Capital Foods gets interim relief in trademark infringement battle over 'Schezwan Chutney.'
For its brand Ching's Secret, Capital Foods' has a trademark registration protecting the use of the name 'Schezwan Chutney'. In 2020, when it discovered Radiant Indus Chem was using the same name for the product under its brand 'Mrs. Food Rite' it approached the Delhi High Court. In a recent hearing, a Division Bench granted an interim injunction in Capital Foods' favour. The court observed that the intent behind the latter's adoption of the same mark was to trade in the name and reputation of Capital Foods.
Capital Foods had claimed that Radiant Indus Chem had not only infringed on its trademark but also copied its trade dress and its website contents. The court has accepted this allegation and observed, "...the stylisation, colour combination, get-up, trade dress and copyrights in its advertising material has been blindly copied from the appellant-plaintiff (Capital Foods)," reads the court's order, dated January 25.
In the past, it has fought similar cases against other companies that sold the same product under the 'Chutney' title. The nomenclature is extremely crucial to Ching's Secret as it reflects its 'Desi Chinese' proposition. That is, the 'Chutney' brings the 'desi' touch to the condiment.
"Schezwan Chutney is not the category's name. It is our brand name. We don't mind our rival brands calling their products anything like sauce, dip, spread or whatever else they like," she added.
The company claims that before it launched the product, the category did not exist in India.
"Earlier the product was called 'Schezwan Sauce'. We were the first to manufacture it commercially and term it as 'Chutney'. We have created a consumer base from nothing. When it became big, every other brand started entering the category. Brands cannot come in, copy us and ride on our success," the brand's spokesperson said.
Last month, a single judge bench of the Delhi High Court refused to grant the injunction, saying that the mark is a descriptive term.
“In the present case, in my prima facie opinion, the combination of the two words does not take away the descriptive nature of the words as they still continue to describe the nature and quality of the product in question. In fact, it is together that they become descriptive,” the Court had stated on January 13.
The company, then, appealed to the Division Bench, which said that the trademark Schezwan Chutney has acquired secondary significance considering the voluminous sales and expenditure incurred on advertisement and promotion by Capital Foods.
In its submission to the Court, Capital Foods, which sells the fiery red sauce under its Ching's Secret product range, has said that between 2012-20, the company had spent more than Rs 273 crores in promotion of the product under the brand 'Schezwan Chutney' and had sales of over Rs 316 crores for the same product.
It obtained registration for trade mark application 'Schezwan Chutney' on July 30, 2012 and adopted the mark in 2016.
Pawan Sarda, former group CMO and head of D2C, Wingreens World, says it's a clever strategy to protect the 'Chutney' title.
"The 'chutney' in its name highlights that it is an Indianised recipe. That is how it becomes a part of Indian dining tables. It is a clever strategy from their side to block a particular way of expressing a category. It is a dream for every brand to own the category," he says.
Bonafide Research's India Chinese, Hot and BBQ Sauces Market Overview for 2022-28 shows a growth of CAGR more than 17% in these markets in the period from 2016-17 to 2021-22. The report states that in the Chinese sauce market, Schezwan sauce has increased with the highest CAGR "due to the emergence of its new uses in various dishes".
According to industry experts, the branded market for Schezwan sauces in India is around Rs 200 crores. Capital Foods has informed the court that it holds at least 88% of the market share.
What makes Schezwan flavours popular?
Whether it is the street side Chowmein or the ubiquitous Gobi Manchurian, Indians clearly have an affinity to 'Desi Chinese'. It is nothing like what the Chinese eat back in their country. Rather, it is adapted to the Indian palate's desires for fiery spices and tanginess. Sarda says that Indian palate is more spicy and this makes Schezwan sauces a popular choice.
"Desi Chinese is an innovation of India. The actual Chinese food doesn't taste like the way it is prepared in India. Schezwan sauce is an important ingredient in Chinese dishes in India and it is one of the fast growing categories," Sarda says.
What adds to the popularity of the product, is the brand's positioning of it as an everyday condiment. Unlike other Chinese sauces, like Soy, Chilli or Manchurian sauces, Schezwan is no longer limited to the oriental cuisine alone. The brand's marketing and its recipe instructions suggest that the dip can be used with day-to-day Indian dishes like dosa, rotis and parathas.
"When a brand is creating any category it also wants that it becomes a part of day-to-day use. It can't be restricted to its original use alone. As Indian economy grows, the exposure to international food is increasing and a lot of 'Indianisation' is happening. We are adapting these foods for Indian palate. Indianisation is important as that is where the market grows," he adds.
Digbijoy Chakraborty, GM- Marketing, Capital Foods says after the regional cuisines, if there is any one cuisine that unifies India, it is Desi Chinese.
"One could order a Chowmein, but never cook it at home as there was no cooking aid. Everyone was fond of Chinese cuisine but no brand was catering to that need. We realised that its a problem Indian kitchens faced and so in 1996 we launched a brand that helps Indians make it at home," he says.
From being just a side dip, served along with momos or Fusion Dosa by roadside vendors, Schezwan Chutney has come a long way to become a branded condiment. Seeing this rising popularity of the category, many brands, both big and small, have launched their own versions of the chilli-garlic sauce. Keya, Knorr, Veeba, Wingreens, Mother's Recipe among many other brands are selling the product under different combinations of 'Schezwan', 'Chutney', 'Desi' 'Sauce', etc. It has become challenging for brands to carve a niche for themselves in such a commoditised market.
In such a scenario, the 'chutney' identity can help the brand stand out from the crowd.
Kalyan Karmakar, a leading brand consultant and blogger at Finely Chopped Consulting, says, if the brand wants to make its Schezwan Chutney unique, it should come up with some proposition around it.
"Since the word 'Chutney' is very generic, the brands can actually play more with the proposition to stand apart in this category. For example, declare it as 'Sabse Teekha' (Most Spicy) or something along those lines," he says.
afaqs! sought comments from Mrs. Food rite with regard to the case. This story will be updated as as and when the brand responds.