Discussing Cal HC’s July 25 interim injunction order in Exide v. Amara, Srishti Gaur explains how the case exemplifies a slippery slope of granting trademark protection over colour schemes. Srishti is a third-year student at National Law University, Delhi.
Too Common to Claim? Rethinking Trademark Boundaries in Colour Protection
By Srishti Gaur
Recently, the Calcutta High Court in Exide Industries Limited v Amara Raja Energy and Mobility Limited granted an interim injunction against Amara Energy from using the red and white colour combination for its product ‘Elito’ batteries. The Court accepted Exide’s claim that the prolonged use of a specific colour combination (here, red and white) for automotive batteries gave rise to proprietary rights to Exide Industries over this colour scheme.
Both parties are key producers of automotive batteries. Amara, known for its “Amaron” batteries, had launched a product “ELITO” initially in blue colour, however, upon receiving feedback that blue did not stand out and a change to a bright colour was needed, it rebranded it and launched the product in India in red colour. The Court recognized that Exide has been using the colour scheme for years and Amara’s change was a calculated decision to mislead consumers about the origin of the product (¶ 26).
The unease with this decision, in specific, is how it allows Exide to gain legal recognition over the use of red and white for automated batteries, a colour scheme which is routinely used across this industry. With this decision, the Court blurred the lines between what is distinctive and can acquire a secondary meaning and what is merely functional, opening floodgates to trademarks over combinations that are commonplace.
While the judgment mainly focused on Exide’s use of red colour in its mark, it is equally important to note that the court took in consideration other aspects, including the use of word “EL” and a shattered ‘O’ device in finding deceptive similarity. However, the broader concern of the post will be on the discussion surrounding colour combinations.
Where did it miss the (trade)mark?
It is given that colours are a bit abstract and for it to be classified as an identifier, it requires to be a source identifier in the minds of consumers. As per the Draft Manual Trademarks, a colour cannot require protection of any sort unless it has attained a secondary meaning (p. 84). This is possible if, through long and exclusive use, people link it to a particular brand (p. 85). In ITC Limited v Britannia Industries, the Court noted that not every colour combination will qualify for trademark protection, only the colour scheme that is unique in the relevant industry, along with its consistent and distinctive use will qualify it as a trademark. These are the very points that the Court failed to recognize, as will be shown in this section.
The first question to be asked is whether the public views the colour of a product as an indicator of its manufacturer or not. In the given case, the market of automated batteries is flooded with the combination of classic red with white coloured fonts. In the nook and cranny of every street-side shop in India – several brands of automotive batteries use the same shade (like RedCel, Redox, Micro Red, AutoPower) – are found. In National Bell Co. v Metal Goods, the Supreme Court held that where the mark is commonly used in the market, it loses its capacity to distinguish one producer from another.
Further, under trademark law, the burden is on the claimant to prove that a particular colour or combination has acquired a secondary meaning – merely having an association with colour(s), no matter the time period of use, does not establish distinctiveness of the trademark. The order does not indicate that Exide discharged this burden and adding to it, the court assumed the ‘distinctiveness’ without offering a concrete explanation to it. The CHC’s logic falters here since it is difficult to justify how Exide can claim a right over a colour scheme so ubiquitously used but deny Amara the same.
The next related question considered by the Court was whether the allegedly infringing mark confuses or misguides the public regarding the product. Or it can be put as whether the consumers are “capable of distinguishing” between products of different sources [Section 2(1)(zb) of the Indian Trademarks Act, 1999]. For misrepresentation to take place, there should be confusion with respect to the source. But as explained above, in a market, in this case – automotive batteries, which is saturated with red and white combination marks, a consumer cannot associate it exclusively with one (here, Exide) and not with the rest of the products.
The Court noted that Exide has been using the mark “openly, extensively and continuously” (¶ 5), however, this does not satisfy the requirement that the public believes that the goods are those of the plaintiff. To better explain, for instance – Cadbury’s purple makes a consumer directly link it with the original product, however, it is not so in this case. Unlike in Cadbury’s case, the red and white combination does not unequivocally point to Exide in the eyes of an average consumer.
A Slippery Slope for Trademark Law
The case exemplifies a slippery slope of granting trademark protection over colour schemes. It underscores a significant tension – what should be the basis for allowing exclusive rights over a colour scheme? While the court acknowledged that this order does not provide a monopoly to Exide over the colour red since “law frowns upon monopolies”, it still went ahead with recognizing a “connection or an association” that rests solely with the petitioner (¶ 21). This risks converting ordinary colour choices into private property. The Court has to be cognizant of certain considerations to avoid crossing into monopolistic territories.
To prevent allowing proprietary claims over even simple decoration or a sign that does not affect the distinctiveness, the functionality doctrine serves as a pertinent tool (elaborated here). To put it concisely, as per the doctrine, a colour used for merely decoration or practical reasons (like, visible safety) does not serve the purpose of a trademark, which is to identify the source of the product.
The functionality can also extend beyond physical traits. It can be conceptual – for instance, there are certain universal concepts like hot, cold, nature, femininity represented by red, blue, green, and pink respectively. These colours describe a concept and not a distinctive mark as such. Thus, if the colour of the packaging style of a product is functional or generic in the given industry, which serves a utilitarian or natural function, protecting it under trademark law will lead to unnecessary blocking of competitors from using such features.
Even the Draft Manual cautions against widespread recognition of granting exclusivity over colours since there lies public interest in not limiting the availability of colours for traders. It is in favour of promoting competition amongst producers. In a relevant industry, certain colours are common or meaningful and should be open to being used by other traders as well – unnecessary restrictions will result in anti-competitive outcomes. In this regard, J. Mansfield in the Australian case of Philmac Pty Ltd v the Registrar of Trade Marks noted that a colour can be trademark worthy if it is not popular, practically motivated or conceptually meaningful for the relevant market. If a colour is naturally chosen by the competitors in a market, the set of colours will be less likely to serve as unique identifier.
This is a cautionary tale against colour monopolies that can emerge when boundaries are not maintained. An example observed in the United States wherein aggressive litigation has enabled brands to effectively own certain colours or combination(s) thereof. This approach favours the large corporations with the bandwidth to engage in long-lasting litigations but harms smaller corporations or new entrants, creating significant barriers for them. Further, such trends depart from the underlying philosophy of Indian trademark law, which seeks to favour public interest.