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Cephalon, Inc vs.maneesh Pharmaceutical Limited & Anr - Court Judgment

LegalCrystal Citation
CourtDelhi High Court
Decided On
AppellantCephalon, Inc
RespondentManeesh Pharmaceutical Limited & Anr
Excerpt:
.....order xxxix rule 1&2 cpc inter alia seeking an order restraining the defendants from using the trademark “provigil”. defendant no 1 (hereafter „mpl‟) has filed ia no 6074/2016 under order xxxix rule 4 cpc seeking vacation of the interim order dated 12.02.2016 by virtue of which defendants were restrained from using the mark "provigil". both the aforesaid applications were taken up and heard together.2. cephalon has filed the above captioned suit seeking a decree of permanent injunction restraining infringement of its trademark “provigil”, passing off, unfair practices and damages against the cs(comm) 106/2016 page 1 of 14 defendants. mpl has filed its written statement. although, defendant no 2 (hereafter „sigma‟) was served, none has entered appearance on its behalf.....
Judgment:

$~17 * + IN THE HIGH COURT OF DELHI AT NEW DELHI CS(COMM) 106/2016 CEPHALON, INC ..... Plaintiff Through : Mr Chander M Lall, Advocate with Through : Mr Gaurav Gogia and Ms Bhavya ..... Defendants versus MANEESH PHARMACEUTICAL LIMITED & ANR Ms Kripa Pandit, Advocate. Sethi, Advocate. CORAM: HON'BLE MR. JUSTICE VIBHU BAKHRU % ORDER

1910.2016 VIBHU BAKHRU, J IA Nos. 2094/2016 and 6074/2016 1. The plaintiff (hereafter „Cephalon‟) has filed IA no 2094/2016 under Order XXXIX Rule 1&2 CPC inter alia seeking an order restraining the defendants from using the trademark “PROVIGIL”. Defendant no 1 (hereafter „MPL‟) has filed IA no 6074/2016 under Order XXXIX Rule 4 CPC seeking vacation of the interim order dated 12.02.2016 by virtue of which defendants were restrained from using the mark "PROVIGIL". Both the aforesaid applications were taken up and heard together.

2. Cephalon has filed the above captioned suit seeking a decree of permanent injunction restraining infringement of its trademark “PROVIGIL”, passing off, Unfair Practices and Damages against the CS(COMM) 106/2016 Page 1 of 14 defendants. MPL has filed its Written Statement. Although, defendant no 2 (hereafter „Sigma‟) was served, none has entered appearance on its behalf and by an order dated 26.05.2016, Sigma‟s right to file the Written Statement was closed.

3. Cephalon is engaged in the business of manufacturing pharmaceutical and medicinal preparations and specializes in drugs to treat and manage neurological diseases, sleep disorders, cancer and pain since the year 1987.

4. Cephalon claims that the mark "PROVIGIL" was first adopted in the year 1995 by Genelco, S.A, a subsidiary of the Cephalon; however, as per the documented use, it was adopted in 1998.

5. It is averred in the plaint that "PROVIGIL" is a drug containing 'modafinil' and is used for treating excessive sleepiness associated with narcolepsy and shift work disorder.

6. Cephalon is the registered proprietor of the trademark "PROVIGIL" in India under registration No.1293763 in class 05 in relation to pharmaceutical and medicinal preparations. It is stated in the plaint that Cephalon has applied for registration and/or is the registered proprietor of the trademark "PROVIGIL" in various countries such as Brazil, Canada, Chile, China, Italy, Japan, Panama, South Africa, United Kingdom, United States of America, etc.

7. It is further stated in the plaint that owing to such long, extensive and continuous use across various countries, the mark "PROVIGIL" has become CS(COMM) 106/2016 Page 2 of 14 a well known mark as defined under Section 2(1)(zg) of the Trade Marks Act,1999.

8. It is averred in the plaint that in 2004, Cephalon came to know about a journal advertisement of the mark “PROVIGIL” bearing no 1025822 in class 05 in the name of Sigma. However, Sigma had filed for registration of the trademark on proposed user basis. It is further averred in the plaint that by a letter dated 24.06.2004 to the Registrar of Trade Marks, Cephalon initiated Opposition proceedings opposing the offending mark and thereafter, in April, 2005 a copy of Counter Statement was served on Cephalon (opponent in opposition proceedings) by Sigma. Further, it is stated that in June, 2005, Cephalon filed its Evidence in support of Opposition under Rule 50 of the Trade Mark Rules (hereafter 'the Rules') and the Opposition proceedings are stated to be pending as Sigma did not file its Evidence in support of the application under Rule 51 of the Rules.

9. It is stated that thereafter, in 2009, it came to the knowledge of Cephalon that MPL along with one of its subsidiaries Svizera Healthcare was using the mark “PROVIGIL” on its website http://svizerahealth.com/Products/Ace_Privigil.html with the registered ® symbol; therefore Cephalon sent notices dated 08.10.2009 and 24.11.2009 to MPL regarding misuse of the mark “PROVIGIL”. Cephalon further states that MPL‟s letter dated 28.11.2009 sent in response revealed that Sigma had assigned application of the trade mark in question in favor of MPL.

10. Cephalon avers that in November, 2013, it was served with a petition dated December, 2009 by the Trade Mark Registry under FORM TM-26 CS(COMM) 106/2016 Page 3 of 14 filed by MPL seeking cancellation of the Cephalon‟s registration of the mark "PROVIGIL". It is further averred that Cephalon filed a counter statement dated 27.02.2014 and the matter is pending before the Trade Mark Registry.

11. Cephalon states that in July, 2015, it came to their knowledge that MPL was also manufacturing and selling the medicines under the trademark “PROVIGIL” and that the said medicines were available for sale in Delhi.

12. MPL states that it is a prior user of the trademark “PROVIGIL” and has been using the said trademark since 2002. It is further averred that MPL‟s application for registration of the trademark was filed on 11.07.2001, which was prior to Cephalon‟s application filed on 01.07.2004 13. MPL further states that the mark “PROVIGIL” was coined from the words PROMISE and VIGILANCE and is used in connection with formulations indicated for induction of ovulation of pregnancy in the anovulatory or infertile women. MPL states that the products manufactured by MPL and Cephalon are completely different further the prices, consumers, trade channels, etc. of the products of MPL and Cephalon are also completely different. It is stated that defendant's products contain sterile freeze dried Human Chorionic Gonadotrophin and hence needs to be preserved in a specific controlled environment without which the efficacy of the same would be lost; therefore the manner in which MPL‟s product are stored and dealt with is significantly different from the manner in which Cephalon‟s products are dealt.

14. Mr Gogia, the learned counsel appearing for MPL earnestly contended that the order dated 12.02.2016 restraining MPL from using the CS(COMM) 106/2016 Page 4 of 14 trademark “PROVIGIL” be vacated for the following reasons:-

"(a) that Cephalon was not using the trademark “PROVIGIL” in India and its registration was liable to be cancelled; (b) that MPL had been using the trademark “PROVIGIL” for its product since 2002 and, therefore, was a prior user of the mark in India; (c) that Sigma (MPL's predecessor) had filed an application for registration on 11.07.2001 which was prior to Cephalon's application which was filed on 01.07.2004; (d) that Cephalon's application had been registered without notice to MPL and thus, the registration was liable to be cancelled; (e) that Cephalon was fully aware of MPL's use of the trademark “PROVIGIL” and had taken no steps to object to the user and, thus, had acquiesced and waived its right to object to the use of the trademark by MPL; (f) that trade channels of the drugs marketed by Cephalon and MPL were completely different and, therefore, there was no possibility of confusion with regard to the two drugs.

15. Mr Gogia further relied on the decision of the Division Bench of this Court in B.L. and Co. and Others v. Pfizer Products Incl.:

93. (2001) DLT346in support of his contention that delay in initiating any action disentitled Cephalon from securing an interim injunction restraining MPL's use of the trademark “PROVIGIL”. CS(COMM) 106/2016 Page 5 of 14 16. Mr Lal, learned counsel appearing for Cephalon countered the submissions made by Mr Gogia. He submitted that even though Cephalon had not sold the drug manufactured by it in India directly, there can be no dispute that Cephalon was the prior user of the trademark “PROVIGIL” and was using the said trademark since 1998. He further submitted that the trademark “PROVIGIL” was registered in the name of Cephalon in various countries and Cephalon intends to sell the drug in question in India. He further contended that there is free flow of information regarding medicines and treatment and medical practitioners all over the world, use medical literature from other countries. He submitted that it would be anomalous if a particular medicine was sold under one trademark in one country and a different medicine was sold under the same trademark in another country. He strongly relied on the decision of the Supreme Court in Milmet Oftho Industries and Others v. Allergan Inc: (2004) 12 SCC624in support of his contention that it would lead to an anomalous situation if the trademark “PROVIGIL” was recognised as associated with the drug manufactured by Cephalon all over the world but the same trademark was used in India in respect of a different drug by a different manufacturer.

17. Mr Lal also relied upon the decision of the Supreme Court in Cadila Health Care Ltd. v.Cadila Pharmaceuticals Ltd.: (2001) 5 SCC73in support of his contention that in matters relating to drugs and other medicinal products a greater degree of a scrutiny would be required because any confusion in respect of the trademarks used in association with pharmaceutical preparations would be potentially more harmful than any confusion in relation to other consumer products. CS(COMM) 106/2016 Page 6 of 14 18. I have heard the learned counsels for the parties.

19. There can be no dispute that trademarks used by Cephalon and MPL are similar; the spelling of the word 'PROVIGIL' is identical and, thus, both the marks are also phonetically identical. There is little doubt that the use of the trademark “PROVIGIL” for different medicines has a propensity to create confusion. The drugs manufactured by MPL are used for a completely diffferrent purpose and to address a differrent medical condition. Whilst it may be correct that the manner of storage and channels of distribution of the drugs manufactured by Cephalon and MPL may be different; nonetheless, it would be highly undesirable if the same trademark is associated with two different drugs. In this regard, it is relevant to refer to observations made by the Supreme Court in Cadila Health Care Ltd. (supra) which reads as under:-

""22. It may here be noticed that Schedule 'H' drugs are those which can be sold by the chemist only on the prescription of the Doctor but Schedule 'L' drugs are not sold across the counter but are sold only to the hospitals and clinics. Nevertheless, it is not uncommon that because of lack of competence or otherwise, mistakes can arise specially where trade marks are deceptively similar. In Blansett the Pharmaceuticals Co. Vs. Carmick Laboratories Inc. it was held as under:

"Confusion and mistake is likely, even for prescription drugs prescribed by doctors and dispensed by pharmacists, where these similar goods are marketed under marks which look alike and sound alike."

20. Although, Cephalon has not sold PROVIGIL directly in India as yet, I find that there is much merit in the contention that it would be highly CS(COMM) 106/2016 Page 7 of 14 confusing if one drug is sold all over the world under a trademark and another drug is sold in India under the same trademark. There are constant interactions between the medical practitioners and doctors all over the world. Information relating to medical treatments and management of medical conditions and ailments are shared without boundaries. Literature relating to pharmaceutical preparations for addressing ailments and diseases are freely exchanged and read by practitioners all over the world. Most of the medical books used in the study of medicine are also common. Medical practioners in one country draw from medical literature available in other countries as well.

21. Doctors and medical practitioners usually keep themselves abreast of all development in medical sciences and it is a common practice for doctors to attend medical conferences in order to share their experiences and learn from others. Given the environment of medical science, it would be most undesirable if a drug for a given treatment is known by a particular trademark in one country and a drug for another treatment is sold under the same trademark in another country. Thus, there is much merit in the contention that both Cephalon and MPL cannot be permitted to use the same trademark “PROVIGIL” at the same time. Further, it is also Cephalon‟s case that it does intend to use the trademark PROVIGIL in India.

22. In Milmet Oftho (supra), the Supreme Court referred to its earlier decision in Cadila Health Care Ltd. (supra) and observed as under:-

"“8. In respect of medicinal products it was held that exacting judicial scrutiny is required if there was a possibility of confusion over marks on medicinal products because the CS(COMM) 106/2016 Page 8 of 14 potential harm may be far more dire than that in confusion over ordinary consumer products. It was held that even though certain products may not be sold across the counter, nevertheless it was not uncommon that because of lack of competence or otherwise that mistakes arise specially where the trade marks are deceptively similar. It was held that confusion and mistakes could arise even for prescription drugs where the similar goods are marketed under marks which looked alike and sound alike. It was held that physicians are not immune from confusion or mistake. It was held that it was common knowledge that many prescriptions are telephoned to the pharmacists and others are handwritten, and frequently the handwriting is not legible. It was held that these facts enhance the chances of confusion or mistake by the pharmacists in filling the prescription if the marks appear too much alike.

9. We are in full agreement with what has been laid down by this Court. Whilst considering the possibility of likelihood of deception or confusion, in present times and particularly in the field of medicines, the Courts must also keep in mind the fact that nowadays the field of medicine is of an international character. The Court has to keep in mind the possibility that with the passage of time, some conflict may occur between the use of the mark by the Applicant in India and the user by the overseas company. The Court must ensure that public interest is in no way imperiled. Doctors particularly eminent doctors, medical practitioners and persons or Companies connected with medical latest developments in medicine and preparations worldwide. Medical literature is freely available in this country. Doctors, medical practitioners and persons connected with the medical field regularly attend medical conferences, symposiums, lectures etc. It must also be remembered that nowadays goods are widely advertised in newspapers, periodicals, magazines and other media which is available in the country. This results in a product acquiring a worldwide reputation. Thus, if a mark in respect of a drug is associated with the... RESPONDENTS

worldwide it would lead to an anomalous situation if an field keep abrest of CS(COMM) 106/2016 Page 9 of 14 identical mark in respect of a similar drug is allowed to be sold in India.” 23. In the present case, it prima facie appears that Cephalon had adopted the trademark “PROVIGIL” prior to its use by MPL. It is asserted that the said trademark was adopted by Cephalon's subsidiary in 1995 and its use is documented since 1998. Cephalon has also produced various certificates evidencing the registration of the trademark “PROVIGIL” in the name of Cephalon in various countries and has also filed documents to indicate that its application for registration of the trademark is pending in several other countries. Although, MPL has stated that it has adopted the trademark since 2002 however, the documents filed by MPL indicate the sale of its products only from 2005. Thus, it is prima facie established that Cephalon is a prior user of the trademark albeit outside India.

24. Although, MPL has stated that it had adopted the mark in 2002, it is relevant to note that the application for registration of the mark in question was not filed by MPL but by Sigma in 2001. MPL claims that Sigma assigned the trademark to MPL only on 07.05.2005.

25. Further, Cephalon has also provided the sales figures of its product sold under the brand PROVIGIL in United States of America. The figures indicate that Cephalon‟s turnover of products under the trademark “PROVIGIL” in United States of America in the year 1999 was US $ 30,218,616.43 and was US$ 66,881,794.60 in 2015. Thus, Cephalon‟s turnover of the products sold under the trademark "PROVIGIL" in USA was approximately `435 crores in 2015. MPL has claimed that its turnover is CS(COMM) 106/2016 Page 10 of 14 also in crores of rupees but the Chartered Accountant's Certificate filed by MPL indicates that its sales for the year 2015-16 was only `1,35,44,087/-. Thus, it prima facie appears that Cephalon‟s sales of product under the brand name PROVIGIL far exceeds the turnover of MPL.

26. The contention that Cephalon had acquiesced to MPL‟s use of the trademark “PROVIGIL” also cannot be readily accepted. Admittedly, Cephalon had opposed the registration of the trademark “PROVIGIL” in the name of Sigma. Further, Cephalon had also caused notices to be issued to MPL in 2009 regarding misuse of the mark on the website.

27. In Power Control Appliances and Another v. Sumeet Machines Pvt. Ltd.: (1994) 2 SCC448 the Supreme Court explained the scope of the defence of acquiescence as under:-

"“Acquiescence is sitting by, when another is invading the rights and spending money on it. It is a course of conduct inconsistent with the claim for exclusive rights in a trade mark, trade name etc. It implies positive acts; not merely silence or inaction such as is involved in laches.” 28. The Supreme Court also referred to a following passage from the decision in the case of Electrolux Ld. v. Electrix Ld.: (1954) 71 RPC23 "Upon this matter, a great deal of learning has been referred to, and we have also had our attention drawn to a number of cases. The latter include the well-known statement in Willmott v. Barber by Fry, J.

(as he then was) at p.

105. He said this:”It has been said that the acquiescence which' will deprive a man of his legal rights must amount to fraud, and in my view that is an abbreviated statement of a very true proposition. A man is not to be deprived of his legal rights unless he has acted in such a way as would 'make it fraudulent CS(COMM) 106/2016 Page 11 of 14 for him to set up those rights'. Let me pause here to say that I do not understand that, by the word 'fraudulent', the learned Judge was thereby indicating conduct which would amount to a common law tort of deceit. 'What, then, are the elements or requisites necessary to constitute fraud of that description?.' In the first place 'the plaintiff must have made a mistake as to his legal rights'. Secondly, the plaintiff must 'have expended some money or must have done some act (not necessarily upon the defendant's land) on the faith of his mistaken belief'. Thirdly, the defendant, the possessor of 'the legal right, must know of the existence of his own right which is inconsistent with 'the legal right, must know of the existence of his own right which is inconsistent with' the right claimed by the plaintiff. If he does not know of it he is in the same position 'as the plaintiff, and the doctrine of acquiescence is founded upon conduct with a knowledge' of your legal rights. Fourthly, the defendant, the possessor of the legal right, must know 'of the plaintiff's mistaken belief of his rights. If he does not, there is nothing which' calls upon him to assert his own rights. Lastly, the defendant, the possessor of the legal 'right, must have encouraged the plaintiff in his expenditure of money or in the “other acts which he has done, either directly or by abstaining from asserting his legal right'. In reading that passage, it is perhaps necessary to note (because it makes it at first sight a little more difficult to follow) that the positions of plaintiff and defendant as they are usually met with are there transposed, and that one of the parties who is there spoken of as the plaintiff corresponds with the present case with the Defendants, and vice versa."

29. In Kerly‟s Law of Trademarks and Trade Names Fifteenth Edition, the authors state that the test of acquiescence is: in all the circumstances “..... whether it would be unconscionable to allow the claimant to maintain his claim. It is, however, clear that the matters which fall to be considered include the factors identified in the old cases: whether the proprietor induced or encouraged the defendant's behaviour, or represented to him that he was entitled so to act, the CS(COMM) 106/2016 Page 12 of 14 passage of time, reliance by and detriment to the defendant and so on. Mere failure to sue, however, without some positive act of encouragement, is not in general enough to give a defence. A defendant who infringes knowing of the claimants mark can hardly claim if he is later sued upon it.” 30. Thus, mere failure or delay on the part of Cephalon to initiate action would not disentitle it to seek relief for infringement of its trademark. Cephalon had earlier objected to MPL‟s use of the trade mark on its website and it had also opposed Sigma‟s application for registration of the trademark “PROVIGIL”. In the circumstances, it cannot be accepted that Cephalon has acquiesced to MPL‟s use of the trademark “PROVIGIL”.

31. Further Cephalon has asserted that it became aware that MPL was selling medicines under the trademark “PROVIGIL” only around July, 2015.

32. The fact that Cephalon has not directly marketed its product in India as yet would not be of significant relevance since it is the first to use the trademark in the world. In Milmet Oftho (supra), the Supreme Court had observed as under:-

"“Thus the ultimate test should be who is first in the market. In the present case, the marks are the same. They are in respect of pharmaceutical products. The mere the... RESPONDENTS

have not been using the mark in India would be irrelevant if they were first in the world market.” fact that 33. In view of the above, the interim order passed on 12.02.2016 shall continue till the disposal of the suit. MPL‟s application for vacation of the order (IA60742016) is rejected. CS(COMM) 106/2016 Page 13 of 14 34. Both the applications are disposed of. CS(COMM) 106/2016 35. List before the Joint Registrar for further proceedings on 01.12.2016. VIBHU BAKHRU, J OCTOBER19 2016 RK CS(COMM) 106/2016 Page 14 of 14


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