JAVED HUSSAIN, REGISTRAR OF COMPANIES,---The case before me is a revision application filed under the provisions of section 484 read with section 37 of the Companies Ordinance, 1984 (the "Ordinance"), by Irfan Attorneys-at-law (the appellants) on behalf of the Verizon Trademark Services LLC (a company organized and existing under the law of Delaware, 1320 North Court House Road, U.S.A.), against the orders dated 14-1-2009 (the impugned order), passed by the Assistant Registrar of Companies, Company Registration Office, Lahore.
2. The brief facts leading to this case are that a company namely Verizon (Pvt.) Ltd. Was incorporated on 25-11-2005, at the Company Registration Office Lahore. The appellant filed an application at the Company Registration Office Lahore for issuance of direction under section 38 of the Ordinance to Messrs Verizon (Pvt.) Ltd. To change its name, as the name of other company (Verizon Trademark Services LLC) registered in the U.S.A. Also contains the word Verizon. The Assistant Registrar of Companies Company Registration Office Lahore rejected the said application of the appellant, on the following grounds:--
(i) Main object of both the companies are different;
(ii) No direction can be issued after the expiration of three years from the date of registration of the company;
(iii) Verizon Trademark Services LLC is not registered with SECP,
(iv) Case appears to be violation of intellectual property.
3. The appellant company filed a revision application in terms of section 484 of the Ordinance on 19-2-2009, against the above-said order through Han and Irfan Attorney-at-law.
4. The comments were sought from CRO, Lahore on the said revision application. In his comments, the Additional Registrar of Companies, Company Registration Office, Lahore apposed the revision application in the following terms:--
(i) The case appears to be more of a violation of intellectual property, therefore applicant may approach the competent authority; and
(ii) Objects of the applicant and respondent Company are entirely different and therefore the question of benefiting from the goodwill of applicant company by the respondent company does not arise.
(iii) As per proviso of section 38(b) of the Companies Ordinance, 1984 "no direction can be issued, after the expiration of three years from the date of registration of the company or registration by its new name, as the case may be."
5. After completion of procedural formalities as required, hearings were fixed for April 27, 2009, May 5, 2009, May 21, 2009, June 2, 2009 and July 7, 2009. No one appeared on behalf of the respondent company at all the hearings.
6. However the representative of respondent Messrs Bhandari Naqvi and Riaz Associates sought adjournment, and informed vide its letter dated 20-5-2009 that parties to the dispute are also attempting to reach a settlement of the matter, but neither the respondent's company nor its legal representative informed about any settlement. However, Mr. Khurram Shahzad Chughtai; Advocate appeared on behalf of the appellant company and presented the following arguments:-
(i) The application was filed within limitation period of 3 years, as stipulated in section 38(b) of the Ordinance. The fact of the matter is that Verizon (Private) Limited, was incorporated on 25-11-2005 and the application was filed on 21-11-2008, within the 3 years of limitation period and before the expiry of the same. Hence, the Impugned Order is unwarranted in this respect.
(ii) The observation of learned Assistant Registrar that Verizon Trademark Services LLC is not registered with SECP in Pakistan is non-conclusive, as it is unclear, as to what the learned Assistant Registrar is holding in respect of the application. Again, on the basis of assumption, if it is deemed that the learned Assistant Registrar purported to hold that since Verizon Trademark Services LLC is not registered with SECP in Pakistan therefore powers of rectification of name of a company cannot be exercised in favour of such a foreign company, even such a finding is or would be erroneous.
(iii) The only requirement under section 37(1) of the Ordinance for putting into motion the scope of the said section is that the company's name is inappropriate or deceptive.
(iv) In case titled Messrs ADT Services AG and another v. Messrs ADT Pakistan (Pvt.) Ltd. And 4 others 2005 CLD 1546, the honourable Sindh High Court, not only entertained the grievance of a Swiss Company Messrs ADT Services AG but also admitted the assertions of a foreign company against a Pakistani company Messrs ADT Pakistan (Pvt.) Ltd. On the ground of deception. It was held; 'That adoption of name and registration of Company under a name which is deceptive is not permissible under section 37 of the Company Ordinance, 1984. In case where deceptive name has been adopted and it comes to the notice of the Company it may apply for the change in name or even the Registrar of Companies (now Securities and Exchange Commission of Pakistan) is competent to order for rectification of deceptive name."
(v) That the learned Assistant Registrar has made an error by stating that the SECP is not the competent authority with regards to the redressal of the grievance in the application.
(vi) In Messrs ADT Services AG and another v. Messrs ADT Pakistan (Pvt.) Ltd. And 4 others 2005 CLD 1546 it has become very clear that there is no other authority in Pakistan other than the SECP which is empowered to deal with the specific issue of rectification of company name.
(vii) The name of Verizon (Private) Limited is inappropriate and deceptive and was not liable to be registered under the law. The learned Assistant Registrar has abdicated his role as a quasi judicial forum by not entertaining the application in accordance with the provisions of section 37(1) and not made quasi judicial determination of the two questions, namely whether the name of Verizon (Private) Limited was (i) inappropriate or (ii) deceptive in light of the facts and grounds stated in the application.
(viii) The object and scope of sections 37 and 38 is to prevent deception, fraud and misrepresentation in the business and trade through adoption of a well known trade name, company name, trademark and service mark or a name, which could independently or otherwise lead to deception.
(ix) The name of Verizon (Private) Limited (respondent No,2) is otherwise deceptive and identical to or so nearly resembles the name of the applicant which has a worldwide reputation and goodwill extending to Pakistan also and on this score also the name of respondent No,2 is liable to be rectified under section 38.
7 Mr. Chughtai further submitted that the appellant company is a publicly traded company on the New York Stock Exchange under the stock ticker symbol the applicant generates annual consolidated operating revenues of $93,500,000,000 globally, and is a Dow 30 company. Verizon Communications and its affiliates employ a diverse workforce of approximately 232,000 employees. The applicant owns and operates one of the most expansive end-to-end global Internet Protocol (IP) networks serving more than 2,700 cities in 150 countries worldwide and provides advanced IP, data, voice and wireless solutions to large business and government customers. Also I did not find any business connection between the two companies on the usage of the word "Verizon". It is clear that the purpose of prohibiting the use of such words is that a company shall not create an impression that it is carrying on operation of another well established company (established in or outside Pakistan).
8. After hearing the stance of the representative of the appellant company, considering all other facts, including the comments of the Company Registration Office, Lahore, I am of the view that the section 37 of the Companies Ordinance, 1984 is clear, explicit and prohibit the Commission not to allow the name of a company, which is deceptive or inappropriate. The application for the purpose of giving direction to the respondent company, was made with in prescribed limit of three years.
The papers/documents supplied by the representative of the appellant company clearly suggests, that if the respondent company carries on its business with the word "Verizon", the reputation of the appellant company registered in the U.S.A. Will be damaged.
9. In view of the above facts, I in exercise of the powers delegated to me under section 484 of the Ordinance vide S.R.O.No,659(I)/2009, dated 14th July, 2009, set aside the order dated 14-1-2009 of the Assistant Registrar of Companies, Company Registration Office, Lahore. Joint Registrar In charge, Company Registration Office, Lahore is directed to initiate necessary action under section 38 of the Ordinance for change of name of Verizon (Pvt.) Ltd. And complete the proceedings in accordance with the provision of law.