The Delhi High Court has delivered a pivotal clarification on the legal threshold for trademark protection under the Trade Marks Act, 1999, holding that mere use of a term as a corporate trade name - without active, consumer-facing use as a source identifier - cannot ground claims of infringement, passing off, or rectification. This judgment redefines the boundaries of protectable goodwill in the pharmaceutical sector, where corporate structure often obscures brand visibility.
Background & Facts
The Dispute
The dispute arose between two pharmaceutical entities: Rexcin Pharmaceuticals Pvt. Ltd. (Petitioner) and Rekin Pharma Pvt. Ltd. (Respondent). Rexcin, incorporated in 2003, claimed exclusive rights to the term 'REXCIN' since 2003, asserting its use as a trademark across multiple classes. Rekin, incorporated in 2017, registered the mark 'REKIN-SP' in Class 5 for pharmaceutical products and used it prominently on its medicines. Rexcin filed a rectification petition seeking cancellation of Rekin’s registration and a suit for injunction, alleging deceptive similarity and passing off.
Procedural History
- 2017: Rekin Pharma applied for registration of 'REKIN-SP' in Class 5 on a 'proposed to be used' basis.
- 2020: Rekin’s mark 'REKIN-SP' was registered by the Trademarks Registry.
- 2022: Rexcin filed applications for registration of 'REXCIN' in Classes 5, 16, 35, 44, and 45, claiming use since 2003.
- 2023: Rexcin filed C.O. (COMM.IPD-TM) 111/2023 for rectification of 'REKIN-SP' and CS(COMM) 142/2023 for injunction.
- 2024: The Court directed both parties to consider restricting use of 'REKIN' to corporate name only, but no settlement was reached.
Relief Sought
Rexcin sought cancellation of Rekin’s trademark registration under Section 57 of the Trade Marks Act, 1999, and an interim injunction restraining Rekin from using 'REKIN-SP' and its variants, alleging deceptive similarity, bad faith, and passing off.
The Legal Issue
The central question was whether use of a term solely as a corporate trade name, without active, consumer-facing application as a source identifier for goods, can establish prior rights, goodwill, or a basis for cancellation or injunction under the Trade Marks Act, 1999.
Arguments Presented
For the Petitioner
Rexcin contended that its long-standing use of 'REXCIN' since 2003, even as a trade name on invoices and packaging, constituted trademark use under Section 29(5) of the Act. It argued that Rekin’s mark 'REKIN-SP' was deceptively similar, adopted in bad faith, and likely to cause confusion among consumers. Rexcin relied on its registrations in Classes 16, 44, and 45, and its financial turnover to assert reputation and goodwill.
For the Respondent
Rekin countered that Rexcin never used 'REXCIN' as a trademark on any pharmaceutical product. It demonstrated that Rexcin operated exclusively as a B2B white-label manufacturer, selling products under third-party brands like 'Gentalene Plus' and 'Moisturex'. Rekin established its own prior use since 2017, with prominent display of 'REKIN-SP' on medicines, consumer-facing marketing, and registration in Class 5. It argued that no confusion existed despite eight years of coexistence, and that Rexcin’s petition was retaliatory, filed only after Rekin initiated a defamation suit.
The Court's Analysis
The Court conducted a rigorous examination of the statutory definition of trademark use under Section 29(6) of the Trade Marks Act, 1999, which explicitly lists permissible forms of use: affixing to goods, offering for sale, advertising, or importing/exporting under the mark. The Court held that incidental mention of a corporate name - such as 'manufactured for Rexcin' or 'trademark usership of Rexcin' - printed in small font on the reverse of packaging, does not satisfy this statutory threshold.
"The said products marketed by the Petitioner are sold under distinctive registered brand names... The Petitioner’s trade name appears inconspicuously on the product as the marketer and/or licensor of the trademark. In the considered opinion of the Court, such affixation... does not constitute use as a trademark for sale of goods within the meaning of Section 29(6)."
The Court distinguished the Petitioner’s reliance on Radheshyam Tourism v. Radheshyam Travels and Laxmikant V. Patel, noting that those cases involved active, consumer-facing use of the mark as a service identifier. Here, Rexcin’s business model was purely B2B, with no direct interaction with end consumers. The Court emphasized that goodwill cannot be inferred from turnover alone; it must be tied to the mark’s function as a source identifier.
The Court further rejected the application of Section 11(1) and Section 11(2), noting that Rexcin had no prior registration or pending application in Class 5 at the time Rekin filed in 2017. The absence of any evidence of actual consumer confusion, despite eight years of concurrent use, was decisive. The Court also dismissed the claim under Section 11(3)(a) for passing off, holding that without protectable goodwill in the mark 'REXCIN' as a source identifier, the foundational element of misrepresentation was absent.
The Verdict
The Petitioner lost. The Court held that mere use of a term as a corporate trade name, without active, consumer-facing use as a source identifier for goods, does not constitute trademark use under the Trade Marks Act, 1999. The registration of 'REKIN-SP' was upheld, and the injunction application was dismissed.
What This Means For Similar Cases
Trademark Use Must Be Consumer-Facing
- Practitioners must now prove that a mark is displayed on products or in advertising in a manner that identifies the commercial source to end consumers.
- Invoices, corporate letterheads, or incidental mentions on packaging are insufficient to establish trademark use.
- B2B manufacturers cannot claim trademark rights based on trade name usage if their products are sold under third-party brands.
Registration Alone Does Not Confer Priority Without Use
- A prior registrant cannot claim protection if it has not used the mark in commerce for the relevant goods.
- The Court confirmed that Section 11(1) and Section 11(2) require an 'earlier trade mark' that is either registered or well-known at the time of application - neither of which Rexcin established.
- Applicants must file for registration in the correct class and demonstrate actual use or intent to use in that class.
Passing Off Requires Demonstrable Goodwill
- To succeed in a passing off claim, the claimant must prove: (1) goodwill attached to the mark, (2) misrepresentation causing confusion, and (3) damage.
- The Court clarified that goodwill cannot be presumed from corporate history or turnover; it must be evidenced by consumer recognition of the mark as a source identifier.
- In pharmaceutical cases, where brand loyalty is high, courts will scrutinize whether the alleged mark is actually used on the product, not just in corporate disclosures.
