In the midst of the COVID-19 pandemic, recent case law developments in India give an early indication how brand owners adapt their brand positioning in this new world. India’s first COVID-19‒related intellectual property (IP) case provides an opportunity to analyze the relevant provision in the trademark and advertising laws in India.
India’s First COVID-19‒Related IP Suit
In March, Hindustan Unilever Limited (HUL) filed an action with the High Court against Reckitt Benckiser (India) Private Limited (Reckitt) with respect to an advertisement being broadcast by Reckitt on television and the Internet. The advertisement was for Reckitt’s DETTOL brand liquid hand soap, and allegedly claimed that bar soaps were ineffective in tackling the coronavirus. This led HUL to assert that Reckitt had disparaged (and in turn, infringed) its bar soaps sold under the LIFEBUOY trademark. (For a description of the legal case, .)
Seeking a permanent injunction against the broadcast of Reckitt’s advertisement, as well as damages of INR 10 million (US $132,000) for disparagement/denigration of soap products under the LIFEBUOY mark, HUL submitted the following statement:
When the need of the hour is for everyone to come together and work towards common good, the Defendant’s (Reckitt’s) action is irresponsible and against public morality. Such advertisement is detrimental particularly in a country like India where the larger population is traditionally not using multiple products for their hygiene needs but relying predominantly on soap alone.
Before arguments could commence in the matter, Reckitt agreed to suspend the advertisement for a month (until April 20, 2020) and the suit was directed to be listed for arguments on the same date. As courts remained closed in April due to the lockdown, the earlier order was directed to be extended by the court with the consent of the parties. There has been no further update in the matter and the next date for the hearing might be in June. In the meantime, Reckitt’s voluntary suspension of the broadcast continues.
It will be interesting to analyze the approach adopted by the court to adjudicate upon the claim of disparagement, which will require consideration of the following questions:
- Is Reckitt making a misleading/false claim regarding HUL’s product?
- Would such a claim lead to deception in the minds of the consumer?
- Would it affect consumer behavior/decisions leading them to not use bar soaps during the pandemic?
Or would the court, in contrast, view Reckitt’s claims as mere “product puffery,” which is permissible under Indian law?
This case is centered on the issue of comparative advertising, which is lawful in India. However, comparative advertisements are subject to certain guidelines and regulations which demand a closer look.
What the Statutes and Guidelines Say
The Indian Trademarks Act, 1999 (TMA), seeks to strike a balance between the rights of registered trademark owners and consumer interest in informative advertising. It assists in regulating unfair trade practices in comparative advertising by specifying what kind of “use” of a registered trademark in connection with advertising would constitute infringement. As per Section 29 of the TMA, an advertisement may infringe a registered mark if it does the following:
- Takes unfair advantage of and is contrary to honest practices in industrial or commercial matters;
- Is detrimental to the registered mark’s distinctive character; or
- Is against the reputation of the registered trademark.
Section 30 of the TMA provides exceptions to infringement and specifically allows third-party use of a registered mark for purposes of indicating the kind, quality, quantity, intended purpose, value, geographical origin, the time of production of goods, or of rendering of services or other characteristics of goods and services covered under such mark.
Further, the Advertising Standards Council of India (ASCI) has adopted a Code for Self-Regulation (the Code) for advertisements. The role and functioning of ASCI is to deal with complaints received from consumers and industry, against advertisements which are considered as false, misleading, indecent, illegal, leading to unsafe practices, or unfair to competition, and consequently in contravention of its Code. However, the purpose of the Code is to control the content of advertisements and not to hamper the sale of products. Though the Code is not legislation, the same is in line with the provisions of various other laws including the trademark law.
Under the Consumer Protection Act, a “consumer” may initiate an action vis-à-vis an unfair trade practice including the practice of making any statement, whether orally or in writing or by visible representation, which gives false or misleading facts disparaging the goods or trade of another person.
How Indian Courts View Comparative Advertisement
Reckitt & Colman v. MP Ramachandran & Anr. [1999 PTC (19) 741] was an early case where the High Court of Delhi summarized the law on comparative advertising as follows:
- A tradesman is entitled to declare his goods to be the best in the world, even though the declaration is untrue.
- He can also say that his goods are better than his competitors’, even though such statement is untrue.
- For the purpose of saying that his goods are the best in the world or his goods are better than his competitors’, he can even compare the advantages of his goods over the goods of others.
- He cannot, however, while saying his goods are better than his competitors’, say that his competitors’ goods are bad. If he says so, he defames his competitors and their goods, which is not permissible.
- If there is no defamation to the goods or to the manufacturer of such goods, no action lies. But if there is such defamation, an action lies and if an action lies for recovery of damages for defamation, then the court is also competent to grant an order of injunction restraining repetition of such defamation.
Dabur India Limited v. Colgate Palmolive India Ltd., 2004 (29) PTC 401 (Del), clarified that generic disparagement of a rival product without specifically identifying or pinpointing the rival product is equally objectionable.
The decision in McDonalds Hamburgers Ltd. v. Burgerking (UK) Ltd.,  F.S.R. 112, was followed in Glaxosmithkline Consumer Healthcare Ltd. (GSK) v. Heinz India, MANU/DE/3273/2010, wherein it was held that advertisements are not to be read as if they were some testamentary provision in a will or a clause in an agreement with every word being carefully considered and the words as a whole being compared. In determining the meaning of an impugned advertisement, courts must account for the fact that the public expects a certain amount of hyperbole in advertising, and the test to be applied is whether a reasonable man would take the claim being made as one being made seriously, or whether he would take it with a large “pinch of salt.” The more precise and specific the claim, the more likely it was that the public would take it seriously. In this case, an advertisement claiming that the HORLICKS (GSK’s brand) boy is taller, stronger, and sharper as opposed to the COMPLAN (Heinz India’s brand) boy was held to be “mere puffery.” (Horlicks and Complan are both malt-based beverages for children.)
In Pepsi Co. Inc. v. Hindustan Coca Cola Ltd., 2003 (27) PTC 305 (Del) (DB), the court looked at the intent, manner, and story of the commercial to decide the question of disparagement. In the commercials at issue, a young boy is asked to name his preferred cola drink. He mutters a name—his lip movements suggest he is saying “Pepsi.” Thereafter, he tastes drinks in two different bottles and to the question “which one will children like,” points to one and says children would prefer that as it was sweet. He indicates he likes the other one—the strong one. It is then revealed that the sweet drink is “Pappi”—the name he muttered in the beginning; this leaves the boy embarrassed at having initially chosen a childish drink over one preferred by grown-ups. The jingle “wrong choice, baby” (akin to Pepsi’s jingle “yehi hai right choice, baby”) also featured in connection with “Pappi.” Per the appeals court, Hindustan Coca-Cola tried to project that young and growing children would not like “Pappi (Pepsi)” as it is sweet and “childish” and in that way, inferior. This was not a simple comparison or boast of a superior product. Merely alleging a drink is meant for children may not amount to denigration, but the manner in which the boy was shown to feel ridiculed for his initial preference depicted Pepsi as a drink of less worth and disparaged it, particularly when the lead actor said, “Wrong choice, baby.”
Timing Is Everything
In the Dettol dispute, it is noted that HUL and Reckitt Benckiser have often taken legal action against each other’s advertisements.
In Hindustan Unilever Ltd v. Reckitt Benckiser (India) Ltd, decided by the Calcutta High Court in September 2013 (later confirmed in appeal), four advertisements were in dispute. The first two had facts somewhat similar to the most recent tussle between both parties. The first advertisement portrayed a plate divided vertically. The half cleaned by Reckitt’s “Dettol” Kitchen Gel (claiming to be capable of killing 100 times more germs than the leading dishwashing liquid of the day) had only one germ left, whereas innumerable germs were left behind on the other part. The theme of the second advertisement was similar to the one above; however, instead of a leading dishwashing liquid, Vim (HUL’s product) was clearly depicted.
The court stated that reference to a “leading dishwashing liquid” in the first advertisement would be understood as Vim, as it had a two-thirds share of the Indian market. Further, Reckitt’s claim that “Dettol Healthy Kitchen Gel” “kills 100X more germs” was legally permissible. However, showcasing that Dettol’s application killed nearly 100 percent of the germs while suppressing the germ removal capacity of Vim by depicting that the application of Vim did not kill or remove any germs, denigrated and lowered the reputation of the VIM brand; made the advertisements one-sided, unfair, and devoid of honest intention; and infringed HUL’s VIM mark.
Turning to the most recent dispute, if Reckitt has indeed alleged that bar soaps, as opposed to liquid soaps, are not effective cleansing agents, this would appear to be a false claim. But would consumers take such a claim at face value? One could argue that in ordinary circumstances Reckitt might have been let off with a ruling of “puffery” in its favor. Yet in light of the Calcutta High Court ruling above, a successful claim of disparagement by HUL might also have been probable. However, given the extraordinary times we are living through, where washing hands with soap and water is time and again emphasized as the best prevention against COVID-19, the commercial would certainly have a greater probability of introducing doubts on the efficacy of bar soaps in the minds of consumers and potentially altering behavior in terms of making them gravitate strongly towards liquid soaps. Such considerations and potential consumer responses would go into analyzing the “intent and the message being conveyed by a commercial” and make it likely to be regarded as disparaging and unlawful.
Of course, the outcome being discussed is hypothetical; we do not know if Reckitt will resume broadcasting the disputed advertisement in the post-lockdown environment. It could be that the dispute simply dies away as, typically, responsible brands are sensitive to the environment in which they operate. As signaled by the international authorities, COVID-19 is unlikely to disappear soon; equally, a preventive cure does not appear forthcoming soon. The mantra for the current climate is “Just wash your hands”—and across the world, corporations have been combining efforts to improve the situation, rather than indulging in behaviors likely to attract the ire of rivals.
Although every effort has been made to verify the accuracy of items in the INTA Bulletin, readers are urged to check independently on matters of specific concern or interest.