The Delhi High Court in Christian Louboutin SAS v. Nakul Bajaj & Ors, CS (COMM) 344/2018, held that e-commerce websites, actively participating in the sale of goods/ services, are not intermediaries and can be held liable for misuse of trade marks on counterfeit products.
Darveys is an ecommerce website of the Defendant that sells products of luxury brands in India. Christian Louboutin, we believe, needs no introduction. Darveys was found selling counterfeit Christian Louboutin products. Further, Darvey's design and content gave a general impression that it was affiliated to Louboutin itself. Nakul Bajaj argued that Darveys was merely acting as a link between the sellers and consumers. Darveys contended that the website should be considered as an intermediary under section 79 of the Information Technology Act, 2000 ("IT Act"). Section 79 protects intermediaries against third party information, data or communication link since they do not have any control over the information stored or transmitted. Here, the primary question before the Court was whether the extent of involvement in the process of buying and selling of the products, made Darveys an intermediary or not. The Court noted that none of the seller's sources were known or displayed on the website. The genuineness of the products was proclaimed by Darveys alone and the terms of service suggested that Darveys exercised complete control over the products. Darveys was also involved in the use of metatags of the brand names including those of Louboutin to attract user traffic. The Court held that, such active participation of Darveys is more than that of an intermediary and therefore it cannot invoke the safe harbour immunity under the IT Act. Darveys was held liable for misusing Louboutin's trademarks and proprietary rights and for sale of counterfeit products. The Court held that any e-commerce website, which allows displaying of counterfeit goods, would be falsifying the mark.
The Court directed Nakul Bajaj, to henceforth ask for evidence of genuineness of the product from the seller. If such evidence is not provided, the Court directed Darveys to take down such products from display. The Court further directed to disclose the details of these sellers on the website. Since there was no actual sale of Louboutin's products through Darveys, no order for damages was passed.
Compiled by: Adv. Sachi Kapoor | Concept & Edited by: Dr. Mohan Dewan
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