Assessment of Damages in Trademark Disputes - Part II

In continuation of the first part, this segment delves deeper into evolving judicial pronouncements concerning trademark infringement/passing off and awarding damages with a concluding analysis.

In Starbucks Corporation v. Teaquila A Fashion Cafe [(2022) 91 PTC 620], the Delhi High Court, while granting a permanent injunction in favour of Starbucks, rejected its claim for damages of ₹13 lakhs, as the claim was based on an assumption of sale of 400 beverages without sufficient evidence. Considering that infringement had been established on the defendant’s part, the Court awarded notional damages to the tune of ₹2,00,000/- in favour of the plaintiff.

In Sangeetha Caterers and Consultants LLP v. Hotel Sangeethaa Pure Veg [2023 SCC Online Mad 6371], the plaintiff sought a permanent injunction against the defendant from infringing on their registered trademark ‘SANGEETHA’ and from operating a restaurant business under the name ‘HOTEL SANGEETHAA’. The plaintiff requested the Court to direct the defendant to surrender all infringing materials for destruction and to award damages for a sum of ₹25,00,000/-. The Madras High Court granted a permanent injunction and awarded litigation costs to the plaintiff and directed the defendant to surrender all materials. However, with regard to damages, the Court was of the view that the plaintiff had not provided sufficient evidence to substantiate their claim and therefore, no damages could be awarded.

In Aero Club v. M/S Sahara Belts [2023 DHC 8423], the Delhi High Court granted a permanent injunction against the defendant from manufacturing, selling, offering for sale, advertising or selling any products bearing the ‘WOODLAND’ word mark, label and ‘TREE’ device mark or any other mark identical or deceptively similar to plaintiff’s mark. The Court awarded damages to the tune of ₹10,00,000/- and costs of ₹1,00,000/-

In Boeing Company and Anr. v. Advance Technologies and Ors. [(2023) 301 DLT 279], the Delhi High Court granted a permanent injunction against the defendants from infringing on the trademark/ logo and copyright, restrained the proprietor of defendant No.1 from impersonating to be an employee of Boeing, and passing off goods and services as those of the plaintiffs. The Court awarded damages for a sum of ₹3,00,000/- and cost of ₹2,00,000/-.

In Tata Sons Private Limited and Ors. v. Tushar Fulare [2024 SCC Online Del 374], the plaintiffs sought permanent injunction, damages and rendition of accounts against the defendant for copyright infringement of their distinctive trade dress and packaging, as well as infringement of a well-known trademark ‘TATA’ and ‘tata Water Plus’. The defendant argued that no injunction should be directed with respect to the mark ‘ZINC WATER PLUS’ and its trade dress, as these were very generic words. However, the Court passed a summary judgment, granting the plaintiff an injunction against the defendant as their branding was similar to that of the plaintiff. Additionally, the Court awarded damages of ₹50,000/- in favour of the plaintiff, along with the actual costs in accordance with the Commercial Courts Act, 2015, the Delhi High Court (Original Side) Rules, 2018, read with the Intellectual Property Division Rules, 2022.

In Visakha Chemicals v. Bindal Food Products [2024 SCC Online Del 2589], the plaintiff had filed a suit asserting ownership of trademarks "ROCHAK" and "AM PACHAN" along with exclusive rights to their packaging and trade dress. The plaintiff alleged that the defendant was selling similar products under the plaintiff's trademarks, leading to trademark infringement and passing off. The defendant contended that "ROCHAK" and "AM PACHAN" were generic terms and thus, not eligible for trademark protection, but failed to substantiate their claims with sufficient evidence. The Delhi High Court granted a permanent injunction and awarded nominal damages amounting to ₹3,00,000/- against the defendant over the intellectual property rights of ayurvedic medical products. Additionally, the Court awarded actual costs in accordance with the Commercial Courts Act, 2015, the Delhi High Court (Original Side) Rules, 2018, read with Delhi High Court Intellectual Property Division Rules, 2022.

In Kabushiki Kaisha Toshiba v. Tosiba Appliances Co. [2024 SCC Online Del 5594], the plaintiff sought permanent injunction and damages of ₹25,00,000/- to restrain the defendant from unlawfully using their trademark “TOSHIBA” as “TOSIBA”, which was deceptively similar and likely to confuse consumers due to the marks being visually and aurally identical. The Delhi High Court granted a permanent injunction, ruling that the defendant's use of the mark constituted infringement and awarded nominal damages of ₹15,00,000/- as compensation for the duration of the infringement. However, the Court declined to grant the full amount claimed, along with punitive damages, as it was based on assumptions of the plaintiff. Additionally, the Court directed that the plaintiff's actual costs be recoverable from the defendant under the provisions of the Commercial Courts Act, 2015.

In Lifestyle Equities CV and Ors. v. Amazon Technologies, Inc. and Ors. [2025 DHC 1231], the plaintiffs instituted a suit before the Delhi High Court seeking a decree of permanent injunction and damages for infringement of their registered trademark “Beverly Hills Polo Club” (BHPC) against Amazon Technologies Inc. (defendant mo.1); the retailer- Cloudtail India Pvt. Ltd. (defendant no.2) who sells the products on the e-commerce platform www.amazon.in which is operated by Amazon Sellers Services Pvt. Ltd. (defendant no.3). None of the three defendants disputed the rights of the plaintiffs in BHPC trademark, including their registration under Class 25 which deals with apparel products. Defendant no.s 1 and 2 stated that the impugned logo is not being used in a trademark sense. Defendant No.3 claimed that it is merely an intermediary and that alleged listings, which the plaintiffs objected to, have been removed and further undertook that whenever there are future listings bearing the infringing device mark, the same shall be removed, as and when directed by the Court.

The Delhi High Court observed that all three defendants, which were closely interlinked with each other, sought to project that they were independent of each other with an intent to avoid fastening of liability and dissipate the consequences of infringement. Further, in e-infringement cases, the biggest challenge would first be in fixing responsibility on each of the parties. There are complex questions which arise, including issues relating to intermediary liability, entitlement to safe harbour protection, as also jurisdictional issues. The multi-layered nature of e-commerce has made it increasingly difficult to identify, attribute liability and effectively enforce IP rights, necessitating clear legal frameworks to address the evolving challenges posed by online trademark infringement.

The Court observed that, unlike in typical trademark infringement matters where damages require approximation, in the present dispute, the existence of a comprehensive Trademark License Agreement entered into between the plaintiffs and major brands, which were the licensee for India and neighbouring markets, provided sufficient basis for the computation of damages. Accordingly, the Court granted a decree of permanent injunction, restraining the defendants from using the infringing mark and the defendants were held liable for wilful infringement of trademark and were directed to pay ₹336 crores as compensatory damages, against ₹1,260 crores claimed, along with ₹3.23 crores towards litigation costs.  The Court declined to grant the plaintiff damages sought on account of loss of goodwill, reputational harm, and loss of opportunity to enter into a joint venture/ pursue an IPO, holding that such claims were speculative and unproven. Amazon has recently filed an appeal challenging the said order before the Division Bench of the Delhi High Court.

The evolving landscape of intellectual property infringement disputes in India underscores a robust commitment by the judiciary to uphold the sanctity of intellectual property rights. Recent judgments reflect a balanced approach in awarding damages, taking into account factors such as the severity of infringement, degree of malafide conduct and the financial losses suffered by the aggrieved party. This approach marks a significant shift towards not only compensating those harmed but also deterring future misconduct through punitive damages.

Quantifying damages is no easy feat in the modern era of proliferated e-commerce and necessitates a meticulous examination of various factors. Courts need to rigorously evaluate lost profits, the duration of infringement and the actions of the infringer to ensure a fair and just outcome. Legal principles established in landmark cases like Hindustan Unilever Limited and Koninlijke Philips, have provided clarity and guidance on the assessment of damages, facilitating an environment conducive to innovation and fair competition. This clarity not only benefits current litigants but also sets important precedents for future cases, thereby safeguarding the integrity of brands and commerce.

About the authors: Mayank Grover is a Partner and Pratibha Vyas is an Associate at Singhania & Partners LLP.

Disclaimer: The opinions expressed in this article are those of the author(s). The opinions presented do not necessarily reflect the views of Bar & Bench.

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