The new trademark rule 2017 allows any trademark owner to file a request to file a request in form of TM-M requesting the registrar to declare a trademark ‘well-known’. Once a trademark is declared well-known by a registrar of trademark, or a court of law, the trademark registry is bound under law to not register any trademark that is identical or similar to the ‘well-known’ trademark across all classes of goods and services. Similarly at the time of infringement proceedings, a ‘well-known’ trademark can be asserted against defendants dealing in entirely different goods and services.
Prior to enactment of rule 124, a Registrar or a court law could declare a trademark well-known only during opposition , rectification or infringement proceedings. Rule 124, however creates an entirely new procedure to recognize well known trademark . this procedure is different from opposition, rectification, or infringement proceedings in that the latter are adversarial in nature with both parties presenting evidence to back their claims and the registrar is required to resolve these conflicting claims through a reasoned order. The trigger of these proceeding is a legal event that is not usually within control of trademark owner. The new rule 124 allows the trademark owner to set the ball rolling without requiring any infringement or opposition proceedings. The rule impose some vague duty to “invite objections from general public” but this process is fundamentally different from opposition, rectification, infringement or opposition proceedings. The rule does impose some vague duty to “invite objections from the general public” but this process is fundamentally different from opposition, rectification or infringement proceedings where an opposing party has already asserted its rights against the trademark owner.
Whether rule 124 is constitutional?
In this case the Trademark Rule 2017, draw their legitimacy from Trademark Act 1999. This legislation however does not delegate to the central government power to create an entirely new procedure to recognize well-known trademark. Section 157of the Act which lay out the rule making power to make rule making power of Central Government under Trademark Act 1999is silent on the issue of ‘well-known trademark’. There is a residuary provision in Section 157(xli) that gives the Central Government the power to make rules for “any other matter which is required to be or may be prescribed”. Like all provisions conferring residuary powers, this provision is widely drafted however a residuary provision is still bound by the two most important principles of delegating legislative power: The first principle is that delegated legislation cannot be in conflict with the provisions of the parent legislation. Secondly, an essential legislative function cannot be delegated by Parliament to the Executive – the In re Delhi Laws judgment is quite clear on this issue.
The new Rule 124, I would argue, goes against both principles. The rule reflects an entirely new policy to recognize “well-known” trademarks through a procedure that is not an adversarial proceeding. In fact, the new procedure is in conflict with the adversarial procedure recognized in Section 11 for a trademark to be recognized as well known. Unlike the Section 11 procedure which required an opposition, rectification or infringement proceeding to trigger a adjudication on whether the trademark is well-known, Rule 124 allow a trademark to be recognized as well known by simply making an application to the Registry. The requirement to “invite objection” is fundamentally different from an opposition or rectification hearing because it does not guarantee a right to be heard. This entire procedure is alien to the scheme of the Trade Marks Act, 1999.
The true fear with this new procedure is that it places immense powers in the hands of the Trade Mark Registry, which as we all know is one of the more corrupt agencies in the IPO – we are all aware of Registrar’s Kasturi’s arrest and conviction on charges of corruption. The possibility for abuse of power is ably aided by some rather strange provisions in the Trade Marks Act, 1999. In particular Section 11(9) of the Trade Marks Act makes it clear that the Registrar shall not require as a condition, for determining whether a trade is well-known, any of the following, namely: (i) That the TM has been used in India; (ii) That the TM has been registered; (iii) that the application for registration of the trade mark has been filed in India; (iv) that the trade mark is well known in or registered in any other jurisdiction other than India (v) that the trademark is well-known to the public at large in India.