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Dunkin Donuts Sued for Alleged Trademark Infringement

Life isn’t so sweet for Splenda in what could turn into a bitter courtroom battle.

Heartland Consumer Products, the Carmel-based company behind Splenda, is suing Dunkin’ Brands Inc., alleging the company is misleading consumers into thinking they are getting the real Splenda when it’s just a knockoff.

According to the complaint filed in federal court this week, after Dunkin’ and Heartland ended their business relationship in April, the restaurant chain turned to “Chinese-made, off-brand sucralose” in packaging that Heartland claims is similar to Splenda’s.

Both sweeteners come in pastel-yellow paper packets.

The Dunkin’ version does not include any brand name for the sucralose it contains, but the new packaging indicates it is manufactured for Dunkin’ by Chicago-based Merisant.

Additionally, the company claims Dunkin’ employees tell customers that Dunkin’ uses Splenda products.

“Investigators revealed that a clear majority of stores affirmatively represented, through their agents or employees, that non-Splenda sucralose sweetener was used instead Splenda brand sweetener,” the complaint states.

Heartland has applied for an injunction to stop Dunkin’ Donuts from representing that it uses Splenda products, as Dunkin’ is “irreparably damaging the value of Heartland’s iconic Splenda trademark and other marks,” according to the 22-page complaint.

The company is claiming other damages arising from Dunkin’s “violations of trademark and trade dress infringement, dilution and unfair competition under the Lanham Act, the Indiana State Trademark Act, the common law of the State of Indiana and the Indiana Crime Victims Act.”

Splenda is a low-calorie sweetener derived from sugar using a patented process to create a sweetener that tastes like sugar, according to its website.

It was introduced to American markets in 1999. and Heartland and owns 62% of market share as of 2007. The company’s U.S. trade sales this year are expected to be $163 million.

Legality of Parallel Imports in India viz a viz Kapil Wadhwa Judgment

Intellectual Property Rights (IPR) exist to incentivize innovation & trade and provide exclusivity of usage to authors/innovators/trademark holders. In the present scenario where right holders are vigilant and aggressive in asserting their claim over their intellectual property, the issue of Parallel Imports is assuming an ever greater importance towards determining the limits of Enforcement of IPR in India.

What is Parallel Import? – The Concept, Explained

Parallel Import occurs when goods belonging to right-holders are legitimately acquired/bought by a third party in country A and are then imported to and sold in country B without the express consent of right holders. These goods are legitimately bought in country A where the goods may be available at a lower price than Country B and the same goods are then sold in Country B at a price higher than the authorized sellers of the right-holder, thereby making the same goods available at a lower price to consumers (through parallel channels). This trade practice is carried out to take advantage of differentiation of price of goods between different countries which may be due to various factors including different taxation regime(s), subsidies, market trends, etc.

“For easier understanding, a product which may be priced at $60 in Nepal is imported into India and is sold for $70 in India whereas the actual right-holder of the product has priced the same product at $ 80 for Indian markets. Consumers, in this case, are getting two products of the same brand but at different prices (parallel channels turning out to be cheaper).”     

Whether such imports are legal or illegal depends on the Principle of Exhaustion followed in the country of import. Article 6 of TRIPS (Trade-Related Aspects of Intellectual Property Rights) read with foot note 6 of Article 28 and Article 5(d) of Doha Declaration makes it clear that it is open for countries to determine the principle of exhaustion they want to follow. The Principle of Exhaustion followed by a country determines the country’s stand on whether or not the right holder’s exclusive right over a product is “exhausted” after its first genuine sale to a customer or whether the right holder can control further re-sale or distribution of the goods after first sale. Broadly, two types of exhaustion principles are followed by countries – 1) National and 2) International. In case of national exhaustion principle (followed in USA), the goods can be legally resold only within the territory where they are first sold, which means that the interest of the right holder will exhaust only in the country of first sale and further re-distribution by imports of such goods from other countries is illegal. In case of International Exhaustion Principle (followed in India), after the first sale, the right holder exhausts all the rights over that unit of product internationally and such product can be legally imported/distributed further anywhere in the world.

Under the current Indian law, legislations pertaining to each IPR provides for parallel imports differently such as Parallel imports are expressly prohibited under the Designs Act, 2000 and that the Geographical Indicators Act, 1999 doesn’t cover the issue of parallel imports at all. Since the Section 2(m) had been dropped from the Copyright Amendment Bill, 2012 India still follows principle of national exhaustion with respect to Copyrighted material. In so far as Patents are concerned, Section 107A (b) of The Patents Act, 1970 expressly provides for parallel imports. In addition, Section 30(3)(b) of the Trade Marks Act, 1999 also provides for the issue of parallel import and was discussed in great detail in the case of Kapil Wadhwa v. Samsung Electronics[2013 (53) PTC 112 (Del.)].

A Division Bench of the Delhi High Court, in this case, re-considered the question of whether the Trade Marks Act,1999 embodies the International Exhaustion Principle or the National Exhaustion Principle when the registered proprietor of a Trade Mark places the goods in the market under the registered trade mark. The court held that the earlier finding -that there was legislative intent to put barriers on importation-was premature and went on to interpret Section 30(3) as follows:

“(1) Where goods bearing a registered trade mark are lawfully acquired by a person, the sale of the goods in the market by that person is not infringement of the trade mark by reason only of the registered trade mark having been assigned by the registered proprietor by some other person after the acquisition of those goods. (2) Where goods bearing a registered trade mark are put on the market and are lawfully acquired by a person, the sale of the goods in the market by that person is not infringement of the trade mark by reason only of further sale in the market. The two situations are distinct and operate in mutually exclusive areas and the question of any one being interpreted in a manner to render the other otiose does not arise.”

While defining what “lawful acquisition” is, the court stated that there is no law which stipulates that goods sold under a trade mark can be lawfully acquired only in the country where the trade mark is registered. In fact, the legal position is to the contrary. Lawful acquisition of goods would mean the lawful acquisition thereof as per the laws of that country pertaining to sale and purchase of goods. Trade Mark Law is not to regulate the sale and purchase of goods. It is to control the use of registered trademarks.

Thus the division bench held that the Trademarks Act embodies the principle of International Exhaustion and the term “market” Section 29 and 30 of the act refers to international market and not the domestic market. The only condition imposed by the court on parallel import, in relation to trademark, is that the imported goods should state they have been imported and that after sales service and warranty is not provided by the right holder but rather by the importer.

Despite different principles followed in different countries, Right holders can avail remedies like Injunctions, Damages etc. in cases where unauthorized parallel import amounts to infringement. On the other hand, in a case where parallel import has been declared illegal, provisions of Intellectual Property Rights (Imported Goods) Enforcement Rules, 2007 and the Customs Act, 1962 are also provided for. Under these Enforcement Rules, a right holder may apply to a Commissioner of Customs at a port where the goods infringing his IPR are likely to be imported. If the Custom authorities arrive at the conclusion that the goods being imported are infringing in nature and are liable to be confiscated under Section 111 of the Customs Act then they may Sub-rule (9) of Rule 7 of the said Rules seize the goods. Penalty can also be imposed on importer in terms of Section 112 of the Customs Act. This ensures that the protection of right-holders’ interest remain paramount in the eyes of law.

Indian Court takes strict action against website selling fakes

In a landmark action towards preventing online sale of fake products, the Indian judiciary has taken the strictest action against online infringement activities that were being carried out by an e-retail website.


Online Investigation found that an e-retail website was selling fake goods of globally well-known brands which included some of the biggest athletic footwear & apparel companies and a couple of premium lifestyle companies dealing in apparel, home, accessories and fragrances. Test-purchases confirmed that the goods on this website were infringing the trademark of these global brands. After this finding, a combined action was taken by the right-holders against the website.counterfeitORDER OF THE COURT

Counsel for the Plaintiff – Mr. S.K. Bansal in his arguments, stressed on the Trans-border reputation of the global brands. Taking serious cognizance of the increasing menace of Online-counterfeiting, the court, in order to prevent such infringing activities in future provided for every possible remedy against the Defendants which are currently available under the IPR legislations in India by way of various directions to the Registrar as well as Web-hosting providers of the website. The court appointed a Local Commissioner (LC) to oversee the search and seizure of the infringing products and also restrained the defendants by way of an injunction-order. A complete take-down (blocking) of the entire online presence including social media accounts of was ordered and effected successfully.


The court also directed the Department of Telecommunication (DOT), Government of India, to block the web pages/URLs /other listing of This direction acted as a breakthrough as it meant that each and every URL containing contents of the infringed trademark will be blocked by the Ministry of Communications and Information Technology through all the (Internet Service Providers) ISPs of the country, as and when notified by the Plaintiff through its regular detailed investigations.

Court’s decision under the circumstances of the case acted as a positive proof of the enforcement mechanism of Intellectual property laws in India and the willingness of the court to go to the extra mile for protection of the right holders.