Cadila Health Care Ltd. v. Cadila Pharmaceuticals Ltd.

Relevant Acts and provisions

Trade and Merchandise Marks Act, 1958

Section 27(2)Section 28

Provisions considered: Sections 27(2) and 28 of the Trade and Merchandise Marks Act, 1958, concerning passing off and infringement.

Brief facts

Both parties traced their origin to a common group that had split, and each was permitted to use the word Cadila in its corporate name. In 1996 the appellant launched a medicine under one mark for cerebral malaria, and in 1997 the respondent launched a different drug under a similar mark for the same ailment. The appellant sought an interlocutory injunction restraining use of the respondent's mark as deceptively similar. The trial court and the Gujarat High Court refused interim relief, reasoning that both were prescription drugs supplied to hospitals and dispensaries, reducing the risk of confusion.

Issues before the Court

1. What factors are relevant in determining deceptive similarity between trade marks used on medicinal products?
2. Does sale of a drug as a prescription-only medicine reduce the likelihood of confusion?
3. Was the refusal of interim injunction justified?

Court's findings

The Court held that confusion between the names of two medicinal products carries graver consequences than confusion between ordinary consumer goods, since a mistaken purchase could have harmful or even fatal effects on health, and that courts must therefore apply a stricter standard when assessing deceptive similarity in pharmaceutical marks. It observed that the fact that a drug is sold only on prescription, or only to hospitals and clinics, does not eliminate the possibility of confusion, given the realities of dispensing in India, including handwriting errors and oral orders.

The Court laid down the factors relevant to deceptive similarity: the nature of the marks, the degree of visual and phonetic resemblance, the nature of the goods, the similarity in nature, character and performance of the goods, the class of purchasers and their education and care, the mode of purchasing, and other surrounding circumstances.

The Court noted that a large section of Indian consumers are not conversant with English and may be unable to distinguish phonetically similar names, making sound similarity especially significant for medicinal products.

Decision

Appeal disposed of; the Court declined to grant an injunction itself and remitted the matter to the trial court to decide the suit applying the factors laid down.

Cases cited

• Corn Products Refining Co. v. Shangrila Food Products Ltd., AIR 1960 SC 142

Authorities referred to in the decision. Please verify each citation in the judgment itself.

Keywords

Deceptive Similarity Passing Off Pharmaceutical Trademark Phonetic Similarity Public Health