In a judgment dated 10th of September, 2012 a Division Bench of the Madras High Court declined to set aside the judgment dated 30th September, 2010, of a Single Judge of the same court, declining to grant Consim Info Pvt. Ltd. an interim injunction in a trademark infringement lawsuit against Google & other internet marriage portal which compete with Bharat-Matrimony.com an internet marriage portal which is owned by Consim. The judgment can be accessed over here.
For our post summarizing the previous judgment, along with the facts, please click over here. It should also be noted that apart from this lawsuit, Consim has also dragged Google to the Competition Commission of India (CCI) alleging violations of India’s Competition Commission Act, 2002. That post is available over here.
The final order of the Madras High Court was rather peculiar, in the sense that the judges concluded that despite Consim, being entitled to an interim injunction it was not going to grant them the same because of the fact that three years had passed since the first interim order and that the judges would prefer the matter proceed through a speedy trial since they were several factual questions at dispute.
A. Google’s allegation against Yahoo
In an interesting twist, Google has alleged before the Division Bench that Consim had filed the present trademark infringement suit at the behest of Google’s competitor – Yahoo! Google has stated in open court that Yahoo is a strategic investor in Consim and that Yahoo was not being sued by Consim despite it offering similar trademark services as Google. In pertinent part Google stated “Yahoo! is a strategic investor and shareholder in Consim. Yahoo! is also doing the same alleged infringement of trademarks of Consim but no action has been initiated against them. While not initiating action against other infringers is no defence by itself, that the fact that Yahoo! was an investor in Consim, makes the action to be suspected and the suppression of this fact would disentitle Consim for any relief of injunction.”
Although the Madras High Court mentions this fact in its judgment, it completely ignores the argument in its final conclusion and understandably so since the argument has little legal merit and to the best of my knowledge was not made before the Single Judge. Nevertheless, I though it necessary to point this out because it shows us how surrogate corporate battles are played out.
B. The allegations of suppression made by Shaadi.com
In an earlier post, I had discussed an application filed by Shaadi.com at the stage of appeal alleging that Consim has suppressed several material facts regarding the true status of its registered trademarks. For that post, you can click over here. In its final judgment, the Madras High Court dismissed these applications on the grounds of delay and lack of an adequate explanation as to why these documents were not argued before the Single Judge. The Court has however stated that the Defendants were at liberty to produce all such documents during the stage of trial.
C. On alleged confusion to consumers & double standards by Google Ad-words’ policy
The Division Bench appears to have come to an unequivocal conclusion that the manner in which sponsored links were being displayed by the Google Adwords program, in response to the keying in to the search engine the competing trademarks, would cause confusion amongst the consumers. The Court also seems to frown upon the choice of the ‘keywords’.
In pertinent part, in para 46 the court states “The respondents 1 and 5 could have used some other words as key words on the sponsored links. The action of the respondents 1 and 5 would only create confusion in the mind of the Public.”
In para 54 of its judgment, the Madras HC also alleges that Google is guilty of double standards in its approach towards resolving ad-words disputes. In pertinent part, the Court states the following:
“As already held by us, the respondents 1 and 5, Google has been adopting double standards, since the benefit given to the respondents 2 to 4 were not given to the appellant. Had Google adopted uniform standard for appellant on par with the respondents 2 to 4, one can say that the Google has not adopted double standards. But, in the case on hand, there is a clear discrimination between the appellant and the respondents 2 to 4. However, as stated by the learned Judge we are also of the opinion that this issue can be examined only at the time of trial.”
I do not understand what the Court is saying at this point. It does not explain clearly as to what it means by double-standards. Any comments on this point are more than welcome?
Also on the point of confusion, the reasonable consumer is presumed to be able to distinguish between the ‘organic’ search results and the ‘sponsored links’ displayed either on top off or on the right hand side of the ‘organic’ search results. Would a reasonable consumer be confused between ‘organic’ search results and ‘sponsored link’? Maybe they would, maybe they wouldn’t! But the court does not really analyse the confusion angle from this perspective. Did Google make this argument?
One of the key factors which swung the judgment in favour of Google and Consim’s competitors in the last round before the Single Judge in 2010 was the judge’s interim finding that the registered trademarks of Consim that were at issue were highly descriptive. The Single Judge went as far as to hint that if the marks in question were more distinctive, he would have ruled differently.
An appellate court has very limited grounds for review and when it is clear that the ‘descriptiveness’ or otherwise of the marks involved made such a significant impact on the ruling of the Single Judge, it is paramount that the appellate court analyse this portion of the judgment. Surprisingly, the Appellate Court is silent on this point and presumes instead that Consim’s trademarks are strong. In part the Court seems to have made this presumption on the basis of Section 31 of the Trade Marks Act which grants a presumption of validity in the favour of all registered trademarks. True as that may be most High Courts do make a prima facie finding at the interim stage because all of us know that examination at the Trade Mark Registry is not as stringent as it should be.
Given that both Shaadi.com and Google have raised serious objections pertaining to the validity of Consim’s trademarks, it is likely that atleast Shaadi.com along with Consim’s other competitors will challenge the suspect trademarks before the IPAB. If they do so, they are entitled to seek a stay of the infringement lawsuit pending before the Madras High Court.
However regardless of any challenge before the IPAB, I’m willing to bet that both parties are ready to file cross-appeals before the Supreme Court and it is very likely that the Supreme Court will admit the plea on limited grounds.