Insights & Research
A store layout is the arrangement and design of a physical store or retail space. It includes elements such as the layout of merchandise, the placement of signage and displays, the use of lighting and color, and the overall aesthetic of the space. The store layout is an important aspect of a retail business, as it can influence customers’ shopping experiences and help attract and retain customers.
When a person thinks of a particular restaurant or store, they may have an image in their mind of the storefront, layout, color scheme, decor, and interiors. For instance, Apple store layouts are characterized by features such as flat tables, white shelves and decor, and glass walls, and are known for their signature white color scheme, clear-glass fronts, and flat tables. This raises the question of whether the consistent use of layouts and decor over time and with brand expansion can become a source identifier and extension of a business, similar to a trademark or trade dress. Because companies invest significant resources in developing unique or distinctive store outlets, it is important for them to protect their investment.
In the case of Cadbury India Limited v. Neeraj Foods and Products, the Delhi High Court observed that the protection of the hard-earned reputation and goodwill vested in one’s goods and services as the basis behind trademark law. On May 19, 2017, the Indian Hotels Company made history by obtaining a trademark registration for the exterior design of the Taj Mahal Palace Hotel in Mumbai. This is the first time that an iconic landmark in India has received a registered trademark.
In Indian trademark law, there is no express provision to protect store layouts but the inclusive definition of ‘mark’ under s.2(1)(m) has allowed for the recognition of non-conventional marks. To qualify as a trademark under the Indian Trade Marks Act 1999, Section 2(1) (zb), a mark must meet the following criteria:
Thus, a store layout would fall under the purview of the definition of a trademark. In the case of Starbucks Corporation v. The Nature bake Pvt. Ltd., the Delhi High Court held that a store layout can be protected as a trademark if it meets the requirements for trademark registration.
From the above definition we can understand that graphical representation of the mark to that is to be registered is an important pre-requisite for the registration of a mark as a trademark. Rule 2 of Trademark Rules, 2017 states that a graphical representation means the representation of a trademark for goods or services represented or capable of being represented in paper form and includes representation in digitized form.
Challenges in Protection
The protection of store layouts does come with several advantages. However, at the same time, it does stretch the scope of trademark laws to give rise to certain disadvantages. One of the significant issues that most store layout applications face is proving the distinctiveness of a store layout. The onus is on the applicant to prove that the store layout created is specific to the business and that the consumers may immediately recognize the brand through the store layout. These objections can be overcome by annexing pictures of the actual stores, showing evidence of use, if any, stressing on the description of mark and consistency in the store layouts worldwide.
In the case of Levi Strauss (India) Pvt. Ltd. v. J.K. Industries, the court granted an injunction in favour of the plaintiff, Levi Strauss (India) Pvt. Ltd., prohibiting the defendant, J.K. Industries, from using a store layout that was similar to that of the plaintiff's stores. The court held that the plaintiff's store layout was distinctive and non-functional, and therefore qualified for protection under the Trade Marks Act, 1999.
The main issue with layout marks is whether they can accurately identify the source of a product. In the case of Apple Store, the German Trademark office initially argued that the design of the store may help consumers understand the quality and price range of the goods, but not the source, meaning that other trademarks are necessary. However, Apple argued that many 3D trademarks are applied directly to the product, making them inseparable from it. Additionally, Apple pointed out that non-conventional trademarks such as color and motion marks are often used in conjunction with word marks. Unlike traditional trademarks, store layouts are made up of multiple elements arranged in a specific way. As it is not possible to determine the exact size at which the mark will be used, it may take on different appearances, potentially leading to protection of all possible variations of the layout. However, layout marks can meet the standards for non-conventional trademarks as outlined by Ralf Sieckmann - being "clear, precise, self-contained, easily accessible, intelligible, durable, and objective" - if their visual representations accurately depict their proportions. According to Trade Mark Rules, the graphical representation of shape trademark applications must be in the form of drawings showing all features of the mark, accompanied by a detailed description of those features. The registrar may also request different perspectives. The functionality doctrine in trademark law prohibits the registration of marks that consist of technical features that add value to the product itself. This doctrine, found in Section 9(3) of the Trade Marks Act, is meant to prevent the anticompetitive effects of granting monopolies on functions. Functionality can often be an issue for taste or scent marks, as they are often used to make products more appealing. In the context of layout marks, functionality can be a challenge as the items used to create the unique arrangement may be necessary for certain technical functions.
A prerequisite for trademark registration is the ability of the mark to distinguish the goods or services of the applicant from the other. Section 9(1)(a) of the Trade Marks Act even lists the lack of distinctiveness of a mark as a ground for refusal for registration. Godrej and Boyce, who had applied for trademark registrations of areas in their ‘U & Us Home Studio’ had to establish the distinctiveness of their ‘Discussion Area Zone’, ‘Material Library Zone’ and ‘Colour Visualiser Zone’.
Concept of Trade Dress
The concept of ‘trade dress’ may not be expressly provided for under the provisions of the Trade Marks Act, but has been adjudicated before Indian Courts in cases such as Colgate Palmolive Company v Anchor Health and Beauty Care Pvt. Ltd., where the High Court of Delhi held that the adoption of similar elements in the packaging of the goods, namely the adoption of the colours red and white for packaging toothpaste tubes, could very well create confusion as to the origin of the goods in the mind of the average consumer. In the event an illiterate consumer was to consume the goods of Defendant solely based on the identical trade dress of the two goods, it would be tantamount to passing-off under trademark law. The principles of trade-dress have been adopted for adjudicating IP matters on store layouts as well. In Merwans Confectioners Pvt. Ltd. v Sugar Street, the Plaintiff had filed a suit for perpetual injunction against Sugar Street, which was one of their franchisees for adopting the distinctive trade dress associated solely with their outlet. The usage of this trade dress continued post the termination of the franchise agreement between the parties on account of lapses by Defendant. The High Court of Bombay rejected the claim the Plaintiff sought over certain features of their entity, including the placement of furniture and lighting, stating that features which add merely to the aesthetic of a store and serve no source-identifying features cannot be granted exclusivity under trademark law. This decision of the High Court of Bombay acts as a caveat for store owners who are looking to seek registration of their layout in the future.
Design Registration in Store Layouts
One question that arises in relation to store layouts as trademarks is why they can't be protected as copyright or industrial design instead. While some architectural designs can be protected under copyright, it does not cover the design of useful articles themselves. Store layouts have been protected as industrial designs in the past, with an example being the registration of KFC's layout design. However, the main drawback of using industrial design protection for a store layout is that it is limited in terms of the length of protection and number of renewals, whereas trademark rights can be renewed indefinitely every ten years. Industrial design protection also cannot be obtained if the design has been publicly disclosed in any way, whereas a trademark on a store layout can be registered regardless of how long it has been in use and even if it has been publicly disclosed. Another option is to first register the store layout as an industrial design and then as a trademark. This approach has been supported in two High Court decisions in India - Crocs Inc USA vs. Bata India and Super Smelters Limited vs. SRMB Srijan Private Limited - where it was held that a registered design that has not lost its distinctiveness after its expiration may meet the requirements for a trademark. In this case, not recognizing the mark as a trademark would be to conflate two distinct things.
The cost to register a trademark for an individual, a sole proprietorship, a startup, or a small entity (MSMEs) is Rs. 4500 per class. The cost to register a trademark is Rs. 9000 per class for all other applicants, including bodies corporate, Limited Liability Partnerships (LLP), partnership firms, joint applicants, societies, and trusts. There may be additional fees for marks, series of marks, and associated marks, and these fees will apply to each class.
The government fee for applying for a trademark in India will depend on the number of classes for which you are seeking protection. The overall cost of trademark registration may seem high at first, but it can be justified by breaking down the fees involved in the process. In order to register a trademark in India, there are several steps to follow, and each step has associated fees. Understanding these fees can help you understand the cost of the process.
Choosing the right brand name for your company can be a difficult and challenging task, as it will become a part of your brand identity and may be difficult to change later on. It is important to carefully consider your options and conduct thorough brainstorming sessions to come up with the best possible brand name. Once you have a brand name in mind, it is crucial to conduct a trademark search as soon as possible to ensure that it is available and can be registered.
It is important to protect your trademark in the appropriate class or classes for the goods or services that you offer under your trademark. There are 45 trademark classes. The first 34 classes are goods while the rest are services classes. Classification of the trademark is also a crucial part.
While it is commonly believed that the first step in registering a trademark is filing, the actual first step is conducting a trademark search. This search involves checking with the trademark office to see if any identical trademarks are already registered in the relevant class. The trademark agent or attorney will conduct this search to determine whether the name or logo of your company is similar to any existing registered trademarks. A trademark search is important because it can reveal the presence of similar or identical brands, helping you to choose a distinctive trademark. Once it is determined that your chosen trademark is unique, you can move on to the next step in the process. The cost of a trademark search is determined by the client's choice of brand name, logo, etc.
Cost for a trademark search: No official fees in India.
Timeline: 1 day
If the results of the trademark search show that your business name or logo is unique, the trademark attorney will draft a trademark application. However, if someone else already has the same or a similar trademark, you may need to choose a different name or logo. You might be able to contest the other party's registration if you think the trademark is legitimately yours and you have used it for a long time, even before they registered it. Once you have filed a trademark application, whether manually or online, you may use the ™ symbol to indicate that you are seeking trademark protection. The application must be filed with the appropriate trademark registry.
Fees for a trademark application: For individuals, startups, small businesses, and large entities, the government fee is Rs. 4500 per mark and Rs. 9000 per class.
Timeline: 1 to 2 days.
After you have filed a trademark application, a trademark examiner will review it to determine if it meets the requirements for registration. If the examiner raises any objections to the application, you will need to file a response and address the objections within one month of receiving them. Working with a knowledgeable service provider who can anticipate potential objections during the classification and trademark search process can help you avoid many of these issues, saving both time and money in the process of getting your trademark registered in India.
Costs for Response to Objection: No official fees.
Examination timeline: 1 to 2 months from the date of filing your application.
Response timeline: w/in one month from the date of examination.
If you are able to successfully contest any objections raised during the examination process, your trademark application will be published in the trademark journal. You can view the status of your application online. After the trademark has been published in the journal, the general public has the right to file an opposition to the registration within four months if they believe it will cause them harm. An opposition proceeding can extend the timeline for registration by up to four years.
Cost for filing a notice of opposition and counterstatement: The official fee is Rs.2700/- per trademark per class.
If there are no oppositions filed within four months of the publication of your trademark in the journal, registration will be granted. The registration is valid for a period of 10 years from the date of application. Once the registration has been granted, you may use the ® symbol to indicate that your trademark is registered.
Fees for registration certificate: No official fee for obtaining a digital trademark certificate from the trademark office. The certificate can be easily downloaded from E-register in India.
Timeline: usually released within a few months of the date of the advertisement.
Once your trademark has been registered in India, it must be renewed every 10 years by paying the prescribed fee. If the trademark is not renewed, it will be removed from the Register of Trademarks.
Costs for a Trademark renewal: As official fees, the government charges Rs. 9000 per mark and per class.
The ongoing trend of protection of store layouts is a positive move .On the otherhand , there is still room to grow as it's in its developing phase. . It has a vast scope as it is already recognized as a non-traditional trademark. The trademark for store layouts proves to be a benefit to the IP protection for small enterprises ,businesses ,companies etc and their designs/layouts
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