Surnames & Trademarks

Businesses in India have often been started by using the surname or family name of the person starting such business. This practise has been followed in India for a very long time and such practice of adopting a surname for the name of the business is done purely so that customers can easily associate the surname so adopted with that particular business. But due to the increasing number of businesses cropping up in India, the registration of a brand or a business with a surname has taken a severe hit as it has often lead to confusion and deception in the minds of the public leading to suits at Courts with two parties fighting it out for a surname.

Even though there is no clear law on the registration of surnames as a trademark, the Delhi High Court’s findings in Anil Rathi v. Shri Sharma Steeltech gives us a fair idea as to what should be kept in mind while registering surnames as businesses in India.

RATHI as a trademark

The Plaintiff and defendants in this instant dispute were engaged in the manufacturing of steel products under the trademark ‘RATHI’ which happens to be the name of the family that is engaged in the said business. The Plaintiff herein is one of the trustees of the foundation that runs the business, whereas the defendants are the family members. An MoU and a trust deed exist between the Plaintiff and the Defendants with regards to the use of the RATHI trademark.

However, one of the Defendants on his own had acted in contravention of the MoU and Trust deed and had started granting a license to third parties for the RATHI trademark for which the Plaintiff herein is the registered proprietor.

The Plaintiff had filed the instant suit stating that the defendants had infringed upon the trademark RATHI and that the foundation of the Plaintiff is the only entity that has the rights to grant licenses for the impugned trademark.

Findings of the Court

The Plaintiff on the basis of Section 28 of the Trademarks Act, 1999 argued that they are the registered proprietor of the trademark RATHI and that gives them the exclusive right to the use of the trademark in relation to the goods or services under which such trademark has been applied and to obtain relief in respect of infringement of the trademark.

However, the Defendant stated that their use of the impugned trademark RATHI was bona fide as provided under Section 35 of the Act. In order to understand this argument clearly, we need to have knowledge as to what Section 35 of the Act states.

Section 35 of the Trademarks Act in brief states that the registered proprietor or a registered user of a registered trademark shall not interfere with any bona fide use by a person of his own name or that of his place of business. While the Defendant was seeking shelter under the provision of Section 35 of the Act, the Court held that the Defendants could not seek shelter under the said provision as Section 35 was restricted to personal use of a registered trademark and did not encompass aspects that deal with the grant of license or use of a registered trademark by third parties. In addition to this, the Court also held that such act of the Defendant was clearly in contravention of the MoU and Trust Deed between the Plaintiff and the Defendant.

The Court found that the use of the registered trademark RATHI by the defendant was not bona fide as the Defendants granted licenses for use of the impugned mark in the same industry as that of the Plaintiff.

More Clarity on Section 35?

Although this decision of the High Court sheds some much-needed light on the interpretation of Section 35 of the Trademarks Act, there is still nothing substantial when it comes to deciding cases wherein the point of the argument is with regards to surnames being used as trademarks with respect to business. In such an event where the impugned mark is a surname or a family name, the Court should dive deep into the main aspects of Section 35 namely, the bona fides requirement and the likelihood of confusion which has been dealt with appropriately in this case. It would not hurt to have more clarity on the matter!