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High risk: trademark cases on the rise in liquor industry

High risk: trademark cases on the rise in liquor industry
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First Published: Mon, Mar 29 2010. 10 55 PM IST
Updated: Mon, Mar 29 2010. 10 55 PM IST
Over the past three months, Bangalore-based John Distilleries Ltd, which has been selling Original Choice whisky for 16 years, has filed two separate cases of piracy of design and trademark violation after it noticed products packaged much like its own.
In February, it filed a lawsuit against Bangalore-based SPR Group Holdings Pvt. Ltd, which makes Smugglers Cask whisky. And in December, it went to the courts against JP Distillery Pvt. Ltd, maker of Highway No. 1 whisky.
The two cases are to come up for hearing in the Bangalore high court in a couple of weeks.
John Distilleries, however, is itself defending a case over the name of its whisky brand. Allied Blenders and Distillers Pvt. Ltd, which sells Officer’s Choice whisky, has dragged the Rs470 crore firm to court over the similarity in the brand names.
The case is to come for hearing in the Supreme Court in April, after the Madras high court dismissed it in September.
“Five years back we were fighting only one case, but now we are fighting eight to 10 cases,” says Shakeel Syed, manager (legal) at John Distilleries, which also sells brands such as Mônt Castlé brandy and Big Banyan wines.
The number of litigations are climbing as even small liquor companies seek brand differentiation, are aware of intellectual property rights (IPRs) and have set up dedicated legal cells, he says.
Cases of trademark violation have been on the rise in the liquor industry in recent years as companies often copy names, bottle and label designs as well as packaging to ride the popularity of other fast-moving brands, say two industry experts and a trademark lawyer.
Sushant Singh, managing partner at Sushant M Singh and Associates, a Delhi law firm that specializes in IPRs, says trademark violation cases in the liquor industry have multiplied over the past decade-and-a-half—from five in the 1990s to 15-20 in 2005 and about 30 in 2009.
Similar looking brands— which crop up mostly in spirits as the market for these is larger than that for beer or wine—are sold in limited pockets and are often restricted to a state, says V.N. Raina, director general of the All India Distillers’ Association, an industry body.
The copy brands tend to be priced slightly below the original and are aimed at the illiterate, value-conscious customer, a liquor retailer said on condition of anonymity.
While the so-called Indian made foreign liquor industry is projected at 235 million cases a year as at end-March, estimates of the look-alike industry vary from 1-5% of this. Each case contains 12 bottles of 750ml.
“New entrants try to attain early profits by adopting certain features of a well-known trademark,” says Singh of the law firm.
The actual number of disputes is even larger as many of these are settled out of court.
Some significant cases in the country in recent years include: France-based Pernod Ricard versus Hyderabad’s Rhizome Distilleries Pvt. Ltd over Imperial; the former had the Imperial Blue brand while the latter had Imperial Gold; Scotland’s Scotch Whisky Association against Khoday India Ltd over the trademark Peter Scot, once a household Indian whisky brand, for using Scot; Diageo North America Inc. versus Shiva Distilleries Ltd over brands Smirnoff and Brisnoff.
So why do liquor companies copy others?
The bottles of Bangalore-based Chamundi Winery and Distillery’s Blue Grapes brandy are similar to that of Mumbai-based Tilaknagar Industries Ltd’s Mansion House brandy.
“We didn’t want to copy,” says K. Rajendra, partner at Chamundi Winery. “The neck label, the cap and the colour of the carton packaging is different.” The bottle shapes are the same, he admits, but that’s only “because there are few bottle designers”.
poornima.m@livemint.com
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First Published: Mon, Mar 29 2010. 10 55 PM IST