The Delhi High Court recently granted interim relief to PhonePe in a trademark dispute with AGF Finlease India over the latter’s use of "PhonePey Loan."

The Court held that AGF Finlease’s use of the mark was prima facie infringing, deceptive, and likely to mislead the public by implying an association with PhonePe. Consequently, AGF Finlease was restrained from using the contested mark.

The dispute arose when PhonePe, a Walmart-owned digital payments giant, filed a suit against AGF Finlease for branding its digital lending services as "PhonePey Loan," which PhonePe argued was deceptively similar to its registered trademark.

The company also alleged that agents of AGF Finlease falsely represented themselves as affiliated with PhonePe’s loan services.

PhonePe’s counsel, Advocate Sidharth Chopra, argued that "PhonePey Loan" was nearly identical to the "PhonePe" trademark, causing consumer confusion. He asserted that the defendant’s actions were a deliberate attempt to exploit PhonePe’s goodwill and reputation.

He also cited instances of misrepresentation by AGF Finlease’s agents. In response, AGF Finlease’s counsel claimed that the spelling difference distinguished "PhonePey" from "PhonePe" but did not refute the petitioner’s allegations of similarity.

Justice Mini Pushkarna, granting interim relief, observed that PhonePe had established a strong prima facie case of trademark infringement and misrepresentation. The Court noted that the similarity between "PhonePe" and "PhonePey Loan" could mislead consumers into believing AGF Finlease’s services were endorsed by or associated with PhonePe, harming the latter’s reputation.

Addressing the argument about spelling differences, the Court remarked that the marks were deceptively similar, warranting an injunction. AGF Finlease and its agents were restrained from using "PhonePey Loan" or any other mark infringing on PhonePe’s trademark.

Emphasizing the importance of protecting trademarks, the Court highlighted that such laws safeguard both the rights of trademark owners and consumers from deceptive practices. It directed the Domain Name Registrar GoDaddy to disable the website "PhonePey Loan" and instructed social media platforms like Facebook and Instagram to remove all infringing content.

The Court remarked, “When marks are deceptively similar, the possibility of consumer confusion is inevitable,” stressing the need to prevent further dilution of PhonePe’s trademark and erosion of its goodwill.

The High Court scheduled the matter for further hearing, ensuring AGF Finlease’s compliance with the interim orders in the meantime.