Subway Trademark Case

Subway Trademark Case: All you need to know

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This article on “Subway Trademark Case: All you need to know” was written by Shudhi Malhotra, an intern at Legal Upanishad.

Introduction

Delhi High Court: In a case where Subway sought an injunction for its mark “SUBWAY” against the mark “SUBERB,” C. Hari Shankar, J. dismissed the application and held that after Infinity Food made changes to the decor, layout, the wall hanging, menu cards, and staff and outlet uniforms, the mark’s appearance could not be said to be confusingly similar to Subway’s device mark, “SUBWAY.” A case of trademark infringement brought by the international fast food chain against Suberb, a Delhi-based restaurant, was dismissed by the Delhi High Court. A “sub” is not only a sandwich from Subway. According to the court, the term “sub” is frequently used to refer to submarine sandwiches, which are made using a cylindrical bread roll that has been split down the middle and is filled.

What is Trademark?

  • A trademark is a symbol, design, word, or phrase that associates a company with its goods or services.
  • As soon as a trademark is registered, the owner is granted “exclusive rights” to use it.
  • The trademark registration process is governed by the Trademark Act, of 1999. A trademark that is registered with the Controller General of Patents, Designs, and Trademarks, generally known as trademark registration, is guaranteed protection under the Act.
  • A trademark has a ten-year lifespan and may be perpetually renewed by the owner every ten years.

Infringement of a Trademark

A registered trademark is violated or infringed upon when used without the consent of the organization that owns the trademark.

It may also be illegal to use a mark that is substantially similar to similar products or services. Courts must decide in these situations whether consumers will be confused between the two as a result.

A trademark can be violated in a variety of ways. The trademark holder must, however, demonstrate that the mark has a distinctive character.

Deceptive similarity- According to the law, a mark is regarded misleadingly similar to another mark if it closely resembles the other mark and causes consumer confusion. Such trickery may be produced aesthetically, architecturally, or phonetically.

Passing off- Let’s take the example of a brand emblem that is difficult for customers to understand because of a misspelling. The allegedly infringing commodities need not be identical in these situations; rather, it is necessary to demonstrate that the rival traders’ goods are comparable in terms of their essence, character, and functionality. (Cadila Pharmaceuticals Limited v. Cadila Healthcare Limited, 2001) Essentially, it is necessary to prove some sort of fraud, misrepresentation, or harm to the goodwill and reputation of the owner of a mark to claim “passing off.”

Background of the Subway Trademark Case

The plaintiff (Subway) was a U.S.-based corporation that ran a well-known international chain of restaurants by that name. In addition to owning the registrations for the “SUBWAY” word and device marks in India, the plaintiff also held registrations for the names “SUBWAY CLUB” and “VEGGIE DELITE,” which it used for its club sandwich and vegetable sandwich, respectively. Defendants 3 and 4 were partners in the partnership firm represented by Defendant 1 (Infinity Food).

Defendants 3 and 4 were licensees of the plaintiff to whom the plaintiff had granted the right to franchise the plaintiff’s outlets, and they had been serving and selling the plaintiff’s products through the outlets they operated since 2019.

Submission on behalf of the Plaintiff

According to Subway, Infinity Food violated its intellectual property rights by doing the following:

  • The use of the “SUBWAY” brand name and logo, with a matching yellow and green color scheme, for the two restaurants owned by Infinity Food.
  • Usage of the names “VEGGIE DELICIOUS” and “SUB ON A CLUB,” which were confusingly close to Subway’s registered trademarks for “VEGGIE DELITE” and “SUBWAY CLUB.”
  • Use of the same or similar menu cards, paper napkins, signage, store decor, and staff uniforms.
  • The use of images and wall art in their locations that were comparable to those in Subway’s locations.
  • Using the same methods, processes, and ingredients for meal preparation as those used in Subway outlets and placing the service counters in the restaurants in the same location.
  • Recitals on the Subway website were copied word for word and formatted similarly on the Infinity Food website.

Submission on behalf of Defendants

Infinity Food offered to:

  • (a) change the color scheme of the exterior signage of their restaurants to a combination of purple, pink, white, or red;
  • (b) change the color of their logo to a combination of one or more of the aforementioned colors;
  • (c)  refrain from using the colors yellow or green in either the signage or the logo;
  • (d)  take down their website that copied the text from Subway’s website, and (e) change the names of their sandwiches “VEGGIE DELICIOUS” and “SUB ON A CLUB” to “VEG LOADED REGULAR” and “TORTA CLUB”.
Subway Trademark Case
Subway Trademark Case: All you need to know

Law, Analysis, and Judgment

The Court stated that Subway was not pleased with the adjustments made by Infinity Food since the word marks “SUBWAY” and “SUBERB” were confusingly similar to one another as word marks and would still be confusing even if the color scheme of the said marks were changed. Further noted by the court was Infinity Food’s argument that Subway could not assert exclusivity over the initial

“SUB” portion of the “SUBWAY” mark since “SUB” was generic about the goods in connection to which it was used. The question put to this Court was, “Whether, after the modifications that Infinity Food had made, it could still be considered to be infringing Subway’s registered trademark, or passing off its goods and services as those of Subway, to entitle Subway to an injunction?”

The court pointed out that under Section 29 of the Trade Marks Act, 1999 (Act), only registered trademarks could be infringed upon, and Section 28 of the Act provided protection for marks that already had registrations, like the word mark and device mark “SUBWAY,” both of which were owned by Subway. To receive protection from this Court against infringement, Subway was not authorized to use any other registered trademarks.

The Court further noted that Section 17(2) of the Act prohibited dissection of a trademark and the assertion of exclusivity in respect of a portion of the mark (anti-dissection rule) as well as the assertion of infringement in respect of any matter that was common to the trade or otherwise of a non-distinctive character (public Juris).

The Court opined that Infinity Food’s mark “SUBERB” could not be said to infringe any of Subway’s word mark or device mark as “SUBERB” was not phonetically similar to “SUBWAY” though both were words of two syllables. The first syllable “SUB” was common and “SUB”, when used in the context of sandwiches, was well known that it was an abbreviation for “Submarine”, which represented a well-known variety of long-bodied sandwiches, generally 6 or 9 inches in length.

“SUB” was therefore, public Juris when used in the context of such eateries, and thus, no exclusivity could be claimed by Subway over the first part of its registered “SUBWAY” mark, that is, “SUB”. Moreover, once the “SUB” part of the “SUBWAY” mark was out of the way, there was quite obviously no similarity at all between “WAY” and “ERB”.

The Supreme Court ruled in J.R. Kapoor v. Micronix India, 1994 Supp (3) SCC 215, that no exclusivity could be claimed over the prefix “Micro” and that no infringement could be claimed because the suffixes “Nix” and “Tel” were phonetically and otherwise dissimilar. The Division Bench of this Court concluded that “Temokem” was not confusingly similar to “Temoget” when used for pharmaceutical products containing temozolomide in Schering Corporation v. Alkem Laboratories Ltd, (2009) SCC OnLine Del 3886.

Conclusion

The court determined that Infinity Food’s red and white “SUBERB” mark was no longer confusingly similar to Subway’s device mark following the alterations made by Infinity Food. Additionally, the changes made to the two marks “VEG LOADED REGULAR” and “TORTA CLUB” would put an end to any claims of infringement because “CLUB” and “VEG” were public Juris. A passing-off claim had not been established, according to the court, and Subway was not entitled to an injunction due to the alterations made by Infinity Food. As a result, the request for an interim injunction was denied.

References

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