The Trade Marks Act, 1999 permits comparative advertising by means of using another's trademark, however in that process the advertiser doing so cannot disparage the goods or services of another. Any such act disparaging the goods or services of another shall not only be an act constituting infringement of trademark, but also shall constitute product disparagement which covers the domain of unfair trade practices.
Lately in a high profile dispute involving FMCG majors, product disparagement was the core of the issue in comparative advertising. Reckitt and Benckiser had moved the Delhi High Court seeking restraint on the television commercial of Hindustan Unilever Limited alleging that the commercial is in bad taste and has brought discredit to its cleaning product Harpic. It was contented that the advertisement by Hindustan Unilever Limited features a toilet bowl being cleaned with a blue colour liquid and proceeds to show how blue colour cleaners are ineffective against fighting germs compared to Domex, Hindustan Unilever's product, which is white in colour. Reckitt and Benckiser claimed that Hindustan Unilever by claiming that HUL's Domex kills germs better than the blue-coloured liquid puts Harpic in bad light as the blue colour is an identifiable characteristic of Harpic so much so that it has become synonymous with its product in this category. It was further claimed that Harpic is a household name and commands a market share of 80 percent. The advertisement of Hindustan Unilever is a disparagement of the entire class of blue liquid toilet cleaners and in particular Harpic. Denying all the allegations, HUL said there was no direct attack on Harpic in the advertisement as Reckitt and Benckiser was selling its product under other colour combination also apart from blue. The court, after hearing both parties has reserved the judgement.
The law on comparative advertising and product disparagement with respect to trademarks is given in sections 29(8) and 30(1) of the Trade Marks Act, 1999. Section 29(8) enunciates situations where use of another's mark in advertising can amount to infringement, if such use does not comply with the conditions laid down under the section. At the same time, section 30(1) makes such use, an exception, if it is in accordance with the conditions provided under this section.
Trademark Act, 1999 permits comparative advertising u/s 30(1) which reads as follows:
Nothing in section 29 shall be preventing the use of registered trademark by any person with the purposes of identifying goods or services as those of the proprietor provided the use:-
- is in accordance with the honest practices in industrial or commercial matters, and
- is not such as to take unfair advantage of or be detrimental to the distinctive character or repute of the trade mark.
But with certain limitations which are provided u/s 29(8) which reads as:
A registered trademark is infringed by any advertising of that trademark if such advertising:-
- takes unfair advantage and is contrary to honest practices in industrial or commercial matters; or
- is detrimental to its distinctive character; or
- is against the reputation of the trademark.
Comparative advertising is productive in a state of healthy competition whereas when used with mala fide intentions, it misleads the consumers into buying the wrong products. A tradesman is entitled to boast about his product for the sole purpose of its promotion, howsoever untrue it may be, and for that purpose can even compare the advantages of his goods over the goods of others but there cannot be any mention of the disparagement of the competitor's good.
The key elements of comparative advertising law are as follows:
- Although comparative advertising is legal, the competitor is still entitled to sue if it is targeted in an advertisement and anything said about it is false or misleading.
- Even if the competitor is not specifically mentioned but may be identified by implication, it may be seen as the target.
- Once the competitor is seen as the target (either by implication or by specific naming), if any fact stated or impression created is false or misleading the advertiser may be liable for damages. The competitor may also be entitled to an injunction to stop the campaign.
- Special care must be taken in the use of a design trademark in a comparative advertisement.
- In a comparative advertising campaign which involves the use of a competitor's trademark, the emphasis should be on promoting the product based on the differences, not the similarities, between the two products.
The intent of the legislature in enacting the aforementioned provisions is quite apparent: To impose the leniencies of permitted comparative advertising over the stringencies of trademark protection.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
