The Hon’ble HC earlier today on 27th April 2021 while hearing the parties in the instant case of PhonePe versus. Ezy Services & Ors stated that “PhonePe” and “BharatPe” are both composite marks and the plaintiff cannot claim exclusive ownership over the “Pe” suffix.
In the present case, the Hon’ble Delhi High Court after considering the submissions made by both the parties has refused to pass an interim relief order against “BharatPe” while holding that the mark “BharatPe” is not in violation of the trademark held by “PhonePe”.
The Hon’ble Delhi HC while passing the judgment earlier this month stated that parties are not supposed to misspell generic words to claim exclusive ownership unless there is any evidence of such misspelling achieving secondary meaning. Subsequently, the judgment was passed by the Hon’ble Single Judge bench, who nevertheless directed “BharatPe” to keep accounts of the amounts earned as a result of the use of the mark and to file half-yearly audited statements.
In the instant matter during the ongoing proceedings PhonePe (plaintiff) in its suit before the Hon’ble High Court, submitted that “Pe” was an “invented word” and was an essential, dominant and distinguishing feature of its registered trademarks in the name of “PhonePe”. Additionally, it was also argued by the plaintiff that usage of “BharatPe” (defendant), which offers “identical services”, infringed/ violated its registered trademark and also amounted to passing off.
In continuation, the plaintiff also emphasized that a consumer of average intelligence and imperfect recollection, on seeing the defendants’ mark “BharatPe”, would notice the “Pe” suffix and associate the services of the defendant with that of the plaintiff.
Subsequently, the defendant, on the other hand, contended that the plaintiff was not the registered proprietor or permitted user of the word “Pe”. Likewise, the registration by the plaintiff was over the entire word “PhonePe” and the same cannot be separated.
Additionally, the defendant also claimed that the two marks i.e. PhonePe and BharatPe were visually, phonetically, and structurally different when viewed as a whole and that the BhartPe mark was being used since 2016, adding that the idea behind the mark was to build a single QR code for merchants to facilitate the making of payments across all consumer UPI-based applications, and hence the tagline, “Bharat Pe Sab Chalta Hai”.
In furtherance, it was also argued by the defendant that the suffix “Pe” is purely a misspelling of the word “Pay” and no exclusive ownership rights could be enforced in respect of such a word unless it has acquired a secondary meaning concerning the plaintiff’s business.
However, after analyzing the provisions of the Trademarks Act and a plethora of judgments on the issue of trademark infringement, the Hon’ble Court culled out the legal position as follows:
- Exclusivity can be claimed, and infringement/passing off alleged, only in respect of the entire mark, not in respect of a part thereof.
- It is open, however, to assert infringement of a part when the part so copied is the dominant part of the essential feature;
- No exclusivity can be claimed over a descriptive mark or a descriptive part of the mark even by misspelling it unless it has acquired a secondary meaning;
- Whether a mark has acquired secondary meaning requires evidence of members of the public testifying to that effect;
- Where the defendant also makes out a case of extensive use of its mark, it militates against any acquiring of secondary meaning by the mark of the plaintiff.
Furthermore, after applying the above principles to the facts and case at hand, the Hon’ble Court is of the opinion that no case for any interim relief to PhonePe had been made out.
Moreover, the Hon’ble Court opined that there may be substance in the plaintiff’s claim that the “Pe” suffix, which undeniably connotes the expression and meaning “pay”, constituted the dominant part of the essential feature of the “PhonePe”.
Yet, at present, the “plaintiff to establish that the “Pe” suffix had acquired distinctiveness, and a secondary meaning, to the extent that the consuming public would invariably associate the “Pe” suffix as relating only to services provided by the plaintiff, it may, nevertheless, have been able to make out a case of infringement. This, however, is essentially a matter of trial. The plaintiff has been in business only since 2016, using the “PhonePe” mark. The defendants have also claimed extensive use of their “BharatPe” mark. This, too, constrains the Hon’ble Court from arriving at any prima facie conclusion that the “Pe” suffix had acquired secondary meaning, invariably associated with the plaintiff,” the Hon’ble court remarked while passing the judgment.
Finally, the Hon’ble Court opined that barring the common “Pe” suffix, the two marks were not confusing or deceptively similar. Accordingly, the Hon’ble Court dismissed the application for an interim injunction against the defendant, opining that no case for the same was made out.