Court Checks Denigrating Advertisements

06 November 2012

The significance of advertising in product promotion cannot be denied, for this only creates the recognition and identification for the product in the minds of the consumers.

However, it is a settled law of comparative advertising that a manufacturer is entitled to make a statement that his or her goods are the best and to make statements for the “puffing” of goods and that these statements will not give rise to a cause of action to other traders or manufacturers of similar goods to institute proceedings as there is no disparagement or defamation of the competing goods.

On the other hand, a manufacturer is not entitled to say that his or her competitor’s goods are bad so as to puff and promote his or her own goods. Even generic disparagement of a rival product without specifically identifying or pinpointing the rival product is equally objectionable.

In a catena of cases, the courts have clearly ruled that comparative advertising is a mala fide activity aimed at maligning the reputation of the competitor. More recently, the Delhi High Court has rendered two judgments restraining comparative advertising and disparagement of products.

In SC Johnson & Son Inc and Anr v. Buchanan Group Pty Ltd, the plaintiff claimed that their cleaning product was denigrated in an advertisement run on television and the internet by the defendants.

It was alleged that the one of the cleaners shown in an orange bottle with the typical trigger nozzle was similar to that of the plaintiff, and that the defendant’s product was shown to be more advanced and effective in removing stains from tough surfaces than those cleaners.

In a nutshell, by this comparison, the defendants led consumers and viewers to believe that other cleaners, including the plaintiff’s products, are ineffective and worthless.

The court ruled that the defendant’s advertisement was indeed aimed at disparaging the plaintiff’s product as the bottle of the inferior cleaner was shown to be of the same colour and with the particular trigger nozzle as that of the plaintiff.

Even if not directly, there is still enough innuendo to denigrate the plaintiff’s cleaner product, since it came within the test of the defendants’ alluding to a “specific defect” or “demerit” in the plaintiff’s product.

The fact that the advertisement was withdrawn after three months’ run was not a sufficient argument, in the eyes of the court, which said that the advertisement had to be replaced with a new one not because of comparative advertising, but because of commercial reasons.

Moreover, the defendants had refused to give any assurance that they would not run the impugned advertisement again.

The court observed, “The provisions of Order 39 Rules 1 & 2 of the CPC make it clear that it not only empowers the court to injunct what it perceives is a the continuing wrong but also brings within its fold threatened breach of a legal right invested in the plaintiffs.”

In another instance, Frankfinn Aviation Services Pvt Ltd v. Akash Gupta, the impugned advertisement was published by the defendant in a popular English daily newspaper against the training institute of the plaintiff; both are in the business of providing aviation and hospitality training. The advertisement was directed at depicting that the nature of training provided by the plaintiff’s institute was inferior to that of the defendant’s training as it was provided on stationary aircraft rather than real aircraft, thereby ensuring no practical training.

The defendants, in their written statement, had alleged a similar conduct on the part of the plaintiff, saying that they had not come with clean hands. To substantiate, the defendant produced the details of another suit in which an injunction was passed against the plaintiff for taking out advertisements referring to defendant’s academy.

The court, after due evaluation, averred that the defendant had, indeed while comparing its services, shown the plaintiff’s institute in bad light. Also, by using the word ‘useless’ and ‘no real success’, the defendants had clearly defamed the plaintiff’s services. The way the advertisement was given, it clearly referred to the plaintiff and no one else. Hence, the defendant was not allowed to wash its hands by saying that the advertisement only reflected the benefits of defendant’s academy.

Accordingly, the court found the plaintiff to be entitled to an injunction, but rejected the prayer of the plaintiff with regard to recovery of Rs10 million (US$220,000) and interest for quantified damages.

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