CASE BRIEF: RELAXO FOOTWEARS LIMITED VS AQUALITE INDUSTRIES PVT LIMITED

 

CASE NAME	Relaxo Footwears Limited vs Aqualite Industries Pvt Limited
CITATION	MANU/DE/2681/2021, MANU/DEOR/262044/2023
COURT	Delhi High Court
Bench	Jayant Nath, J., Sidharth Mathur, Registrar
Date of Decision	08 Oct’ 2021, 18 Oct’ 2023

INTRODUCTION

Relaxo Footwears Limited vs. Aqualite Industries Pvt. Limited is a significant case concerning design infringement in footwear products. The case addresses important questions about design protection, novelty in footwear designs, and the criteria for determining design infringement. The dispute centers around allegations that Aqualite Industries copied distinctive design elements from Relaxo's registered footwear designs, particularly focusing on specific aesthetic features like vertical ridges and grooving patterns. The plaintiff, Relaxo Footwears Limited, began as a small enterprise in 1976 and was incorporated in 1984. Starting with Hawaii slippers, the company grew to become India's largest footwear producer with a turnover of Rs. 2,400 crores, manufacturing over 6 lakh pairs of footwear daily. The case examines the balance between protecting registered designs and the inherent constraints in footwear design innovation.

FACTS

• Relaxo Footwears claimed design rights over two products, BHG 136 and BHG 137, both registered under the Designs Act of 2000.
• BHG 136's distinctive feature was vertical ridges/grooving patterns running across the entire slipper's periphery (Design Registration No. 325071 dated 27.12.2019).
• BHG 137 featured vertical ridges/grooving patterns in the upper half of the slipper's periphery (Design Registration No. 325074 dated 27.12.2019).
• In February 2021, Relaxo discovered alleged lookalikes of their products in Delhi markets.
• The defendant's products (Fashion 919 and Fashion 925) were claimed to be slavish replicas of the plaintiff's designs.
• The plaintiff had previously filed suits against the defendant (CS(COMM) 1510/2016 and CS(COMM) 1288/2018) for similar infringement issues.

ISSUES

1. Whether the defendant's products constituted infringement of the plaintiff's registered designs.
2. Whether the plaintiff's designs lacked novelty and originality as claimed by the defendant.
3. Whether the designs were subject to prior art and thus not protected under Section 5(1) of the Designs Act, 2000.
4. Whether slight variations in design qualify for registration/protection under the Designs Act.

ARGUMENTS

Plaintiff's Arguments:

1. Claimed unique features in their designs, including teeth-like structures and specific patterns.
2. Argued that their designs were inherently distinctive, arbitrary, and fanciful.
3. Contended that the defendant was a habitual infringer of their intellectual property rights.
4. Asserted that the designs were duly registered and entitled to protection.

Defendant's Arguments:

1. Claimed the plaintiff's designs lacked novelty and originality.
2. Argued that the features were subject to prior art and common to trade.
3. Contended that slight variations in design do not qualify for registration/protection.
4. Claimed that footwear designs have inherent constraints that limit innovation possibilities.

DECISION 

The Delhi High Court carefully examined the claims of design infringement and the defenses raised by Aqualite Industries. The Court first addressed the fundamental question of whether the defendant had copied the plaintiff's designs. Through a visual comparison of the products, the Court found striking resemblances between the designs, particularly noting how the teeth-like structure had been copied in the defendant's products - throughout the entire circumference in Fashion 919 and in the upper half in Fashion 925. The Court then considered the defendant's claim of prior art and lack of originality in the plaintiff's designs. While acknowledging the Division Bench's observation in Crocs Inc. vs. Bata India Ltd. that footwear manufacturers have limited flexibility in creating new designs, the Court emphasized that this limitation does not exclude footwear from protection under the Designs Act, 2000. The Court found that the defendant's evidence of prior art was insufficient, as the documents presented did not establish clear launch dates or publication dates of the allegedly similar designs. Addressing the defendant's own conduct, the Court noted that Aqualite Industries had themselves applied for registration of similar designs. This fact weakened their argument that such footwear designs could not be protected. The Court referenced the Cartwright vs. Coventry Radiator Company case to emphasize that while no one can claim monopoly over basic design elements, the combination and unique presentation of these elements can create a protectable design. The Court found particular significance in the timing and nature of the defendant's actions. Despite previous litigation and design infringement settlements, the defendant continued with similar practices. This pattern of behaviour influenced the Court's assessment of the defendant's intentions and strengthened the plaintiff's case for immediate relief. In evaluating the balance of convenience, the Court considered the potential harm to both parties. Given the plaintiff's established market presence, significant investment in design development, and clear registration certificates, the Court found that allowing the defendant to continue producing similar designs would cause greater harm to the plaintiff than the temporary restriction would cause to the defendant. The Court concluded that Relaxo Footwears had established a prima facie case of design infringement. While acknowledging that the defendant's claims about lack of originality and prior art would require detailed examination during the trial, the Court held that these defenses could not be accepted at the interim stage. Consequently, the Court granted an injunction restraining Aqualite Industries from using designs similar to BHG 136 and BHG 137. Finally, the Court emphasized that its decision was based on the specific facts and circumstances of the case, particularly the visual similarity between the designs and the inadequacy of the defendant's evidence of prior art. The order specifically restricted the defendant, its directors, and associated parties from using the registered designs or any deceptively similar variations.

LATEST ORDER

In a recent procedural development on October 18, 2023, Joint Registrar (Judicial) Sidharth Mathur issued an order in the ongoing case. The order granted the plaintiff's counsel an additional opportunity to rectify defects in their e-replication (diary no. 446778/22). Additionally, both parties were directed to submit physical copies of their respective documents if not already filed, along with a joint schedule of documents. The matter has been scheduled for admission denial and marking of exhibits on January 22, 2024. This procedural order digitally signed and verifiable through the Delhi High Court Order Portal via QR code, indicates that the case continues to progress through the judicial system, with both parties being required to complete necessary documentation requirements before the next hearing. This latest order suggests that the substantive issues of design infringement discussed in the main judgment have yet to reach a final resolution as the case moves through standard court procedures.

ANALYSIS

The Relaxo Footwears judgment marks a significant development in Indian design law, particularly in how courts approach design protection in functionally constrained products. The decision provides a balanced framework for evaluating design infringement claims while acknowledging the practical limitations that certain industries face in creating entirely novel designs. This approach ensures that legitimate design innovations receive protection while preventing monopolization of basic design elements. The Court's emphasis on visual comparison as the primary method for determining design infringement provides clear guidance for future cases. By focusing on the overall visual impression and essential features rather than minor technical differences, the Court has established a practical and efficient approach to evaluating design infringement claims. This methodology is particularly valuable in cases involving mass-produced consumer goods where design variations might be subtle but commercially significant. The judgment also addresses the complex relationship between functionality and design protection in footwear. While acknowledging the inherent constraints in footwear design due to functional requirements, the Court rejected the notion that these constraints completely preclude design protection. This balanced approach ensures that innovative design elements receive protection while maintaining access to basic functional features necessary for footwear manufacturing. The Court's treatment of prior art claims is particularly instructive for future cases. By requiring clear evidence of publication dates and market presence for alleged prior art, the Court has set a high standard for defendants seeking to invalidate design registrations. This approach protects legitimate design rights while leaving room for valid prior art challenges when properly substantiated. The decision reinforces the importance of design registration and the prima facie protection it offers. While registration alone does not guarantee protection, the Court's approach suggests that registered designs will receive strong interim protection when supported by evidence of commercial use and clear visual distinctiveness. This interpretation encourages businesses to invest in design innovation and proper registration procedures. The Court's consideration of the defendant's own conduct, particularly their attempt to register similar designs while challenging the protection ability of such designs, highlights the importance of consistent business practices in intellectual property disputes. This aspect of the judgment suggests that courts will look unfavorably upon contradictory positions taken by parties in design infringement cases. Finally, the judgment contributes to the broader development of intellectual property law in India's manufacturing sector. By providing clear guidelines for design protection while acknowledging industry-specific constraints, the Court has created a framework that balances innovation protection with practical business realities. This approach is particularly relevant as India's manufacturing sector continues to grow and compete in global markets where design innovation plays an increasingly important role.