Modi Group barred from using Swedish co trademark

Modi Group's Morgardshammar India, a rolling mill equipment manufacturer, has been restrained from using the Morgardshammar trademark by the Delhi High Court.

Justice A K Pathak restrained India's joint venture firm with Sweden's Morgardshammar AB from using the trademark on the ground that its Sweden partner's share in the Indian firm has plummeted below 25% to 8%, divesting the Indian firm of the right to use the trademark as per the trademark licence agreement.

"In view of the findings on the issues raised, plaintiff (Morgardshammar AB) is entitled for a decree of permanent injunction against use of its trademarks or trade name by the defendants (Morgardshammar India)," said Justice A K Pathak.

Senior advocate Suhail Dutt appearing for Morgardshammar AB, had argued that the Indian company was allowed to use the trademark Morgardshammar in accordance with the trademark licence agreement, as long as shareholding of Morgardshammar AB was not reduced below 25%.

The JV company (Morgardshammar India) had allotted 750,000 shares to U K Modi in 2009 and the shareholding of Morgardshammar AB was reduced to 8%.

As a result of the change in shareholding pattern, Morgardshammar AB had demanded the JV to discontinue the use of the tradename, since it was the proprietor of the trademark Morgardshammar.

The Indian company had contended that Morgardshammar AB did not have exclusive rights on the tradename Morgardshammar as the trademark was not legally assigned to it.