Pune court blocks termination of trademark pacts in Kirloskar dispute

The court’s decision, made on 9 January, came in response to KBL’s application in an ongoing civil suit regarding the ownership and use of trademarks associated with the Kirloskar Group.

The court ruled in favour of KBL, granting a temporary injunction and preventing KPL from taking any steps to terminate the trademark agreements pending the final disposal of the suit. 

The dispute arose after KPL issued termination notices to KBL in July 2024, citing several alleged breaches of the agreements. KBL, a listed entity incorporated in 1926, challenged these notices, arguing that the alleged breaches were minor and could be rectified.

Long-standing dispute

The case revolves around a series of trademark assignments that were made between KBL and KPL, following the creation of Kirloskar Proprietary in the 1970s. KPL was set up to manage the intellectual property rights of various Kirloskar Group companies, including the trademarks KBL originally owned. KBL contends that these assignments were made as part of a “family arrangement” to protect the Kirloskar trademarks and ensure that they were not diluted by third-party interests.

KBL argued that the trademarks should revert to it if the conditions of the user agreements, which are seen as continuing agreements, were no longer met. According to KBL’s legal team, the breaches cited by KPL—ranging from royalty payments to quality control audits—were trivial and largely due to KPL’s own inaction.

The Pune court agreed with KBL’s contention that the breaches were not substantial enough to justify terminating the agreements. In its order, the court emphasized that “the breaches can be rectified” and that KBL should not be prevented from using the trademarks at this stage, particularly given the long-standing relationship between the two entities. The court further noted that allowing KPL to terminate the agreements could cause irreparable harm not just to KBL but to the broader Kirloskar Group and the public.

Judge A.L. Tikle, while delivering the ruling, stated, “The balance of convenience lies in favor of KBL, as the Kirloskar Proprietary may not suffer any significant loss if the injunction is granted. On the contrary, KBL may face irreversible damage if forced to stop using the trademarks.”

The court’s decision is seen as a temporary measure until the final resolution of the dispute, which could have significant implications for the future of the Kirloskar Group’s intellectual property rights. The final judgment on the suit will determine the long-term fate of the Kirloskar trademarks and the nature of the relationship between KPL and KBL.

Queries emailed to KBL and KPL went unanswered.