Companies looking to encash on a rival’s reputation by launching a phonetically similar brand beware! The Delhi High Court has warned that such deceptive marketing techniques need to be curbed.
The court’s warning came during the hearing on a dispute involving two pharmaceutical companies.
Justice VK Jain restrained Omax Healthcare Pvt. Ltd. from making a cough syrup under the brand name Orex as it sounded like Pfizer Products’ popular cough syrup by the name Corex.
Holding that companies cannot cash in on reputation of popular brands by deceptive means, the court said: “A competitor cannot usurp the goodwill and reputation of another by adopting a mark similar to the established mark of its competitor and thereby cause injury to the reputation and business of that person.”
“Any attempt on the part of another person to encash upon the brand value generated by another person needs to be curbed by the court,” said Justice Jain in his order delivered earlier this month.
Directing Omax Healthcare to pay Rs.1 lakh as punitive damages, the court said: “It is difficult to dispute that the mark Orex is phonetically so close and similar to the word Corex that it may not be possible for an ordinary buyer of a cough expectorant to distinguish the products.”In fact, the defendants (Omax Healthcare) have adopted four out of the five words in the registered trade mark Corex of the plaintiff (Pfizer) as its trade mark. So punitive damages have to be paid,” the judgment said.”The courts also need to ensure that there is no confusion in the mind of the consumer as to the source of the product which he is buying. The customer needs to be assured that he buys the same product which he prefers and identifies by its name,” the court observed.Pfizer, a multi-national pharmaceutical company, moved court seeking injunction against Orex saying that its Corex cough syrup was one of their top selling products and was a highly sought after drug for treatment.
It also alleged that there was likelihood of customers getting induced to believe that the product offered by the defendant was of the same quality as the product of the plaintiff.
“We cannot be oblivious of the fact that despite statutory requirements, the chemist and druggist in our country do not hesitate in selling drugs such as cough syrups and expectorants, without insisting upon prescription by a medical practitioner, even if such a prescription is statutorily required,” the court said.
“Drugs such as cough syrups are available over the counter without medical prescription and such similarity in brands would make an impression that they were buying the product of the company which is reputed and well-known,” the court said.