Madras HC declines monopoly to ITC and Nestle on noodles brand names

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Ending a seven-year dispute between two FMCG majors over use of ‘Magic Masala’ and ‘Magical Masala’ as expressions to market their noodles brands, the Madras High Court said they are common English and Indian words and both the companies cannot claim monopoly over them as these words are laudatory and common to the trade.

The order was issued in a dispute filed by ITC alleging that Nestlé India has used the expression ‘Magical Masala’ for its instant noodles brand Maggi in 2013. ITC had used the expression ‘Magic Masala’ with its noodles brand Sunfeast Yippee! in 2010.

Justice C Saravanan observed in the order that inroads made by ITC in the instant noodles segment with use of the expression Magic Masala was perhaps on account of the attractive pricing of its instant noodles as compared to Nestle. It was also on account of the fact that ITC has a very strong market and brand presence.

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Both the companies cannot claim monopoly over the laudatory words ‘Magic’, ‘Magical’ along with common word ‘Masala’ to the exclusion of one another, the court said. “Therefore, neither the plaintiff (ITC) nor the defendant (Nestle) can dissect a portion of a label and claim monopoly over it. As such, the plaintiff cannot claim monopoly over the expression ‘Magic Masala’,” said the Judge.

“In fact, if the plaintiff had filed a trademark application to register the expression ‘Magic Masala’ as a word mark, it would have been rejected by the Trade Mark Registry under Section 9 of the Trade Marks Act, 1999,” he added.

ITC, in its petition in 2013, claimed that the noodles with the expression Magic Masala was a runaway success and had cornered about 12.5 per cent of the market share in the instant noodles segment within three years. It entered the instant noodles market with two variants – Yippee! Magic Masala and Classic Masala.

While Nestle’s brand has been the market leader with 75-80 per cent share in the segment, it was threatened by the rival brand, alleged ITC. It probably adopted the similarly sounding expression Magical Masala to create confusion in the minds of customers and pass off its brand to the customer instead of the Yippee! brand.

It sought the court to issue a permanent injunction against Nestlé for using the expression Magical Masala.

The high court also observed that Nestle used the expression magic earlier also and the expression Magic Masala was first adopted by Lays for its potato chips, according to information submitted by Nestle. Nestle argued that both the expressions have been used as a flavour descriptor and therefore are incapable of being protected. Hence, it felt the suit was liable to be dismissed.

In the long battle for over seven years, an interim order was passed by the high court on the dispute in 2015. According to reports, through the interim order, Nestle was restrained by the court from using the mark Magical Masala or any other deceptively similar mark to ITC’s mark Magic Masala, till the disposal of the case.