By Advocate Vishwanathan Iyer
The recent battle between the Lodha brothers themselves over use of the brand name “Lodha” is a reason for serious concern in the legal community about protection of long-established family names in business. Is a common surname so familiar that it is known within a specific sector of business capable of being monopolized by one party? Or do both brothers hold equal ownership of the brand while jeopardizing consumer confusion?
Indian law of trademarks has seen a series of high-profile cases in which the courts have ruled on the distinctiveness of surname-based brands. From Bajaj Electricals Ltd. vs. Metals and Allied Products to Kirloskar Diesel Recon Pvt. Ltd. vs. Kirloskar Proprietary Ltd., the judiciary has all along held the view that a brand name—especially one that has acquired goodwill—deserves protection, even if it happens to be based on a family surname.
A striking resemblance to the Lodha case is the Bajaj Electricals Ltd. vs. Metals and Allied Products case where the Bombay High Court ruled in favor of Bajaj Electricals, that “Bajaj” name was heavily associated with their business and that use by another company—although bearing the same surname—could lead to confusion among consumers.
Similarly, in the case of Lodha dispute, the question is: Can both brothers use the “Lodha” name singly without creating confusion in the real estate business?
The Kirloskar Diesel Recon Pvt. Ltd. vs. Kirloskar Proprietary Ltd. has laid judicial precedent that family names are trademarked and that it transcends similar products if consumer confusion can be expected.
“A well-known brand name, even if the source is a family surname, is exclusively protected,” Bombay high court had held in 1991.
“Even relatives cannot use the same surname for business purposes if it leads to deception,” the verdict went on.
So even if Lodha is a family name it may be of the organization which has earned tremendous reputation and market identification with the brand, and that is Macrotech in this case.
In Montari Industries Ltd. v. Montari Overseas Ltd., the Delhi High Court in 1995 restrained Montari Overseas from trading in the name of “Montari,” emphasizing the need for distinct corporate identities. The ruling emphasized the legal protection for not using names that could confuse consumers or take benefit from another company’s reputation.
If the Lodha case is to take a cue from this, the court may rule in favor of the brother who has more business affiliations to the “Lodha” brand over time and has made a greater contribution to its market value.
In Mahindra & Mahindra Paper Mills Ltd. v. Mahindra & Mahindra Ltd., the Bombay High Court determined that “Mahindra & Mahindra” had developed distinctiveness and secondary meaning in trade, thereby causing consumers to associate it with a quality of goods and services. The papermill was disallowed from making use of “Mahindra & Mahindra” on the grounds that it created a suggestion of connection with a strongly established brand name.
In Dr. Reddy’s Laboratories Ltd. v. Reddy Pharmaceuticals Ltd., the court observed that Dr. Reddy’s Laboratories developed considerable goodwill since 1984, and the subsequent use by Reddy Pharmaceuticals of the “Reddy” name in 1996 would lead to confusion, misrepresentation and was not in good faith.
Similarly, in the Lodha dispute case, if a brother’s use of the name is considered an attempt to ride free on the goodwill of a popular brand, then the court may intervene and prevent consumer exploitation.
The Lodha case is a quintessential example of how surname trademarks breed family wars over the ownership of a brand. The legal precedents set by Bajaj, Kirloskar, Montari, Mahindra, Dr. Reddy’s provide a strong foundation for the Lodha brothers’ case.
The issues in this case are – who built the reputation of the Lodha brand in real estate? Did Lodha brand acquire a secondary meaning and does it connote a particular business entity?
In industries like real estate, where the brand’s reputation has a direct bearing on sales and consumer trust, resolution of this issue will be crucial.
