In a case before the Delhi High Court recently, an order was passed against an advertisement which denigrated the goodwill and reputation of another company and its product.
In Reckitt Benckiser (India) Ltd v Hindustan Lever Limited, the plaintiff’s soap was sold under the trade mark Dettol, while the defendant’s advertisement was intended for the promotion of its soap, Lifebuoy. As the manufacturer of Dettol for over 70 years, Reckitt Benckiser sought a permanent injunction and damages for the disparagement and unfair trade practice against the introduction of a television advertisement by Hindustan Lever.
Reckitt Benckiser alleged that a bare viewing of the advertisement would be sufficient to convince the court of the malicious intention of Hindustan Lever to increase the market share of its Lifebuoy soap by tarnishing the goodwill and reputation of Dettol Original Soap.
In a detailed judgment, the court passed a decree of permanent injunction restraining Hindustan Lever from issuing or telecasting the impugned advertisement and ordered the defendant to pay Rs500,000 (US$9,500) in punitive damages.
The court ruled that staking a claim to having the best product, or saying one product is better than another product was permissible, since the mere puffing of goods cannot be actionable.
However, alleging that one’s own product is superior in contrast to another’s product, which is portrayed as bad and harmful, is entirely different.
When comparing goods, a company is not allowed to slander or defame the goods of its competitors, nor label the goods as inferior without producing substantial evidence.
The update of court judgments is compiled by Bhasin & Co, a corporate law firm based in New Delhi. The authors can be contacted at [email protected] or [email protected] Readers should not act on the basis of this information without seeking professional legal advice.