HC slaps ₹50 lakh fine on firm for suppressing facts in trademark dispute

The high court noted that Thakur had not only obtained the order through a fraud, but had tried to to ensure the fraud continued even after the Defendant had brought evidence against him

MUMBAI: The Bombay High Court on Wednesday imposed a penalty of ₹50 lakh on the owner of ‘Doctor Extra Soft’ a footwear manufacturer, after noting that he had suppressed facts to get the court to intervene in a case against a Delhi-based competitor over a trademark dispute.

Judge`s gavel and law books.constitutional crisis (Shutterstock)

In June, the court passed an interim order in favour of the owner, Shoban Salim Thakur, restraining a Delhi-based competitor Chaitanya Arora and his firms from selling footwear under the trade mark ‘Doctor Health Super Soft, Doctor Super Soft, Doctor Extra Soft’.

Arora, who was not present at the court during the order, filed an affidavit asking the court to cancel the order. He alleged that Thakur had approached the court with “unclean hands” and had deliberately suppressed facts and documents in the case.

Advocate Hiren Kamod, representing Arora and his firms, told the court that Thakur had “consciously and systematically played a fraud on this court” by hiding that his registration for the footwear trademark was limited to Maharashtra, and did not apply to other states. Despite that, Thakur had gotten an order from the court which was applicable pan-India.

Senior counsel Janak Dwarkadas, representing Thakur, denied the allegation, and said that the firm had “neither wilfully nor deliberately concealed any material fact from the court”. He said that the affidavits later filed by Thakur said that he had missed mentioning the disclaimer in his complaint, and such mistakes were not significant enough to cancel the order.

However, the single-judge bench of justice Arif Doctor cancelled the interim order and held that it was “plainly dishonest” for Thakur to have claimed that geographic limitation did not affect the case. The bench held that Thakur had deliberately suppressed facts from the court, calling his conduct “dishonest and unscrupulous”.

The bench added that Thakur had not only obtained the order through a fraud, but had tried to to ensure the fraud continued even after the Defendant had brought evidence against him.

“The overarching issue before the Court is the dishonest and fraudulent conduct of the Plaintiff and the manner in which the order has been obtained. This is something that cannot be condoned,” the court said after observing that Thakur was fully aware of the consequences of his actions.

The court noted that Arora’s entire business had come to a standstill due to the interim order, the court directed Thakur to pay a sum of ₹25 lakh each to two of the defendants- Chaitanya Enterprises and Sonu Shah, the proprietor of Sonu Enterprises.