Background of the case:

The Commission received a complaint from “Nimco Corner” alleging that its registered trademark, firm name, and product packaging, were being fraudulently used by “Mr. Nimko Corner” and “Karachi Nimco.” Nimco Corner claimed that it was the sole proprietor of the registered name ‘NIMCO’ since 1947, along with its distinctive logos and packaging. An enquiry was initiated to probe into the matter.

The enquiry committee concluded that Mr. Nimko Corner and Karachi Nimco had violated Section 10 of the Competition Act, 2010 by imitating the trademark, packaging, and color scheme, design and get up of products of Nimco Corner.

During the hearings, Mr. Nimko Corner failed to appear before the bench despite several reminders. Therefore, the Commission proceeded ex-parte ine accordance with Regulation 26(2)(e) of the Competition Commission (General Enforcement) Regulations, 2007.

Issues:

i) Whether the complaint is time barred?

ii) Whether the complaint is filed maliciously or with mala fide intent?

iii) Whether the defense of Genericism is available to Respondents vis-à-vis the word “NIMCO”?

iv) Whether the Respondents have violated section 10 of the Competition Act?

Foreign Judgments:

1) Backaldrin Osterreich The “Kornsitz” Company GMBH v Pfahnl Backmittel GMBH, [2014] EUECJ C-409/12

2) Societe Des Produits Nestle S.A . vs. Food International (Pvt.) Limited

3) Colgate Palmolive Co v Anchor Health and Beauty Care Pvt Ltd, 2003 (27) PTC 478 Del

Order:

The Respondent No.2 had placed reliance upon Section 81 of the Trademark Ordinance and asserted that the violations by Respondent No.2 were in knowledge of the Complainant for 5 years and the Complainant had not taken any action, and therefore the Complainant had acquiesced to the violation and the complaint was hit by laches. The Commission noted that no evidence had been presented which indicated that the Complainant had been aware of the infringement for 5 years. The Commission also held that the provisions of the Competition Act, in line with Section 59 thereof, will have overdinig effect and therefore Section 81 of the Trademark Ordinance was not applicable.

The Commission also held, in response to the defense of genericism taken by the Respondent No.2, that until any direction is issued by the relevant authority vis-à-vis the generic word fo the word ‘NIMCO’ , the Commission cannot entertain any such defense.

The Commission concluded that the Respondent had clearly violated Section 10 by imitating the trademark and packaging material of the complainant. It was further held that Karachi Nimco by using the word “NIMCO” in its branding and copying the firm name and packaging of Nimco Corner had violated Section 10 of the Act.

A penalty of PKR 25 Million was imposed on Mr. Nimko Corner and on Karachi Nimco for violating Section 10 of the Competition Act and it was directed that the undertakings cease and desist from the use of the word “NIMCO” along with any trademark, trade dress and packaging material similar to that of the M/s Nimco Corner. The two undertakings were moreover directed to repackage their products to distinguish them from the products of M/s Nimco Corner.

Current Status:

In the instant matter, Karachi Nimco from filed writ. Petition before the Honorable Islamabad High Court obtained stay order in respect to the instant order. Whereas, Mr. Nimko Corner filed appeal before the Honorable Competition Appellate Tribunal, however no stay order was granted.