Geographical Indications vs. Trademarks: Special Provisions and Rights of Prior Users

Introduction

Two main components that make up intellectual property rights govern the sustenance of creativity, commerce, and culture: trademarks and geographical indications. A trademark refers to that which distinguishes a good or service through a word, symbol, design, or combination that identifies the source of the goods or service. It is something that protects businesses from imitation or misuse while offering consumers the assurance of the quality that goes with a brand. Trademarks such as Adidas and McDonald’s golden arches create recognition and trust between businesses and their customers.

However, a GI represents a label that signifies the origin of a product from a particular region, signifying qualities, reputation, and/or characteristics specific to that area. GIs embody regional authenticity and tradition as it sustains products like Parmigiano Reggiano or Banarasi Sarees in their uniqueness and heritage identity. GIs are collectively owned by the producers of a specific geographical region, unlike trademarks, which are privately owned by their respective entities or businesses.

While trademarks primarily serve commercial branding, and GIs emphasize cultural heritage, both protect economic interests, foster consumer awareness, and ensure fair competition. They symbolize fair competition between firms, and consumer consciousness. They also help in the development of local economies, making it impossible to abandon them entirely in the modern global intellectual property regime.

Difference between Trademark and Geographical Indication

Rights of Prior Users

Prior user rights provide an individual or entity the entitlement to continue using a trademark or geographical indication (GI) if their use predates its registration by another party. This doctrine safeguards those who have built goodwill and reputation associated with a mark or GI through consistent and genuine use, ensuring that they are not unfairly disadvantaged by later registrations. These rights are pivotal in preventing unjust enrichment by subsequent registrants and in maintaining the integrity of longstanding market presence. They protect unregistered users who have established consumer recognition for their goods or services, thus balancing the interests of prior users and registrants.

Prior User Rights in Trademarks

The Section 34 of the Trade Marks Act 1999 under Indian law lays down the law regarding user rights and grants statutory protection to a user of an unregistered trademark. It expressly bars the registered proprietor or the user of a trademark from interfering with or restraining the use of the trademark by a prior user who has continuously and genuinely used it. The vital part of Section 34 deals with some main principles:

• Continuous and bona fide use: A prior user has to prove uninterrupted and honest use of the mark. Sporadic or token use does not qualify.
• Use prior to registration: There should be use prior to an application for registration or before the registrant starts using the trademark.
• Geographical relevance: Protection is limited to the grounds where the prior user has established goodwill or reputation.

This clause affirms India’s “first-to-use” system, as opposed to the prevalent “first-to-file” system of myriad jurisdictions. The statute guarantees protection for bona fide users who had established rights in unregistered trademarks against subsequent registrations.

Case Laws related to Trademarks

Indian courts have overwhelmingly established that prior user rights are higher than those of registered proprietary rights. The massive milestones of these rulings include:

Century Traders v. Roshan Lal Duggar & Co- (1978 SCC OnLine Del 126)

The High Court of Delhi ruled that the right of prior users outweighs that of registered proprietors. The court expressed that goodwill and reputation gained through use is a foundation upon which protection can rest.

Amritdhara Pharmacy v. Satyadeo Gupta (AIR 1963 SC 449)

The precedent of prior use has priority over registration, as judged by the Supreme Court. It recognized distinctiveness and goodwill as being generated from continuous use of a particular mark and stated that these must be safeguarded to avoid injustice.

Kamat Hotels (India) Ltd. v. Royal Orchid Hotels Ltd. (2011 (4) SCC 616)

It concerned whether registration gives right per se to restrain a bona fide prior user of a trademark. The Supreme Court has upheld the enforceability of prior user rights, even against a registered proprietor.

Laxmikant V. Patel v. Chetanbhai Shah (2002 (3) SCC 65)

The court has clarified that prior user rights will apply for pass-off cases too. The first user of a trademark will thus be able to seek protection against unauthorized use of the trademark that can lead to customer confusion.

N. Ranga Rao & Sons v. Anil Garg (2012 SCC OnLine Del 3578)

The Delhi High Court held that a registered proprietor cannot prevent a prior user from using a mark if the prior user can show long-standing and continuous prior use before registration.

Practical Issues

• Evidence of Prior Use- The continuous and bona fide use requires a lot of substantiating evidence such as invoices, advertisements, and sales records. Collecting and presenting such documents can be a big hurdle.
• Geographical Limit- It may be that the courts would restrict the protections afforded by prior user rights to territories where goodwill and reputation exist.
• Extensions- Local uses may find themselves clashing with cases of an applicant seeking national or prolonged registration for the trademark.

The principle of prior use is a guardian of trademarks and GIs that stood the tests of relativity, thus guarding against endless tension in commerce. It does, however, require proper documentation and consideration of regional goodwill in operations.

Prior User Rights in Geographical Indications

The Geographical Indications of Goods (Registration and Protection) Act, 1999 is not an exhaustive codification of the rights of prior users; however, it finds implicit recognition of the doctrine of prior use to deliver a just approach and to ward off injustice. While the Act represents a move toward collective rights of producers or organizations related to a GI, in some vernacular, it also enables the consideration of traditional and long-standing use in certain disputes:

• Section 22 provides remedies against GI infringement but rather leaves unattended issues related to prior users who are known to be using the GI without formal registration.
• Section 22(3) grants some extra protection in the case of goods of national significance, considering traditional or historical use while determining disputes.

Basic Principles Governing Prior User Rights In GIs

• Recognition of Traditional Use- Producers or artisans connected to GI-tagged products for a long time may assert their rights to prior use, particularly if the same predates the registration. This is especially true in instances where such usage expresses a certain legacy of quality and authenticity.
• Balancing Individual and Collective Rights- While the GIs are bestowed with the collective rights of a community, in some cases, the courts have acknowledged the efforts of individual prior users. This is particularly true in instances of genuine usage by an individual or a group that does not mislead.
• Cultural and Economic Significance- The historical, cultural, and economic importance of the prior user’s connection with the GI may also influence judicial interpretation. Courts often recognize such prior users as significant contributors to preserving the reputation and quality of GI.

Case Laws related to GIs

Tirupati Laddu Controversy

In this matter, the issue of prior use came to the fore when a petition question was raised against the grant of GI status to Tirupati Laddu, stating that such protection could marginalize individuals or groups with a longstanding association with unregistered products, which might offend their religious sentiments. The petition was dismissed for want of proper procedure, but the court did underline the necessity of establishing prior use with credible evidence. The case illustrates the intertwined nature of collective GI rights and individual or group claims linked with cultural and religious concerns.

Darjeeling Tea Case

The Darjeeling Tea case illustrates the tension in balancing prior user claims with collective rights under GIs. The Tea Board of India, tenor the GI holder, fought long and hard to protect the GI from misuse. However, there were exporters of tea who, before the registration, had used “Darjeeling” and who claimed limited rights to trade in the name. In a landmark international case brought before the Trademark Trial and Appeal Board in the United States, the Tea Board successfully defended the GI. However, smaller producers were unable to maintain their rights because of bona fide usages, creating a predicament regarding how to balance individual contributions, as against collective ownership.

The Basmati Rice Controversy

The Basmati rice dispute drew heavily upon the issue of prior use. The proceedings began with the RiceTec, a U.S.-based company, attempting to patent certain strains of rice and use the term “Basmati.” India, supported by NGOs, argued that Basmati has cultural and agricultural heritage from the Indian subcontinent. Even though the subject matter of dispute mostly revolved around patent law, the tenet of prior use played an important role for India on the defense. Generations of farmers had cultivated and marketed Basmati rice in India and Pakistan long before any claims of intellectual property rights, hence traditional use was at the backbone of the argument.

Challenges of Recognizing Prior User Rights in GIs

• Conflict with Collective Rights- As GIs safeguard collective ownership by communities, recognition of individual prior users can become complex and may disrupt the collective framework.
• Evidentiary Concerns- Proving prior use requires extensive historic documentation such as production records, sales data, or local recognition. Such documents often do not exist for traditional producers or rural artisans.
• Geographies- Prior user rights in GIs are often limited in geographical scope to those regions where the product gained recognition, leading to their limited applicability on a wider plane.
• Culture- The Tirupati Laddu controversy is an instance that illustrates the extent to which cultural and religious factors may complicate the understanding of prior user rights.

Special Provisions

Related to GIs

The Geographical Indications of Goods (Registration and Protection) Act, 1999 provides for certain additional peculiar provisions for the applicability of GIs within India, with a concentration on securing the collective ownership rights of producers in charge of GIs and focusing on distinctiveness with respect to products that are geographically linked.

1. Additional Protection for Notified Goods (Section 22(3))

Certain goods of national importance such as Darjeeling Tea are entitled to additional protection beyond the normal remedies available for infringement. Unauthorized use of such GIs too by translation or even by a phonetically similar nomenclature is strictly is prohibited.

2. Infringement and Remedies (Section 22)

Infringement is defined broadly under the Act to include any unauthorized use of a registered GI in a manner to mislead the public or tarnish the product’s reputation. The remedy includes injunctions to restrain the misconduct, damages or compensation for injuries sustained by infringement.

3. Prohibition of Assignment, Transfer, or Licensing (Section 24)

GIs cannot be assigned, licensed, or transferred to an individual party. Rather, they would always remain the collective property of the particular community or region in which they are in question.

4. Registration of Authorized Users (Section 17)

Individually, producers can apply for registration as authorized users of a GI giving them rights to use it for marketing. This provides reasonable assurance of valid claim regarding their standing.

5. Protection of Traditional Knowledge and Cultural Heritage

The GI Act in a way recognizes traditional knowledge and cultural practices by the very fact that a product has a historical and geographical connection with the place of origin like Kanjeevaram Silk, Banarasi Sarees, Basmati Rice and many others.

Related to Trademarks

The Trade Marks Act, 1999 provides specific provisions for the protection of trademarks and the fair use of intellectual property.

1. Protection of Well-Known Trademarks (Section 11)

Well-known marks are given broader protection in spite of the fact they are not registered in any particular class. Use of a well-known mark upon goods or services that are unrelated can be restricted in order to prevent dilution of its reputation.

2. Prior User Rights (Section 34)

India adopts the first-to-use principle and protects the earlier users of a trademark, whomsoever later on a person may have registered the mark. In order to claim this right, the continuous and bona fide use of the trademark must be shown.

3. Trademark Licensing and Assignment (Sections 37-45)

Trade mark law allows assignment and licensing of registered trademarks. It enables the trade mark owner to enjoy the commercial benefits of their trademarks and facilitates the legal transfer of ownership.

4. Protection of Collective Marks, (Sections 61-68)

Collective marks are those marks used by members of an association to distinguish the goods or services of its members. These marks are treated with special protection. The collective mark shall show a connection between the goods/services and the organization members.

5. Defensive Trademarks (Section 47)

Trademark owners may use defensive marks to prevent the misuse or dilution of their brand reputation regarding goods or services that do not directly relate to their primary business.

6. Opposition to Trademark Registration (Sections 21 and 124)

The Opposer Corridor allows for the print to be opposed from registration when said mark is incorporated or exists deceptively similar to that which exists. This lends help in preventing infringement and confusion in the market.

Conclusion

The conflict between Geographical Indications and Trademarks presents a balance between regional heritage protection and private commercial rights. While GIs pride themselves mainly on cultural and community interests, trademarks are geared specifically toward brand identity and market good will. The laws-the Trade Marks Act, 1999, and the Geographical Indications Act,1999-present distinct rights that overlap with each other more or less, with special provisions for prior users to ensure both fairness and legitimacy.  Globalization is connecting markets, and therefore, striking the right balance between GIs and trademarks has become more important than ever. There must be a strong and workable enforcement mechanism to protect innovation and traditional knowledge without infringing upon others’ legitimate rights.