Delhi High Court Cancels Bad Faith Trademark Registration Against “Beauty of Joseon” : Combatting Trademark Squatting

Introduction

The case of Goodai Global Inc. v. Shahnawaz Siddiqui & Anr. (C.O. (COMM.IPD-TM) 81/2024) revolves around a rectification petition under Section 57 of the Trade Marks Act, 1999 filed against mark titled ‘Beauty of Joseon’. The petition was filed by Goodai Global Inc., a South Korean entity, seeking the removal of a device mark registered under application number 5635163 in Class 3 in favor of the respondent on a ‘proposed to be used’ basis. The Delhi High Court, through Justice Amit Bansal, delivered a judgment on January 28, 2025, granting the petition and canceling the impugned mark on grounds of bad faith and deceptive similarity.

Understanding the Key Legal Concepts

Before delving into the judgment, it is crucial to understand some fundamental legal terminologies and provisions:

1. Trade Mark Rectification (Section 57 of the Trade Marks Act, 1999): This provision allows any aggrieved party to seek the cancellation or rectification of an erroneously registered trade mark.
2. Bad Faith Registration (Section 11(10)(ii)): The Act prohibits the registration of trademarks acquired in bad faith, which refers to dishonest adoption to exploit an existing brand’s reputation.
3. Trade Mark Squatting: This occurs when an entity registers a well-known mark to block the legitimate owner’s entry into the market.
4. Proposed to be Used Basis: A trademark applicant may file for registration without prior use but must establish intent to use the mark genuinely.

Facts of the Case

• The petitioner, Goodai Global Inc., is a South Korean manufacturer of beauty and personal care products, operating under the brand ‘Beauty of Joseon.’
• The company launched its products globally in 2010 and started exporting them to India in August 2022 through multiple e-commerce platforms.
• In December 2023, while filing for trademark registration in India, the petitioner discovered that the respondent had registered a near-identical device mark on a ‘proposed to be used’ basis.
• The petitioner subsequently filed a rectification petition, arguing that the respondent had no legitimate basis for registration and that the mark was obtained dishonestly.

Contentions of the Petitioner

• The respondent’s mark is deceptively similar to the petitioner’s established brand, leading to confusion among consumers.
• The respondent had no legitimate intent to use the mark but had merely registered it to prevent the petitioner from entering the Indian market.
• The respondent failed to appear in court and did not file a reply, indicating a lack of substantive defense.
• Given the petitioner’s global presence and extensive use of the mark, the respondent’s registration was an act of bad faith under Section 11(10)(ii) of the Trade Marks Act, 1999.

Contentions of the Respondent

• The respondent did not file any reply or appear in court, leading to an ex-parte order against them.
• The failure to contest the petition reinforced the inference that the respondent had no legitimate claim over the impugned mark.

Issues Raised

1. Whether the respondent’s registration of the impugned trademark was valid under Indian trademark law?
2. Whether the petitioner had established prior use and goodwill associated with the disputed mark?
3. Whether the respondent’s conduct constituted bad faith and warranted cancellation under Section 57 of the Act?

Judgment and Ratio Decidendi

• The Delhi High Court ruled in favor of the petitioner, granting the rectification petition and ordering the removal of the impugned mark from the Trade Marks Register.
• The court held that:
  • The respondent’s mark was deceptively similar to the petitioner’s globally recognized brand.
  • The respondent had no legitimate reason to adopt a Korean-language mark and had registered it merely to obstruct the petitioner.
  • The absence of a defense from the respondent indicated that the registration was obtained in bad faith.
• The court relied on precedents such as Kia Wang v. Registrar of Trademarks and BPI Sports LLC v. Saurabh Gulati, reinforcing that registrations obtained dishonestly should be canceled.

Conclusion

The judgment in Goodai Global Inc. v. Shahnawaz Siddiqui & Anr. serves as a crucial precedent against trademark squatting and bad faith registrations. It reinforces the principle that a well-known international brand’s established goodwill cannot be misappropriated by third parties through dishonest registrations. By canceling the impugned mark, the Delhi High Court has upheld the integrity of trademark law and protected genuine brand owners from opportunistic misuse.

This case highlights the importance of proactive trademark enforcement by global brands and provides clear guidance on legal remedies available in cases of bad faith registration in India.

Link to the complete judgement: https://dhccaseinfo.nic.in/jsearch/judgement.php?path=dhc/ABL/judgement/04-02-2025/&name=ABL28012025COT812024_102702.pdf

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