Christian Louboutin SAS v. Abubaker & Ors.

Delhi High Court | Valmiki J. Mehta J. | 25 May 2018 AIRONLINE 2018 DEL 256 | CS (COMM) No. 890/2018

Background

Christian Louboutin SAS, the renowned French luxury footwear company, filed a commercial suit before the Delhi High Court seeking injunction against infringement of its trade marks, passing off and damages. The plaintiff claimed exclusive ownership of registered trade marks bearing registration numbers 1922048, 2341890 and 2341891 all relating to the application of a red colour shade to the soles of ladies’ footwear, commonly known as the “RED SOLE.” The mark claimed was not a word mark but a single colour red applied to the sole of ladies’ shoes.

The defendants Abubaker and others operating two outlets in Mumbai under the entity M/s Veronica were selling shoes with red-coloured soles. The plaintiff alleged that this constituted infringement of its registered trade marks and also amounted to passing off, notwithstanding that the defendants were selling their footwear under the word mark “VERONICA.”

The suit came up for admission before the court and summons had not yet been issued to the defendants. The court suo moto raised the question of whether the plaint disclosed a legal cause of action at all and after hearing the plaintiff’s senior counsel at length, dismissed the suit at the threshold without issuing summons, applying Order XII Rule 6 of the Code of Civil Procedure.

Issues for Determination

Whether a suit can be dismissed at the threshold stage without issuing summons under Order XII Rule 6 CPC on the ground that even taking the contents of the plaint as correct, no legal cause of action is made out.
Whether a single colour can qualify as a “mark” and consequently as a “trade mark” under the definitions in Sections 2(m) and 2(zb) of the Trade Marks Act, 1999.
Whether the plaintiff could claim exclusive ownership of a single colour as a trade mark by registering it as a “device” trade mark or by relying on acquired distinctiveness under the Proviso to Section 9(1) read with Sections 31 and 32 of the Trade Marks Act.
Whether Section 10(2) of the Trade Marks Act permits a single colour to be registered and exclusively owned as a trade mark.
Whether the defendant’s use of red colour on the soles of its footwear was saved by Section 30(2)(a) of the Trade Marks Act as a characteristic or feature of the goods and therefore did not constitute infringement.
Whether a cause of action for passing off was made out, given that the defendants were selling their footwear under the distinct word mark “VERONICA.”
Whether two prior judgments of coordinate benches of the Delhi High Court in Deere & Company v. Malkit Singh and Christian Louboutin SAS v. Pawan Kumar which had upheld single-colour trade mark protection, were binding on this court.

Key Holdings of the Court

Suit dismissible at threshold under Order XII Rule 6 CPC. The court held that where even taking all contents of the plaint as correct no legal cause of action is made out, the suit can be dismissed at the stage of admission without issuing summons, by invoking Order XII Rule 6 CPC. This is distinct from and in addition to Order VII Rule 11 (rejection of plaint) and Order XIIIA (summary judgment) and does not render the court an “adversary.”
A single colour cannot be a “mark” under Section 2(m) of the Trade Marks Act, 1999. The court held that the legislature’s deliberate use of the expression “combination of colours” in Section 2(m) as opposed to “colour” in the singular means that a single colour cannot constitute a mark and therefore cannot be elevated to the status of a trade mark. This was held to be an absolute textual bar.
Registration as a “device” trade mark does not overcome the bar. The court rejected the argument that a single colour could be registered as a “device” trade mark. A device must have a standalone, independent existence of its own and cannot simply be a colour applied to a part of the product itself. What cannot be done directly cannot be done indirectly by ingenious interpretation.
Section 10(2) does not permit single-colour trade marks. The word “colour” in singular in Section 10(2) refers to the colour in which a non-colour trade mark (such as a word mark) may be depicted, not to a single colour being capable of being a trade mark in itself.
Proviso to Section 9(1) and Sections 31 and 32 do not assist the plaintiff. Even if acquired distinctiveness under the Proviso to Section 9(1) and the validation provisions of Sections 31 and 32 could rescue an otherwise non-registrable mark, those provisions only apply to something that is first a “mark” under Section 2(m). Since a single colour is not a mark, these provisions cannot be invoked to give validity to its registration.
Section 30(2)(a) operates as a complete bar on the infringement claim. Even assuming the plaintiff’s registrations were valid, the defendants’ use of red colour on the soles of their footwear was protected under Section 30(2)(a) as a use that “indicates the… kind, quality… or other characteristics of goods.” The red sole is a feature and characteristic of the product giving it appeal a non-trademark function and therefore its use by the defendants could not be prevented.
No cause of action in passing off. Passing off did not arise because: (a) a single colour cannot be a trade mark and therefore no proprietary right exists in it; (b) the defendants’ use of red was legally protected under Section 30(2)(a); and (c) the defendants were selling under a distinct word mark “VERONICA” while the plaintiff’s own word mark was “CHRISTIAN LOUBOUTIN,” creating no scope for deception or confusion.
Prior coordinate bench judgments not binding. The judgments in Deere & Company v. Malkit Singh and Christian Louboutin SAS v. Pawan Kumar both of which had upheld single-colour trade mark protection were held not to be binding because neither had considered Section 2(m) of the Trade Marks Act nor Section 30(2)(a). Following N. Bhargavan Pillai v. State of Kerala, a judgment rendered without considering a direct statutory provision has no binding effect.
Suit dismissed. Taking all pleadings as correct, the plaintiff was held to have no legal cause of action and the suit was dismissed at the threshold.

Statutory Provisions Involved

Section 2(m), Trade Marks Act, 1999 defines “mark” to include a device, brand, heading, label, ticket, name, signature, word, letter, numeral, shape of goods, packaging or combination of colours or any combination thereof. The court held the use of “combination of colours” not “colour” to be a deliberate legislative choice excluding single-colour marks.
Section 2(zb), Trade Marks Act, 1999 defines “trade mark” as a mark capable of being represented graphically and capable of distinguishing goods or services of one person from those of others and may include shape of goods, packaging and combination of colours.
Section 9(1), Trade Marks Act, 1999 sets out absolute grounds for refusal of registration, including marks devoid of distinctive character or consisting exclusively of indications of characteristics of goods. The Proviso to Section 9(1) permits registration if the mark has acquired distinctive character through use or is a well-known trade mark.
Section 10, Trade Marks Act, 1999 Section 10(1) permits a trade mark to be limited to any combination of colours. Section 10(2) provides that a trade mark registered without colour limitation shall be deemed registered for all colours.
Section 29, Trade Marks Act, 1999 defines infringement of a registered trade mark, including use of an identical or deceptively similar mark in relation to the registered goods.
Section 30(2)(a), Trade Marks Act, 1999 provides that a registered trade mark is not infringed where its use indicates the kind, quality, quantity, intended purpose, value, geographical origin, time of production or other characteristics of goods or services. The court treated this as a supervening provision that conclusively barred the plaintiff’s infringement claim.
Section 31, Trade Marks Act, 1999 makes original registration prima facie evidence of validity in all legal proceedings.
Section 32, Trade Marks Act, 1999 provides that a trade mark registered in breach of Section 9(1) shall not be declared invalid if it has, after registration and before commencement of legal proceedings, acquired a distinctive character in relation to the goods for which it is registered.
Order XII Rule 6, Code of Civil Procedure empowers a court to pass a decree on admission; the court extended this to permit dismissal of a suit at the threshold where the plaint, taken at its highest, fails to disclose any legal cause of action.

Reasoning of the Court

The court’s reasoning proceeded on three closely related grounds.

First – on the statutory definition of “mark,” the court undertook a textual analysis of Section 2(m) and found the legislature’s choice of the phrase “combination of colours” to be deliberate and precise indicating that at least two colours are required. Since the plaintiff was claiming exclusive ownership of a single shade of red applied to a sole, it fell outside the definition of “mark” altogether and no amount of acquired distinctiveness, registration or longstanding use could cure this fundamental deficiency. The court rejected the attempt to characterise the red sole as a “device” holding that a device must have standalone independent existence and not simply be a colour applied to an inseparable part of the product itself.

Second – on Section 30(2)(a), the court held that even on a liberal assumption that the plaintiff’s registrations were valid, the defendants’ use of red on their soles was a characteristic use of colour to make the product aesthetically appealing. Such use performs a non-trademark function and is expressly protected by Section 30(2)(a). The court drew support even from the US Qualitex Co. decision relied upon by the plaintiff, noting that even that judgment recognised that where a colour serves a significant non-trademark function or where competitive availability of the colour is important to the industry, single-colour trade mark protection would not apply.

Third – on passing off, the court reasoned that the tort of passing off requires a misrepresentation leading to confusion. Where the defendant uses a wholly distinct word mark on its goods and the plaintiff also identifies its goods by its own word mark, there is no possibility of any consumer being misled into thinking the defendants’ goods originate from the plaintiff. The red sole in isolation a colour performing a functional and aesthetic role could not by itself create the association required for a passing off action.

The court also addressed the procedural question with clarity: Order XII Rule 6 CPC enables dismissal of a suit at the threshold even without issuing summons, where the plaint itself taken as entirely true discloses no legal cause of action. This is a distinct power from Order VII Rule 11 (rejection of plaint) and Order XIIIA (summary judgment for commercial suits) and neither the Division Bench ruling in Bright Enterprises nor the adversarial nature of litigation prevents its exercise in an appropriate case.

Doctrinal Significance

Single-colour trade marks not recognised under Indian law. This is the most significant holding of the case. The court categorically ruled that the Trade Marks Act, 1999 by using “combination of colours” in Section 2(m) forecloses the registration or exclusive ownership of a single colour as a trade mark. This stands in express contrast to the position in the United States (Qualitex v. Jacobson) and the European Union, where single-colour trade marks can be acquired through distinctiveness.
Section 30(2)(a) as a functional use defence. The court’s elaboration of Section 30(2)(a) as protecting use of a trade mark’s features when those features are characteristics of the goods rather than source identifiers introduces a “functionality doctrine” into Indian trade mark jurisprudence. This is analogous to the functionality doctrine in US and EU trade mark law that prevents manufacturers from monopolising product features that are competitively necessary.
Per incuriam doctrine applied to coordinate bench rulings. The court’s refusal to follow two prior single-judge rulings of the same High Court on the ground that those rulings had not considered directly applicable statutory provisions applied the per incuriam principle to coordinate bench decisions. Relying on N. Bhargavan Pillai, the court held that a judgment rendered in ignorance of a directly applicable statutory provision is not binding even on courts of equivalent standing.
Threshold dismissal under Order XII Rule 6 CPC. The court’s use of Order XII Rule 6 to dismiss a suit at the admission stage before summons, in the absence of the defendant on the ground that the plaint discloses no legal cause of action even if taken as entirely correct, is a significant procedural contribution clarifying the relationship between Order VII Rule 11, Order XII Rule 6 and Order XIIIA CPC in commercial court proceedings.
Limits of trade mark protection for product aesthetics. The judgment raises important questions about the boundary between trade mark protection and product design. It signals that colour applied to a product to enhance its visual appeal is a product characteristic that cannot be monopolised under trade mark law a principle with broad implications for fashion, consumer goods and design-intensive industries.

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