Introduction:

In a significant judgment impacting the interplay of design law and common law rights, the Delhi High Court Division Bench comprising Justices C. Hari Shankar and Ajay Digpaul, in M/S Crocs Inc USA v. M/S Bata India & Ors [RFA (OS) (Comm) 22/2019], restored suits filed by Crocs USA against major Indian footwear brands including Liberty, Bata, Relaxo, Aqualite, and others for allegedly copying Crocs’ distinctive clog design. The division bench overturned an earlier decision of the single judge who had dismissed Crocs’ suits on the ground that no passing off action could lie when the trade dress in question is registered as a design under the Designs Act. The single judge’s ruling had created a chilling effect on the enforcement of rights in product configurations registered under the Designs Act, effectively forcing proprietors to choose between statutory design rights and common law passing off remedies. The division bench’s decision now clarifies that passing off, as a distinct common law remedy, can coexist with statutory design protection, thereby reinstating Crocs’ right to pursue remedies for alleged imitation of its unique clog design, which Crocs claimed enjoys goodwill and distinctiveness as a trade dress in India.

Arguments of the Appellant (Crocs):

Senior Advocate J. Sai Deepak, along with advocates S.K. Bansal, Ajay Amitabh Suman, Gaurav Gogia, Deepak Shrivastava, and R. Abhishek, appeared for Crocs Inc USA, arguing that the single judge erred by relying on the five-judge bench decision in Carlsberg Breweries A/S v Som Distilleries and Breweries Ltd (2019) to dismiss the passing off claims. Crocs contended that the single judge misread Carlsberg to imply that once a design is registered under the Designs Act, a plaintiff is precluded from initiating a passing off action, whereas the actual ratio of Carlsberg only emphasized the overlap between design infringement and passing off claims without negating their independent existence. Counsel for Crocs relied heavily on the three-judge bench decision in Mohan Lal v. Sona Paints & Hardwares (2013), which recognized the right to maintain separate suits for design infringement and passing off, even when both arise from the same subject matter. Crocs argued that the distinctiveness and goodwill attached to its clog design amounted to a trade dress protected under common law, and that the use of an identical or deceptively similar design by the Indian footwear brands misled consumers into believing that the defendants’ products originated from Crocs, thereby satisfying the classic ingredients of passing off: goodwill, misrepresentation, and damage. The appellant further argued that the Designs Act does not oust common law remedies and that a rigid interpretation would undermine both the statutory scheme and the fundamental right to protect business reputation against misrepresentation.

Arguments of the Respondents (Indian Footwear Brands):

On behalf of the respondents, advocates Neeraj Grover, Mohona Sarkar, and Kashish Vij defended the single judge’s order, contending that the Designs Act is a self-contained code that provides exhaustive remedies for design infringement. They argued that once a proprietor opts for design registration, the statutory regime precludes enforcement of common law rights through passing off actions founded on the same design, as such parallel claims would lead to a perpetual monopoly beyond the limited term granted under the Designs Act. The respondents submitted that the registration of the design itself indicated that the features of shape, configuration, pattern, or ornament were aesthetic rather than distinctive of origin, and hence could not simultaneously serve as trade dress in passing off. Counsel for the respondents cited the single judge’s reliance on Carlsberg to support the proposition that any claim for passing off based solely on a registered design should be barred to prevent overlap and inconsistency between the statutory and common law remedies. They insisted that to allow passing off actions on registered designs would create confusion about the extent of design rights and expose defendants to indefinite liability, even after the statutory design rights expire, thereby frustrating the public domain principle inherent in the Designs Act. The respondents also raised practical concerns over dual proceedings causing multiplicity of litigation, forum shopping, and inconsistent verdicts on the same subject matter.

Court’s Judgment:

Delivering a comprehensive 70-page judgment, the division bench of the Delhi High Court held that neither Mohan Lal v. Sona Paints & Hardwares (2013) nor Carlsberg Breweries A/S v Som Distilleries (2019) precluded the institution of passing off suits on the basis of subject matter registered as a design. The bench clarified that Carlsberg only underscored the need to maintain separate causes of action for design infringement and passing off, without ruling out the latter when the subject matter coincides. It observed that the essence of passing off lies in preventing misrepresentation that causes injury to the goodwill of a product, which operates in its own common law space independent of statutory rights under the Designs Act or the Trade Marks Act. The court reasoned that there was no legal bar or policy rationale in the Designs Act to exclude the remedy of passing off where the defendant misuses the registered design as part of a larger trade dress or packaging to deceive customers. It held that Crocs need not establish “something more” than the design itself to maintain a passing off claim; the same design can form the basis for both design infringement and passing off claims, provided that fraudulent imitation and misrepresentation are proved respectively in each cause of action. The court emphasized that a passing off claim arises not merely from copying the design, but from the commercial use of the copied design in a manner that leads consumers to believe the defendant’s goods are those of the plaintiff, thereby causing confusion. It rejected the single judge’s interpretation of Carlsberg as barring passing off actions in cases where the alleged trade dress was subject to design registration, and instead highlighted that Carlsberg recognized that the same elements can sustain both design infringement and passing off claims if properly pleaded. In reinstating Crocs’ suits, the division bench directed the single judge to proceed with the trial on merits, allowing Crocs to pursue both its design infringement and passing off remedies concurrently. This decision marks a pivotal moment in Indian intellectual property jurisprudence by affirming the coexistence of statutory and common law remedies, thus strengthening the protection available to brand owners against imitation that dilutes goodwill and misleads consumers.