This Article Is Written By Anushka Singh, 3rd Year BA.LLB D.E.S Shri Navalmal Firodia Law College, Pune during Her Internship at Ledroit India
Abstract:
This article dissects the high-stakes legal battle between beverage giants Coca-Cola and Bisleri over the iconic “Maaza” brand. The conflict ignited when Bisleri, years after selling the Maaza trademark rights for India to Coca-Cola, attempted to manufacture the drink in India for export to Turkey. The Delhi High Court faced a critical question: Does manufacturing goods in India solely for export constitute trademark infringement within India? The judgment firmly established that under Section 56 of the Trade Marks Act, 1999, “export” amounts to “use” in India. This decision closed a significant legal loophole, securing Coca-Cola’s exclusive rights and setting a precedent for cross-border IP disputes.
Keywords: Trademark Infringement, Section 56, Export Rights, Assignment Deed, Passing Off, Territorial Jurisdiction, Maaza, Delhi High Court.
INTRODUCTION:
We all know Maaza. In India, it is not just a drink; it is practically an emotion. The “Har Mausam Aam” (Mangoes in every season) campaign defines the childhood of millions. But behind that sweet, yellow pulp lies a bitter corporate feud that questioned the very nature of ownership. Imagine selling your house to someone, handing over the keys, and pocketing the money. But then, a few years later, you decide to use the backyard to build a shed for your friend because “technically, I’m not living in the house.” That, in a nutshell, is what happened in The Coca-Cola Company v. Bisleri International Pvt. Ltd.
The conflict began when Bisleri, the original creator of Maaza, sold the brand rights to Coca-Cola in 1993 but later tried to use the name to sell products abroad. This triggered a massive legal question: If you sell a trademark in one country, can you still use it to export goods from that country to another? This case is not just about soft drinks. It is about the boundaries of intellectual property and whether a contract truly means “goodbye” to your rights.
The Unique Position of “Maaza”
While carbonated drinks like Thums Up and Limca were transferred in their entirety, the transaction regarding Maaza—a non-carbonated mango drink launched in 1976—contained a unique geographical split. Bisleri International (formerly Aqua Minerals Pvt. Ltd., part of the Parle Group) retained the rights to the Maaza trademark in countries other than India where it had existing registrations. This bifurcation of rights—Coca-Cola owning the brand in India, and Bisleri owning it in select overseas territories—created a latent fault line.
The 1993 Master Agreement was designed to seal Coca-Cola’s dominance in India. Yet, fifteen years later, this very agreement became the battlefield. In 2008, fueled by what industry insiders described as “seller’s remorse” and the massive growth of the beverage market, Bisleri attempted to reassert control over the Maaza brand. The ensuing litigation, The Coca-Cola Company v. Bisleri International Pvt. Ltd., was not merely a contract dispute; it was a test of the “long-arm” reach of Indian trademark law and the enforceability of non-compete clauses in perpetuity.
LEGAL FRAMEWORK:
Before we dive into the courtroom drama, let’s look at the rules of the game. The case relies heavily on the Trade Marks Act, 1999. To understand why Bisleri lost, you have to understand three specific sections that act as the pillars of this judgment.
- Section 56 (Use of Trademark for Export): This is the star of the show. In simple terms, this section says that if you apply a trademark to goods in India for the purpose of exporting them, it counts as “using” the trademark in India. Why does this exist? To prevent India from becoming a factory for counterfeiters who say, “We aren’t selling fakes here, we are just making them here.” The law says if you make it here with the mark, you are liable here.
- Section 29 (Infringement): This is the standard definition of breaking the law. It states that if you are not the owner, you cannot use a mark that is identical or deceptively similar to a registered trademark in the course of trade.
- Section 45 (Assignment): When a trademark is assigned (sold), the new owner steps into the shoes of the old one. The seller usually loses all rights unless the contract explicitly says otherwise. Once you sign that deed, you cannot come back later and claim you still own a piece of the pie.
CASE ANALYSIS:
FACTS: THE DEAL GONE SOUR
To understand the betrayal Coca-Cola felt, we have to go back to 1993. The Parle Group (owned by the Chauhan family) sold its portfolio of soft drinks—Thums Up, Limca, Gold Spot, and Maaza—to Coca-Cola. This was a massive Master Agreement. Bisleri (formerly Acqua Minerals) assigned the trademark rights, formulation rights, know-how, and goodwill of “MAAZA” for India to Coca-Cola.
Coca-Cola became the absolute owner of Maaza in India. However, Bisleri retained the rights to the trademark in other countries where it had arguably registered it before the sale. The deal seemed clear: Coca-Cola rules India; Bisleri can play elsewhere.
Fast forward to 2008. Coca-Cola discovered that Bisleri had filed for trademark registration of “MAAZA” in Turkey. That alone might have been a grey area, but Bisleri went a step further. They started manufacturing the beverage base (the pulp mixture) in India and exporting it to Turkey under the “Maaza” name.
When Coca-Cola objected, Bisleri didn’t back down. Instead, they sent a legal notice in 2008 repudiating (cancelling) the old 1993 licensing agreement, essentially saying, “We are taking our rights back.” They claimed Coca-Cola had breached terms, so the deal was off. Coca-Cola, realizing their flagship mango drink was under threat, rushed to the Delhi High Court.
The License Agreement and Relinquishment
Following the assignment, a License Agreement was entered into in October 1994 between Coca-Cola and Golden Agro Products Pvt. Ltd. (an affiliate of Bisleri). This agreement allowed Golden Agro to manufacture the beverage base for Coca-Cola. Crucially, this agreement was later terminated, and a “Relinquishment of Franchise Rights” agreement was signed, for which Coca-Cola paid an additional US $500,000.
The cumulative effect of these agreements was to strip Bisleri of all rights to the Maaza brand within India. The legal fiction Bisleri later attempted to construct—that they were merely licensing the brand to Coca-Cola—was directly contradicted by the irrevocable language of these assignment deeds. The plaintiff’s case rested on the assertion that an assignment is a sale, and one cannot “cancel” a sale years later simply because the asset has appreciated in value.
ISSUES: THE CORE QUESTIONS
The Delhi High Court had to answer complex questions that mixed contract law with IP statutes:
- Jurisdiction: Did the Delhi High Court even have the power to hear this case? Bisleri was in Mumbai, and the “sale” was happening in Turkey. Coca-Cola argued that the “threat” of infringement was in Delhi.
- The Export Loophole: Does manufacturing goods in India only for export constitute infringement under the Trade Marks Act? Bisleri argued that since no Indian consumer was buying this specific batch, no Indian law was broken.
- Validity of Assignment: Could Bisleri simply “cancel” the 1993 assignment and start using the mark again?.
ARGUMENTS:
- The Petitioner (Coca-Cola): They argued that the 1993 Master Agreement was an absolute sale, not a temporary rental. Bisleri had sold everything related to Maaza in India. Coca-Cola contended that manufacturing ingredients and putting the “Maaza” label on them in India—even for export—is a clear violation of Section 56. They argued that if Bisleri were allowed to do this, it would dilute Coca-Cola’s exclusive rights. They also claimed “passing off,” arguing Bisleri was trying to cash in on the reputation Maaza had built under Coca-Cola’s management over the last 15 years. regarding jurisdiction, they pointed out that Bisleri had published a notice in a Delhi newspaper threatening to use the mark, which gave the Delhi court the right to intervene.
- The Respondent (Bisleri): Bisleri tried to be clever with geography. They argued that the 1993 agreement only restricted them from selling Maaza within the Indian market. They claimed that since they were selling the drink in Turkey, Indian trademark laws were irrelevant. And they also raised a procedural objection: the defendant resides in Mumbai, so the Delhi High Court should not interfere. They essentially argued, “We are selling in Turkey, and we live in Mumbai. Why are we in a Delhi court?”.
The Respondent’s Challenge:
- Bisleri’s legal team mounted a vigorous defense based on Section 20 of the Code of Civil Procedure (CPC), 1908. Their arguments were grounded in physical locality:
- Bisleri International is registered in Mumbai.
- The legal notice (the alleged trigger) was dispatched from Mumbai.
- The manufacturing plant (Varma International) was located in Chittor, Andhra Pradesh.
- The defendants argued that no “cause of action” had arisen in Delhi. They characterized Coca-Cola’s choice of the Delhi High Court as “forum shopping,” an attempt to drag the Mumbai-based defendants to a convenient but legally inappropriate venue.
JUDGMENT:
The Verdict The Delhi High Court, led by Justice Manmohan Singh, delivered a crushing verdict against Bisleri.
First, on Jurisdiction: The court held that the threat of use is enough. Bisleri had published a notice in a Delhi newspaper and sent a legal notice to Coca-Cola (who has an office in Delhi). This created a “dynamic effect” in Delhi, giving the court jurisdiction.
Second, and most importantly, on Export Rights: The judge relied heavily on Section 56. The court held that exporting goods from India with a trademark is legally the same as selling them in India. The judge clarified that if you apply a mark to goods in India for export, you are “using” the mark in India. Since Coca-Cola owned the mark in India, Bisleri’s act of manufacturing and labeling the bottles (or base) here was a direct infringement. The destination of the goods (Turkey) did not matter; the origin of the infringement (India) did.
The Court also slammed Bisleri for trying to take back rights they had already sold. The judge noted that the 1993 assignment was absolute and irrevocable. Bisleri could not use the Maaza name anymore—not for local sales and not for exports. An interim injunction was granted, stopping Bisleri from using the mark in India or exporting it.
Assignment is Not a License
The judgment drew a sharp distinction between an assignment (sale of ownership) and a license (permission to use). The court held that Bisleri had no residual rights in the Maaza trademark within India. Consequently, they had no legal standing to “terminate” the agreement or to use the mark. The attempt to use the mark after assignment was held to be mala fide and a direct infringement of Coca-Cola’s statutory rights. This reinforced the sanctity of the assignment deed as the supreme document governing the relationship, immune to unilateral repudiation absent a fundamental flaw in the contract’s formation, which was not present here.
CONCLUSION:
This judgment is a wake-up call for Indian businesses engaged in global trade. It clarifies that you cannot bypass trademark laws just by shipping your products across a border. If you manufacture here, you are liable here. The court effectively closed the “export loophole” that many infringers tried to use to manufacture fakes in India for foreign markets.
In my analysis, the judgment was strictly necessary to protect the sanctity of contracts. If Bisleri were allowed to use the mark, it would render the 1993 sale meaningless. Imagine buying a car, and the previous owner keeps a spare key to drive it on weekends—it’s absurd. The court applied that same logic to trademarks.
The Need of the Hour: The “need of the hour” is for companies to conduct strict IP audits during mergers and acquisitions. When you buy a brand, ensure your agreement explicitly covers global rights or specifically restricts exports. A vague contract is a lawyer’s best friend and a CEO’s worst nightmare. For students and practitioners, this case stands as the golden rule for Section 56: In India, “exporting” is “using.”
