The Labyrinth Of Deceptive Similarity And AI’s Contribution To Indian Trademark Laws
Author: LawSphereX
Category: Intellectual Property
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THE LABYRINTH OF DECEPTIVE SIMILARITY AND AI’S
CONTRIBUTION TO INDIAN TRADEMARK LAWS
Smita Goswami, BA LLB, Department of Law, Calcutta University
ABSTRACT
Every company has a duty to carry forward its goals and fulfil its criteria. On the basis of that, it creates a logo or in other words, a trademark which acts as the identification mark for that particular company. It determines the authenticity and genuineness of the product manufactured. Since, everything comes with pros and cons, this trademark can be easily misused by miscreants for illicit purposes. Thus, “Deceptive Similarity”, among the trademarks, is one of the ways to take out the resemblances within the logo and place them tactfully in a newly made design. This drastically affects the overall reputation of the company which makes the public question its authenticity and eventually leads to an utter confusion. With the advent of Artificial Intelligence (AI), such work has become much easier for the tricksters.
Moreover, it is difficult to find out the flaws even by a prudent person. This paper would like to focus on the intersection of AI and trademark covering Deceptive Similarity, where AI acting as a ‘double-edged sword’ and the challenges faced by the companies in carrying forward their businesses. It also aims to suggest measures which may be useful to tackle the challenges. Keywords: Artificial Intelligence, Trademark, Deceptive Similarity, Infringement, Indian Trademark Act, 1999, Intellectual Property Prelude Intellectual Property (IP) governs exclusive rights given to the creators based on human intellect. It refers to all the intangible properties that come into existence as a result of human intellect.
These originate from human minds which include literary, scientific and artistic works, performances of performing artists, broadcasts, phonograms, scientific discoveries and industrial designs etc. as per the World Intellectual Property Organisation. The bundle of rights which govern the intellectual property of the creator/inventor are known as the Intellectual Property Rights (IPR). These rights help the creators to retain property rights over their creations by rewarding them for their work. IPR encompasses patents, copyright, trademark, industrial designs, geographical indications and many other terms. Patents comprise technology and operations. Geographical indication addresses the place of origin of the product. Trademarks pertain to naming of the work. The emergence of Artificial Intelligence has spurred a wave by reducing the involvement of human in various fields.
AI has assumed an inexorably significant part in the sphere of IP as well. For instance, in case of trademark, we can say that AI has increased the productivity indeed but has also resulted in many disadvantages which will be discussed in the later portions of the paper. What is a trademark According to Section 2(1)(zb) of the Trade Marks Act, 1999, a ‘trade mark’ means a mark capable of being represented graphically and which is capable of distinguishing the goods or services of one person from those of others and may include shape of goods, their packaging and combination of colours.
The international agreements and instruments that address the protection of trademarks include the Agreement on Trade-Related Aspects of Intellectual Property Rights (the TRIPS Agreement), Paris Convention for the Protection of Industrial Property (the Paris Convention), the Madrid Agreement Concerning the International Registration of Marks and the most recent Madrid Protocol. Besides these conventions, the World Intellectual Property Organization (WIPO) enshrines guidelines for the protection of well-known marks at the international level. Trade mark is used to protect a logo, phrase, word, letter, colour, sound, picture, aspect of packaging or any combination of these. Just as, a name is used to recognise any person or place, similarly, trademark acts as an indicator of a product’s company.
Their function is a source- identifier and assure quality of products, in this manner lessening the costs that a consumer may have spent on exploring for products which meet the desired requirements. A distinct image or a symbol affixed to a manufactured product of a company helps to allure customers and in the long run, its business reaches greater heights with fame and rewarding profits. This mark gives legal protection to the owners against others deceptively using it in a similar way by creating similar symbols and hardly making apparent changes. This is what is commonly termed as ‘deceptive similarity’ in trademarks and is quite prevalent among the tricksters.
There are a lot of functions associated with a trademark of a company which are as follows: - • Source of product differentiation- Every buyer attaches a product with a particular logo or symbol in their mind which enables them to categorise and classify goods or services according to their characteristics. • Source of advertisement- Trademark acts as an indicator. When a product gets launched by a company, people all over the world become aware of it through advertisements through newspapers, televisions, magazines etc. Thus, a trademark helps in identification of a particular source which increases the market power eventually. • Source of consumer welfare- A company while manufacturing a product keeps the customer’s desires and likings in mind. Thus, its focus mainly remains on such a mark which will captivate the eyes of the customers faster. In M/S. Hindustan Pencils Pvt. Ltd. v.
M/S. India Stationery Products1, it was held that the distinguishing mark is beneficial for the customers which confirms the authenticity of the product by the particular company. • Persistence in quality- Trademark promises continuation in the flow of quality. Having a registered trademark increases the urge to keep the priority of customers in the forefront. Once the product of a particular company gets the desired appreciation from the customers, it becomes the responsibility of the company to carry forward its business maintaining the same quality. If the product is of the required standard, it will influence the customers to spread the name and fame of the company from their mouths
1 M/S. Hindustan Pencils Pvt. Ltd. v. M/S. India Stationery Products, (1990) AIR Del 19
to others to purchase which will gradually elevate the demand and progress of the company’s growth as a whole. • Shields consumers from deception- Trademark protects the consumers from confusion regarding a mark or symbol of the product. There are high chances of the consumers to get deceived or confused between similar images of alike products. On one side, they may think that they are buying the product which they desire but later, it may be found out that the product is of another company which they don’t even know or aware of. This shield is contributed by a registered trademark which differentiates among equivalent logos. • Protects the business of the manufacturer- Trademark protects the investment or trade of the manufacturer.
The owner of the trademark shall protect his investment which he may have spent in the form of time and money in presenting a service or product to the consumer. Thus, he should take legal actions in case of infringement and prevent others from using the trademark which is determined by the strength, or goodwill, of the association between the trademark and its source, and it is the consumer who determines the value. Concept of Deceptive Similarity When a trademark is registered, the owner acquires certain rights regarding the product for which it is registered. The term ‘Deceptive Similarity’ has been popularly recognised as a ground for trademark infringement. Here, the owner has the right to file a claim for infringement and obtain an injunction.
As per Section 2(1)(h) of the Trade Marks Act, 1999, “a mark shall be deemed to be deceptively similar to another mark if it so nearly resembles that other mark as to be likely to deceive or cause confusion”. In a layman language, deceptively similar mark refers to a mark nearly identical to already existing logo or symbol which may very lucidly confuse the customers while purchasing a particular product manufactured by a particular company in regard to the ‘origin’ or source of goods or services. In Mumtaz Ahmed V Pakeeza Chemicals2, it was held that while differentiating between two deceptively similar marks, their broad and essential features are to be taken into consideration.
2 Mumtaz Ahmed V Pakeeza Chemicals, (2003) AIR All 114
They should not be placed side by side for spotting out the differences in the designs. Determination of Deceptive Similarity While talking about similarity, what is required is a mere resemblance or close similarity and not the close resemblance. Whether a mark used by owner of the company deceives the public or not depends upon a variety of factors and no concrete answer can be given to determine whether the impugned image creates confusion as to the source or origin of goods. It depends on the facts and circumstances of each case. However, the most commonly witnessed similarities depend upon the following factors: - i. The visual similarity of the marks- This includes contrasting the marks’ apparent components, like their overall length, shapes, suffixes, prefixes, shared syllables and shared elements of shape.
Examples include Nestlé's "Magical Masala" packaging was deceptively similar to their "Magic Masala" brand as claimed by ITC. ii. The aural similarity of the marks- This similarity is determined by the phonetics of the words used in a brand or logo. During pronunciation of the words, it becomes difficult for the customers to actually find any discrepancies. It mainly focuses on the length of the marks, the number of syllables and the pronunciation of the marks. For example, "Gluvita" and "Glucovita," or "Lakme" and "Likeme" which involve very subtle differences that can hardly be picked up by our ears. iii. The conceptual similarity of the marks- Apart from the above-mentioned resemblances, certain logo may not be apparently same or may not be similar even while pronunciation. It is about the overall concept which the marks would like to deliver to its consumers.
The three test criteria were formulated in the case of B. D. H Industries Ltd. V. Crydon Chemical Works Pvt. Ltd3 to determine a mark to be deceptively similar or not. o First, apart from the structural, visual and phonetic similarity or dissimilarity, it needs to be looked at from the eyes of a man of average intelligence and imperfect
3 B.D.H Industries Ltd. V. Crydon Chemical Works Pvt.Ltd,, (2002) AIR Bom. 361
collection. o Secondly, the logo or name must be considered as a whole and o Thirdly, it revolves around the question of impression in the view of consumers. There are other tests evolved by the court from time to time while dealing with a variety of cases like the ‘test of an ordinary memory of ordinary purchaser’, ‘test of crucial features of the label/mark’, and the ‘test of the environment where trademark is used’ etc. While deciding whether the marks are deceptively similar or not, it does not depend upon the intention to deceive at times. The intention to deceit need not be proved. Once the reputation is established, one party does not need to prove any misrepresentation on the part of the defendant, as held in Kirloskar Proprietary Ltd. v. Kirloskar Dimensions Pvt. Ltd4.
Essence of Deception As we have been already familiar with the types of deceptively similar marks/symbols, let us dive into the minds of the consumers which may get tricked seeing identical brands of the desired product. It may arise in the ways discussed as undera. Confusion regarding origin of trade- This chaos relates to the source of the trade. A consumer while purchasing a distinct item may think it to be of the same source as it bears a similar mark with which he is familiar. But in reality, it is not. b. Confusion as to goods- This is the most common and prevalent mistake made on part of the buyers. Seeing an identical image/text on a product may trick them to be of the brand that they are looking for.
But, if seen minutely, it can be concluded that there is a minute change in the font of an alphabet or an alteration in the colour of the text which gets easily overlooked by a prudent person. c. Confusion regarding connection in the trade- This also may happen that while comparing between the identical marks, the consumers may believe that there may be a connection between them in relation to trade. But actually, both are different products of different company.
4 Kirloskar Proprietary Ltd. v. Kirloskar Dimensions Pvt. Ltd ,(1997) AIR Kant 1
In Cadila Health Care Ltd . v. Cadila Pharmaceutical Ltd5, the Supreme Court of India laid down certain tests to determine ‘deceptive similarity’ which are to be taken into account which are stated below: - i. Nature of the marks, that is, words, numbers, letters or a combination of both etc. ii. Degree of alikeness, that is, visually, phonetically or conceptually. iii. Nature of goods regarding usage of trademark. iv. Way of purchase of the goods. v. Similitude in the nature, character and purpose of the goods of other competing traders. vi. Type of purchasers who are most likely to buy the goods and their level of care and intelligence exercised by them while purchasing. Amalgamation of AI & Trademark The birth of Artificial Intelligence (AI) in the sphere of digital technology has accelerated at such a rate that we cannot expect anything without depending on AI.
Indeed, it has made our work faster and life easier. At the same time, we cannot overlook the challenges portrayed by AI in any field, be it information technology or intellectual property like copyright, patent and trademark. I absolutely agree with what Matt Bellamy had said regarding AI that “In the long term, artificial intelligence and automation are going to be taking over so much of what gives humans a feeling of purpose. ” The application of AI in the trademark arena is a major thing to be looked into. No matter what we ask AI, it has a solution for everything. Be it an answer to a difficult question in the assignment to a fast recipe for breakfast within 15 minutes, AI never fails. The day is not far when human beings will be treated as a slave to these mere bots.
Though AI algorithms provide good suggestions for creating designs and logo for trademark, it may happen that the mark which it has suggested is very much akin to already-existing trademarks. Thus, trademarks
5 Cadila Health Care Ltd. v. Cadila Pharmaceutical Ltd, (2001) 5 SCC 73.
designed with the help of AI can be categorised under the following heads: - • Completely AI generated name, mark, logo or slogan. • Name, slogan, mark or symbol created under the assistance of AI but directed by a human designer. Hurdles in Registering AI- generated Trademarks in India The laws governing Intellectual Property in India do not hold a clear-cut framework concerning AI-generated trademarks. This raises a few questions regarding ownership of new created marks, examination of such marks and other laws governing AI-related disputes. Due to lack of an unambiguous law related to trademark, many companies experience legal challenges for the protection of logo under Indian laws. After gaining the goodwill and brand value of the company, it may, unintentionally land up in a legal suit with rival traders, who allege that their symbol has been misused or copied.
Since AI is developed to act in consonance with human intelligence, they, at times, might miss subtle cues or design components that are consistent with already-registered trademarks. In such situations, AI’s potential can be interpreted as a double-edged sword. On one side, fraudulent companies may intentionally create identical elements in trademark using AI and will heighten their profit and brand value goals and on the other side, this will have a major negative impact on the customers who may get confused between the source of the original and imitated mark on the products. While registering trademarks by businesses, question arises regarding involvement of human in creation of trademark. They would have to prove that AI was only used as a tool rather than the sole creator. The registration path may pose challenges in court that could invalidate any trademark enjoyed by that AI.
Apart from registration of AI-generated trademarks, it can have another impact when a consumer delegates the choosing of buying products to an AI, Alexa for instance, instead of purchasing on his own. Here the subject matter revolves around the fact that what happens when Alexa, who does not have any idea about any previous purchases, is asked to choose a product. So, the responsibility gets shifted from the consumer to an AI, hence, becoming an AI-driven purchase. This thing affects the purchase of products based on the trademarks which may not be desirable by the customers to some extent. Plausible Remedies and Legal Reforms
1. AI-specific legislations- It is the first and foremost thing to be introduced. Since, Indian
IP laws do not deal with AI-related creations, it becomes difficult to evaluate and pass judgment regarding this. Thus, legislations which cover AI-related aspects of IPR should be formulated at the earliest. Like, the Trade Marks Act, 1999, can be amended to embrace marks created through artificial intelligence
2. Recognition of AI-generated trademarks- Specific guidelines are to be developed for
registration of trademarks generated by AI. A few points must be considered regarding this. AI’s involvement in the creation, extent to which AI’s creation infringing upon other trademarks or not, distinct rules or procedures to be followed to check its validity, extent of human involvement in the creation along with AI are some of the aspects which are to be looked into.
3. Ethical generation of trademarks by AI- Any AI-generated trademarks must not be
misleading, appearing deceiving or offending any group or class socially, culturally or politically. It must not be biased at the same time to offer advantage to any particular classified strata of the society. It’s the responsibility of human to assure that AI is used in an ethical and moral manner.
4. Usage agreements regarding AI-created trademarks- Businesses which are
completely dependent on trademarks designed by AI must enter into agreements, clearly stating the ownership and use rights. This will help in curbing legal disputes on this matter.
5. Public awareness and legal training- AI has percolated our daily lives to such an
extent that we can’t even think about anything without AI. Thus, not only legal practitioners or engineers, even layman should have a basic knowledge about AI and its use regarding IP. In every company, the employers should be trained and made aware about AI-assisted trademarks and its shortcomings. They should have a decent idea about infringement of trademarks created by AI and measures to cope up with it.
Judicial Pronouncements
1. F. Hoffman-La Roche & Co. Ltd. v. Geoffrey Manner & Co. Pvt. Ltd, 19706
In this instant case, the defendant had applied for registration of its trademark on ‘Dropovit’ which was challenged by the appellant on the ground that this mark was likely to cause confusion and deceive customers due to its earlier registered trademark on ‘Protovit’. But the appeal was dismissed by the Supreme Court on the following inferences: - a) Both of the trademarks were not deceptively similar and no question of confusion arises. b) There was no visual or phonetical alikeness as pronunciation of ‘d’ and ‘p’ is quite dissimilar to that of ‘p’ and ‘t’ leaving no reasonable probability of commotion in the minds of the customers. c) There are many trademarks which have ‘vit’ as suffix which can be easily differentiated by the customers among various medicinal preparations. Thus, there was held to be no infringement by the defendant’s company.
2. Lakme Ltd. v. Subhash Trading, 19967
In this instant case, the plaintiff company selling its products under the trademark of ‘Lakme’ filed a case of infringement of trademark against the defendant company running under the trademark of ‘LikeMe’. The Delhi High Court held that there was a definite resemblance between the two names phonetically and this illustrates the case of deceptive similarity which may give birth to confusion among the consumers. Order of injunction was passed.
3. Dr. Reddy’s Laboratories Ltd. v. Manu Kosuri, 20018
Here, the plaintiff company was the proprietor of the trademark ‘Dr. Reddy’s’ which is an eminent pharmaceutical organisation. The defendant company had registered their domain name ‘drreddyslab.com’. The plaintiff moved the court praying for a permanent injunction
6 F. Hoffman-La Roche & Co. Ltd. v. Geoffrey Manner & Co. Pvt. Ltd, (1970) AIR 2062
7 Lakme Ltd. v. Subhash Trading, (1996) PTC 567
8 Dr. Reddy’s Laboratories Ltd. v. Manu Kosuri, (2001) PTC 859 Del
preventing the defendant company from using the domain name as the two names were almost identical to each other. Using similar name by the latter aimed at diverting the business of plaintiff company resulting in damage to the business, reputation and brand value of the company. Thus, the court held that there was every possibility of a customer to be utterly confused in believing that both the names belong to the same plaintiff’s company whereas in reality, it’s different. Thus, the court restrained the defendant company from using the abovementioned domain name.
4. Cadila Healthcare Ltd. v. Cadila Pharmaceuticals Ltd, 20019
In this case, the appellant company (Cadila Healthcare Ltd.) manufactured a drug named ‘Falcigo’ for treating malaria. The Respondent company (Cadila Pharmaceuticals Ltd.) had already been selling a drug named ‘Falcitab’ for treating the same disease. A complaint was filed for trademark infringement before the lower court and an appeal before the High Court, but both were dismissed. When the case went to Supreme Court, it observed that there was a possibility of making a mistake while selling the two drugs having identical names. This may be fatal for the consumers. It laid down certain grounds which are to be taken into consideration while deciding deceptive similarity, which have been already discussed earlier. The Supreme Court did not interfere with the lower courts’ orders and directed the trial court to pass any order as per the observations made by the Supreme Court.
5. Sun Pharmaceutical Industries Ltd. And Anr. V. Kinetic Lifescience (OPC) P. Ltd.
And Anr, 202210 In the above-mentioned case, the impugned mark used by the defendant company, ‘EYESITE’ for health supplements was deceptively similar to the mark used by the plaintiff company, ‘ISITE/I-SITE’. The court was of the opinion that both the words were phonetically and visually similar which would be difficult for any ordinary prudent man to distinguish them. This amounted to infringement of the plaintiff’s statutory rights in the registered trademark ‘I-SITE’ which will lead to loss of reputation, goodwill and revenue of the plaintiff company. Thus, the court restrained the defendants from manufacturing, selling or using the impugned marks identical to the former company’s mark.
9 Cadila Healthcare Ltd. v. Cadila Pharmaceuticals Ltd ,(2001) PTC 541 SC
10 Sun Pharmaceutical Industries Ltd. And Anr. V. Kinetic Lifescience (OPC) P. Ltd. And Anr, (2022) Del 369
6. M/S Kibow Biotech v. M/S The Registrar of Trade Marks, 202311
Here, a question arose regarding proprietorship of trademark where M/S Kibow Biotech, the creator of an AI system was listed. The court dismissed Kibow’s claim as according to the Trade Marks Act, 1999, only a ‘person’ is allowed to apply and own a trademark. Thus, AI systems do not come within the ambit of ‘person’ and are ineligible to be proprietor of trademarks until AI-specific legislations are formulated.
7. Glenmark Pharmaceuticals Ltd. Vs. Gleck Pharma (OPC) Pvt Ltd & Ors., 202412
A suit for trademark infringement was filed by Glenmark Pharmaceuticals Ltd. against Gleck Pharma asserting that the defendant’s trademark “XIGAMET” was deceptively similar to their registered trademark “ZITA-MET”. Both the medicines, though different in molecular composition are used to treat same ailment. They argued that both the trademarks are phonetically, visually and aurally the same. The court observed that from the standpoint of an ordinary man of average intelligence, the mark ‘XIGAMET’ of Gleck was deceptively similar to that of ‘ZITA-MET’ of Glenmark. This confusion among the consumers can potentially cause harmful side effects on them. Hence, injunction was granted by the court restraining Gleck Pharma from using the registered trademark.
8. Christian Louboutin Sas & Anr. V. M/S The Shoe Boutique- Shutiq, 202313
This case threw light on the fact that artificial intelligence cannot override human intelligence in the adjudicatory process. ‘The tool could be utilised for a preliminary understanding or for preliminary research’ as stated by the court. While dealing with Christian Louboutin’s suit, against the defendant firm, it was observed that they had identically copied the shoe design including red sole, spiked shoe style of the plaintiff company. Thus, this act was nothing but an attempt to pass off its own goods as the goods of the plaintiff. Postlude In the realm of intellectual property rights, deceptive similarity within the ambit of trademarks, poses a serious risk to the consumers as it can create confusion in their minds while purchasing
11 M/S Kibow Biotech v. M/S The Registrar of Trade Mark ,(2023) Del 137
12 Glenmark Pharmaceuticals Ltd. Vs. Gleck Pharma (OPC) Pvt Ltd & Ors ,(2024) Bom 8628
13 Christian Louboutin Sas & Anr. V. M/S The Shoe Boutique- Shutiq ,(2023) Del 755
things. Some grounds have also been noted by the Supreme Court while determining deceptively similar trademarks in various cases. This doctrine provides protection in case of infringement of trademarks. The introduction of Artificial Intelligence in the IP laws have led to a dramatic shift in dealing with AI-generated trademarks. Also, the incorporation of AI in the registration of trademarks in India’s intellectual property will help in expediting the procedure to a large extent. Specific distinct guidelines governing AI-involved creations are to be formulated. AI-powered trademark search engines can be introduced which can recognise every minute similarities and will help in increasing trademark protection. The issues of ownership and liability for trademarks generated by AI must be addressed.
Moreover, the consumers should be made aware about AI-driven brand similarities which will allow them to decide wisely while purchasing the products. We are currently in a highly technological advanced stage where Artificial Intelligence and human involvement run parallelly to each other, no matter what the context is. It is a cumulative effect of the judiciary and lawmakers to come forward to deal with the challenges arising from the use of AI in the sphere of determining deceptive similarity in trademarks and formulate new modifications as required, in the years to come.