Allianz Aktiengesellschaft Holding Vs. Allianz Capital and Management Services Ltd. - Court Judgment

Excerpt:
a) the case discussed the determination of acquiescence in a petition filed for injunction on the ground of passing off action within the provisions of section 27(2) and 106 of the trade and merchandise marks act, 1958 - the petition was filed by company based in germany - the dispute was revolving around the use of word 'allianz', which was used by the petitioner and an indian company - the petitioner had taken certain steps to avoid the litigation - it was held that the steps taken by the petitioner could not amount to passive consent even in case of passing off - further, the petitioner was entitled to get injunction otherwise, the petitioner could not be deprived of the relief solely on the same groundb) the case discussed the determination of acquiescence in a petition filed for.....s.n. kapoor, j.1. in these above-mentioned two suits, there are injunction applications and other ancillary applications relating to granting of injunction sought by both the parties in their favor and against the opposite party. since the dispute is confined to use of the word 'allianz' claimed by both the parties in these two suits. all the applications in these suits are taken together. apart from the applications for injunction, there are applications under order 13 rule 2 cpc for taking certain documents on record. they are also being disposed of accordingly in these petitions.2. allianz aktiengesellschaft holding is a german company and the plaintiff in s. no. 1162/95, while the defendant in s. no. 393/95. allianz capital & management services ltd. is the indian company. these two.....

Judgment:

S.N. Kapoor, J.

1. In these above-mentioned two suits, there are injunction applications and other ancillary applications relating to granting of injunction sought by both the parties in their favor and against the opposite party. Since the dispute is confined to use of the word 'ALLIANZ' claimed by both the parties in these two suits. All the applications in these suits are taken together. Apart from the applications for injunction, there are applications under Order 13 Rule 2 CPC for taking certain documents on record. They are also being disposed of accordingly in these petitions.

2. Allianz Aktiengesellschaft Holding is a German company and the plaintiff in S. No. 1162/95, while the defendant in S. No. 393/95. Allianz Capital & Management Services Ltd. is the Indian company. These two companies in the two suits will be called for short 'the German company' and 'the Indian company' respectively.

3. According to the German company, it is incorporated in accordance with the law of Federal Republic of Germany and carrying on its business by itself or through its subsidiaries since 1989 and in operation of one of the world's largest investment, insurance and under writing business under the trading name and style ALLIANZ (word per se) and ALLIANZ with EAGLE DEVICE. It enjoys tremendous reputation and goodwill in the financial world and the insurance industry, in particular. Investment activities are an integral part of the business of insurance. The premia collected on insurance policies are invested keeping in view the safety, liquidity, high yield and good returns. Activities of the applicant's group in India date back to the year 1928 when it (Allianz Und Stuttgarter Lebensversi - cherungsbank- Aktiengesellschaft) established its subsidiary - 'Allianz Und Stuttgarter Life Insurance Bank Limited (hereinafter referred to as 'Allianz Life Insurance India') in India to carry on initially the business of life insurance and under writers having its Head Office at Chandni Chowk, PO Box No. 117, Delhi. Allianz Versicherungs-Aktiengellschaft started a company in Bombay (hereinafter referred to as 'Allianz Insurance India') which offered fire, transport and motor vehicle third party liability insurance services to the public. Both these companies Allianz Life Insurance India and Allianz Insurance India subsequently expanded their business to cover certain investment services. Allianz Life Insurance India and Allianz Insurance India carried on their business through their head office in Delhi and Bombay respectively till the outbreak of the Second World War and for some time thereafter. Consequent upon the outbreak of the Second World War, the applicant's property in India was expropriated as enemy property and it had to withdraw itself from doing business in India. The applicant revived its contract and its activities a few years after the war ended which exists till date. Amongst other activities, the applicant trained employees of Indian insurance companies.

As part of the training process, the applicant deputed its employee, a Mr. Eberhard Splittgerber (an Engineer by profession) in Bombay. Mr. Splittgerber had his office at the head quarters of the New India Assurance Company. During his stay in India, Mr. Splittgerber advised the New India Assurance Company, inter alia, on matters concerning all-risks insurance business and information relating to direct insurance business. The responsibilities- of Mr. Splittgerber included translating the Applicant's forms and publication 'Betriebsbilder' (industries in profile) into English, carrying out inspection and risk assessments during the testing period of the 'Rourkela Steel Plant' and ascertaining quantum of losses at the Steel Plant which was insured jointly by the New India Assurance Company and the Applicant during its construction period. Thereafter, Mr. Splittgerber visited India on diverse other occasions to represent the Applicant's business in India. The German company also insured the steel factory in Rourkela and for this purpose stationed its engineers there. The applicant invited on a regular basis, Indian insurance experts to attend conferences which were organized by it in Germany. It acted in India through its two agents namely, F.E. Hardcastle & Co. Private Limited, Bombay and Gillanders Arbuthnot & Co. Limited, Calcutta. The applicant has also been insuring goods imported in India and settling claims arising there from. It has regular business relationship with all major India insurance companies namely, New India Assurance Company, Oriental Insurance Company and Interlink Reinsurance Company.

The German company filed application Nos. 612456, 612457 and 612458 under Class 16, for the registration of the trade marks 'ALLIANZ', 'ALLIANZ with EAGLE DEVICE' and the 'EAGLE DEVICE' per se before the Trade Marks Registry, New Delhi on 23rd November 1993. The applicant, since at least 1989 continuously used by itself and/or through its affiliates and subsidiaries in connection, inter alia, with investment, insurance and underwriting business, the trading name and style ALLIANZ and ALLIANZ with EAGLE DEVICE. The applicant has several subsidiaries and/or joint ventures which have ALLIANZ as per of their corporate name. Some of the companies are asset management companies while some of the others are investment corporations. Thus, the applicant carries on extensive finance/investment related business in many countries of the world including India. Its strict and vigorous quality oriented service programmes and services provided by the applicant worldwide have generated much goodwill and reputation in the name ALLIANZ and consequently the customers associate the trading name and style ALLIANZ and ALLIANZ with EAGLE DEVICE with the applicant company exclusively, as providing the highest standards of quality service in finance/investment, insurance and underwriting business. According to the applicant company, it had a worldwide premium earnings of DM 65.5 billion (equivalent to Rs. 1,31,000 crores) in the year 1993 alone. The applicant's net income from investments was DM 16.2 billion (equivalent to Rs. 32,400 crores). The total book value of investments held by the applicant is DM 212.8 billion (equivalent to Rs. 4,25,600 crores). The Financial Times dated 27th January 1994 nominated the applicant as one of the most respected companies in the insurance sector, on the basis of its business performance. The applicant company also spent DM 3.6.5 million on advertising in major international newspapers and magazines having wide circulation in India namely, Business Week, The Financial Times, Newsweek, Time, The Far Eastern Economic Review, the Economist, Fortune, the Wall Street Journal, the International Harald Tribune and The Asia Insurance Review and, thus, the trading name and style ALLIANZ and ALLIANCE with EAGLE DEVICE are well-known internationally and are associated by the common man in general and the industry in particular as belonging exclusively to the applicant. The applicant has filed affidavits in this behalf. Even in India, the word ALLIANZ is well-known and associated with applicants. Moreover, with the constant, frequent and extensive international travel in modern times for business, pleasure, study or other reasons, a large segment of the Indian populace is exposed to and have come to recognize and associate the trading name and style ALLIANZ and ALLIANZ with EAGLE DEVICE as belonging exclusively to the applicant and/or its subsidiaries alone.

4. The grievance of the applicant company against the defendant Allianz Capital & Management Services Ltd. (hereinafter called 'the Indian Company') is that in and around 1993, the applicant learned about the use of the word ALLIANZ by the defendant as part of its corporate name in relation to its business written in a manner and script similar to that of the applicant and using it in its letter head, stationery and other printed matter and generally in relation to its business and publishing itself amongst newspapers and magazines. Thus, the defendant is leading the unwary public to believe that its business is in some way connected with the business of the applicant. This use of ALLIANZ is dishonest and is a calculated attempt to achieve a close proximity and thereby pass off its business as that of the applicants. It is a brazen act of dishonesty and motivated purely by mala fide intention to trade upon and benefit from the reputation and goodwill enjoyed by the applicant company. It is also claimed that the defendant company was incorporated on September 30, 1991 under the name of 'Ashtan Capital & Management Services Private Limited' with the main object of providing management and financial consultancy services to industries. The name 'Ashtan' was a coined word made from a combination of words 'Ash' (of Ashwajit) and 'Tan' (of Tanya)....... Mr. Ashwajit Singh and Mrs. Tanya Singh being the promoters and the first Directors of Ashtan. It was converted into a public limited company on August 27, 1992. But on 5th November 1992, Ashtan changed its name to 'Allianz Capital & Management Services Limited' pursuant to a Special Resolution passed in the Extraordinary General Meeting held on 13th October 1992.

The two Directors of the same company-Mr. Ashwajit Singh and Ms. Tanya Singh have incorporated two other companies having 'Ashtan' as their first name. The first 'Ashtan Exports Pvt. Ltd.' Incorporated on 5th April 1991 for the purpose of exporting leather garments. The second company is 'Ashtan Holding (P) Limited' incorporated on 6th June 1991 for the purpose of conducting investment related business. On this basis, it is contended by the applicant company that the defendant/respondent passed the Resolution to the effect that 'The Board of Directors have proposed to change the name because of its wrong pronouncement and spell(ing) by the Company's clients'. But the real purpose was to pass off their trading and investment services as business of the applicant company. In this connection, it is also contended that in comparison to ALLIANZ, ASHTAN - having two strong syllables - is far easier to pronounce. ALLIANZ is a German word and if therespondent's objective was really aimed at easier pronunciation, it could have chosen a less complicated word instead of filching applicant's ALLIANZ and also that the same two Directors would have also changed the name of two other companies which still continue with the name 'Ashtan'. In view of the education of Mr. Ashwajit Singh abroad, specially from the London School of Economics and he being a Certified Internal Auditor from the Institute of Internal Auditors, USA, it could well be assumed that he was aware of the applicant's trading name and style and its enormous goodwill and reputation. It is further contended that what ails the action of the respondent with dishonesty is the fact that the change of name comes close on the heals of globalizationof the Indian economy with the announcement of Indian Government of its new industrial policy in July 1991. Despite protest letter dated 20th November 1993 to the respondent/defendant calling upon to refrain from using the name of ALLIANZ or any other name confusingly similar with respect to insurance or financial services, the defendant/respondent did not resist. Instead, the defendant/respondent denied that the applicant had any reputation or goodwill in ALLIANZ. The 0imsy Explanationn offered for adoption of ALLIANZ by the respondent was that it was a 'phonetic equivalent of the word ALLIANCE'. Again on 31st May 1994, the defendant/respondent was informed that the Explanationn offered by them for adoption of ALLIANZ was without merit and again called upon the defendant/respondent to refrain from using the name ALLIANZ or any other name confusingly or deceptively similar with it. But the correspondence did not bring any fruitful result. Thus concerned, the plaintiff filed the suit and in the suit, the plaintiff/applicant moved this application seeking a restraint order and sought temporary injunction from using the name ALLIANZ or any other word deceptively similar thereto as its corporate name or trading style or as a part thereof, till the disposal of the suit.

5. The defendant is contesting this application on the ground that the application and the suit suffers from inordinate delay, laches and also acquiescence on the part of the plaintiff. The defendant was carrying on its business of merchant banking, corporate finance, money market operations, stock brokering, retailing finance etc. since November 5, 1992 while the present suit has been filed after an inordinate delay of three years without assigning any reason. The defendant/respondent is within its rights in the use of the word ALLIANZ, a simple variation of the common dictionary word 'Alliance', which cannot be monopolized by the plaintiff for any field of activity outside its own. It is evident from the affidavit of Udayan Bose, Chairman of Credit-capital Finance Corp. Ltd. dated 2nd August 1994 that the deponent only associates the word ALLIANZ with the plaintiff's company in respect of insurance and finance sector, while the deponent's company CREDITCAPITAL Finance Corporation Ltd. has sent an application for Underwriting of Public Issue dated 20th September 1993 to the defendants followed by another letter for the same purpose of its company dated 18th November 1993. It is contended that, supposing for the sake of argument, the plaintiff company had a presence in India prior to World War II, most of the documents submitted by the plaintiff along with plaint, pertain to the period prior to World War II after which the plaintiffs wound up their operations in India. The documents relating to earlier period have no evidentiary value as they are proformas claimed to have been used by the plaintiff company. The defendants are leading merchant banker and financial corporation with a steadily growing turnover and market share. Steady growth of the defendant company had brought them on 31st position in the PRIME (Praxis Consulting & Information Services Pvt.) rankings of lead managers, evidencing their reputation and goodwill in the capital market. They have emerged within a short span of their existence as a Category I merchant banker and a leading player in this segment in the private sector in North India. They have a mandate of managing over 31 prestigious issues. In the year 1994, they were lead manager in 17, co-manager in 8, adviser in 7 and underwriter in 246 issues. The PRIME has assessed the ranking of lead managers on the basis of number of issues handled as well as by the PRIME ranking in April 1990 to June 1995. Again from p.261, it would be clear that Allianz Capital & Financial Services Limited ranked 4th in the private merchant bankers.

6. The main line of business of the defendant is merchant banking corporate finance, stock brokering, retail finance etc. while the line of activity claimed by the plaintiff is insurance. There is a difference between the insurance and investment company. In this connection, the learned counsel relies upon Curzon Law Dictionary. It defines an investment company as 'any company whose business consists wholly or mainly in making of investments and the principal part of whose income is derived there from' while an insurance company 'is any company whose business consists wholly or mainly in doing insurance and the principal part of whose income is derived there from'. It has been further denied for want of knowledge that the plaintiff enjoys tremendous reputation and goodwill in the financial world in general and the insurance industry in particular. Since the plaintiff company was involved in services sector, there were no goods which are carried across boundaries. Hence it is inherent in nature of services that their related marks are territorially limited. The revival of its contacts and some of its activities after Second World War has been denied. However, it was submitted that at best the plaintiff's so called presence in India was merely token or academic and not commercial. The presence of plaintiffs reputation at the New India Assurance Company does not amount to a commercially sufficient reason to attribute use or reputation to the plaintiff's mark within India. It is contended that the plaintiff could not indulge in insurance business for the current Government policy does not permit foreign insurance companies to operate in India and since the plaintiff has not carried on insurance activity in India, there was no question of any goodwill or reputation being attributed or attached to the said word ALLIANZ as portraying or signifying the plaintiff services. Assuming, without admitting, that the plaintiff was carrying on insurance activities in India, this activity is in no manner similar to the line of activity of the defendant, since it is limited and involves transactions with insurance companies and not with insurance industry clients at large.

The defendants are carrying on the business, inter alia, of merchant banking. Thus, no goodwill attaches in favor of the plaintiff in respect of ALLIANZ even in respect of insurance sector. Neither the insurance sector nor with regard to investment sector in its favor. At best, the plaintiff/applicant had a token relationship with major Indian insurance companies. The registration obtained by the plaintiff abroad for insurance services are not relevant for the purposes of the present case where the defendant is engaged in a totally different line of business, namely, merchant banking, stock brokering, retail finance etc. and is the underwriter for various large corporations. Filing and pendency of an application for registration of a trade mark does not confer any legal rights on the applicant and is, thereforee, of no relevance for the purposes of the present suit as it is not conclusive proof of the plaintiff's alleged right in the said marks. The said application is for registration in class 16 which in no way relates to the line of activity in which passing off is being alleged. According to the plaintiff's own admission, the said mark ALLIANZ is used for insurance service and not for stationery items included in class 16. The word ALLIANZ is phonetically equivalent of the English word ALLIANCE which simply means a union signifying the coming together of two or more entities and is a word that can be conceived of independently by two different persons at the same time. The defendant is comprised of an alliance of chartered accountants and other professionals. The goodwill and reputation of the mark ALLIANZ generated in India is solely on account of the defendant, so much so that the clients of the defendant are quality-addicted. The said reputation or goodwill has nothing to do with the plaintiff. The turnover and the number of employees, as mentioned by the applicant have no bearing on the fact that the plaintiff has no presence whatsoever in India and moreover, the issue in this suit is focussed on the trade mark ALLIANZ. The sale figures and advertisement expenses are of no importance or relevance as they do not reflect upon the plaintiff's sales or advertisements, or any activity at all, in India, and, needless to say, he plaintiff could not furnish the same as it has no business or reputation in India.

The plaintiff company was primarily in insurance sector and not stock brokering and retail finance. Consequently, there is no question of alleged passing off the business of the defendant as that of the plaintiff. Irrespective of advertisements and their so called circulation in India, the clients of the services are literate and highly educated and are deemed to know the background of the service company. The word ALLIANZ by its very nature cannot be appropriated by a company engaged in a particular line of activity, to the exclusion of all others engaged in completely different lines of activities. The said word does not fall in the category of invented, fanciful or arbitrary trademarks which are inherently distinctive and for which, the circle of protection is wide enough to encompass cognate and allied, and even unrelated, goods and/or services. The word ALLIANZ is a mere variation of a dictionary word 'Alliance' which must, thereforee, acquire a secondary meaning in the trade and in the eyes of the consumers to become distinctive, or exclusively associated with a particular source and, even then, the mark cannot be monopolized by one trader for all nature of goods or services, but only for those in which it deals. No evidence whatsoever has been adduced to indicate that the plaintiff has any business in India for the insurance sector and capital investment sector are two distinct sectors and are not remotely likely to deceive the public. In the present age of 'superspecialities', the difference in the activities of the plaintiff and defendant can be easily made out. Thus, the use of the word ALLIANZ in relation to finance and investment business cannot lead to confusion and deception as to the source and origin of the services. The defendants have been advertising under their corporate name Alliance Capital & Management Services Limited. The adoption of the use of the mark ALLIANZ is neither tainted with mala fide nor by dishonest intention nor it could be said that it is a calculated attempt to show a close proximity to the plaintiff's business.

It was adopted to show union of finance professionals who constitute the Board of Directors of the defendant company and who are the primary source of investor confidence and satisfaction. The concept of transborder reputation established by the various judicial precedents applies to those goods and/or services which have a reputation in India which is associated with the plaintiff. It would be absurd on the part of the plaintiff company to have claimed any transborder reputation in a service mark which does not attract even basic requirement of possessing a reputation in India. The plaintiff so far has no business in India by their own submissions (in para 37) and it is the defendant's investment related business that has immense recognition. The future, indefinite and inchoate plans of the plaintiff are of no relevance in the present context as there is no certainty that the Government will open up the insurance sector in the near future for privatisation. The suit filed by the plaintiff is vexatious and is solely to harass the defendants by grabbing away their lawful gains. The plaintiffs have failed to show any loss or damage to the much claimed reputation of the plaintiff. The plaintiff has no prima facie case. The plaintiff's use of mark ALLIANZ in its insurance business does not entitle it to any protection outside the said insurance business. It is only a simple variance of a common dictionary word Alliance. As a matter of fact, the plaintiff/applicant has no case at all.

7.1. Certain developments have taken place during the pendency of this application. An application has been moved under Order 13 Rule 2 CPC by the plaintiff/applicant for the purpose of indicating that the defendant/respondent has transferred its interest to another company owned by the same group and application of the defendant has also been dismissed by the RBI for recognising it as a Non-Banking Finance Company. In that connection, the plaintiff/company filed copies of order passed by this court in Suit No. 1244/2000, written statement filed by ALLIANZ Securities Limited, correspondence between Allianz Securities Limited and SEBI for transfer of merchant banking registration from the Department to Allianz Securities Limited. Copy of the letter dated 5th November 1998 from SEBI to the defendant regarding transfer of merchant banker certificate to Alliance Securities Limited along with copy of registration dated 3rd November 1998. Though the application was opposed but the substance of the correspondence about the transfer had not been disputed.

7.2 During the course of arguments, learned senior counsel for the defendant Shri V.P. Singh also made a statement to the effect that while the plaintiffs claims entirely rest on insurance business, he would not have any objection in case the plaintiff is allowed to use the word ALLIANZ in relation to insurance business without touching the investment sector though they do not have any right whatsoever in the word ALLIANZ.

8. I have heard the parties counsel and propose to deal with the various arguments advanced in different phases.

The word 'ALLIANZ': its Monopoly of the Plaintiff

9. The first question is: 'Whether the term ALLIANZ is a coined or invented word and if not, whether the generic word, has acquired any secondary meaning in relation to insurance business in India or in respect of any other services claimed by the plaintiff?' The second question relates to the impact of expropriation of the business of the plaintiff/applicant company in India as enemy property on the use of the trade name ALLIANZ in insurance business. The third point relates to the impact of the visit of Mr. Eberhand Splittgerber to advise the New India Assurance Company and matters concerning all risk insurance business and information relating to direct insurance business and the impact of insurance of Rourkela Steel Plant on the insurance business in India and re-insurance of National Thermal Power Corporation Limited in Anta to the extent of 24.38% of the sum assured in association with the Oriental Insurance Company Limited and Chamera Hydro-electric Project and Uri Hydro-electric Project to the extent of 75%. The next point which is required to be considered would be the impact of the application moved by the respondent in 1993 for registration of the word ALLIANZ with EAGLE DEVICE and EAGLE DEVICE.

10. It is apparent that the plaintiff applicant had acquired certain secondary meaning and name in insurance business in India before the Second World War. It is also an admitted fact that the property of the applicant company was expropriated. Seeing the meaning of the term 'expropriation' nothing would be left for the applicant company to claim goodwill in the shape of trade name in India on the basis of its earlier business in India for everything vests now in Government of India. According to the Black's Law Dictionary, the word 'expropriation' would mean as under:

Expropriation, n. 1. A governmental taking or modification of an individual's property rights, esp. by eminent domain; CONDEMNATION (2) Cf. APPROPRIATION. (2). A voluntary surrender of rights or claims; the act of renouncing or divesting oneself of something previously claimed as one's own.'

11. As such, German Company is supposed to substantiate its claim only on new evidence relating to user of 'Allianz'. As regards the point whether the word ALLIANZ or ALLIANCE is a common word and a publicio Jurisdiction which could or could not be monopolized by the plaintiff, learned counsel for the petitioner contends the constant use in India and in various countries of the world, the applicant company has acquired secondary meaning as well and as such, it has got a right to protect its trade name. On the other hand, the contention of learned counsel for the respondent that the word ALLIANZ is a variation and mis-spelling of a common English word 'alliance'. A slight mis-spelling of the word will not turn a descriptive word into a non-descriptive mark.

12. In support of their respective contentions, learned counsel for the applicant referred to various documents relating to its establishment and registration in other countries and documents of training insurance personnel and insurance of Rourkela Plant etc.

13. The learned counsel for the Indian Company drew my attention to the use of the term ALLIANZ which has been added with words and design under International Class 36 relating to Insurance and Financial Services as under:

'ALLIANCE AND DESIGN

ALLIANCE AND DESIGN

ALLIANCE AND DESIGN

ALLIANCE APPRAISAL GROUP

ALLIANCE BANK SUPER PRIMA ACCOUNT AND DESIGN

ALLIANCE BENEFIT GROUP AND DESIGN

ALLIANCE BUSINESS CENTRES AND DESIGN

ALLIANCE CAPITAL A

ALLIANCE FOR MATURE AMERICANS AND DESIGN

ALLIANCE FUNDING, INCORPORATED

ALLIANCE HEALTH SYSTEMS

ALLIANCE MEDICAL AND DESIGN

ALLIANCE OF FAMILIES FOR CHRISTIAN VALUES'

14. It is submitted that all these groups have been registered with the same name under International Class 36 relating to Insurance and Financial Services. Accordingly, there is no distinction between ALLIANCE and ALLIANZ except a different user.

15. Learned senior counsel for the Indian Company has also referred to the Telephone Directory of MTNL, Mumbai indicating as many as 10 telephone numbers of different business concerns using the word ALLIANZ by prefixing it before their respective business in Mumbai itself with exactly similar spelling, as is evident from ANNEXURE A to the written submissions. There were three other companies carrying on the same business of capital and management services namely--ALLIANZ CAPITAL & MANAGEMENT SERVICE; REGENT CHMBS NARIMAN FT ALLIANZ CAPITAL & MANAGEMENT SERVICES; EMCA HSE S BHAGAT-SINGH; and ALLIANZ CAPITAL & MANAGEMENT SERVICE LTD.; EMCA HSE S BHAGATSIN' as mentioned at p.5 of ANNEXURE A/1.

16. He has also produced a photocopy of Delhi Directory 1994 which had as many as six entries in following names:

'Alliance Carpet (Priv) Ltd.; A128 Laj NgrI-24.

Alliance FranoiseDe Delhi; D-13 NDSE Part II-49.

Alliance Furnishers; 20 FUIL Bldg ConCir-I

Alliance India; BISRM Apptt. Jamia Ngr-25

Alliance MerchandisingCo.(Priv)Ltd., B 426 New Fr Clny-65.

Alliance Press; 5657/11 Gali Hanuman Mndr Qb Rd-6.'

17. The learned counsel for the respondent referred to the dictionary meaning of allianz and alliance McCarthy on Trademarks and Unfair Competition Volume 1. McCarthy referred to observations of Judge Learned Hand as stated:

'DISTINCTIVENESS OF MARKS

11.12

A slight misspelling of a word will not generally turn a descriptive word into a non-descriptive mark. In speaking of the effect of misspelling upon the descriptiveness of a mark Judge Learned Hand stated:

It is however, generally held that mere misspelling is not enough. . . Whether this is because the public is not assumed to be critical enough to detect the contrivance, or whether the mark could have no scope, the books do not say. The difficulty is double; a reader who knew how to spell might be in doubt whether the mistake was deliberate; one who did not, would be unaware that it was a mistake at all... If does seem to us, however, that the misspelling of a single letter is too little, for while to many it might be enough, over many it would pass unnoticed.

Following this reasoning, Judge Hand held the mark DIOXOGEN for hydrogen dioxide to be descriptive as a mere misspelling in part of 'oxygen.' In discussing a misspelling of a descriptive term, the United States Supreme Court said:

The word, thereforee, is descriptive, not indicative of the origin or ownership of the goods; and being of that quality, we cannot admit that it loses such quality and becomes arbitrary by being misspelled. Bad orthography has not yet become so rare or so easily detected as to make a word the arbitrary sign of something else than its conventional meaning.

For example, spelling NEW as NU will not prevent a court from considering the effect of the word as properly spelled. Use of the misspelled mark AL-KOL for rubbing alcohol is obviously descriptive......'

18. Learned counsel for the Indian Company has submitted that instead of 'c' by using 'z' in 'Allianz', the German company would not acquire any right. In support of his contention, he relied upon In the matter of an application by the National Biscuit Company for a Trade Mark, Vol. XIX, No. 14, Reports of Patent, Designs and Trade Mark Cases 281. In that case, the word 'UNEEDA' was in dispute. The Court of Appeal held that the applicants alleged that the word in its inception, was not arrived at from the word 'you need a' but they admitted that the public had read it with the pronouncement and meaning of these words. The Court of appeal held that 'UNEEDA' was a mere putting together of three ordinary English words with the misspelling without any change of pronouncement and was, thereforee, not an invented word which could be said to have been monopolised by the German Company.

19. The learned counsel for the Indian Company in this very connection referred to the case of Sunbeam Lighting Co. v. Sunbeam Corporation, Court of Appeals, Ninth Circuit 86 USPQ 240. There the dispute related to the trade mark SUNBEAM. The Court of Appeal made the following observations:

'Realizing the continuously expanding use of electrically operated conveniences in the progress of the civilized world, it seems quite unreasonable to hold that the plaintiff company with its well-earned reputation for quality in its line should have the legally enforceable monopoly to this superlative term throughout the whole electrical world. It stretches to the very top of the unreasonable to say that the word 'Sunbeam' applied to a household utility machine operated by electricity should be adjudged to bring a stop to its long continued use in the firm name of a successful business enterprise whose business is the manufacture and sale of fixtures for the production offluorescent light, a light which more closely resembles the light of a sun-beam than any other light yet discovered.

The evidence contains reports of pollers who exhibited a photograph of defendants' portable fluorescent lamp which shows that some persons jumped to the conclusion that because it had the word 'Sunbeam Lighting Co., Los Angeles' in sight that it was manufactured by plaintiff in Chicago. There was expert testimony to the effect that the plaintiff was a factory of such renown that the mere appearance of the word Sunbeam on large fluorescent fixtures on exhibition to engineers and obstructionists meant plaintiff and no other manufacturer, although the article viewed had no resemblance to anything manufactured by plaintiff nor performed any function of the slightest sameness. Psychologists came to the same conclusion. Evidence of this kind is well answered in the Palmer case, supra 78 USPQ 352: 'The use of ordinary words either alone or in combination, without more, to describe a publication, is not entitled to protection under the law of trade marks or as unfair competition.' See American Auto Ass'n v. American Auto owners Ass'n 216 Cal. 125 : (1932) 14 USPQ 263]. The United States Court of Appeals for the District of Columbia said (the present Chief Justice of the United States speaking): 'A publisher though he has a registered trade mark cannot be protected from all of the inadequacies of human thought and memory. *** Probable confusion cannot be shown by pointing out that at some place, at some time, some one made a false identification.' McGraw-Hill Publishing Co. v. American Aviation Associates 73 App.D.C. 131 : 117 F.2d : 47 USPQ 494. See P. Lorillard Co. v. Peper, 8 Cir. (1898) 86 F. 956; Collegiate World Publ. Co. v. Du. Point Publ. Co., D.C., NDIII ED (1926) 4 F.2d 158.

The judgment is affirmed in so far as it enjoins defendants-appellants from the use of the words 'SunlightMaster' and 'Master' in association with the word 'Sunbeam', and from the use of the word 'Sunbeam' by a script resembling or suggestive of the script used by plaintiff appellee. The judgment is reserved in all other particulars. Affirmed in part, reversed in part, and remanded.

20. Trade Mark law primarily exists to protect consuming public from confusion though concomitantly they also protect the trade mark owner's right to non-confuse public. owners of trade marks are protected from other deceptively similar marks that are likely to cause confusion under common law of passing off or under the Trade Mark Act. Non-distinctive trade mark such as common name mark are not protected generally. The trade marks are entitled to be protected if mark is shown to have a secondary meaning. There are two aspects of ascribing secondary meanings.Secondary meaning exists if trade mark is interpreted by consuming public to be an identification of product; but this by itself may not be sufficient. It is also required that the consuming public must also identify the product with the product's origin. If the second limb of identifying the product along with its origin is not complete, it may not be possible to say that a particular non distinctive trade mark or common name mark has acquired secondary meaning. Secondary meaning is generally established through extensive advertising that creates in mind all consumers association between different products bearing same mark which suggests that the product's origin from a single source. As such, a trade mark owner, before claiming any right or title, must demonstrate that its mark was first to acquire secondary meaning in a particular market and not otherwise. However, there could be some possibility of likelihood of confusion when consumer's viewing mark would probably assume that product or service it represents is associated with source of different product or service identified by similar mark. In order to determine the likelihood of confusion, degree of similarity between owner's mark and alleged infringing mark, strength of owner's mark, price of goods and other factors indicative of care and attention expected of consumers when making purchase, length of time the infringer has used the mark without evidence of actual confusion arising, intention of infringer in adopting mark, evidence of actual confusion, whether goods, competing or marketed through one and the same trade channel and advertised through same area, extent to which targets of party's sale efforts are same, relationship of goods in mind of public because of similarity of function and other facts suggesting that consumer public might project prior owner to manufacturer product in infringer's market. Evidence of misdirected letters may or may not be sufficient depending on circumstances in each case.

21. The learned counsel for the Indian company also referred to Save-A-stop, Inc., et al. v. Sav-A-Stop, Inc. 121 USPQ 232. In that case, the plaintiff/wholesaler had not used the words ('Save-A-Stop'), descriptive of its service of supplying merchandise racks to retailers, over long period of time substantially to exclusion of all others who perform same or similar services. Arkansas Supreme Court took the view that the words were not protected by injunctive relief against defendant (wholesaler) which uses 'Sav-A-Stop', because one cannot appropriate as his mark the usual words in common language which would be used to describe service render; neither partly adopted name as a result of his own wit, but both got idea from others in same business who use same name; name is not unique enough to either party to enable one to have its use to exclusion of other.

22. The learned counsel for the Indian company has contended that in Astra Pharmaceutical Products, Inc. v. Beckman Instruments, Inc. 220 USPQ 786 that there was no likelihood of confusion between 'Astra' for pharmaceutical and 'Astra' for blood analyser. Similarly, in the case in hand, there could not be any confusion between ALLIANZ for the insurance business and ALLIANZ for investment and financial services. It may be noticed in this connection that learned counsel for the Indian company rightly submitted that though under international classification of goods and services that services rendered in financial and monetary affairs are services rendered in relation to international contracts are covered by class 36 but they are different parts of the same class. They are distinct businesses and like the 'Astra' for pharmaceuticals and 'Astra' for blood analyser, they could not be treated as one and the same in Astra Pharmaceutical Products' case (supra). The Court of Appeal, after considering the case law, observed in para 15, as under:

15. 'Finally, Astra argues that even though there are over 100 registrations of the mar 'ASTRA', its mark is unique and individual in the medical field and this uniqueness will suffer from Beckman's use of the mark. It contends that the other registrations have not already diluted its mark because they are in unrelated fields. We have already noted that, while the Beckman analyzer and Astra products may be in the same broad health care field, there is sufficient dissimilarity to prevent confusion. For the same reasons, there is sufficient dissimilarity to prevent dilution. If the other registrations and uses of the 'ASTRA' mark have not already diminished the uniqueness of Astra's mark, Beckman's use of it on its analyzer will not diminish it, either. thereforee, we hold that no genuine issue of material fact has been raised relating to trademark dilution.'

23. The learned senior counsel Shri V.P. Singh further relied upon General Adjustment Bureau, Inc. v. General Insurance Adjustment Company 155 USPQ 128. In this case, the court observed in para 2 as under:

2. 'A greater similarity in the names is usually allowed when the customers are capable of close discrimination, 18 Am.Jur.2d Corporation $ 148 (1965); Annot (1930) 66 ALR 962, and are experienced in the area of enterprise with which the parties are concerned. Lawyers Title Ins. Co. v. Lawyers Title Ins. Corporation 109 F. 2d 35 : 43 USPQ 166 : 174 DC Cir.1939. Appellant's clients are insurance companies long experienced in the insurance business and the handling of claims. They are either the owners of General Adjustment Bureau, Inc., or participate in its earnings. We cannot say that the trial court was clearly erroneous when it found the similarity of the names would not probably deceive the appealee's customers.

Appellant relies upon General Adjustment Bureau, Inc. v. Fuess 192 F. Supp. 542 : 129 USPQ 307 (SD Tex. 1961) wherein the United States District Court for the Southern District of Texas applied a 'likely to cause confusion' test quoting the Fifth Circuit's opinion in Abramson v. Coro, Inc. 240 F.2d 854 : 112 USPQ 307 : 308 (5th Cir. 1957), and Pure Foods v. Minute Maid Corporation 214 F.2d 792 : 102 USPQ 271 (5th Cir.1954).

The trial Court in this case applied the rule stated in Coalgale Abstract Company v. Coal County Abstract Company 67 P.2d 37 : 33 USPQ 285 (Okla. 1937), wherein it was held that in order to enjoin the use of a trade name '[There must be such a similarity that the ordinary buyer, exercising ordinary intelligence and observation in business matters, will certainly or probably be deceived. A mere possibility of deception is not sufficient.'

24. On the basis of this plea, the learned counsel contended that in the present case, the customers are highly discriminate that the customers are capable of close discrimination in between the insurance business and financial services, for on account of high literacy amongst the clients and the distinction between the two kinds of business and he justifiably submitted that a mere remote possibility of any imagined deception is not sufficient seeing the affidavit filed by the German company in respect of their claim about their reputation. In matters of insurance business coupled with the circumstance that one of them - Udyan Bose, approached for underwriting business of his company from the Indian company.

25. Learned counsel for the Indian company referred to Chase Manhattan Overseas Corporation and Ors. v. Chase Corporation Ltd. and Anr. 6 IPR 59. In similar circumstances, the applicant sought orders to prevent the respondent from using the name CHASE in respect of its Australian operations. Federal Court of Australia, after considering the facts of that case held as under:

(i) An overseas company commencing operations in Australia is not necessarily in the same position as a newly incorporated company; it may, as in this case, be known in Australia before commencing to trade here.

(ii) There was no basis in the evidence for a conclusion that investors had been misled and common sense suggested that such a result was unlikely.

(iii) Potential business associates and those negotiating with the first respondent would be unlikely to be misled as there was, and would be, very little common field of activity between any of the applicants and the first respondent.

(iv) It could not be said that there existed a real chance or possibility that any member of the public would be misled into associating with Chase AMP, the second applicant, any adverse publicity which the first respondent might be unfortunate enough to incur.

(v) As to the passing off claim, where a word used for a name is neither concocted nor descriptive, the case will depend upon evidence as to whether, in all of the circumstances, the use of the relevant word is likely to convey to potential customers the misleading impression that the respondent's business or goods is that of the applicant. The relevant question in such a case was identical to that which arose under Section 52 of the Trade Practices Act.'

26. It is also submitted that the German Company had not yet started its business of NBFC and investment and financial services before the Indian company. Accordingly, in so far as business of investment company is concerned, the German company has no right or title to seek the relief of injunction and in so for as insurance business is concerned, the Indian company had already made a statement that Indian company would not use the word ALLIANZ in respect of German business in India.

27. The next case relied upon by the learned counsel for the Indian company was Nationwide Building Society v. Nationwide Estate Agents Ltd. and Anr. 8 IPR 609. In that case, the plaintiff claimed to be the largest building society with 530 branches and 1240 agency branches manned by estate agents. In that case the plaintiff was one of the largest building societies, which had actively promoted itself under the name 'Nationwide'. As well as its 530 building society branches, it had 1,214 agency branches, manned principally by estate agents who acted as the plaintiff's mortgage brokers. Several of these had fascie boards with the estate agent's name above and 'Nationwide Building Society' in large letters beneath. On 1st January 1987 the plaintiff took advantage of the Building Societies Act, 1986 (UK) and purchased 380 estate agencies, which continued to trade under their own names in conjunction with the words 'Nationwide Estate Agency'. The defendants had previously operated a large chain of estate agents under the name 'Alien & Harris Ltd., a subsidiary of Nationwide Estate Agents Ltd.', but later transferred much business to the former company, retaining four estate agencies under the name 'Nationwide Estate Agents Ltd.'. They intended to open a further 100 branches under the same name. The plaintiff sought an interim injunction restraining the defendants from trading under any name incorporating 'Nationwide', giving several instances of damaging confusion. The defendants alleged (i) that the plaintiff's use of 'Nationwide' was illegal under Section 15(1) Building Societies Act, 1986 since it was not its full name, (ii) the plaintiff's evidence of confusion was inadmissible hearsay, and (iii) the plaintiff was guilty of acquiescence or delay. Both parties obtained survey evidence to support their cases. The Court in this case, refusing the injunction, held that (i) a building society could promote itself by a logo or part of its name provided it used its full name when entering into legal obligations; (ii) the plaintiff's evidence was admissible, since it was capable of proof by a witness or document; (iii) acquiescence, whilst arguable, should not preclude the grant of interlocutory relief; and (iv) despite evidence of actual confusion, the likelihood of further confusion, and the fact that the damages at trial would be an inadequate remedy, neither party had any real goodwill in the estate agency business under the name 'Nationwide'. The Court could not grant an injunction which was designed to prevent one competitor from setting up so that the other could obtain a head start.

28. The learned counsel for the respondent also relied upon Wander Ltd. and Anr. v. Antox India (P) Ltd. 1991 PTC 1. In that case, the dispute related to calcium gluconate tablets under the trade name Cat-De-Ce. In that case, Wander Ltd. was manufacturing calcium gluconate tablets and the trade mark Cat-De-Ce in its own factory in Bombay from August 1983 to June 1986. Under an agreement, the Antox India (P) Ltd, agreed to manufacture gluconate tablets under the said registered trade mark and sell the entire product to the one company. Accordingly, Antox applied for the manufacturing license. The agreement dated 28th March 1986 between the parties had run into serious troubles and that led Antox to file the suit and to seek temporary injunction. It was held by the Supreme Court that in a passing off action, if the plaintiff's right is independent of such a statutory right to a trade mark and is against the conduct of the defendant which lends or is intended or calculated to lead to deception. Passing off is said to be species of unfair trade competition or of actionable unfair trading by which one person, through deception, attempts to obtain an economic benefit of the reputation which another has established for himself in a particular trade or business. The action is regarded as an action for deceit. The tort of passing off involves a misrepresentation made by a trade to his prospective customers calculated to injure, as a reasonably foreseeable consequence, the business or goodwill of another which actually or probably, causes damage to the business or goodwill of the other trade.

Laches, Delay and Reverse Confusion

29. In regard to laches and delay in filing the suit, the learned counsel for the plaintiff submitted that in the case of Swaran Singh v. Usha Industries (India) and Anr. : AIR1986Delhi343 , the plaintiffs were using USHA as registered trade mark since 1960 for electric irons and the defendant was using it without registration since 1961 for electric irons. The plaintiff came to know of the infringement of the trade mark in May 1982 but they filed the suit in 1984. The plea was taken that the delay in filing the suit was vital. The following observations were made by a Division Bench of this Court in para 7:

7. 'There is then the question of delay. Learned counsel for the respondents had urged that the delay is fatal to the grant of an injunction. We are not so satisfied. A delay in the matter of seeking an injunction may be a ground for refusing an injunction in certain circumstances. In the present case, we are dealing with a statutory right based on the provisions of the Trade and Merchandise Marks Act, 1958. An exclusive right is granted by the registration to the holder of a registered trade mark. We do not think statutory rights can be lost by delay. The effect of a registered mark is so clearly defined in the statute as to be not capable of being misunderstood. Even if there is some delay, the exclusive right cannot be lost. The registered mark cannotbe reduced to a nullity. The principles governing other types of injunctions are not to be readily applied to a case like the present. Of course, if it was a case of a similar mark as opposed to the same mark, the concurrent user coupled with delay might be a ground for refusing an injunction. However, when the same mark is being used, in a sense, the public is deceived into purchasing the defendant's goods on the belief that they are the plaintiffs goods, so a registered trade mark is a casualty, it is the duty of the Court to protect the registered mark. That is the whole concept of registration. So, we cannot refuse an injunction even if there is some delay especially when the mark is the same. To refuse the injunction would tantamount to permit a fraud being practiced on unwary customers. This is a matter of principle on which the Court cannot refuse the injunction.'

30. It may be mentioned that here in India, the German Company did not have any registration of trade mark before the defendant started their business in the name of ALLIANCE Capital and Investment Services Limited. Consequently, this judgment may not be of much help to the counsel for the plaintiff, for this judgment indicated that there were some distinctions in between in non-registered trade mark and a registered trade mark conferring statutory rights on the holder of registered trade mark.

31. The learned counsel further relied on the case of Nanak Chand and Ors. v. Kohinoor Chemical Co. Ltd. (1970) 2 Del 344. In that regard, the following observations were made at p.349 of the judgment:

'It is no doubt true that the delay in applying for an order of temporary injunction is one of the considerations which has to be kept in view, but delay by itself is not sufficient to deprive the registered proprietor of the trade mark of his rights unless it is such as to give rise to a belief that the proprietor of the trade mark has either acquiesced in the user of the mark by the opposite party or has abandoned his rights therein.'

32. It may be mentioned firstly that this judgment related to registered trade mark and not to a passing off action. However, in the light of the observations made by the Division Bench, it would be required to be seen whether the plaintiff has acquiesced in the user of the mark by the opposite party or has abandoned his rights therein.

33. Learned counsel for the German company also relied upon Hindustan Pencils (P) Ltd. v. India Stationery Products Co. and Anr. : AIR1990Delhi19 . That case also related to registered trade mark. In that case the plaintiff was having registered trade mark 'Nataraj' for pencils, pens, pins, clips etc. since 1982. Action was taken in 1985 for cancellation but suit was filed in 1988. In that case, defense of inordinate delay of six years laches and acquiescence against confirmation was rejected as the use was deceptive and fraudulent and delay was not inordinate. Here again, it may be mentioned that the trade mark was not registered trade mark in India and the claim of the German company is based on a just passing off action. However, in Hindustan Pencils (P) Ltd v. India Stationery Products Co. and Anr., (supra), this registered trade mark was sought to be used in respect of same articles. Here the services are of different nature.

34. In Rev. on Inc. and Anr., v. Hosiden Laboratories (India) and Ors. : 42(1990)DLT640 again, it was a registered trade mark and there was defense of concurrent user by defendant which was not accepted. In that case, the plaintiff's were not only the registered trade mark owners since 1975 but it had acquired a reputation as a whole in advertising their goods in world famous magazines available in India. In that case, Hon'ble Mr. Justice P.K. Bahri took the view that firstly, it was not a concurrent user for the defendant came into picture after ten years. The plea of ignorance of registration of the trade mark would not be availed and in those circumstances the single Judge took the view that it could not be said that the plaintiff had come to the court belatedly in seeking the necessary relief of injunction against the defendants and even if there had occurred any such delay, the same was not fatal to the maintainability of the suit.

35. I think that the correspondence exchanged between the parties by sending protest letters and notices protesting against using the word ALLIANZ the German company has taken appropriate steps to avoid litigation, if possible. This would not amount to acquiescence even in case of passing off and if the German company is entitled to get injunction otherwise, the German company could not be deprived of that relief solely on this ground.

Transborder reputation.

36. As regards transborder reputation of ALLIANZ which has also been spilled over in India in view of advertising and publicity of its business under the name ALLIANZ in major international newspapers and magazines having wide circulation in India namely, Business Week, The Financial Times, Newsweek, Time, The Far Eastern Economic Review, the Economist, Fortune, the Wall Street Journal, the International Harald Tribune and The Asia Insurance Review. In India earlier, they were doing the insurance business and they again established the office prior to the Second World War. The German company continued to assist by advising the nationalised assurance companies.

37. However, it is pointed out by the learned senior counsel for the Indian company that the question of transborder reputation was required to be seen in the light of not the insurance business but financial and investment services for there are two different segments of the financial part of the businesses. Since the German company had never started any business in India at any point of time till filing of the suit, they could not claim any transborder reputation in respect of business which was yet tostart. In this regard, in view of the judgment of the Supreme Court in the case of Whirlpool Corporation and Anr. v. Mr. N.R. Dongre and Ors. : 56(1994)DLT304 and judgment of a Division Bench of this Court Rob Mathys India Pvt. Ltd. v. Synthes AG Chur 1997 (17) PTC 669, it is rightly contended that so long as the German company did not start any business other than the insurance, it could not have any transborder reputation in India in respect of investment, under-writing and merchant banking services.

Dishonest adoption

38. As regards the plea of dishonest use of the word ALLIANZ by the Indian company, it is submitted that the conversion from Asthan Capital and Management Services Limited to Alliance Capital and Management Services Limited on 5th November 1992 was dishonest adoption of the word ALLIANZ. The reason advanced for change in the name from Asthan to Allianz recorded in the office of the Registrar of Companies was that the Board of Directors had proposed to change the name because of its wrong pronouncement and spelling by the company's clients. There may be some force with the reason given for the change of the name is not very much appealing for the other companies of the same group - Asthan Holdings Pvt. Ltd. is continuing the business with the same old name and using the word 'Asthan'.

39. The learned counsel for the German company relied upon Montari Industries Ltd. v. Montari Overseas Ltd. : 57(1995)DLT771 . In that case, the plaintiff company was registered as Montari Industries Limited in Punjab on 27th January 1983 and thereafter, six more companies of the same group were established with the name 'Montari' between 24th June 1988 to 2nd May 1994. The defendant company was set up on 21st April 1993. The defendant company obtained certificate of commencement of its business on 4th July 1994. They were still in the stage of construction of the factory. Machines were yet to be installed. The plaintiff company as well as the defendant company had approached the share market. The plaintiff came out with the Rights issue, the subscription of which was to be opened on 9th January 1995. The defendant's public issue was to open on 10th January 1995. The plaintiff became aware of the defendant's activities when the latter came to the capital market. It may be noticed that in the case of Montari Industries Ltd. v. Montari Overseas Ltd. (supra), the plaintiff company had an older set up in India itself in Punjab since 27th January 1983. In so far as the investment, under-writing and financial services etc. are concerned, the German company had not set up any business in India and, thereforee, the facts of Montari Industries Ltd. v. Montari Overseas Ltd. (supra) were different. Though the case of Montari Industries Ltd. v. Montari Overseas Ltd. (supra) was decided on the facts of its own case, in that case the plaintiff company was located in India itself and not in Germany, as is the case in hand.

40. In Prakash Roadline Ltd. v. Prakash Parcel Services (P) Ltd. : 48(1992)DLT390 , the word 'Prakash' had acquired secondary meaning for the plaintiff in the trade on account of its use over a long period of time and the use of the word 'Prakash' and the name of the defendant was not bona fide. It is evident that the plaintiff company was using the word 'Prakash' much before. The plaintiff company was established in the year 1961 and had been carrying on business of transport for the last 13 years while, on the other hand, the defendant company had been incorporated in October 1991 and started business thereafter. Here the position is just reverse.

41. Learned counsel for the German company placed reliance on K.G. Khosla v. Khosla Extractions : AIR1986Delhi181 . There could not be any doubt about the proposition that the passing off action need not merely relate to the case; it could relate to services also. That case was also decided on its own facts and there was no foreign company having any business in India in so far as investment, under-writing and financial services are concerned.

42. Learned counsel also referred to Gold Star Co. Ltd. v. Gold Star Industries and Ors. : 57(1995)DLT658 . In that case, the plaintiff was a proprietor for the owner of the trade mark GOLDSTAR sought injunction against the defendant who were using the trade mark GOLDSTAR on account of continuous user since 1984 and since it was registered trade mark, the defendants were restrained from using the trade mark GOLDSTAR for its products of washing machines, mixers, grinders, geysers, ovans, hot plates, electrical cooking appliances, fans and other such appliances. thereforee, the facts were again different from the goods in hand.

43. Another case referred to by the learned counsel for the plaintiff was Poison Ltd. v. Poison Dairy : 56(1994)DLT102 . In that case, the plaintiff company was Polson Pvt. Ltd. incorporating to expand the business of Poison Model Dairy in the year 1938. They were continuously doing the business in the name of Poison and their turnover between 1966 to 1978 ran into crores. They also acquired Amba Tannin & Pharmaceuticals in the year 1972. It became a Division of Poison Limited having a turnover of Rs. 2.5 crores. The defendant company in that case had been incorporated in the year 1992 under the name and style of Poison Dairy Limited. Both of them approached the share market to raise further funds. The plaintiff filed the suit for grant of permanent injunction restraining the defendant No. 1 from using the word 'Poison' or any colourable imitation. After considering the facts of that case, Hon'ble Mr. Justice P.K. Bahri took the view that defendant was trying to prima facie take benefit of reputation which the trade mark Poison enjoyed, in order to deceive general public. The defendant company was successor-in-interest of the old company for having the same high quality of products, as used to be marketed by the plaintiffs predecessor. It may be just mentioned that in that case also, the plaintiff company existed much before the inception of the subsequent company. Here the case is just reverse so far as the business of insurance business in India is concerned.

44.1 In this very connection, the next contention Shri V.P. Singh, learned senior counsel for the Indian Company that the main line of business of the defendant is that of merchant banking, corporate finance, stock bearing, retail finance etc. whereas the business of the applicant was of insurance.

44.2 In support of his contention, he referred to the definition as given in Curzon Law Dictionary relating to investment company and insurance company as under:

'Insurance Company is any company whose business consists wholly ormainly in doing insurance and the principal part of whose income is derivedthere from'.

44.3 Investment company has been defined as:

'any company whose business consists wholly or mainly in the making of investments and the principal part of whose income is derived there from'

45. Thus, it appears that these are two different sectors. Even if, for the sake of arguments, it is accepted that the applicant company was doing insurance business in India for it insured and re-insured certain companies along with the two nationalised insurance companies, it would indicate that the business of applicant company was confined to insurance business. The facts that their experts were training the officials of the four nationalised insurance companies by inviting four officials of the four Indian insurance companies in Germany, would relate to insurance business in India. Nothing has been shown from the side of the applicant that they were doing any business of merchant banking or that of investment company in India before the registration of the defendant company. Thus, while the word ALLIANZ may have acquired a secondary meaning in India in relation to insurance business, it could not be said that it could, by any stretch of imagination, acquire any secondary meaning in relation of investment business that these are not the goods; these are the services having a special class of customers who are highly educated and discerning.

DELAY AND LACHES:

46. The next point which is required to be considered is delay and laches on the part of the plaintiff to file the suit. According to the plaintiff's own admission, the plaintiff came to know of the use of the word ALLIANZ by the defendant, sent their first letter protesting against the use of the word ALLIANZ or any other name confusingly similar thereto on 29th September 1993 but the suit was filed in May 1995. From the side of the plaintiff, it is submitted in reply to this argument that from the date of its knowledge, the plaintiff had taken vigorous steps to prevent the defendant from using the impugned mark by writing to the defendant. It is also contended that delay by itself was sufficient to deprive the owner of a trade mark of his rights unless it is such as to give rise to the belief that the proprietor of a trade mark has either acquiesced in the use of the mark by the opposite party or has abandoned its right therein. In any case, the use of the mark being fraudulent, even inordinate delay would have defeated any cause of action or grant of ad interim injunction and the right to use the mark could not be lost. It is not of much importance whether a clear case of infringement is there.

47. Seeing the statement of Shri V.P. Singh about no objection to use of the mark ALLIANZ for the purpose of insurance business by the applicant, it is felt that simply on account of delay of about two years, it could not be said that there is inordinate delay to provide such a ground which by itself would be sufficient to refuse the interim injunction. Consequently, this plea may not be sufficient by itself to reject the application for interim injunction.

48. However, it is required to be seen as to whether by delaying in institution of the suit, the plaintiff had given rise to the belief that the plaintiff had either acquiesced to the use of the mark by the defendant or had abandoned its rights therein. This becomes important from the point of view of the fact that the defendant is doing business not in insurance but as a merchant banker in the private sector in North India having 31st ranking as a lead manager. There are advertisements indicating that the Allianz Capital Merchant Banking had entered into merchant banking in July 1993 as is evident from the various newspaper reports relating to the years 1993, 1994, 1995 indicating that between 1993 and 1995, the defendant had established their business in India. So far as merchant banking and management services are concerned, they also planned a foreign arm to tap financial global market, as is apparent from the report published in The Economic Times dated 28th January 1995 and 2nd March 1995. On April 3, 1995, the Allianz Capital and Management Services had ranked first amongst private sector merchant bankers. Its income had gone up to 370% as per the reports published in The National Harald on 13th September 1995 and other newspapers.

49. Seeing the documents on record, it appears that at least in the field of merchant banking, under writing business etc. they had acquired a reputation in India. It may be mentioned that in so far India is concerned, leaving aside insurance business, no business of the kind run by the defendant was undertaken in India.

50. In such circumstances, the question is whether the defendant, having acquired a reputation in the field of merchant banking and as an investment company, should be deprived of its business. The learned counsel for the defendant in this connection, referred to the concept of 'reverse confusion' as observed by McCarthy on Trademarks and Unfair Competition, Vol. 3 at p.23.01[5]. It reads as under:

'In a reverse situation, rather than trying to profit from the senior user's mark, the junior user saturates the market and overwhelms the senior user. The result is that the senior user loses the value of the trademark, itsproduct identity, corporate identity, control over its goodwill and reputation, and ability to move into new markets. ..... Reverse contusion is themisrepresentation that the junior user is the source of the senior users goods. ..... customers may consider the senior user the unauthorised infringer and the junior user's use of the mark may in that way injure the senior user's reputation and impair its goodwill.'

51. In this regard, it was further submitted that the German company is the only foreign insurance company who was attempting backdoor entry in the market as provider of financial services and their mala fide intention was clear from the fact that even the' liaison office alleged opened in 1997-98 in Mumbai on which the German company placed reliance repeatedly, but failed to adduce prima facie evidentiarytransaction as an investment company as an evidence of the reputation. It does not find a mention in their own advertisements. It is also submitted that in so far as an investment financial service business is concerned, the German company is trying to capitalise on the pre-existing reputation in the work 'Allianz' that the Indian company has exhibited.

52. In this connection, another aspect is the affidavit dated 2nd August 1994 sworn by Udayan Bose, Chairman of Creditcapital Finance Corp. Ltd. who approached the defendant for under-writing the public issues. Thus, it appears that reverse confusion is possible in the case of the above specified areas in view of the PRIME banking and the fact that the plaintiff company had not shown anything in the case that they were in the above-said business in India. Now, in case one considers the affidavits filed by Udayan Bose in the light of the submissions made by the defendant company of Udayan Bose, itself had applied for under-writing the issues, does not sufficiently explain the subsequent affidavit filed at the behest of the plaintiff company for the affidavits filed by them. Mr. Arun Charan Mukherji was involved in insurance business and he just stated in his affidavit at p.518 as under:

3. 'Having spent so many years in the insurance industry, I am aware that Allianz Aktiengesellschaft Holding ('Allianz AG') of Germany is well-known and active internationally in the insurance and financial sector. I, thereforee, associate the word 'Allianz' only with Allianz AG of Germany and none else.'

53. Similarly, Udayan Bose stated that:

'3. Having spent so many years in the banking industry, I am aware that Allianz Aktiengesellschaft Holding ('Allianz AG') of Germany is well-known and active in the insurance and financial sector. I, thereforee, associate the word 'Allianz' only with Allianz AG of Germany.'

54. Mr. Udayan Bose could have claimed in his affidavit dated 2nd August 1994 that he has been misled by the defendant company while they applied for under-writing of public issue of their company vide their letter dated 20th September 1993 and letter dated 18th November 1993. It may be mentioned that this fact has not been denied; rather an argument has been built up on the assumed basis of this affidavit that in reply to the preliminary objections in para 2, the German company claimed that 'the very incident that the Creditcapital Finance Private Limited approached the defendant for under-writing the public issue, shows that having been misled by the defendants by misusing the word ALLIANZ as part of its corporate name' indicating that the under-writing of the public issue of the Creditcapital Finance Private Limited by the Indian company has not been disputed. There is virtually no basis to say that Mr. Udayan Bose was misled in any manner in so far as under-writing of the public issue of his company was concerned. Had it been so, when he filed the affidavit, he should have stated in so many words that he has been misled by the Indian company.

55. In such circumstances, the possibility of reverse confusion could not be ruled out relating to the business concerned with investment company. The affidavits filed in the circumstances would only go to show that the plaintiff company had reputation in so far as insurance business is concerned and they have also acquired some reputation in financial sector abroad, not in India, in view of the very nature of services different from goods.

56. In is No. 4514/99 in S. No. 393/99, the Indian Company had further sought that the defendants be restrained from issuing misleading advertisements proclaiming them to be in the finance sector.

57. On the other hand, in is 1191/2000 in S. No. 1162/95 and is 7997/2000 in S. No. 393/99 the German Company sought to file certain documents to establish that the Indian Company was not a merchant banker and having its transferred its license to another company on 3rd November 1998, has lost all interest in that respect. Another suit No. 1224/2000 was filed by Allianz Securities Limited seeking injunction order as part of the corporate name and trading style. The German Company came to know in connection with that suit. In so far as the transfer of merchant banking is concerned, it has not been disputed. In the interest of justice, the documents are allowed to be filed.

58. Since the German Company has not yet started any insurance, business in this country so far, it could not be said that the Indian Company or its transferee would be passing off their services as services of the German Company. Rather, in view of the reputation earned by the Indian Company in the business other than insurance, it would be reverse confusion. Even if one thinks that the Explanationn given by the Indian Company to change its name from Asthan to Allianz is not satisfactory, it wouldnot ensure to the benefit of the German Company in respect of business other than insurance business.

59. However, as regards the running of the business as Non Banking Finance Company if license is granted to the German Company and the license has been refused to the Indian Company in suit No. 393/99 and their successor-in-interest for none of the Indian companies has been granted Non Banking Finance Company license and the Indian company cannot run the business of Non Banking Finance Company in the absence of license and permission of the Reserve Bank of India, the balance of convenience in regard to this particular business shall be in favor of the German Company and in case at this stage they are ordered to change the name, they may be suffering inconvenience as well as irreparable loss. In view of these circumstances, the German Company has to be allowed to use the term 'Allianz'.

60. The Supreme Court in Ciba Geigy v. Sun Pharmaceutical Industries 1997 (17) PTC 364 followed the observations of Lord Diplock in American Cynamid v. Ethicon Ltd. (1975 (1) All ER 504) in following words:

'My Lords, when an application for an interlocutory injunction to restrain a defendant from doing acts alleged to be in violation of the plaintiff's legal right is made on contested facts, the decision whether or not to grant an interlocutory injunction has to be taken at a time when ex hypothesi the existence of the right or the violation of it, or both, is uncertain and will remain uncertain until final judgment is given in the action. It was to mitigate the risk of injustice to the plaintiff during the period before that uncertainty could be resolved that the practice arose of granting him relief by way of interlocutory injunction; but since the middle of the 19th century this has been made subject to his undertaking to pay damages to the defendant for any loss sustained by reason of the injunction if it should be held at the trial that the plaintiff had not been entitled to restrain the defendant from doing what he was threatening to do...'

'It is no part of the court's function at this stage of the litigation to try to resolve conflicts of evidence on affidavit as to facts on which the claims of either party may ultimately depend nor to decide difficult questions of law which call for detailed argument and mature considerations. These are matters to be dealt with at the trial. One of the reasons for the introduction of the practice of requiring an undertaking as to damages on the grant of an interlocutory injunction was that 'it aided the court in doing that which was its great object, viz., abstaining from expressing any opinion upon the merits of the case until the hearing' (Wakefield v. Duke of...)'

'. . . If damages is the measure recoverable at common law would be adequate remedy and the defendant would be in a financial position to paythem, no interlocutory injunction should normally be granted, however strong the plaintiff's claim appeared to be at that stage...'

61. It is to mitigate the risk of injustice to either of the parties during the period of pendency of the trial that the practice arose to take appropriate precaution so that none of the parties suffers ultimately by grant or refusal of the injunction. If damages is the measure recoverable at common law would be adequate remedy and the defendant would be in a financial position to pay them, no interlocutory injunction should normally be granted, however, strong the plaintiffs claim appeared to be at that stage. Though prima facie, there does not appear any reason but to be on safer side, in order to safeguard the interest of the plaintiff on the ground of refusal to grant injunction, the respondent can be directed to keep accounts and furnish a statement within two weeks to pay damages in the event of the plaintiff succeeding ultimately in the action.

62. Accordingly, these applications are disposed of with the following directions:

(i) In order to avoid reverse confusion, while the German Company is allowed to use the word 'Allianz' with respect to insurance sector and business of Non Banking Finance Company, they are restrained from using the word 'Allianz' with regard to investment and financial services sector.

(ii) The German Company is also restrained from issuing any advertisement by using the word 'Allianz' proclaiming themselves to be in the investment and financial sector, excepting the business of Non Banking Finance Company.

(iii) Since the Indian Company is entitled to use the word 'Allianz' in respect of investment and financial services sector, excepting the business of Non Banking Finance Company, the Indian Company is restrained from using it for the purpose of insurance and Non Banking Finance Company business. However, in case the Non Banking Finance Company business is transferred back to the Indian Company and RBI grants permission and dispute about user of word 'Allianz' arises, it may be considered by the court at that stage.

(iv) Both the parties are restrained accordingly from using the word 'Allianz' beyond the business sectors as aforesaid, in which they are allowed to use the same in any manner.

(v) Both the parties shall maintain the accounts fairly in respect of the user of the word 'Allianz' in connection with their respective aforesaid businesses and shall file an undertaking within four weeks to compensate the other company in case the matter is decided finally in favor of the opposite party.

(vi) None of the parties shall use the same script and colour scheme to avoid confusion and shall not issue any advertisement contrary to the above and further so long as the matter is not decided, both the companies shall give a note on their all correspondence and hills indicating user of the word 'Allianz' in terms of the order on above said IAs.

63. None of the observations made herein above shall tantamount to expression of any final opinion. The observations shall be confined to the disposal of the above said applications.

64. With these observations, the IAs are disposed of accordingly.

65. The suits be listed in court according to roster on 12th October 2001.