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INTRODUCTION

The judgment delivered on 9 March 2026 in Western Digital Technologies Inc. v. Geonix International & Ors., FAO(OS) (COMM) 146/2024 and connected matters, addresses the balance between trademark protection and the principle that lawfully sold goods can be freely resold. The growing market for refurbished electronic goods has raised important legal questions regarding trademark rights. This case before the Delhi High Court examines whether refurbishing and reselling used hard disk drives (HDDs), originally manufactured by companies such as Western Digital and Seagate, amounts to trademark infringement or passing off. The Court also clarified the scope of international exhaustion under the Trade Marks Act, 1999.

FACT OF THE CASE

The appellants, Western Digital Technologies Inc. and Seagate Technology LLC, manufacture hard disk drives which are sold to Original Equipment Manufacturers outside India. These HDDs are integrated into devices and sold with a limited warranty. Once the warranty expires, they are treated as “end-of-life” products and are often discarded abroad.

The respondents, including Geonix International, Daichi International, and Consistent Infosystems, acquired such discarded HDDs through import or purchase. They refurbished these products by testing them, erasing existing software, installing new software, removing the original trademarks, and assigning new serial and model numbers. These refurbished HDDs were then sold under the respondents’ own brand names.

The appellants filed a suit alleging trademark infringement and passing off. The learned Single Judge of the Delhi High Court, by judgment dated 21 May 2024, refused to grant a complete injunction but allowed the respondents to sell refurbished HDDs subject to strict conditions. These conditions included clear disclosure that the products were used and refurbished, mention of the original manufacturer only in words, and provision of the refurbisher’s warranty. The appellants challenged this decision before the Division Bench.

ARGUMENT IN FAVOUR 

The appellants argued that the respondents’ actions amounted to trademark infringement under Section 29 of the Trade Marks Act, 1999, which defines infringement as unauthorized use of a registered trademark in a manner likely to cause confusion. They contended that even after removal of trademarks, the physical characteristics of the HDDs could lead technically aware consumers to identify them as Western Digital or Seagate products.

They further relied on Section 30(4), which allows a trademark owner to oppose resale if the condition of goods has been “changed or impaired.” According to the appellants, removal of trademarks, alteration of software, and reassignment of serial numbers amounted to impairment of the goods.

The appellants also raised claims of passing off and reverse passing off, arguing that the respondents were selling the appellants’ goods as their own, thereby misleading consumers. They also relied on Section 103 of the Act relating to false trade descriptions and raised concerns regarding the reliability and security risks of refurbished HDDs.

The appellants relied on Kapil Wadhwa v. Samsung Electronics Co., 2012 SCC OnLine Del 5172, to argue that resale rights are limited where goods are altered. They also cited Kaviraj Pandit Durga Dutt Sharma v. Navaratna Pharmaceutical Laboratories, AIR 1965 SC 980, and Satyam Infoway Ltd. v. Siffynet Solutions (P) Ltd., (2004) 6 SCC 145, to establish the principles of passing off. Further reliance was placed on Pernod Ricard India Pvt Ltd v. Karanveer Singh Chhabra, 2025 SCC OnLine SC 1701, regarding appellate interference.

ARGUMENT AGAINST 

The respondents argued that their actions were lawful as the HDDs were acquired through valid commercial transactions. They relied on Section 30(3) of the Trade Marks Act, which incorporates the principle of international exhaustion, meaning that once goods are lawfully sold, the trademark owner cannot control further resale.

They contended that there was no infringement under Section 29 because they did not use the appellants’ trademarks during resale, as all marks had been removed. On the issue of Section 30(4), they argued that refurbishing improved the products rather than impairing them.

The respondents also submitted that their customers were informed and aware that they were purchasing refurbished products, eliminating any likelihood of confusion. They rejected the concept of reverse passing off, arguing that it is not recognised under Indian law.

They relied on Kapil Wadhwa v. Samsung Electronics Co., 2012 SCC OnLine Del 5172,. to support their argument on international exhaustion and cited Kaviraj Pandit Durga Dutt Sharma v. Navaratna Pharmaceutical Laboratories, AIR 1965 SC 980 to argue that the essential elements of passing off were not satisfied.

COURT’S DECISION

The Division Bench dismissed the appeals and upheld the decision of the Single Judge. The Court held that under Section 29, infringement requires actual use of the registered trademark. Since the respondents had removed all trademarks before resale, there was no use of the appellants’ marks, and therefore no infringement was established.

The Court then interpreted Sections 30(3) and 30(4). It held that Section 30(3) permits resale of lawfully acquired goods, while Section 30(4) allows restriction only if the goods are “changed or impaired.” Applying the principle of noscitur a sociis, the Court held that “changed” must be read along with “impaired,” meaning that only changes negatively affecting the product or the brand’s reputation would be relevant. The Court found that refurbishing HDDs did not amount to such impairment.

The Court relied on Kapil Wadhwa v. Samsung Electronics Co., 2012 SCC OnLine Del 5172, to reaffirm the principle of international exhaustion. On passing off, it relied on Kaviraj Pandit Durga Dutt Sharma v. Navaratna Pharmaceutical Laboratories, AIR 1965 SC 980, and Satyam Infoway Ltd. v. Siffynet Solutions (P) Ltd., (2004) 6 SCC 145, and held that there was no misrepresentation or likelihood of confusion.

The Court also rejected the concept of reverse passing off, holding that Indian law under Section 27(2) recognises only traditional passing off. Relying on Pernod Ricard India Pvt Ltd v. Karanveer Singh Chhabra, 2025 SCC OnLine SC 1701, the Court declined to interfere with the discretionary order of the Single Judge.

CONCLUSION

This judgment clarifies the legal position on refurbished goods and trademark rights in India. The Court emphasised that trademark infringement requires actual use of the mark, and mere identification of a product with its original manufacturer is insufficient. It reaffirmed the principle of international exhaustion, allowing free resale of lawfully acquired goods unless there is clear impairment affecting the product or the brand’s reputation.

At the same time, the Court ensured consumer protection by maintaining strict disclosure requirements for refurbished goods. The rejection of reverse passing off as a recognised claim further limits the scope of trademark protection in such cases. Overall, the judgment adopts a balanced approach by supporting legitimate trade in refurbished goods while ensuring transparency and preventing consumer deception.