use of mark SAI RENAISSANCE amounts to honest concurrent use under Section 12 of the Trade Marks Act.

The trial court decreed in favour of the appellants, and an appeal was filed by the respondent before the High Court of Karnataka.

In its order dated April 12, 2019, the High Court stated that the trial court arrived at its judgment as to infringement of trademark by the respondent mainly taking into consideration two aspects: firstly, that it is a registered owner, and secondly, that it has its existence in India since the year 1990, a few years before the respondent started their hotels and with reference to Section 29 (2) of the Act. The High Court effortlessly straddled the distance between Section 29(2) and 29(4), by merely stating – “But in my opinion, section 29 (4) (c) of the Act is applicable to the set of circumstances of this case.” How this rationale was arrived at by the High Court remains unexplained.

The appellant owns a registered trademark in India under various Classes including 42 and 43. Its registration in Class 42 was in 2003, with usage from the same year, thus establishing a usage of 16 years when the High Court took up the matter. Both the appellant and the respondent’s mark are identical; the appellant’s mark (RENAISSANCE) without any alteration and as a whole, is incorporated into the respondent’s mark (SAI RENAISSANCE) and forms the significant part of it. Both trademarks are identical since the respondent’s mark reproduces all the elements of the appellant’s mark without any modification or addition. Both the appellant and the respondent offer the same services. Therefore, there is a registered trademark being infringed by a person who is not the registered proprietor or the permitted user. The case thus falls squarely within Section 29(2)(c) of the Trade Marks Act in that the identity with the registered trade mark and the identity of the goods or services covered by such registered trade mark, is likely to cause confusion on the part of the public, or which is likely to have an association with the registered trade mark.

When the case lies under Section 29(2)(c) of the Trade Marks Act, then Section 29(3) follows. The court shall presume that it is likely to cause confusion on the part of the public, since there is identity of both marks as well as goods/services. Confusion on the part of the public is naturally concluded. Therefore the appellant is not burdened with proof of confusion.

However, in its efforts to position the present matter entirely within the ambit of Section 29(4) , the High Court has misinterpreted Section 29(4)(b). As per the High Court ,“.. the plaintiff is a 5 star hotel, but the defendants is not a hotel of that standard..” It also held that both classes of consumers are different. When both concerned parties are offering the same services, it is unclear how the High Court bracketed the current matter in Section 29(4), which only covers services dissimilar to that for which the trademark is registered. The High Court termed the different classes of consumers and the difference in hotels run by the appellant and the respondent as constituting different or dissimilar services without the realization that Section 29(4) would apply only if the infringing use is on goods or services falling in classes other than the one in which the trademark is registered. In its focus to take up and apply Section 29(4)(c) to the present case and offer relief to the respondent on that ground, a serious misconstruction of the law has happened in the High Court’s order.

The Supreme Court categorically held that it was not open for the High Court to have meandered into the discussion as to whether the appellant/plaintiffs trademark had a reputation in India and the use of the mark without due cause takes unfair advantage of or is detrimental to the distinctive character or repute of the registered trademark.

Assuming for a moment that this was a matter under Section 29(4) with identity of the trademark and dissimilarity of goods, the High Court’s finding that the trademark of the appellant has no reputation in India, is itself based on shaky logic. There is no doubt that the appellant owns registered Indian trademarks and is doing business in India. It is a well-established luxury hotel brand. Therefore, there is use and reputation in India. However the High Court establishes that there is no use in India and moves onto whether the appellant enjoys trans-border reputation. Established brands, whatever their geographical origin, are now internationally reputed, due to the widespread prevalence of social media. When the Indian courts have acknowledged this easy spill over of reputation to other shores, and have been expanding the realm of how trans-border reputation can be used to afford protection to foreign marks to the greatest extent possible, the approach of the High Court in the Renaissance matter, seems antediluvian.

The High Court went on to rely on Section 30(1)(b) in isolation, without regard for the wording of Section 30(1)(a). It concluded that the respondent does not take unfair advantage of the appellant’s trademark and is not detrimental to the distinctive character of the appellant’s trademark under Section 30(1)(b). However, it ignores the first limb of the law that the use has to be in accordance with honest practices in industrial or commercial matters [Section 30(1)(a)]. This has also been frowned on by the Supreme Court in paras 57 and 71 of its judgment.

The reason for this stance of the High Court seems to have been a desire to protect the rights of the small indigenous player vis-à-vis the foreign company, by relying on the requirement in Section 29(4)(c), despite the registration and usage of the appellant being clearly established in this case.

Lakshmidevi Somanath is the Head, Intellectual Property Practice, Surana & Surana International Attorneys. She was a Member (Trademarks) of the erstwhile Intellectual Property Appellate Board.