By, Akhil Satheesh

 

In the arsenal of consumerism, no weapon has proven more effective in inflicting the mortal blow than advertising. The ability of this tool to consistently generate a demand for the non-essential and convert luxury to necessity has not been overlooked by companies that favor survival. Although initially advertisements weren’t considered to be free speech protected under Article 19, this stance changed and they were granted the status of “commercial speech” when the Courts eventually opined that although advertisements were issued as a means of commercial gain, they further promoted a free flow of information in the market[i].

In the face of the Covid-19 pandemic, companies across the globe have shifted focus and re-launched advertising campaigns in accordance with the psyche of the general populace, whose indissoluble concern has now become safety and hygiene. As a consequence, the more competitive brands in the market have resorted to explicit claims of product superiority over their fellow rivals. This particular strategy is referred to as Comparative Advertising, a technique in whose employ, companies toe the line between fair play and infringement of the intellectual property rights of its competitors. Comparative advertisement is defined as an ad that either explicitly or impliedly refers to a competitor or goods or services provided by a competitor.[ii] It is essentially a marketing technique where a party advertises his product in comparison with a corresponding commodity of another brand. Companies such as Apple and several other duos have been engaged in satirical advertising wars for decades, which in turn generated social media buzz providing free publicity to all parties involved[iii].

Recently, the Bombay High Court adjudicated upon the first instance of a lawsuit pertaining to comparative advertising during the COVID – 19 pandemic, between Hindustan Unilever Ltd and Reckitt Benckiser[iv], the Dettol parent company. Following the issuance of WHO guidelines[v] recommending recurrent washing of hands with soaps or liquid soaps, marketing for the same had reached an all-time high. In the nascent stages of the pandemic, Hindustan Unilever Limited (HUL), anticipating the increase in demand for hygiene products, released an advertisement implying that the bar soap is more competent in comparison to its liquid counterpart. In this particular instance, the defendants, Reckitt Benckiser had released a counter advertisement which was claimed to be at the expense of the plaintiff company’s reputation, wherein the advertisement publicized the use of Dettol liquid soap over bar soap, claiming the latter to be ineffective against germs, which were representative of the present novel coronavirus scenario. The problem arose when the red bar soap depicted in the advertisement was one that was identical to the Lifebuoy product, in terms of shape, design, and the signature red color. Consequently, the plaintiff company approached the High Court claiming denigration of the Lifebuoy trademark and sought damages amounting to 10 million rupees and further, a permanent injunction against the defendant company for disparaging their products, especially at such an epochal juncture.

The question as to whether this instance was one of unlawful comparative advertising was addressed by the Court which held that the advertisement in question, which clearly portrayed a bar soap identical to or at the minimum, indistinguishable by a person of reasonable intelligence, from the trademarked Lifebuoy soap, as being ineffective against germs, was one conceived with malice against the rival brand.

In the Trademarks Act, 1999, Sections 29(8) and Section 30(1) are those that deal with the concept of comparative advertisement. Section 29(8)[vi] clearly demarcates the parameters, the crossing of which constitutes trademark infringement and states that if an advertisement, while making use of a trademark, takes unfair advantage of it and acts contrary to honest practices or if the act results in disparagement or tarnishing of the reputation of the mark, the act is considered to be infringement, the underlying principle being that the beneficiary of a trademark must be its owner. Section 30(1)[vii],  however, is a positive provision, stating that the use of a registered trademark is justified to the point wherein its use does not constitute a contravention of the principles of honesty and fair trade and does not tarnish the reputation of the trademark.

In Reckitt and Coleman of India v Kiwi T.T.K.[viii] similar circumstances arose regarding the efficacy of wax-based polishes produced by two brands and the Delhi High Court held that although manufacturers are within their right to disseminate claims of the supremacy of product to promote business, this right is limited to the extent where such promotional act does not constitute an act of defamation of the competitor’s product.

Currently, the Advertising Standards Council of India (ASCI) is responsible for maintaining effective oversight of advertisements put into circulation and to provide fair guidelines for the same. However, being a not-for-profit company and not a regulatory governmental body therein lacking any rulemaking authority, the power of the council is limited. The body acts in accordance with its sense of social responsibility with the primary goal being the promotion of free unbiased advertising furthering the interests of all parties involved[ix].

In the existing scheme, no concrete rules governing the advertisement realm are present and as a result, misappropriation of a rival’s trademark exists as a very real possibility. The need for a strong statute is made very apparent with each new case which further exacerbating the load upon an already overburdened judiciary. The overreach made by comparative advertising is merely curbed by laws commandeered from the Trademarks Act, 1999. These provisions only convey the criteria for the determination of an infringement. Repercussions of such an act are not provided for in these sections or in any other statute. Considering the nation’s track record in addressing cases of Comparative Advertising, where the only remedy granted is an injunction with the associated claim for damages being consistently overlooked, the loss incurred by the wronged company is not ameliorated, but rather ignored by the Courts. Further, regarding the plaintiff, in instances of product disparagement, an injunction is generally the only remedy granted by the Courts, which raises the question as to whether an injunction can undo all the damage suffered by the plaintiff. The removal of the advertisement in question fails to have a retrospective effect in eliminating any misconceptions or prejudice and restoring the reputation of the product in the eyes of the general population[x].  The current legal framework has rendered an act of Comparative Advertising and its extensive consequences violating the limits of fair use as a crime with no proportionate punishment. The need for a deterrent in the form of definite statutes bearing precise punitive measures is felt in each of these instances and remains a hurdle that must be addressed hastily.

The relevance of this case, like all others addressing this issue, is that the lacuna present in the field of the proliferation of advertisements and their governance is addressed by judicial decisions which play a pivotal though insufficient role in the determination of disputes, establishing several precedents over time which in turn provide a rough code of conduct to be exercised between rival companies and this particular case furthers this cause. In countries like the US, the concept of corrective advertising is exercised, wherein a Federal Trade Commission order establishes a requirement that the company engaged in deceptive advertising is to cease and desist from such actions and is further barred from subsequent acts of advertising for a particular period of time until the misconceptions produced by the earlier advertisements are rectified[xi], a practice which could be employed in the Indian trade environment as well.

[i] Tata Press Limited v. Mahanagar Telephone Nigam Limited, 1995 AIR 2438.

[ii] Carlton Daniel, Comparative Advertising: A Quick Guide, The National Law Review (Nov. 27, 2020, 3:22 PM), https://www.natlawreview.com/article/comparative-advertising-quick-guide.

[iii] Id.

[iv] Hindustan Unilever Ltd. v Reckitt Benckiser (India) Pvt. Ltd., (COMIPL/300/2020).

[v] Coronavirus Disease (COVID-19) Advice for the Public, World Health Organization (Nov. 22, 2020, 5:17 PM) https://www.who.int/emergencies/diseases/novel-coronavirus-2019/advice-for-public.

[vi] Trade Marks Act, §29 cl. 8 (1999).

[vii] Trade Marks Act, §30 cl. 1 (1999).

[viii] Reckitt & Colman of India Ltd. v. Kiwi T.T.K. Ltd., 63 (1996) DLT 29.

[ix] The Advertising Standards Council of India, Indian Broadcasting Foundation (Nov. 25, 2020, 4:16 PM), http://www.ibfindia.com/node/24.

[x] Pratibha Ahirwar, Analysis on Comparative Advertisement: Resulting In Trademark Infringement, Legal Services India, (Nov. 17, 2020 7:52 PM), http://www.legalservicesindia.com/law/article/1136/7/Analysis-on-Comparative-Advertisement-Resulting-In-TrademarkInfringement#:~:text=Comparative%20Advertisement%20can%20improve%20the,and%20therefore%20make%20efficient%20choices.

[xi] Corrective Advertising-The New Response to Consumer Deception, 72 Colum. L. Rev. 415-431 (1972).

Image Source: Photo by Carlos Cunha on Wikimedia Commons