The Madras High Court has reaffirmed the principle that prior use and goodwill in a name are protectable under the law of passing off, even in the absence of trademark registration. In a dispute between a charitable trust and a private company, the Court held that the adoption of an identical name in the same field and locality is likely to cause confusion among the public, warranting a permanent injunction. This judgment underscores the common law rights of entities to protect their reputation and goodwill from misrepresentation, irrespective of statutory registration.
Background & Facts
The Dispute
The first plaintiff, Kovai Heart Foundation, is a public charitable trust registered on 22.11.1996, engaged in cardiac care, heart camps, and awareness programmes since 1992. The plaintiffs, represented by their trustees (plaintiffs 2 and 3), alleged that the defendants - Dr. V. Rajendran and M/s. Kovai Heart Foundation Private Limited - began using the name Kovai Heart Foundation Private Limited for their medical establishment around 2009. The plaintiffs contended that this use created confusion among the public, leading them to seek a permanent injunction on the ground of passing off.
Key Facts
- The plaintiffs commenced charitable activities under the name Kovai Heart Foundation in 1992 and formally registered the trust on 22.11.1996.
- The defendants incorporated M/s. Kovai Heart Foundation Private Limited under the Companies Act, 1956, and commenced operations around 2009.
- The plaintiffs claimed that the defendants’ use of the name was likely to mislead the public into believing an association between the two entities.
- The plaintiffs relied on documentary evidence, including trust records, communications, and pamphlets (Exs. A1 to A29), to establish prior use and goodwill.
- The defendants argued that the name Kovai Heart Foundation was not exclusive, as Kovai is a geographical reference to Coimbatore, and that the plaintiffs lacked a registered trademark.
Procedural History
- 15.06.2009: Original Suit (O.S. No. 763 of 2009) filed before the Principal District Judge, Coimbatore, seeking a permanent injunction.
- 04.10.2017: The trial Court decreed the suit, restraining the defendants from using the name Kovai Heart Foundation.
- 2018: The defendants filed the present Appeal Suit (A.S. No. 101 of 2018) before the Madras High Court.
- 19.11.2025: The appeal was reserved for judgment.
- 13.03.2026: The High Court dismissed the appeal, confirming the trial Court’s decree.
Relief Sought
The plaintiffs sought a permanent injunction restraining the defendants from using the name Kovai Heart Foundation or any deceptively similar name, on the ground of passing off.
The Legal Issue
The central questions before the Court were:
- Whether the incorporation of the second defendant company, or the absence of trademark registration in favour of the plaintiffs, operates as a bar to the suit?
- Whether the suit instituted by the first plaintiff trust, represented by its trustees, is maintainable?
- Whether the plaintiffs established prior use and goodwill in the name Kovai Heart Foundation?
- Whether the defendants’ adoption of the name Kovai Heart Foundation Private Limited is likely to cause confusion and amount to passing off?
- Whether the geographical or descriptive nature of the expression Kovai Heart Foundation defeats the plaintiffs’ claim?
Arguments Presented
For the Appellants/Defendants
- The second defendant, being a company incorporated under the Companies Act, 1956, is entitled to use its corporate name.
- The plaintiffs do not hold a registered trademark over the name Kovai Heart Foundation.
- The word Kovai is a geographical expression referring to Coimbatore and cannot be claimed exclusively by the plaintiffs.
- The plaintiffs, being a charitable trust, cannot claim exclusive rights over the name.
- There is no real likelihood of confusion or deception among the public, as the first defendant is a well-known cardiologist with an established reputation.
For the Respondents/Plaintiffs
- The plaintiffs have been using the name Kovai Heart Foundation since 1992, long before the defendants commenced their activities.
- The name has acquired goodwill and reputation among the public due to the plaintiffs’ charitable and medical activities.
- The defendants’ use of the identical name is likely to cause confusion and mislead the public into believing an association between the two entities.
- The suit is maintainable as the plaintiffs, represented by their trustees, are competent to enforce their rights in the name.
The Court's Analysis
The Court undertook a detailed examination of the principles governing passing off actions. It relied on several landmark judgments to establish the legal framework:
"The basic purpose of a passing off action is to protect the goodwill earned by prior use and to prevent any misrepresentation that is likely to mislead the public." (Pernod Ricard India Private Limited v. Karanveer Singh Chhabra, 2025 INSC 981)
The Court held that the absence of trademark registration does not bar a passing off action, as the law protects goodwill and reputation founded upon prior use. It rejected the defendants’ contention that incorporation under the Companies Act confers immunity against such actions, emphasizing that the civil court’s role is to examine whether the subsequent use of a corporate name constitutes actionable misrepresentation.
On the question of maintainability, the Court held that the plaintiffs, as a trust, could enforce their rights through their trustees, as the claim was based on goodwill attached to the name rather than statutory monopoly.
The Court then examined whether the plaintiffs had established prior use and goodwill. It accepted the trial Court’s finding that the plaintiffs’ documentary evidence (Exs. A1 to A29) demonstrated continuous use of the name since 1992, long before the defendants’ incorporation in 2009. The Court clarified that the decisive question in a passing off action is not whether the plaintiffs operated a hospital identical to the defendants’, but whether the name had acquired goodwill and public association through its use in charitable and medical activities.
Addressing the likelihood of confusion, the Court applied the settled principle that the test is not one of meticulous comparison but of the impression left on a person of average intelligence and imperfect recollection. It held that the dominant part of the defendants’ name (Kovai Heart Foundation) was identical to the plaintiffs’, and the addition of Private Limited did not materially distinguish it. The Court noted that both parties operated in the same field (heart care) and locality (Coimbatore), increasing the likelihood of confusion.
The Court also rejected the defendants’ reliance on the personal reputation of the first defendant, holding that the question was not about professional competence but whether the name adopted was likely to mislead as to source or association.
On the geographical nature of the expression Kovai, the Court held that the dispute was not about the word Kovai alone but the composite name Kovai Heart Foundation. It emphasized that distinctiveness in passing off law may reside in the totality of the expression and the goodwill it denotes.
Finally, the Court dismissed the plea of delay and acquiescence, holding that mere delay does not defeat a claim for injunction where the complained-of use is continuing and the likelihood of deception persists.
The Verdict
The Appeal Suit was dismissed, and the judgment and decree dated 04.10.2017 passed by the Principal District Judge, Coimbatore, in O.S. No. 763 of 2009, was confirmed. The defendants were permanently restrained from using the name Kovai Heart Foundation or any deceptively similar name. The appellants were directed to pay the costs of the appeal to the respondents.
What This Means For Similar Cases
Prior Use and Goodwill Trump Trademark Registration
- The judgment reinforces that prior use and goodwill are protectable under the law of passing off, even in the absence of trademark registration.
- Entities relying on common law rights must maintain robust documentary evidence (e.g., trust records, communications, pamphlets) to establish prior use and reputation.
Composite Names and Geographical Expressions
- The Court clarified that geographical expressions (e.g., Kovai) cannot be monopolized in the abstract, but composite names (e.g., Kovai Heart Foundation) may acquire distinctiveness through use.
- Practitioners should focus on the totality of the expression and the goodwill it has generated, rather than isolating individual words.
Corporate Incorporation Does Not Confer Immunity
- Incorporation under the Companies Act does not immunize a corporate entity from passing off actions if the adopted name invades the goodwill of a prior user.
- Courts will examine whether the corporate name constitutes actionable misrepresentation, irrespective of statutory incorporation.
Confusion and Deception in Passing Off
- The test for confusion is the impression on a person of average intelligence and imperfect recollection, not meticulous comparison.
- Where parties operate in the same field and locality, the likelihood of confusion is heightened, warranting injunctive relief.
- The dominant part of the name (e.g., Kovai Heart Foundation) is critical; corporate suffixes (e.g., Private Limited) may not sufficiently distinguish the name.
