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Business Standard
16-06-2025
- Business
- Business Standard
Impact on biz no valid reason to set aside injunction: HC on trademark row
The Delhi High Court has ruled that the adverse impact on business operations or plans to launch an IPO cannot be a valid reason to set aside an interim injunction in a trademark infringement dispute, LiveLaw reported. A division Bench comprising Justices Navin Chawla and Harish Vaidyanathan Shankar made this clear while hearing an appeal filed by Newgen IT Technologies. The company had challenged a district court order that restrained it from using the trademark 'Newgen', which was already in use by the respondent in the same business domain. 'In the present case, while the appellant has strenuously contended that the injunction has brought its business operations to a standstill and jeopardised its IPO plans, we are not persuaded by this line of argument,' the court held. 'The appellant cannot be permitted to continue deriving commercial benefit from a mark that, in our considered view, is similar to that of the respondent and clearly warrants restraint through injunctive relief.' Trademark dispute originated after business split The legal battle stems from a dispute between Newgen IT Technologies (the appellant) and VCARE InfoTech Solutions and Services (the respondent). Both companies operate in the field of software product development in India and had previously entered into a partnership agreement. After the agreement was terminated, the appellant adopted the name 'NewGen IT Technologies', prompting the respondent to approach the district court, alleging trademark infringement. The lower court found that the name adopted by the appellant was identical to that of the respondent and was likely to mislead or confuse consumers. Consequently, an ex-parte ad-interim injunction was issued against the appellant, the news report said. HC upholds finding of 'striking similarity' in marks In its appeal, Newgen IT Technologies argued that it had been using the mark 'NEWGEN IT' since 2017, both in India and internationally, and that the respondent had raised no objection until the dispute arose. However, the high court sided with the district court, agreeing that the two marks were 'strikingly similar' and that both companies operated in the same sector. 'Coupled with this is their association as partners under the Partnership Agreement. This similarity is capable of causing confusion in the minds of an average consumer, thereby justifying the grant of an ex-parte ad-interim injunction in favour of the Respondent/Plaintiff,' the Bench observed. The court further noted that the appellant began using the term 'NEWGEN' around the time the partnership with the respondent ended. This timing, according to the Bench, raised serious doubts about the genuineness of the adoption, LiveLaw reported. As the judgment stated, the timing 'cannot be considered as a bona fide adoption". International use no defence without local reputation On the argument that the respondent had knowledge of the appellant's use of the mark in other jurisdictions, the court emphasised the territorial nature of trademark rights. 'It must be remembered that trademark protection is territorial in nature; the use of the mark in one jurisdiction does not ipso facto lead to the generation of goodwill or protection in the other jurisdiction,' the court held. It added that protection in another country can only be extended if there is demonstrated use or transborder reputation of the mark in that jurisdiction — criteria the appellant failed to meet, the news report said. Finding no merit in the arguments advanced by Newgen IT Technologies, the Delhi high court dismissed the appeal, allowing the interim injunction granted by the district court to remain in force.
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Business Standard
12-06-2025
- Business
- Business Standard
Delhi HC restrains Newgen IT Technologies from using 'Newgen' trademark
The Delhi High Court on Thursday dismissed appeals filed by Newgen IT Technologies, upholding an injunction that restrains it from using the 'Newgen' mark. The court found the company's use of the name deceptively similar to that of Newgen Software Technologies, a trademark holder since 1992. It said the present case must be viewed in the context of the prior relationship between the parties. 'In this case, it is undisputed that the appellant (Newgen IT Technologies) initially entered the Indian market under the name 'Vcare InfoTech Solutions and Services Pvt Ltd' and, after having formal business relations with the respondent (Newgen Software Technologies), the appellant adopted branding containing the term 'Newgen', which closely resembles the respondent's mark. Given the similarity in business activities between the parties, references to unrelated third-party use of 'Newgen' are not analogous,' the court said. The court emphasised that Newgen Software was the prior user and that the balance of convenience lay in protecting established goodwill. It also ruled that the injunction was not perverse or arbitrary, and noted that even ex-parte relief is justified when there is urgency, such as a pending initial public offering (IPO). 'The appellant began rapidly expanding its operations, including initiating steps toward an IPO with this new name. All these circumstances collectively indicate that the test of balance of convenience and inconvenience also clearly tilts in favour of the respondent, as non-grant of the injunction would have caused significant inconvenience and harm to the respondent,' the court said. The injunction was originally granted by a commercial court in February 2025 and made absolute in March, after Newgen Software argued that the appellant's rebranding—after a short-lived partnership—would confuse consumers and damage its reputation. Rejecting arguments of prior international use and alleged acquiescence, the Division Bench of Justices Navin Chawla and Harish V Shankar said, 'The defendant herein has miserably failed to make out a prima facie case… the marks are strikingly similar and capable of causing confusion.'
