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| Justice Prathiba M. Singh, Delhi High Court |
Justice Prathiba M. Singh of the Delhi High Court has recently in
Zydus Wellness Products Ltd. v. Dabur India Ltd. (Neutral Citation: 2022/DHC/005793) has examined the law of disparagement in relation to comparative advertising. The Court has examined the leading authorities on the subject and has held that the intent and storyline of the advertisement has to be seen along with the intention to denigrate the product of a competitor. The relevant excerpts from the judgment are reproduced hereunder:
34. The term 'comparative advertising' has been defined in
Article 2 of the Advertising Directive of the EEC as "any advertising which explicitly or by implication identifies a competitor or goods or services offered by a competitor". This definition has been affirmed and relied upon by a ld. Single Judge of this Court in
Havells India Ltd. v. Amritanshu Khaitan MIPR 2015(1) 0295. In the case of
Godrej Sara Lee Ltd. v. Reckitt Benckiser (I) Ltd. 2006 (36) PTC 307 (Del.) a ld. Single Judge of this Court has defined comparative advertising as an advertisement where a party advertises its goods or services by comparing them with the goods and services of another party. This is generally done by either projecting that the advertiser's product is of the same or superior quality to that of the compared product or by denigrating the quality of the compared product.
35. Thus, there has to be either express or implied reference to a competitor or its goods or a product category. A mere fleeting allusion to some unidentifiable product or product category cannot constitute `comparative advertising'. For an advertisement to be classified as comparative advertisement, there ought to be some attributes of a product which are depicted in the commercial such as the container, coloured packaging, mark, logo identifying the Plaintiff's product directly or indirectly. Even if such elements are absent, for the Plaintiff to claim generic disparagement, there ought to be some indicators of identification of the product category at least.
36. In the case at hand, the glass which is shown in the hand of the mother giving the generic orange drink is not identifiable in any manner with the Plaintiff or even with an orange energy drink. It could even be an orange soft drink, orange crush, orange squash, orange mocktail, orange juice, etc., Even on careful repeated watching of the impugned TVC by the Court, it is not clear as to what is the drink being stirred in the glass. It seems to be an orange-coloured drink which is put into a transparent glass and nothing more. However, in the conversation between the mothers after the race finishes, the category of the generic product being depicted has some reference when one of the mothers asks "Both of them drank the same orange glucose then how did your daughter win so easily?" Thus, the impugned TVC identifies 'orange glucose' as the product category towards which the advertisement in question is directed. Therefore, the impugned TVC can be classified as 'comparative advertising' to the broad orange glucose product category.
37. In view of this finding, the next question that needs to be probed by the Court is whether the impugned advertisement is disparaging in nature. For the purpose of examining disparagement, comparative advertising can be categorised in the following categories:
i. Where there is a direct comparison with a competitor's product. ii. Where there is a comparison with a specific product which can be deciphered due to some references such as a similar mark, a similar logo, similar packaging, similar container, etc. iii. Comparison with a product of related category with no direct reference.
iv. Where there is a general comparison without an identified product category as a whole.
38. Numerous decisions relating to comparative advertising and disparagement have been cited by the parties. Broad principles have been laid down repeatedly in these decisions. Principles of comparative advertising laid down in these decisions would have to be applied depending upon the category of comparative advertising in which a particular case would fall.
39. Disparagement is an act of belittling someone's goods or services with a remark that is misleading. The law relating to disparaging advertisements is now well settled. It is open for a person to exaggerate and highlight the qualities and features of his own goods, but it is not open for a person to belittle and disparage the goods of another. There is a plethora of judgments which have been cited before this Court by ld. Sr. Counsels for both the parties. In the case of
Pepsi Co. v. Hindustan Coca Cola 2003 (27) PTC 305 (Del.) a ld. Division Bench of this Court held that the following factors are required to be considered while deciding the question of disparagement: i. Intent of the commercial;
ii. Manner of the commercial; iii. Story line of the commercial and the message sought to be conveyed by the commercial.
i. The intent of the advertisement - this can be understood from its story line and the message sought to be conveyed. ii. The overall effect of the advertisement - does it promote the advertiser's product or does it disparage or denigrate a rival product?
In this context it must be kept in mind that while promoting its product, the advertiser may, while comparing it with a rival or a competing product, make an unfavourable comparison but that might not necessarily affect the story line and message of the advertised product or have that as its overall effect. iii. The manner of advertising - is the comparison by and large truthful or does it falsely denigrate or disparage a rival product? While truthful disparagement is permissible, untruthful disparagement is not permissible.
41. It is on the basis of the above principles that this Court needs to ascertain whether the impugned TVC is disparaging or not. Generic disparagement is recognised as disparagement under the law, however, in almost all cases where generic disparagement has been held to be objectionable there has been some reference or some usage or depiction which has clearly led to the conclusion that it is the aggrieved party's product or the entire product category is being referred to. For example:
42. It is usual for advertisers and companies marketing and selling products to portray their products as being superior. In the process of depicting superiority, a generic comparison ought to be permitted and creativity cannot be stifled. A television commercial is not to be analysed in a hyper critical manner. A commercial would have to be viewed as a whole from the view of an ordinary consumer or viewer. The message being portrayed in the commercial would have to be seen and if the message is not derogatory, no objection can be raised.
43. In the opinion of the Court, cases where there is a direct comparison and denigration of the competitor's product would fall in a completely different category as against those cases where there are allusions or indirect references. Allegations of disparagement in cases where comparison is alleged with an unrelated category as a whole is also objectionable. However, in the case of generic comparison with a product of related / same category without any direct reference to any competitor, the freedom for advertisers would be greater than those cases falling in other categories. This is because in order to portray a particular product as being superior or better than existing products, a generic comparison highlighting the strength of its own product without launching a negative campaign against its competitors ought to be permissible failing which the strength of the advertisement could itself be considerably diluted. The purpose of advertising any product is for marketing the attributes of that product. Such attributes could be unilateral or relative in a generic manner. It cannot be said that every generic comparison would be referencing to the market leader which would, in the opinion of the Court, be curtailing freedom of advertising to a considerable extent. Mere allusions, in the absence of a decipherable comparison would not be sufficient to make out a case of generic disparagement. An advertiser ought to have the freedom to make advertisements with generic comparison highlighting the features of its own product and if the same is done without an allusion to any market leader, objection cannot be raised unless representation being made is absolutely false or misleading.
44. Viewed from this perspective, the following decisions of the ld. Division Benches of this Court are relevant in the present factual matrix:
I. In Dabur India Ltd. v. Colortek Meghalaya Pvt. Ltd. and Ors. (supra), the products concerned were 'GOOD KNIGHT NATURALS' and 'ODOMOS'. There was no overt or direct reference to 'ODOMOS' in the entire commercial. The content of the commercial showed that the competing product was causing rashes, allergy and was sticky, which was a serious depiction. However, the ld. Division Bench held that there was nothing in the advertisement to suggest that the commercial denigrated the products of the Appellant therein. The observation of the ld. Division Bench are as under:
"5. The submission of the Appellant is that its product Odomos is an extremely popular mosquito repellant cream and it enjoys over 80% of the market share all over the country and in some parts of the country it enjoys a 100% market share. The sales of the Appellant's product run into crores of rupees and the advertisement and promotion expenses also run into crores of rupees.
6. It is averred that the commercial of the Respondents' product was telecast on a news channel on 8th October, 2009. We are told that it has appeared on several occasions thereafter. According to the Appellant, the commercial disparages its product and, therefore, the Respondent should be injuncted from further telecasting it. It is submitted that even though there is no direct or overt reference to the Appellant's product, since the Appellant's product enjoys a huge market share, the commercial is obviously targeting it. Serious objection was taken to the suggestion in the commercial that the Appellant's product causes rashes, allergy and is sticky.
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18. On balance, and by way of a conclusion, we feel that notwithstanding the impact that a telecast may have, since commercial speech is protected and an advertisement is commercial speech, an advertiser must be given enough room to play around in (the grey areas) in the advertisement brought out by it. A plaintiff (such as the Appellant before us) ought not to be hyper- sensitive as brought out in Dabur India. This is because market forces, the economic climate, the nature and quality of a product would ultimately be the deciding factors for a consumer to make a choice. It is possible that aggressive or catchy advertising may cause a partial or temporary damage to the plaintiff, but ultimately the consumer would be the final adjudicator to decide what is best for him or her.
19. Having said this, we are of the opinion after having gone through the commercial not only in its text (as reproduced above) but also having watched it on a DVD that there is absolutely nothing to suggest that the product of the Appellant is targeted either overtly or covertly. There is also nothing to suggest that the commercial denigrates or disparages the Appellant's product either overtly or covertly. There is also no hint whatsoever of any malice involved in the commercial in respect of the Appellant's product - indeed, there is no requirement of showing malice.
20. Learned Counsel for the Appellant submitted before us that since his client has over 80% of the market share in the country and a 100% market share in some States, the obvious target of the commercial is the product of the Appellant. In our opinion, this argument cannot be accepted.
The sub-text of this argument is an intention to create a monopoly in the market or to entrench a monopoly that the Appellant claims it already has. If this argument were to be accepted, then no other mosquito repellant cream manufacturer would be able to advertise its product, because in doing so, it would necessarily mean that the Appellant's product is being targeted. All that we are required to ascertain is whether the commercial denigrates the Appellant's product or not. There is nothing in the commercial to suggest a negative content or that there is a disparagement of the Appellant's product. The commercial merely gives the virtues of the product of the Respondents, namely, that it has certain ingredients which perhaps no other mosquito repellant cream has, such as tulsi, lavender and milk protein. While comparing its product with any other product, any advertiser would naturally highlight its positive points but this cannot be negatively construed to mean that there is a disparagement of a rival product. That being so, whether the Appellant's product is targeted or not becomes irrelevant.
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(a) A tradesman is entitled to declare his goods to be best in the world, even though the declaration is untrue.
(b) He can also say that his goods are better than his competitors', even though such statement is untrue.
(c) 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.
(d) He however, cannot, while saying that his goods are better than his competitors', say that his competitors' goods are bad. If he says so, he really slanders the goods of his competitors. In other words, he defames his competitors and their goods, which is not permissible.
(e) 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.
These propositions have been accepted by learned Single Judges of this Court in several cases, but in view of the law laid down by the Supreme Court in Tata Press that false, misleading, unfair or deceptive advertising is not protected commercial speech, we are of the opinion that propositions (a) and (b) above and the first part of proposition (c) are not good law. While hyped-up advertising may be permissible, it cannot transgress the grey areas of permissible assertion, and if does so, the advertiser must have some reasonable factual basis for the assertion made. It is not possible, therefore, for anybody to make an off-the-cuff or unsubstantiated claim that his goods are the best in the world or falsely state that his goods are better than that of a rival."
(supra) the competing products were 'COLGATE' & 'PEPSODENT'. In this case, the commercial clearly depicted 'COLGATE' and made a direct comparison with 'PEPSODENT'. Customer's imagination was not needed to see as to in what manner the comparison was being made with what product in the said case. 'PEPSODENT' claimed to have 130% germ attack power in comparison with 'COLGATE'. This was held to be not merely hyperbole and relying upon
Lakhanpal National v. M.R.T.P Commission (1989) 3 SCC 251 it was held that the same was an unfair trade practice. The observation of the ld. Division Bench is as under:
"58. In our view, even if, we assume that the representation that Pepsodent is more effective in combating germs, 4 hours after brushing, in comparison with Colgate ST, is correct even then, prima facie, the advertisement would be disparaging as it also conveys the message that Colgate is ineffective and lacks the requisite quality to maintain oral hygiene and combat tooth decay and its usage, as depicted by the Colgate child, would result in the user ending up with a tooth related ailment. As explained in
Dabur India Ltd. v. Colortek Meghalaya Pvt. Ltd. & Anr.
(supra) a trader cannot, while saying that his goods are better than his competitors', say that his competitors' goods are bad. If he says so, he really slanders the goods of his competitors. In other words, he defames his competitors and their goods, which is not permissible. In our view, this is precisely what the impugned print advertisement conveys by its advertisement theme and the visual story."
III. The most recent decision of the ld. Division Bench of this Court in
Reckitt Benckiser (India) Pvt. Ltd. v. Hindustan Unilever Limited (supra) dealt with a case where toilet cleaners 'HARPIC' and 'DOMEX' were being compared in an advertisement. A perusal of the storyboard in the said case would show that there was a direct reference to 'HARPIC' product and it was suggested that 'HARPIC' does not address the problem of bad odour. The actual 'HARPIC' product was also shown in the said commercial. The commercial also depicted a child who is expressing displeasure by asking "Toilet se badbu nahi aayengi?" to enquire about the bad odour which would emanate if 'HARPIC' is used. In the said decision, the ld. Division Bench has held as under:
"33. On a plain viewing, it is clear that the message sent by the advertiser is that Harpic does not address the problem of bad odour. The astonished expression of the child and his gesture of holding his nose while asking the question whether the toilet will not stink and the mother of the child getting concerned and worried, sends out a clear message that if you use Harpic, the toilet will continue to stink because the mother, who is otherwise regularly using Harpic, has not been able to address the problem of foul odour persisting in their toilet. The latter part of the impugned TVC-1 then shows a toilet bowl with discolouration possibly reflecting bad odour and the voice over saying "Kyoki toilet ki badbu se ladne ke lie DOMEX me hai fresh guard technology". The remaining part of the impugned TVC-1 is about the product Domex and its quality to combat bad odour for a longer period of time.
34. The impugned TVC-1 not only projects a message that Domex fights odour for a longer period of time, it also sends a clear message that Harpic does not address the problem of foul smell that emanates from toilets. The manner in which the impugned TVC-1 is structured, first, sends a message that Harpic only cleans without addressing the problem of bad odour and thereafter, sends the message that whoever chooses Harpic would have to live with their toilets smelling foul. This is a message that disparages Reckitt's product and, in our view, cannot be permitted.
35. The finding of the learned Single Judge that the impugned TVC-1 does not denigrate Reckitt's product is erroneous and cannot be sustained. The latitude available in advertising is wide but does not extend to denigrating the product of one's competitor.
36. By an order dated 01.12.2021 passed by this Court, HUL was restrained from airing the impugned TVC-1. We make the said order absolute. The same shall continue till disposal of the suit."
The facts in
Reckitt Benckiser (India) Pvt. Ltd. v. Hindustan Unilever Limited (supra) are clearly distinguishable from the facts the present case as there is no direct comparison with the Plaintiff's product in the case at hand. No image of the Plaintiff's product has been used and the qualities being attributed to 'HARPIC' are also completely derogatory in the said case. Moreover, nowhere in the impugned TVC the Plaintiff's or for that reason any product is being adversely commented upon as was the scenario before the ld. Division Bench. In the impugned TVC, only the features of the Defendant's product are highlighted. Even the ld. Division Bench in Reckitt
Benckiser (India) Pvt. Ltd. v. Hindustan Unilever Limited (supra) has highlighted the difference between embellishing one's own product and calling the competitor's products as bad or inferior. The relevant portion of the said judgment reads as under:
24. In a comparative advertisement, it is open for an advertiser to embellish the qualities of its products and its claims but it is not open for him to claim that the goods of his competitors are bad, undesirable or inferior. As an illustration, in a comparative advertisement, it is open for an advertiser to say his goods are of a good quality but it is not open for an advertiser to send a message that the quality of the goods of his competitor is bad. As observed by the Chancery Division in the case of De Beers Abrasive Products Ltd. and Others v. International General Electric Co. of New York Ltd. and Another, it is open for a person to claim that he is the best seller in the world or a best seller in the street but it is not open for him to denigrate the services of another. Thus, it is not open for an advertiser to say "my goods are better than X's, because X's are absolutely rubbish". Puffery and Hyperbole to some extent have an element of untruthfulness. If a tailoring shop claims that he provides the best tailored suits in the city, the same may be untruthful. However, it is apparent to anyone who reads or hears this statement that it is puffery. Such statements or taglines are neither held out nor understood as a representation of unimpeachable fact.
It is obvious that the person availing services from the tailoring shop, as mentioned above, cannot maintain an action of misrepresentation. However, when it comes to statements made by an advertiser in respect of the goods of his competitors and other persons, the latitude available to an advertiser is restricted. Whilst it is open for the tailoring shop to state that it provides the best tailored suit in the city; it is not open for it to advertise that the other tailoring shops in the street lack the necessary skill and their suits are ill tailored.
25. A comparative advertisement would always involve the statement that the goods of the advertiser are better in some aspects than that of the competitor. But there is line that an advertiser cannot cross. He cannot disparage or defame the goods of his competitor.
26. There may be cases where certain features of an advertiser's product may be demonstrably better than the features of his competitor. In such cases, it is permissible for an advertiser to advertise and highlight these features. The message must clearly be to highlight the superior features of his product while ensuring that the product of his competitor is not disparaged or defamed.
45. An analysis of the above three Division Bench judgments of this Court shows that in the case of a commercial which has no direct or overt reference to a competitor's product, there cannot be a presumption that the product of the Plaintiff is being targeted. The ld. Division Bench observes in Dabur India Ltd. v Colortek (supra) that where there is no overt or covert reference, merely on the basis of market share it cannot be presumed that the advertisement is directed towards the market leader. In the opinion of this Court, the reasoning and rationale in
Dabur India Ltd. v. Colortek (Supra) fully applies to the facts of the present case. In fact, in
Dabur India Ltd. v. Colortek (Supra) the allegation of qualities being attributed to the competitor's product of causing rashes, allergy and stickiness were far more derogatory than the portrayal in the impugned TVC.
46. Applying the ratio of the judgments discussed above, this Court is of the view that the impugned TVC merely highlights the qualities of the Defendant's product and it does not disparage any orange glucose powder drink. Disparagement cannot be a far-fetched inference. In the impugned commercial, the mother asks a probing question as to how when her daughter drank the same orange glucose, the other lady's daughter won the race. This is being interpreted by the Plaintiff as a comparison as it leads to an inference that 'DABUR GLUCOPLUS-C ORANGE' is more effective, hence, superior and the other products including the Plaintiff's product are ineffective, hence, inferior - thus disparaging. The Plaintiff's case is that the gestures of disappointment and frustration on the face of the mother whose daughter lost the race is sufficient to infer disparagement. This, in the opinion of the Court, is far-fetched. It would not be proper for the Court to flip the coin to conclude - 'mine is better' as 'yours is bad'. The comparison being made in the impugned TVC might be unfavourable to the Plaintiff, but it cannot be held to be disparaging. The intent and the overall effect of the advertisement in question seems to be to promote the Defendant's product and not to denigrate the Plaintiff's or any other manufacturer's product.
47. The next argument of the Plaintiff that there is a serious misrepresentation of fact also does not hold ground. The admitted position is that the Defendant's product does have 25% more glucose than the Plaintiff's product. The impugned advertisement is by and large truthful and there is no falsity involved. Therefore, there is no serious misrepresentation of fact on part of the Defendant in the impugned TVC. The argument of the Plaintiff that more glucose does not translate into higher energy also does not hold ground for two reasons. First, the storyboard of the advertisement merely shows "25% more glucose in every sip". This is not misrepresentative considering the contents of the Defendant's drink. Second, as far as the claims of 'instant energy' is concerned, the Plaintiff's own product packaging, and its advertisements which have been placed on record, show that the Plaintiff's own stand is that glucose gives instant energy. The Plaintiff cannot take a different stand for its own product and Defendant's product. Moreover, the storyboard shows that in the impugned TVC it has been said "this has 25% more glucose than your glucose powder, which gives more instant energy + 2 times micronutrients", however, it was brought to the attention of the Court that the impugned TVC, which is Bengali, does not use the phrase 'gives more instant energy' and merely claims that it 'gives instant energy'. Thus, the overall message sought to be conveyed by the Defendant vide the impugned TVC is that its product has 25% more glucose which gives instant energy.
48. In the absence of any disparaging uttering, still or image in the impugned TVC, this Court is unable to arrive at a conclusion merely on the basis of the market share of the Plaintiff that the Plaintiff's product is being disparaged or there is any generic disparagement. The impugned TVC when viewed from the perspective of an ordinary viewer does not give the impression of denigration or disparagement but one where the Defendant's product is being self-promoted. Moreover, the intelligence of an ordinary viewer also ought not to be ignored while judging such commercials. The ld. Division Bench in
Dabur India v. Colortek (supra) has pointed out that market forces, nature and quality of the products would ultimately be the deciding factors for a consumer to make a choice. It cannot be ignored that the consumers are cognizant of the fact that advertisements are one sided commentary put out by the manufacturers and sellers for the promotion of their own products and are inherently biased in nature. While deciding a disparagement suit, the overall impact of the commercial has to be considered and in the absence of any derogatory remarks, mere use of some expressions cannot lead to an injunction.
