It does not pay to Nip On

Justice S. J. Kathawalla of the Bombay High Court, in Nippon Steel & Sumitomo Metal Corporation Versus Kishor D. Jain & Another. while ruling on a suit for infringement of Trade Mark and Passing off, in respect of the Plaintiff’s extremely well known and registered trade/service marks/name/logos Nippon Steel, Nippon Steel & Sumotomo Metal, NSSMC And in respect of business of steelmaking and steel fabrication businesses, by an ex-parte ad-interim order restrained the Defendants from infringing the same.

The Plaintiff is the world’s leading integrated steel producer ranked 3rd amongst all the steel producers in the world having produced more than 47 million tonnes of steel in the year 2017.

The Defendants are also engaged in the business of stocking, distribution and manufacture of steel.

The Plaintif filed the suit on the basis of the complaint made to them by a trading company viz. YANBU Steel Company in Saudi Arabia (“YANBU”) with respect to the quality issue of some Carbon Seamless Pipes used for laying pipes in oil plants. YANBU informed the Plaintiff that it purchased the said Carbon pipes from the Defendants believing the same to have been manufactured by the Plaintiff. They were sold to YANBU under the mark of the world renowned steel company Nippon Steel Corporation. Upon inquiries and investigations, the Plaintiff learnt that the said Carbon pipes had been supplied to YANBU by the Defendants ie. 2 individuals by the names of Kishore Jain and Jeetendra Burad falsely representing the same to be emanating from the Plaintif. In addition to the aforesaid misrepresentation, the Defendants had also provided to YANBU forged and fabricated certificates bearing the Plaintiff’s trade marks/logos thereby misleading them to believe that the said Carbon pipes had originated from the Plaintiff.

The Court initially passed an ex-parte ad-interim order against the Defendants and appointed a Court Receiver and ordered a thorough inspection of the infringing activities taken up by the Defendants and to seize the impugned goods and to make a mirror copy of the electronic records of the Defendants. It was revealed that besides infringing the trademarks of the Plaintiff, the Defendants were also indulging in forgery by fabricating the Plaintiffs inspection reports, certificates and signatures. This led YANBU to believe that the pipes being provided were in fact products of the Plaintiffs.

The Court observed that the present case calls for a serious measure and should be treated strictly since the activities of the Defendants are of a serious and criminal nature. The spurious pipes on which the trademarks were affixed are installed in highly sensitive areas such as oil plants. If these spurious pipes do not meet the standards and quality as the original pipes or that the specifications provided on the fabricated certificates are incorrect and not as per requirements; in such circumstances, it could lead to disastrous consequences. The court observed that the acts of the Defendants have in fact brought disrepute to the reputation of the country,

As a result, the Defendants submitted to a decree, as they were fully aware and cognizant of their misdeeds and did not wish to incur the full wrath of the court.

Although no amount of damage can be equated to the gross wrong committed by the Defendants, in order to send out a strong message to such unscrupulous entities/persons, that crime does not pay, the Court ordered the Defendants to pay an unprecedented amount of damages to the tune of INR 5 Crores to charity.

It is extremely unfortunate that some people have absolutely no regard for ethics or principles and in the bargain they make an irreparable dent to the reputation of our country only to make a quick buck. It is heartening to see that some courts take an extremely strict view of such offences. Keeping in mind the large scale infringement that is going on, the only deterrent that we can think of is that more and more judges award such kind of damages. As his term ends, Justice S. J. Kathawalla will be dearly remembered as a judge who tried to make a difference.