The Indian Trademark Law grant exclusive rights to the trademark owner. The exclusivity here indicates that the trademark owner has the liberty to utilize his/her trademarks without any external interferences. The Indian Trademark Laws grants bundle of rights to the trademark holders and the rights of every trademark owner includes the right to commence and prosecute a legal action against infringement of his/her rights in a trademark. It is important that the action taken by the trademark owner is bona fide and the proprietor has taken due diligence in initiating the proceedings.

Infringement proceedings include high costs of litigation and any injunction granted may lead to irreparable loss such as loss of revenue and reputation. Thus, considering the serious consequences of an infringement proceeding no person should be dragged to courts based on groundless threats of infringement. At times infringement proceedings are used by the large, powerful companies to intimidate or harass smaller companies. The small entities which do not have the required economies to fight the legal battle may give-up on the usage of the mark which they are genuinely entitled to.  Such threats of infringement, lacking any legal basis are termed as Groundless or baseless legal threats. It can also be coined as Trademark bullying. The United States Patent & Trademark Office (USPTO) has defined Trademark bullying as the act where the “trademark owner that uses its trademark rights to harass and intimidate another business beyond what the law might be reasonably interpreted to allow.”

In India, Intellectual Property laws are designed to provide protection from the groundless threat of infringement and also to prevent IP owners from making wrongful threats of an infringement action against other parties. With specific reference to the Trademark Act 1999, Section 142 of the Trademark Act deals with the Groundless threats of legal proceedings. The section provides that when a person by means of circulars, advertisement or otherwise threatens another person with an action or proceeding for infringement of a registered trademark or alleged to be a registered trademark, a person aggrieved may bring a suit against such former person and obtain a declaration to the extent that such threats are unjustified. The legal remedy available for such threats is that the aggrieved party can get an injunction in his favor to restrain the other person from the continuance of such threats and may also recover damages. Similar provisions are also available in other Intellectual Property laws such as Copyright Act, Patents Act, Design Act and Geographical Indications of Goods (Registration and Protection) Act.  Section 142 of the Trademark Act exempt any act done by the legal practitioners and agent on behalf of the client in his professional capacity from their liability.  Although the law grants protection to those who become victims of such threats, the law does not define what constitutes a baseless/ groundless legal threat. The word baseless legal threat has been coined by the Judiciary at several instances while considering various cases, but this is not sufficient enough to set right the lacuna in giving a definition to a groundless legal threat. The judiciary has extended its protection to infringement threats which are unjustifiable.

The scope of the protection conferred under the Trademark Act includes protection from the groundless threats of legal proceedings for alleged infringement. The legislation extends to the protection even against threats from those who don’t claim to be the proprietor, licensee, assignee or a registered user of the registered trademark.

In the case of Bata India Limited Vs Vitaflex Mauch GmbH, the Plaintiff instituted a suit against the Defendant for restraining the Defendant from making groundless threats of legal proceeding to the Plaintiff. Moreover, the Plaintiff also claimed damages from the Defendant for issuing groundless threats to the Plaintiff. The major issue before the Delhi High Court was whether the legal notice amounted to legal threat and whether the Plaintiff is entitled to claim injunction and damages for the same. The Hon’ble High Court held that the threats made by the defendant to the Plaintiff are groundless, unjustifiable and wrongful. Therefore, the Defendant was ordered to restrain from in any manner issuing any groundless threats in whatsoever manner.

To conclude, it is very important that any person who sends any legal notice or Cease and Desist letter or initiates any other legal proceedings should exercise caution and ensure that the action taken is within the rights granted to them under the law.