Exxon Mobil Corporation vs. M/S Bike Zone / Siddhivinayak Autoline & Ors.
Facts
The plaintiff, Exxon Mobil Corporation, filed a suit against defendants M/S Bike Zone / Siddhivinayak Autoline & Ors. for alleged counterfeit products. An ex-parte ad interim injunction was granted on November 26, 2021, and later made absolute on March 1, 2023. During proceedings, the Local Commissioner inspected defendant no.1's premises and reported no counterfeit goods. For defendant no.2, 40 bottles were found, but GST invoices indicated products were sourced from Pooja Sales. Defendants 1 and 2 stated they were ready to suffer a permanent injunction, claiming they were not suppliers of counterfeit products and could not pay the costs claimed by the plaintiff. Defendant no.3 was proceeded ex-parte.
Held
The Court decreed the suit in terms of prayer 38(i) of the plaint, which typically involves granting a permanent injunction. The Court considered the principles laid down in Koninlijke Philips N.V. v. Amazestore, which outlines a chart for awarding damages based on the degree of mala fide conduct, ranging from injunction for first-time innocent infringers to aggravated damages for deliberate and calculated infringement. This decision was cited with approval in Puma SE v. Ashok Kumar. In light of these principles and the submissions, the Court directed defendant no. 2 to pay costs of Rs. 25,000/- to the Delhi High Court Lawyers Welfare Fund within four weeks. The seized goods deposited under superdari were to be released to the plaintiff. The suit was disposed of on these terms.
Key Issues
1. Whether the defendants, specifically defendant no. 2, should be liable for costs and damages in light of the alleged infringement of the plaintiff's rights by supplying counterfeit products, considering the Local Commissioner's report and the GST invoices presented. (Mixed question of law and fact, concerning principles of damages and costs in intellectual property infringement cases). Contentions: Petitioner/Appellant (Plaintiff): Argued for costs and damages based on the alleged infringement. Relied on decisions in Koninlijke Philips N.V. v. Amazestore, 2019 SCC OnLine Del 8198 and Puma SE v. Ashok Kumar, 2023 SCC OnLine Del 6764, which provide a framework for awarding damages based on the degree of mala fide conduct. Revenue/State (Defendants): Defendants 1 and 2 stated they were ready to suffer a permanent injunction but were not in a position to pay the claimed costs. They pointed to the Local Commissioner's report finding no counterfeit goods at defendant no.1's premises and GST invoices for defendant no.2 suggesting sourcing from Pooja Sales, implying they were not the primary infringers.
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Cause title — parties, addresses and appearances
O R D E R %
2024
Pursuant to the previous order dated 11th January, 2024, Court had heard plaintiff and defendant no.1 and 2. 2. Counsel for defendants states on instructions that they are ready to suffer permanent injunction since they had not been suppliers of the alleged counterfeit products, and they are not in a position to pay the costs, as is being claimed by plaintiff.
Counsel for defendants also draws attention to the fact that Local Commissioner which had inspected the premises of defendant no.1 reported that no counterfeit goods were found, even though, counsel for plaintiff states that there was a hoarding which was outside defendant no. 1’s shop, and on that basis, it is stated that the product was being sold. This is a digitally signed order. The authenticity of the order can b
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