Dongguan Huali Industries Co. Ltd. v. Anand Aggarwal and Ors.

The Delhi High Court, in a recent judgment, granted an interim injunction in favor of Dongguan Huali Industries Co. Ltd. (“Plaintiff”), barring Anand Aggarwal and others (“Defendants”) from using the mark HUALI. The court found that the Plaintiff had demonstrated prior rights in India, and a prima facie case of dishonest adoption by the Defendants, despite the Defendants being the registered proprietors of the HUALI mark in India.

The Plaintiff contended that since it had marketed furniture components under the mark HUALI globally since 2004, and in India since 2007, it has established substantial goodwill and reputation. The Plaintiff also submitted that it has made efforts to secure a trade mark registration in India, which has been opposed by one of the Defendants. Further, the Plaintiff argued that the Defendants’ adoption of an identical mark for identical goods and services was a deliberate attempt to mislead consumers and exploit the Plaintiff's established market presence. Moreover, as per the Plaintiff, the Defendants had obtained a trade mark registration dishonestly by relying on false documentation.

The Defendants, on the other hand, submitted that they have a valid trade mark registration for the mark HUALI in India. They argued that the Plaintiff has claimed use of its mark in India only since December 2013, in its trade mark application, and that their alleged claim of use in India since 2007 is only an attempt to supersede the Defendants’ use claim of 2008. As regards the allegation of their evidence being false/fabricated, the Defendants submitted that the discrepancies in the documents were owing to inadvertent clerical errors made by junior employees, who have since left the company.

The court, in its decision, highlighted the Defendants’ questionable conduct, including their reliance on forged documents, which threatened irreparable harm to the Plaintiff’s market reputation and financial interests. The court also emphasized that while trademark registration grants statutory benefits, it does not extinguish prior common law rights arising from actual use and accrued goodwill. Accordingly, the court granted an interim injunction in favour of the Plaintiff.