Informist, Tuesday, Jan. 21, 2025

NEW DELHI – Allowing an application by Kirloskar Brothers Ltd., a district court in Pune, Maharashtra, stayed a communication issued by Kirloskar Proprietary Ltd. to terminate a trademark licence or user agreement regarding trademarks of various Kirloskar Group companies. In the agreement, various companies of the group had assigned their trademarks to Kirloskar Proprietary. Thereafter, the companies were given licences to use the trademarks.

"...the plaintiff (Kirloskar Brothers) has satisfied prima facie case. Even balance of convenience lies in favour of the plaintiff as the defendant (Kirloskar Proprietary) may not suffer any loss if the injunction is granted," the court said. On the contrary, Kirloskar Brothers may suffer an irreparable loss if the injunction is not granted, it said.

The court observed that Kirloskar Proprietary may take action for infringement against it, which may force Kirloskar Brothers to stop using the trademarks. That may result in drastic repercussions not only for Kirloskar Brothers, but also for the public at large, it said. Hence, Kirloskar Brothers is entitled to get an injunction, the court added.

Kirloskar Brothers said the sole purpose for which Kirloskar Proprietary was incorporated was to take care of the trademarks and other intellectual property rights of Kirloskar Group companies. Kirloskar Brothers said the assignment agreements were executed only to protect the trademarks of the plaintiff and other group companies.

The court was hearing a suit by Kirloskar Brothers challenging Kirloskar Proprietary's ability to terminate the trademark licence or user agreement between the companies. During the pendency of the proceedings, Kirloskar Proprietary had withdrawn its communication and reinstated the licence or user agreement in favour of Kirloskar Brothers. However, the suit continued as the withdrawal was not unconditional and the issues raised by Kirloskar Brothers for consideration by the court continued to subsist.

In July 2024, Kirloskar Proprietary once again communicated its intent to terminate the trademark licence or user agreement and the same would take effect after 180 days from the date of the communication. Aggrieved, Kirloskar Brothers had filed an interim application in the suit challenging the communication.

On Tuesday, the shares of Kirloskar Brothers Ltd. ended 3.6% lower at INR 1,902.45 on the National Stock Exchange. End

Reported by Surya Tripathi

Edited by Rajeev Pai

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