Pharma Trademark Infringement in India

The pharma major Cadila Healthcare, was recently issued a notice by the Supreme Court of India in a matter involving Passing Off of a trademark. The notice is a result of a petition filed before the Supreme Court by Ahmedabad based pharma firm Unichem Laboratories against the decision of Karnataka High Court. The matter relates to violation of the trademark of Cadila for a drug called ‘Losacar’, used in treatment of Hypertension. Unichem marketed its drug as ‘Losar’, which was alleged by Cadila as passing off because of deceptive and phonetic similarity. The drugs come from a compound ‘Losartan Potasium’, used widely for treatment of hypertension and related aliments.

The Karnataka High Court approving the prior use of the trademark by Cadila, held that it could pursue its civil suit in the Bangalore civil court as there was passing off due to similar sounding names. A passing off action is available against an unregistered mark, and any mark similar to such a mark is not registrable by virtue of Section 11(3)(a) of the Trade Marks Act, 1999. The High Court turned down Unichem’s plea and directed that it had the jurisdiction to decide the trademark violation between the two companies. Cadila had filed a suit in the city civil court against Unichem, against the use of the trademark, ‘Losar’.

The Supreme Court bench headed by Chief Justice KG Balakrishnan, took into consideration the arguments presented by Unichem, that the HC had not heeded the grounds for refusal of registration of a trademark under Section 9 of the Act and merely considered ‘prior use’ as a factor for allowing the civil suit. Section 9(a) prescribes that a mark cannot be registered if it is devoid of any distinctive character, that is to say, not capable of distinguishing goods or services of one person from those of another person. The law requires the trademark to be distinctive, and not being descriptive of the goods in trade, so as to be registrable. In the present case, the trademark is derived from the generic name of the salt, ‘Losartan Potasium’, hence no acquired distinctiveness or secondary significance could be proved in relation to the mark.

It was alleged that the HC had presumed that mere prior use of the mark was a sufficient ground for passing off action, even if no goodwill or reputation ensued from such use. It was also averred that both the existence of goodwill and reputation as well as distinctiveness was an essential criteria in determining passing off.

The determination of the Supreme Court in respect of descriptive marks now remains to be seen.