The term “family-owned trademarks” refers to trademarks that are used in connection with a family-run business and are equally owned by all family members. These trademarks grant all family members parallel rights to use the mark. As a result, it offers each heir protection under the shared goodwill and common family legacy doctrine.
When a family splits, questions about who will own the family business’s intellectual property and how to divide it come up. These disputes often center on the family’s trademarks. The courts have consistently ruled that family trademark disputes fall under the same legal guidelines as other family disputes.
How is a trademark dispute regulated when the parties are the heirs of the first owner of the trademark?
Unlike residential property and cash, intellectual property can not be divided, but all legal owners possess equal rights over the trademark. The Supreme Court of India further held that the peace and tranquility of families in such cases must be maintained, and family arrangements should not be disturbed as far as possible.
Even though there are elements of commercial disputes, family disputes have generally been handled differently by all courts. When it comes down to it, a trademark is also a type of property. Therefore, it makes sense that family members who run a business under a well-known and valuable trademark will resist giving up their rights to the mark.
In the case of Shri Ram Education Trust v. SRF Foundation & Ors, where the Plaintiff—one of the famous Sir Shri Ram’s legal heirs—was asserting sole ownership of the trade mark SHRI RAM by claiming to the court that he first used the same in 1988, you can learn how the court handles family trademark disputes.
During the hearing, it was brought to the court’s attention that their grandfather had first used the aforementioned mark when operating prestigious educational institutions like Lady Shri Ram College and Shri Ram College of Commerce. Due to their shared ancestry, both parties were equally entitled to use the family trademark. The court viewed the situation as a family conflict and decided that one family member could not assert exclusive ownership of the mark without more evidence to the contrary. The other heirs are not prohibited from using the same mark simply because one heir previously adopted it.
Though the matter can be resolved through a family settlement, it is recommended that a Memorandum of Understanding is also created as a valid strategy. In the case of famous music company owner Gulshan Kumar’s family, the Delhi High Court stated that the petition was more about family arrangements between the parties. In such a situation, giving equal importance to both parties is essential. The Delhi High Court Bench in the matter of Rajni Dua & Ors vs Bhusan Kumar & Ors ruled to keep a considered view that the arrangement that had been going on during the lifetime of the late Mr Gulshan Kumar and that has been again reiterated in the notes prepared in the handwriting of defendant no. 1 and plaintiff no. 2 and later given a concrete shape in the form of a family arrangement must continue.
Similarly, in the same court in the matter of Darshan Lal Dhooper vs. Motia Rani & Ors., citing the previous judgment, the deed was dissolved, stating that the terms and conditions state that neither the petitioner nor the respondent Nos. 1 through 3 individually may claim to be the owner of the aforementioned trade mark “Plaza.” So, under the terms of the aforementioned agreement, any application for registration of the trademark “PLAZA” could only have been made in the joint names of the petitioner and the respondent Nos. 1 to 3.
What statutory solution does the Indian court recommend for trademark disputes within families?
The courts have ruled that it is crucial to keep the peace within the family and try to keep things as they are whenever possible when there are family trademark disputes. If the agreement is followed and respected, peace and harmony within a family can be restored.
It is important to ascertain whether the party asserting superior rights under the mark has perfected those rights after inheriting them in cases involving the inheritance of a family trade mark or the division of a family trade mark. Such legal actions frequently result in a settlement that benefits both parties or a win-win situation.
In order to avoid conflicting or divergent interpretations, a statutory remedy would be the most practical way to address any future issues of this nature.