Infosys Limited Vs. Southern Infosys Limited Case On Trademark Infringement

Introduction

The case revolved around the unauthorised use of the Infosys trademark by Southern Infosys Limited. The High Court of Delhi delivered its judgment on May 27, 2024. This is an important ruling that underscores the importance of trademark protection and issues of infringement. This case is a name closely similar to the well-known Infosys Limited. The High Court judgment emphasised the legal principles governing trademark infringement and performed duties as cautionary tales for companies regarding the diligence required to select company names.

Background

Infosys is a plaintiff. This is one of the top leaders in IT Services.  Infosys trademark was adopted and registered as this trademark Infosys in 1987, and it has been used continuously till now.

The www.Infosys.com website has been under the maintenance of Infosys since 1992. On July 18, 2023, the plaintiff² observed unauthorised use of the Infosys trademark and informed the defendant about it. Despite this, the defendant failed to respond. According to section 29(5) of the Trademark Act¹, it is alleged that Southern Infosys Limited maliciously adopted the “Infosys” trademark to the detriment of the plaintiff. So Infosys sued to restrain the defendant³ from using their mark as their company name.

Plaintiff’s Arguments

The Infosys trademark has been used since 1981. The Infosys Limited World trademark is fashionable and has a positive reputation and goodwill. Infosys Limited obtained many registrations for the mark in various classes, the first being in 1987, and the company has been operating its website, wwww.Infosys.com, since 1992. Increase the mark link with Infosys.

The plaintiff argued that Infosy’s brand value in this trademark could mislead consumers into presuming a connection between the two companies. This is the main problem with Infosys Limited’s reputation and brand value. Infosys said in court that its ability to sell itself and its growth in India and other countries showed how important it is to businesses today.

Defendant arguments

The defendant argued that Infosys had previously issued a cease and desist notice on 27/04/2024 but failed to complete it. The defendants argued that this omission was a tactic for inadequate disclosures to the court.

The defendant contended that they have been using the name Southern Infosys Limited without any limitations from Infosys Limited since 1998. They emphasised that since 2000, the plaintiff has been aware of Southern Infosys Limited’s existence. The defendant contended that since the plaintiff hasn’t filed a lawsuit in more than 20 years, this should be considered tacit consent. As a result, the plaintiff shouldn’t be allowed to file a lawsuit.

The defendant contended that the word “Infosys” is merely a contraction of “information” and “systems,” suggesting it’s a generic descriptor for the services offered. This argument weakens the plaintiff’s claim of sole ownership of the trademark. Upon comparison of these two trademarks, it is asserted that the trademarks are different in appearance, and there exists clarity among the pertinent consumers.

Legal Issues

chances of infringement under Section 29(5) of the Trade Marks Act. 1999.  the Delhi high court held that trademark infringement happens only when the Defendant uses the registered trademark as part of their trade name and the Defendant captures in commerce concerning the services for which the trademark is registered.

The Court concluded that Plaintiff had been the registered owner of the trademark since 1987 and had first used this mark in 1981 based on the claims made by the two parties. People were confused when Disha Financial Services Limited used the Infosys mark as Southern Infosys Limited before September 30, 1998, when the company started working in the IT service. The Court said that small mistakes in the process that are properly fixed should not take away from the case’s main points when there is clear trademark abuse. Thus, the Court concluded that the Plaintiff’s omission is prima facie plausible and does not constitute purposeful concealment.

The court highlighted that the defendant chose to incorporate a trademark in 1998, but the plaintiff registered this in 1987. Moreover, the Defendant operates within the same sector as the Plaintiff. The court pointed out that before the company’s initial public offering, it should have diligently verified the appropriateness of its corporate name. The court interpreted the oversight as indicative of the company’s lack of good faith. Consequently, the Honorable Delhi High Court concluded that despite the Plaintiff’s considerable delay in filing the present lawsuit, this procrastination did not eliminate the Plaintiff’s right to challenge and seek protection against what seemed to be a clear infringement case. The descriptive character of the mark “Infosys” The Court, in determining the descriptiveness of the term “Infosys”, held that the term ‘Infosys’ may have begun as a potentially descriptive term. Still, due to the extensive and continuous use of the mark and the declaration of Infosys as a well-known trademark, the mark has acquired a secondary meaning that links it directly to Plaintiff, thereby making it a distinctive mark.

Judgement

The Delhi High Court, in ruling in favour of Infosys Limited, recognised Southern Infosys Limited’s unauthorised use and thus restrained the Defendant from using the mark “Infosys” as part of their corporate/trade name or in any other manner that would constitute trademark infringement of the Plaintiff. Given that Defendant has used the mark for an extended period.  The court allowed the Defendant a term of four weeks to change to a non-infringing tradename.

Conclusions

The case of Infosys Limited v Southern Infosys Limited discusses a robust legal framework for the protection of well-known trademarks in India. The decision underscored the judiciary’s firm stance in safeguarding trademark owners’ rights, particularly in precise ill-faith acquisitions and potential consumer confusion. This case is a solid reminder to firms and trademark owners to take prudence before acquiring trademark names, especially in the IT sector, where brand reputation and consumer confidence are critical. This ruling underscored the significance of prompt actions in trademark conflicts. Furthermore, it indicated the Court’s propensity to overlook procedural errors when confronted with solid evidence of infringement.

Author: GANESH THELU, in case of any queries please contact/write back to us at support@ipandlegalfilings.com or IP & Legal Filing

Reference:

• Manu/de/4097/2024. Infosys Limited vs . Southern Infosys Limited ( 27 . 05 . 2024 – DELHC )