1. The Petitioners in O.A.Nos.845 & 846 of 2019 have filed the suit C.S.No.542 of 2019, against the sole defendant under the Trade Marks Act, for permanent injunction, rendition of accounts, damages and delivery of all finished and unfinished infringing products. In the course, filed applications for interim injunction restraining the defendant from directly or indirectly use the trademark of the plaintiffs 'STUDIO MASTER' and or any mark identical or similar to the Plaintiffs trademark 'STUDIOMASTER' and 'STUDIOMASTER PROFESSIONAL' amounting to infringement and passing off. In those two applications viz., O.A No.845 of 2019 and O.A No.846 of 2019 this Court, on 17.09.2019, granted ad-interim order. Same is sought to be vacated in Application No.8052 of 2019 by the defendants.
2.The applications for interim injunction and vacate injunction are taken up for consideration by this order. For the convenient sake, the parties are described as plaintiffs and defendants.
3.Case of the plaintiffs:
The 1st plaintiff is a registered partnership firm. The 1st plaintiff was the erstwhile proprietor of the trademark 'STUDIOMASTER' and its formative marks. The 1st plaintiff assigned the said trademarks to the 2nd plaintiff vide assignment deed dated 27.05.2008. The plaintiffs are part of the Ahuja Radios Group established in the year 1940. They are manufacturers of, dealers in, and exporters of audio equipment and instruments. The 2nd plaintiff commenced their business in or about the year 1994. With several decades' experience in designing and manufacturing professional audio equipments, they are the leaders in pro audio solutions. Their products are build to exacting standards of the Indian Market, which demands reliability and high performance in rugged usage conditions. The products of the 2nd plaintiff are sold under various Trademarks of which one brand is ‘STUDIOMASTER’ which was conceived, coined and adopted in the year 1990 by the 1st plaintiff. The 2nd plaintiff is also widely known for their audio equipment sold in the name and style of 'STUDIOMASTER PROFESSIONAL'. There is great demand for the plaintiffs audio equipment under the marks 'STUDIOMASTER' and 'STUDIOMASTER PROFESSIONAL' in India. The range of plaintiffs products includes, Amplifiers, Mixers, Loudspeakers, Transducers, Microphones, DJ Products, Processors, Conference Systems and power supply products such as voltage stabilizers and power sequences.
4.The 2nd plaintiff is the present trademark proprietor of the 'STUDIOMASTER', 'STUDIOMASTER PROFESSIONAL' and its formative mark such as 'STUDIOMASTER INDUSTRIAL'. The class and validity period is as below:-
5.The 2nd plaintiff is the true proprietor of the trademarks 'STUDIOMASTER', 'STUDIOMASTER PROFESSIONAL' and its variants by virtue of priority in adoption, long, continuous and extensive use and advertising. The reputation consequently accruing thereto in the course of the trade, it is entitled to take action against the unauthorised use of its trademark by third parties.
6.The defendant, who had business relationship with the plaintiffs used to purchase the plaintiffs product and resell it in the market. Later, the plaintiff ceased to supply its product to the defendant, after coming to know the defendant’s unfair and illegal business practices. In August 2019, the plaintiff came across an advertisement in Facebook posted by the defendant, stating that 'STUDIOMASTER' products are available with them and they are the authorised dealer for Chennai, without mentioning the source of the products and their supplier. This is evident that the defendant is selling products with identical trademark of the plaintiffs, misappropriating the brand thereby violates the statutory and common law rights of the plaintiffs in the trademark 'STUDIOMASTER', 'STUDIOMASTER PROFESSIONAL' and its variants.
7. The malafide intention of the defendant is evident by the offering of product bearing the identical trademark of the plaintiffs for sale in the market and cause confusion among the consumers. The motive of the defendant to exploit the 2nd plaintiff trademark and make illegal gain. The defendant, who is in the same industry is aware of the goodwill and reputation of the plaintiffs build over the years and they are the prior user of the trademark. Hence, the use of identical trademark of the plaintiff is infringement under Section 29 of the Trade Marks Act, and by using the identical Trademark, they passing off their product as that of the plaintiffs product and deceive the buyers.
8.Stating that, there is likelihood of confusion among buyers and dilution and Tarnishment of the trademark as will as erosion of goodwill and reputation, the applications for interim injunction is sought to avoid irreparable injury.
9. Case of the defendant:
'STUDIOMASTER' is an internationally renowned brand of professional audio equipment originating in the United Kingdom over 40 years ago. It has earned a reputation for its quality in England and over several other countries including India. The defendant is a sole proprietary concern dealing in more than 30 internationally renowned brands of professional audio equipment including Yamaha, NX Audio, Probehiringer since 1997. They commenced the sale of mixers, loudspeaker systems and related products of the Studiomaster brands manufactured by M/s.Soundking Electronics and Sound Co. Ltd., in their factory at Ningbo, China. Nippon Enterprises South is the sole distributor of the said Studiomaster and Carlsbro products (Manufactured by Soundking) in India, pursuant to the Distributorship Agreement dated 22.05.2013. The defendant purchased the product from Nippo Enterprises South and resell it to its customers. The defendants are neither manufacturer nor they affix any label on the traded goods. After obtaining the UK Trademark, the predecessor of 'Soundking' is using the trademark since 1990. On 07.03.2008, Soundking became the owner and beneficiary of the trademark 'STUDIOMASTER'. In and by Brand and Trademark Licensing Agreement dated 08.03.2008 between 1).Studiosound Ltd; 2).Recording Studio Design Ltd and 3).Soundking Group Co. Ltd., Studiosound and Recording Sound Design, granted Soundking the license for sole and exclusive use of the owned brand and trademark and existing IP Rights of Studiomaster all over the world and the said license is for 50 years. In the year 2010, Studiosound merged with Soundking.
10.Setting out the background pertaining to the creation of the brand 'STUDIOMASTER', development, usage and successive transfer of ownership of the mark, the acquisition of the proprietorship of the trademark by Soundking and the connect proceedings before the Trademark Registry, Intellectual Property Appellate Board, the defendant contents that the plaintiff has wilfully suppressed material facts and have obtained the interim orders by painting a false picture.
11.According to the defendant, the 1st plaintiff was the sole distributor in India for the Studiomaster UK Products, since 1976. It claim falsely that the name was coined, conceived and adopted by them since 1990. The registration of the Trademark has been obtained surreptitiously in their name, even while they were the distributors in India of the original 'STUDIOMASTER' of UK Company. The usage claimed by the plaintiff is that of the UK company, owning the well known 'STUDIOMASTER' brand.
12.By deliberate misrepresentation and suppression of fact injunction has been obtained. The plaintiffs have filed the suit despite knowing that Soundking the true owner of the brand 'STUDIOMASTER' has filed two trademark applications before the Trademark registry in 2009 for registering the device mark and in 2019 for registration of the word mark 'Studiomaster' and they have filed application for removal of the marks registered by the plaintiff fraudulently and same are pending before the IPAB. The trademark 'STUDIOMASTER' and its variations are registered in over 16 Countries and the application by Soundking for registration of the trademark 'STUDIOMASTER' in India is pending.
13.Beside challenging the plaintiffs claim of exclusive right over the trademark ‘STUDIOMASTER’ based on alleged prior use and registration, the defendant also plead that the mark used by the defendant is distinct and distinguishable. Therefore there is no question of confusion or passing off. The suit is filed against a small dealer even without issuing cease and desist notice with the malfide intention to indirectly hinder the sale of the original Studiomaster UK products manufactured by Soundking, as a covert attack on their formidable competitor Soundking. 14.The plaintiff herein has filed the counter affidavit in the vacate stay Application No.8052 of 2019, wherein, it is stated that, they are the earliest applicants, adaptors, users and registered proprietors of the Trademarks 'Studiomaster' and 'Studiomaster Professional' in India. Whereas, the defendant has not filed any document or agreement to shown their authority to represent the alleged foreign parties, whom he claim to be the ownership of the marking question.
15.The defendant has not produced any document to substantiate the plea that, some of the third parties has filed rectification petition before the Intellectual Property Appellate Board (IPAB). In fact, the plaintiff has already issued cease and deceit notice to one 'Toyo Technical Service' on 07.02.2008. It has given letter to the Commissioner of Customs on 25.02.2008, not to permit import of products with impugned trademarks. When the plaintiff came to known about the trademarks application for 'Studiomaster' by the entity 'Ningbo Soundking Group Company Ltd' in the year 2009, they have filed notice of opposition against the said trademark and same is pending. When the plaintiff came across 'Nippon Enterprises South', marketing products under the plaintiffs' trademark 'Studiomaster' in the year 2018, issued cease and deceit notice to 'Nippon Enterprises South' on 05.11.2018. Pursuant to the receipt of the notice, Nippon Enterprises South has replied that Ningbo Soundking is alleged owner of the trademark 'Studiomaster' and Carlsbro. Nippon Enterprises South is the distributor of the Ningbo SouthKing Group Co Ltd. In the reply, Nippon Enterprises South has stated that, they are not using the plaintiffs' trademark and specifically admitted that plaintiff is the proprietor of the trademarks 'STUDIOMASTER' and 'STUDIOMASTER PROFESSIONAL'. Nippon Enterprises South had admitted to non-use of the plaintiffs' trademarks.
16.The plaintiffs had already taken action against Ningbo Southking Group Company Limited, before the Trademark Registry, therefore, the plaintiff's has not proceeded against those entities but only against the defendant, who is marketing products with infringed trademark. Denying the distribution agreement dated 22.03.2013 between Studioking Limited (UK) and Nippon Enterprises South, the plaintiff states that, the said agreement is invalid and the grant of distribution right to Nippon Enterprises South by Studioking Limited is without any authority.
17.The brand and trademark license agreement between the Studio Sound Limited, Recording Studio Design Limited and Soundking Group Co. Ltd dated 08th March 2008 is denied and invalid as there is no explanation/document as to how two different entities (Studiosound Limited and Recording Studio Design Limited) claim to be the alleged simultaneous 'legal and beneficiary proprietary right holders of the trademark/brand 'Studiomaster'. Further, the said document is truncated, incomplete and hence cannot be relied on.
18.The plaintiff in his counter would further state that, the plaintiff was manufacturers of all 'Studiomaster' products for the UK Company. The plaintiff applied for, obtained trademark registration for the mark Studiomaster and were also selling the products manufactured by them, in the Indian market, with full knowledge and co-operation of the UK Company since 1990. The said UK Company become bankrupt between 2000-2002, leaving the plaintiffs' with large unpaid bills in respect of goods already shipped. It refuse to honour the bills raised by the plaintiffs and ceased to respond to the plaintiffs' request. In order to recover the said loss, the plaintiff invested in the promotion of the brand 'Studiomaster' in India thereby creating a market, promoting the brand and building up a large customer base, filing trademark applications and seeking registrations.
19.Grant of injunction is based on the triple test namely balance of convenience, irreparable loss and prima facie case. While granting interim injunction this Court, on perusing the statement made in the plaint and records filed along with the plaint had granted interim injunction on 17.09.2019.
20. In the plaint, the plaintiff has contended in paragraph No.7, as below:-
'The 2nd plaintiff audio equipment and instruments, apparatus for transmission or reproduction of sound and images are sold under various trademarks of which one brand is 'STUDIOMASTER' which was conceived, coined and adopted in the year 1990 by the 1st plaintiff and the plaintiff is filing sales invoices from the year 2003. Apart from the above, the 2nd plaintiff is also known for their audio equipment sold widely in the name and style of STUDIOMASTER PROFESSIONAL. The plaintiffs' mission is to bring high performance products that have a hallmark of their legendary reliability, within reach of every user in the Country.' (emphasis added)
21.Based on this averment, this Court was convinced that there is a prima facie case made out by the plaintiffs that the ownership of the trademarks has been conceived, coined and adopted by the plaintiff. Whereas, after the petition to vacate injunction narrating the background of the impugned trademark, the plaintiff has come out with new theory admitting the ownership of the trademark with the UK Company but he has registered it, in his name, in India, after UK Company become bankrupt.
22.In said circumstances, it is essential to look into the documents filed by the defendants including the reply notice of M/s.Nippon Enterprises South, sent to the plaintiff on 18.12.2018.
23. Paragraph No.8 in the affidavit filed by Power of Attorney of the defendant in support of Application No.8052 of 2019 reads as below:-
(i).In the year 1976, the brand name STUDIOMASTER was created and adopted by a group of Audio equipment to overcome the shortcomings of the amplifiers at that time. They started with the Company name, 'Recording Studio Design (RSD), with the avowed goal of developing audio equipment capable of high quality sound for a wide range of commercial applications from studios to large live PA systems. In 1978, the amplifier 800B of highest power rate (800w) was produced. Foreseeing a breakthrough in amplifier design, the amplifier, Mosfet 1000(1000w) was launched by STUDIOMASTER in 1980 which far exceeded the power of 800B. By its commitment to quality, bolstered by in-house technical expertise, STUDIOMASTER created its own niche in pro-audio filed and has been enjoying a market reputation world over for the quality and stability of its amplifier products. Ever since Soundking acquired the brand STUDIOMASTER, having re-launched in the UK under the trading name Studioking, it has been rapidly expanding its operations all over the world. The products under the trademark STUDIOMASTER and variations thereof includes but are not limited to Mixer and power mixers, Amplification, Processors, Speaker Cabinet, Portable PA Systems Range, Line Array Range, Archive/Old Products Range, Asian Region Product Range, etc. With STUDIOMASTER producing mixing consoles, more and more STUDIOMASTER consoles are seen in studios and audio projects and has achieved numerous milestones over the years, some of which are detailed below:
|Invented the world's first VLM (Value Leadmaster)|
|Invent the world's first MIDI mixing console.|
|Launch the world's first entertainment mixing consoles.|
ii. There has been a popular demand for the STUDIOMASTER brand professional audio equipment all over the world, including India. The respondents/Applicants, recognizing the business potential owing to the brand reputation enjoyed by the STUDIOMASTER products took up the dealership of Studiomaster UK in the early 1990's. This fact is reflected in even in the documents relied upon by the respondents/Applicants and stands further corroborated by the following documents:
* Authorisation Letter dated 04.11.1998 authorizing the 1st respondent/Applicant to sell Studiomaster products. The Letter dated 04.11.1998 is annexed herewith and marked as Document 4.
* Authorisation letter furnished by Studiomaster Diamond Ltd., dated 16.09.1999, certifying that 'Audioplus', the respondents/Applicants herein is an exclusive Distributor for Studiomaster Products in India and that the Authorization is to be in force until cancelled or superseded. It is further stipulated therein that Audioplus is bound to act within the scope of the contract established by Studiomaster Diamond Ltd. The letter dated dated 16.09.1999 is annexed herewith
and marked as Document 5 24.In the reply notice issued on behalf of the Nippon Enterprises South, Chennai, the claim of the plaintiff regarding the ownership over the trademarks 'STUDIOMASTER PROFESSIONAL' is not been admitted and allegation that, the trademarks of the plaintiffs' are infringed by Nippon is also denied. 25.Thus, it is evident from the documents filed by the defendant and by admission of the plaintiffs in the counter that, the plaintiff is not the inventor of the name Studiomaster. The plaintiffs have suppressed the very vital fact in his plaint regarding the origin of the trademark 'STUDIOMASTER'. He has falsely stated in the plaint that, it was coined and conceived by them. Whereas, this trademark was coined, conceived and marketed by an UK Company and the plaintiffs were only distributor of that Company's product in India. 26.The history of the said trademark as narrated above indicates from UK Company the trademark assigned to Soundking, a China Company through whom the Nippon Enterprises South has taken distribution rights in India. The defendant is one of the dealers under the Nippon Enterprises South. The plaintiff, though aware of existence of Nippon Enterprises South and Soudking and the source for the product marketed by the defendant, suppressing the fact about pendency of dispute between them and 'Soundking', had laid the present suit and got injunction as if, the plaintiff is selling the infringed products procured from unknown source. Since the plaintiff has suppressed the material facts and obtained interim injunction, this Court is of the view that the interim injunction cannot be continued. Further, in view of the contentious issues, there is no prima facie case in favour of the plaintiff for the interim injunction. The contentious issue regarding the rights over the impugned trademarks can be decided only after full trial. Therefore, interim injunction granted by this Court in O.A.Nos.845 & 846 of 2019 stands vacated. Application No.8052 of 2019, is Allowed.