Starbucks Corporation v. Lol Cafe & Anr

judgment procedure in the Commercial Court Act, 2015 is to ensure disposal of commercial disputes in a time-bound manner. In fact, the applicability of Order XIIIA, CPC to commercial disputes, demonstrates that the trial is no longer the default procedure/norm.

¶91Rule 3 of Order XIIIA, CPC, as applicable to commercial disputes, empowers the Court to grant a summary judgement against the defendant where the Court considers that the defendant has no real prospects of successfully defending the claim and there is no other compelling reason why the claim should not be disposed of before recording of oral evidence. The expression "real" directs the Court to examine whether there is a "realistic" as opposed to "fanciful" prospects of success. This Court is of the view that the expression "no genuine issue requiring a trial" in Ontario Rules of Civil Procedure and "no other compelling reason….. for trial" in Commercial Courts Act can be read mutatis mutandis. Consequently, Order XIIIA, CPC would be attracted if the Court, while hearing such an application, can make the necessary finding of fact, apply the law to the facts and the same is a proportionate, more expeditious and less expensive means of achieving a fair and just result.

¶92Accordingly, unlike ordinary suits, Courts need not hold trial in commercial suits, even if there are disputed questions of fact as held by the Canadian Supreme Court in Robert Hryniak v. Fred Mauldin, 2014 SCC OnLine Can SC 53, in the event, the Court comes to the conclusion that the defendant lacks a real prospect of successfully defending the claim." 23A. In reaching the above conclusion, reliance is also placed on the judgments of this Court in Jail Cafe and Anr. (supra) and Teaquila A Fashion Cafe & Anr. (supra).

¶24On the question of claim of damages, in Intel Corporation v. Dinakaran Nair & Ors., 2006 SCC OnLine Del 459, this Court has held as under:- "13. The only other question to be examined is the claim of damages of Rs. 20 lakh made in para 48(iii) (repeated) of the plaint. In this behalf, learned Counsel has relied upon the judgments of this Court in Relaxo Rubber Limited v. Selection Footwear, 1999 PTC (19) 578; Hindustan Machines v. Royal Electrical Appliances, 1999 PTC (19) 685; and CS (OS) 2711/1999, L.T. Overseas Ltd. v. Guruji Trading Co., 123 (2005) DLT 503 decided on 7.9.2003. In all these cases, damages of Rs. 3 lakh were awarded in favour of the plaintiff. In Time Incorporated v. Lokesh Srivastava, 2005 (30) PTC 3 (Del) apart from compensatory damages even punitive damages were awarded to discourage and dishearten law breakers who indulge in violation with impunity. In a recent judgment in Hero Honda Motors Ltd. v. Shree Assuramji Scooters,

(2005) DLT 504 this Court has taken the view that damages in such a case should be awarded against defendants who chose to stay away from proceedings of the Court and they should not be permitted to enjoy the benefits of evasion of Court proceedings. The rationale for the same is that while defendants who appear in Court may be burdened with damages while defendants who chose to stay away from the Court would escape such damages. The actions of the defendants result in affecting the reputation of the plaintiff and every endeavour should be made for a larger public purpose to discourage such parties from indulging in acts of deception.

¶14A further aspect which has been emphasised in Time Incorporated case (supra) is also material that the object is also to relieve pressure on the overloaded system of criminal justice by providing civil alternative to criminal prosecution of minor crimes. The result of the actions of defendants is that plaintiffs, instead of putting its energy for expansion of its business and sale of products, has to use its resources to be spread over a number of litigations to bring to book the offending traders in the market. Both these aspects have also been discussed in CS(OS) No. 1182/2005 titled Asian Paints (India) Ltd. v. Balaji Paints and Chemicals decided on 10.3.2006. In view of the aforesaid, I am of the considered view that the plaintiff would also be entitled to damages which are quantified at Rs. 3 lakh." (Emphasis supplied)

¶25In Hindustan Lever Ltd. and Anr v. Satish Kumar, 2012 SCC OnLine Del 1378, it has been held as under that: "23. One of the reasons for granting relief of punitive damages is that despite of service of summons/notice, the defendant had chosen not to appear before the court. It shows that the defendant is aware of the illegal activities otherwise, he ought to have attended the proceedings and give justification for the said illegal acts. Since, the defendant has maintained silence, therefore, the guilt of the defendant speaks for itself and the court, under these circumstances, feels that in order to avoid future infringement, relief of punitive damages is to be granted in favour of the plaintiff."

¶26In Teaquila A Fashion Cafe & Anr. (supra), this Court awarded damages of Rs.2,00,000/- (Rupees Two Lakh only) in favour of the plaintiff and against the defendants. In my opinion, similar damages deserve to be awarded in favour of the plaintiff and against the defendants in the present suit as well.

¶27In view of the above, a decree is passed in terms of prayer made in paragraph 43 (a), (b) and (e) of the plaint.

¶28The plaintiff is also held entitled to the cost of the Suit. Apart from the Court fee, the plaintiff has filed an 'Advocate Fee Certificate' showing an amount of Rs.13,38,917.85 charged by the counsel as legal fee. The same is found to be reasonable and is thus awarded in favour of the plaintiff and against the defendants.

¶29The Suit is decreed in the above terms. Let a Decree Sheet be drawn accordingly.

NAVIN CHAWLA, J. NOVEMBER 17, 2022/Arya/Ais

* IN THE HIGH COURT OF DELHI AT NEW DELHI Reserved on: 01.11.2022 Date of decision: 17.11.2022 + CS(COMM) 452/2019 & I.A.11495/2019, 13114/2022 STARBUCKS CORPORATION ..... Plaintiff Through: Ms.Priya Adlakha, Mrs.Bindra Rana, Ms.Rima Majumdar, Ms.Shilpi Sinha, Advs. versus LOL CAFE & ANR. ..... Defendants Through: None CORAM: HON'BLE MR. JUSTICE NAVIN CHAWLA 1. This suit has been filed by the plaintiff inter-alia praying for a decree of permanent injunction restraining the defendants from infringing and/or passing off the plaintiff's registered trade mark 'FRAPPUCCINO' and/or using the 'FRAPPUCCINO' mark, including the 'BROWNIE Chips FRAPPUCCINO' or any other similar trade mark in relation to their goods and services. The plaintiff also prays for damages; rendition of accounts of profits illegally earned by the defendants; and for an order of delivery and handing over of all the impugned goods, menu cards, and all other goods of any nature bearing and/or containing the impugned mark 'FRAPPUCCINO' in any manner whatsoever, to the plaintiff for their destruction. 2. Vide order dated 23.08.2019 of this Court, summons in the Suit were issued to the defendants and an ex-parte ad-interim injunction was granted in favour of the plaintiff, restraining the defendants from using 'FRAPPUCCINO' mark in any manner on any of the products sold by them. 3. In spite of service of summons, the defendants chose not to appear or file their written statements and were thus proceeded ex-parte on 28.11.2019. The plaintiff was given time to file its list of witnesses and evidence by way of affidavit. 4. On 26.02.2020, a counsel appeared on behalf of the defendants before the learned Joint Registrar (Judicial), and the learned counsels for the parties submitted that the suit is likely to be settled between the parties and prayed for time for the purpose of compromise. 5. The plaintiff thereafter filed an application, being I.A.13114/2022, under Order XIII-A of the Code of Civil Procedure, 1908 as applicable to commercial disputes of a specified value (in short, 'CPC'), praying for a Summary Judgment against the defendants. Notice of this application was issued by this Court on 22.08.2022, granting a period of three weeks to the defendants to file their reply. However, the reply to the aforesaid application was not filed by the defendant nor was the counsel for the defendant present in Court on 01.11.2022. 6. It is the case of the plaintiff that the plaintiff is a company organized and existing under the laws of the State of Washington, the United States of America (in short, 'United States'). It is a lifestyle- brand company. In the year 1971, its predecessor-in-interest opened its first retail store under the name 'Starbucks' in Seattle, Washington, United States, offering a variety of coffee, tea and spices. In 1985, the plaintiff-company was incorporated as 'STARBUCKS CORPORATION', and in the year 1987, the plaintiff opened its first retail store in locations outside of Seattle, to other locations within the United States as also in Vancouver, British Columbia, Canada. 7. It is further asserted that the plaintiff, under its registered trade mark 'FRAPPUCCINO' and the variations thereof, offers its widely popular hand-crafted blended cold beverages throughout the world. These are also sold in bottled form in many countries in a variety of flavours. 8. The plaintiff has given details of the registration of its 'FRAPPUCCINO' mark in paragraph 7 of the plaint and filed documents in support of this claim. 9. It is further asserted that the plaintiff uses its trade mark 'FRAPPUCCINO' in 30,626 'Starbucks' stores in 80 countries and territories, as well as a bottled-coffee beverage that is distributed to multiple third-party grocery, retail and wholesale stores globally. The plaintiff develops specific flavors for various countries in which beverages under the 'FRAPPUCCINO' mark are available in the 'Starbucks' stores. Some flavors are developed for short