Trademark/ Copyright Infringement: No Jurisdiction Based On Location Of Branch Office Where No Part Of Cause Of Action Has Arisen- Madras High Court

In a significant order, Madras High Court has given clarity about the interpretation of the phrase "actually and voluntarily resides or carries on business or personally works for gain" in Section 134(2) of Trade Marks Act and Section 62(2) of the Copyright Act, which determines the territorial jurisdiction of the courts concerned. In an application filed by the defendant challenging the territorial jurisdiction of the Commercial Division of the Court to adjudicate on an alleged trademark and copyright infringement, Justice Anand Venkatesh has observed that the discretion of plaintiff to file a suit where the plaintiff carries on business is not unconditional. Unlike Section 20 of CPC which requires the plaintiff to file a suit in a court where the defendant resides or carries on business/ where the cause of action wholly or in-part arises or the civil jurisdiction of High Court under Clause XII of Letters Patent Act, specific provisions incorporated in these Acts offers the plaintiff favourable avenues. Even though the plaintiff has no impediments to invoke a court's jurisdiction in such infringement suits, quite contrary to the placement of plaintiff in normal civil suits, the said liberty comes with a caveat: "If suit is filed only based on the situs of the branch office, such a suit can be maintained only if the plaintiff is able to show that at least a part of the cause of action had arisen within the place where the branch office is situated. If suits are allowed to be filed only based on the branch office and nothing more, it will lead to mischievous consequences.", the court recorded in the order. Facts Of The Case The plaint alleges that in December 2019, the respondent found out that the applicant is manufacturing and distributing product with the respondent's registered trademark and the copyright in the artistic work of their label, mainly in Karnataka. The principal place of business of the defendant is at Sivakasi. The place of business of the applicant is Gudiyatham. The respondent filed the suit before High Court contending that the presence of a branch office at Chennai will confer the court with the required jurisdiction to try the case under Section 134(2) of the Trade Marks Act and Section 62(2) of the Copyright Act. Arguments Raised The applicant counsel (defendant in the commercial suit) heavily relied on the apex court judgment in Indian Performance Rights Society v. Sanjay Dalia (2015) whereby it was held that: "The provisions of Section 62 of the Copyright Act and Section 134 of the Trade Marks Act never intended to operate in the field where the plaintiff is having its principal place of business at a particular place and the cause of action has also arisen at that place so as to enable it to file a suit at a distant place where its subordinate office is situated though at such place no cause of action has arisen." The respondent counsel (plaintiff in the commercial suit) drew the court's attention to Madras High Court judgment in Hindustan Unilever Ltd. v. Andhra detergents (2017) and it was his submission that even a branch office of the plaintiff would give a cause of action to maintain a suit before the court according to this judgment. The respondent counsel added that the Supreme Court judgment in Sanjay Dalia was considered in the Hindustan Unilever case,and it was after such consideration that the court held even a branch office of the plaintiff would give a cause of action to maintain a suit before this Court. The counsel attempted to convince the court that Madras High Court has already settled the issue via Hindustan Unilever and it's no longer res integra. Court's Findings Situs Of Branch Office & Territorial Jurisdiction In Wipro Ltd. & Anr. v Oushadha Chandrika Ayurvedic India (P) Ltd. & Ors. (2008), wherein it was unanimously ruled that the term "carries on business" in both Acts is not confined only to the principal place of business, but also any other place where business activities are carried out including branches. Fast forward, in 2015, when the apex court pronounced the judgment in Sanjay Dalia, it referred to the interpretation given to "branch office" in the amended Section 17(2)(b) of Consumer Protection Act, in the case-law of Sonic Surgical v. National Insurance Co. Ltd. In the said case, the court had underscored that the term "branch office" as used in the amended Section 17(2)(b) has to be interpreted to mean only that branch office where the cause of action has arisen. Madras High Court also took into account the primary consideration of the apex court in Dalia, which was even upheld in the latest judgment of Madras High Court in Hindustan Unilever Limited Ponds House v. S. Shanthi (2021): "The Hon'ble Supreme Court was extremely concerned that Section Section 134(2) of the Trade Marks Act and Section 62(2) of the Copyright Act may be...

Trademark/ Copyright Infringement: No Jurisdiction Based On Location Of Branch Office Where No Part Of Cause Of Action Has Arisen- Madras High Court

Sebin James

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