In Enterprise Holdings, Inc. v. Enterprise Auto Rentals, Justice Manmohan Singh of the High Court of Delhi delivered a judgment in favor of the plaintiff against an entity using the trade name Enterprise Auto Rentals and the trademarks ENTERPRISE and ENTERPRIZE. Enterprise Holdings, Inc. v. Enterprise Auto Rentals, CS (OS) No. 489/2013 (Del. Mar. 11, 2014).
Enterprise Holdings had registered the trademark E-ENTERPRISE in Class 39 for vehicle rental and leasing services. Its word mark ENTERPRISE was pending registration in India. Enterprise Holdings was able to establish that it had been marketing its services in India since 2007, although it did not have any business presence there.
The defendant argued that “enterprise” was a common dictionary word and there were six other applications and registrations for trademarks in Class 39 that included the word “enterprise.” The defendant also stressed that the plaintiff had no local business presence and that its presence in India was only on the Internet. The plaintiff countered that its website had received more than 500,000 hits every year from Internet service providers based in India, and several people traveling from India had used its services outside the country.
The court observed that the requirement of a local business presence was formerly an element of a passing off action. However, the concept of passing off had undergone changes with the advent of technology and modernization. Therefore, a transformation had taken place, and courts could excuse the lack of a local goodwill and business if there was proof of substantial reputation and the business had some nexus in the territory where protection was sought. Justice Singh went on to say that the reputation of a business could transcend boundaries by virtue of its advertisement in newspapers, media circulation, expatriate reputation and other relevant factors.
Justice Singh also extended the principle of trans-border reputation to include the Internet. He relied on an earlier case, Cadbury UK Ltd v. Lotted India Corp. Ltd., in which the Delhi High Court observed that a merchant’s presence on webpages of foreign origin and in social media was sufficient to show the trans-border nature of the merchant’s reputation despite the fact that the merchant had no activity in India at the relevant time. However, he added a rider to this broadened concept and opined that trans-border reputation would always be a question of fact in each case.
Justice Singh issued an interim order restraining the defendant from using the trademark ENTERPRISE or ENTERPRIZE in relation to the business of offering vehicle rental and leasing services, and any related services under the name Enterprise Auto Rentals, which activities had created confusion and deception and infringed the plaintiff’s trademark.
This case sets the precedent for the protection in India of those trademarks and service marks that have an international reputation and substantial Internet presence, even where the proprietor has no actual business within the country.
