Fabindia Sued For Selling Factory-Made Clothes As ‘Khadi’

Published on 15 Jun 2018 by Shivi

FabIndia, the famous ethnic retailer, has been sued by Khadi and Village Industries Commission (KVIC) in the Bombay High Court. KVIC is seeking damages from FabIndia for Rs. 525 crore for selling factory-made cotton garments as ‘Khadi’

Indian law firm Kochhar & Company which is representing KVIC, has asked FabIndia to pay monetary damages for the loss of profit earned by the company by using the ‘Khadi’ trademark and the Khadi mark.

Fabindia stated that it has been in conversation with KVIC since 2015 to resolve the matter. But KVIC, the agency which is responsible for promoting Khadi and village industries, revealed that it did not grant Fabindia the rights to sell garments under the Khadi brand since the talks for the same had fallen through due to Fabindia not meeting the procedural norms. However, KVIC has only authorised Raymond and Arvind Mills to use the Khadi trademark.

It was KVIC Chairman Vinai Kumar Saxena, who said that the agency is keen to protect its reputation and would take strong measures against those who violated rules and regulations framed for the benefit of rural artisans attached to it.

KVIC told that despite warnings and assurances given by Fabindia, that it will refrain from doing so, it found Fabindia was continuing to sell its garments in the name and style of Khadi. Around July 2015 according to the complaint by KVIC, it tested samples from Fabindia, revealing that they were not Khadi products and Fabindia was selling factory-made cotton garments in the name of Khadi.

It served a notice to Fabindia subsequently for violating the regulation, in terms of the alleged illegal and unauthorised use of the Khadi mark and it asked Fab India to stop the sale of textiles under the name of ‘Khadi’ and to desist from issuing advertisements for Khadi products in newspapers and other media.

In a letter dated August 16, 2016, FabIndia informed KVIC that it had ‘stopped advertisement campaign in all media and have also sent internal directions to stop selling the cloth with reference to Khadi.’ However, according to the sources, KVIC found that FabIndia was using the Khadi mark tag on its products.

In 2017, the tussle took an ugly turn when KVIC served a legal notice to Fabindia and asked it to stop using the Khadi brand name and to pay compensation for the losses caused to the KVIC.

Tags: Trademark 

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