Trademark Dispute Between Snack Companies Resolved Through Mediation

The case of Laxmi Snacks Pvt. Ltd. vs. Akshar Food Products revolves around a trademark and trade dress dispute concerning the branding of snack products. The legal battle, which began in the courts of Gujarat, was ultimately resolved through mediation at the Supreme Court, setting a strong precedent for alternative dispute resolution in commercial cases.

Background of the Case

The dispute arose between two snack manufacturers, Laxmi Snacks Pvt. Ltd. (the petitioner) and Akshar Food Products (the respondent), regarding the usage of:

• Labels
• Trade dress
• Brand get-up of certain products

Laxmi Snacks Pvt. Ltd. alleged that Akshar Food Products had adopted a deceptive similarity in their packaging and branding, leading to confusion among consumers. The petitioner initially filed multiple civil suits before the District Court, Nadiad, Gujarat, seeking relief against the respondent’s use of certain marks and trade dress.

The dispute reached the Gujarat High Court, which issued an order on November 24, 2015. Dissatisfied with the High Court’s ruling, Laxmi Snacks Pvt. Ltd. appealed before the Supreme Court, challenging the order.

Supreme Court Intervention and Mediation

When the case was heard before the Supreme Court on January 4, 2016, both parties agreed to explore mediation as a means of resolving their dispute. The Supreme Court directed the matter to the Supreme Court Mediation Centre.

Under the guidance of the court-appointed mediator, Dr. Aman Hingorani, the parties reached a comprehensive settlement agreement on January 28, 2016.

Settlement Agreement Terms

The settlement agreement outlined the following key terms:

• All civil suits filed by Laxmi Snacks Pvt. Ltd. in the District Court of Nadiad would be decreed in its favor, except for its claims for monetary compensation.
• Akshar Food Products would be allowed to use the trademark “REET” and the tagline “SAB KHAO SABKO KHILAO.”
• Both parties agreed to comply with the terms of the settlement within the stipulated time.

Since both parties consented to the settlement terms, the Supreme Court found no need to relegate them back to the trial court and decided to formally record the settlement agreement.

Supreme Court Judgment

On February 1, 2016, the Supreme Court bench comprising Justice Kurian Joseph and Justice Rohinton Fali Nariman issued a judgment disposing of the appeals in accordance with the terms of the settlement.

The Court directed that:

• The settlement agreement would form an integral part of the judgment.
• All pending civil suits related to the dispute, numbered Regular Civil Suit Nos. 2 to 12 of 2015 in the District Court of Nadiad, were decreed except for monetary compensation claims.
• A copy of the judgment would be sent to the District Court, Nadiad, instructing it to strike off the suits from its records.

The Court also expressed appreciation for the parties, their counsel, and the mediator for their cooperative approach, which prevented prolonged litigation that could have lasted “at least another two decades.”

Key Legal Takeaways

• Mediation as an Effective Tool: The Supreme Court reaffirmed the importance of mediation in resolving commercial disputes efficiently.
• Trademark Protection: The case underscores the need for businesses to safeguard their intellectual property rights while balancing fair competition.
• Judicial Efficiency: By resolving the dispute through mediation, the Supreme Court prevented unnecessary burden on lower courts.
• Contractual Binding of Settlements: Once recorded in a judicial order, settlement agreements become legally binding and enforceable.

Conclusion

This case highlights the growing role of mediation in resolving trademark and intellectual property disputes. Instead of engaging in prolonged litigation, both parties benefited from an amicable resolution, ensuring fair competition while upholding brand protection.

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Download Judgment: Laxmi Snacks Pvt. Lt vs Akshar Food Products Supreme Court of India Judgment Dated 01-02-2016 (67a33699a929ae59d519763f).pdf