Sunny Sales & Others v. Binod Khanna

In the world of trademarks, ownership is supposed to be clear-cut. But what happens when two businesses on opposite sides of a dispute both claim the same mark, both claim years of use, and both are simply importing goods from overseas manufacturers? The Calcutta High Court faced exactly this puzzle in a dispute over the brand 'LIPU' (and the related mark 'SUNSHINE'), and its refusal to grant an interim injunction offers a critical lesson for every importer-distributor who believes that selling a product is the same as owning its brand.

The dispute pitted Sunny Sales and its associates against Binod Khanna, two parties operating in the same commercial space. Both claimed long-standing use of the contested marks. Yet beneath these competing claims lay a shared reality: both sides were importers, sourcing their goods from multiple manufacturers in China. Neither party could point to a deep, established history of exclusive trademark registration. Their applications for registration were recent, leaving the question of who truly owned the brand 'LIPU' (and the associated 'SUNSHINE' mark) wide open. This lack of clarity pushed the matter into court, where Sunny Sales and its associates sought an interim injunction to immediately stop the opposing side from using the marks.

Sunny Sales and the other plaintiffs argued that their prior and continuous use of the 'LIPU' and 'SUNSHINE' marks entitled them to protection, and that the defendant's parallel use amounted to infringement or passing off. They sought the court's immediate intervention through an interim injunction. On the other side, Binod Khanna countered that he too had been using the marks for a substantial period, and that the plaintiffs had no superior claim. The core legal friction was simple but profound: when both parties are importers pulling products from a pool of Chinese manufacturers, and when neither holds a long-standing registration, how does a court decide who deserves the shield of an injunction? The court had to weigh competing claims of use against the legal presumption that trademark ownership typically vests in the entity that has built public recognition around the mark.

The Calcutta High Court refused to grant the interim injunction. Its reasoning was grounded in a fundamental observation: while both parties claimed long-standing usage, neither had established exclusive rights to the marks. Because both were importers sourcing goods from multiple manufacturers in China, and because their registration applications were recent, the court found no justification for the extraordinary remedy of an immediate injunction at this stage. The legal presumption that ownership belongs to the manufacturer, not the importer, had not been displaced by either side. However, the court did not leave the matter entirely unchecked. The defendant was directed to maintain detailed sales accounts throughout the litigation, ensuring that any future reckoning of damages or market share would be based on verifiable records rather than vague claims.

For founders, importers, and distributors of foreign-manufactured goods, this case delivers a sobering message: selling a product does not automatically make you the owner of its brand. The burden lies heavily on the importer to prove that the mark has become inextricably connected with their business in the public eye, effectively displacing the legal presumption that ownership vests in the manufacturer. Recent registration attempts, on their own, are not enough to secure an injunction at an interim stage. If you are building a business around an imported brand, invest early in building distinct, verifiable brand equity, document your market presence meticulously, and do not assume that being first to file a registration will shield you from a competitor who can show parallel use.