Legal tussle continues: McDonald's, Vikram Bakshi open fresh front

The Delhi High Court has emerged as the latest battleground between warring joint venture partners McDonald's India Pvt Ltd (MIPL) and Vikram Bakshi. At least two matters are currently on in the Delhi High Court involving the two parties. One of them pertains to the use of the McDonald's trademark by Connaught Plaza Restaurants Ltd (CPRL), the 50:50 joint venture between MIPL and Bakshi

The second matter concerns a plea by MIPL seeking to enforce the London arbitration order passed against Bakshi in September 2017. Bakshi has challenged this application pressed by MIPL in the Delhi High Court.

On Thursday, Justice Rajiv Sahai Endlaw, who is hearing McDonald’s plea regarding the use of its trademark, refused to grant an ex parte injunction in its favour, saying CPRL was a running concern and therefore could not be stayed without consideration of all aspects.

The court, however, allowed an MIPL representative to visit by Thursday afternoon some of the restaurants run by CPRL in New Delhi to collect samples of food and packaging as well as inventory. The restaurants were directed to provide the samples to the representative.

In a detailed statement, Bakshi said, “Our products and packaging material are available to any customer across the counter. So where was the need to go to the Delhi High Court to get this packaging material? The counsel for CPRL, Akhil Sibal pointed this out to the court. Further, all our food products are supplied by companies that are compliant with every law that applies to their industry and adhere to the best quality standards.” 

MIPL, on the other hand, provided no update on the visit by its representative on Thursday, saying the suit to enforce termination of its franchise agreement with CPRL was sub judice. “We have no additional comments to share outside the court,” an MIPL spokesperson said.

On Wednesday, the Delhi High Court had dismissed MIPL’s plea challenging a show-cause notice issued to its parent McDonald’s Corp by the National Company Law Tribunal (NCLT) on a contempt petition filed by Bakshi.

Bakshi had moved the contempt petition in the NCLT alleging that the fast-food major’s decision to terminate the franchise agreement with CPRL in August 2017 violated the NCLT order of July 13, 2017. This order had reinstated Bakshi as managing director of CPRL and refrained the US-based giant from interfering in its functioning.

Wednesday’s dismissal in the Delhi High Court paves the way for the contempt proceedings against McDonald’s Corp in the NCLT to resume.

 This matter had been halted thanks to MIPL’s intervention in the Delhi High Court. MIPL has also challenged NCLT’s July 13 order in the appellate tribunal, implying there is no end in sight to the legal issues of the two partners.