This case study is written by Sagar Sarkar, George School of Law, Fresher, LLB(Hons) during an internship at LeDroit India.
ABSTRACT
Dabur India Ltd. vs. Emami Ltd. is one of the landmark cases in Indian intellectual property law, especially on the issue of trademark infringement and unfair competition. This case, decided by the Delhi High Court, dealt with the allegations of Dabur that Emami was indulging in unfair trade practices by preparing packaging and branding of products almost identical to those of Dabur, thus misleading consumers.
KEYWORD
• Trademark Infringement
• Trade Dress Protection
• Intellectual Property Rights
• Unfair Competition
• Injunction
• Delhi High Court
• Dabur
• Emami
INTRODUCTION
Dabur India Ltd. v. Emami Ltd. is perhaps the most important case dealing with trademark law, including passing off and trade dress protection. Dabur claimed that Emami’s packaging is liable to be restrained as it is a copy of Dabur’s own and thus has a risk of causing confusion and dilution of Dabur’s brand. Dabur plead that the packaging elements in its product were distinct colors, designs, and aesthetics, which had acquired strong brand recognition. Emami pleaded that its packaging was sufficiently unique and denied any similarity.
The Delhi High Court had agreed with the claims by Dabur and, therefore, determined that the packaging of Emami can be misleading towards the consumer. This reinforced the principles of distinctiveness in brand creation and protected brand identity against similar imitations with the judiciary working to maintain intellectual property rights.
BACKGROUND
The case involved Dabur India, a large established company in the FMCG industry, which alleged passing off against Emami’s packaging, mainly in the area of healthcare and personal care products. Passing off is defined as an action of one party passing off its goods or business as that of another for which the latter would receive custom.
The contention was with packaging color schemes, design elements, and overall aesthetic for Dabur’s products against Emami.
The fundamental law of comparative advertising is that while a person may exaggerate the claims relating to his own goods, such exaggeration must not denigrate or disparage the goods of another person. The laws governing comparative advertising have evolved by way of judgments which are supported by certain provisions of code of the Advertising Standards Council of India (ASCI).
Recently, in Dabur India Ltd. v. Emami Ltd., the Delhi High Court juggled between the laws of disparagement and right to free speech and ruled in favour of innovation and fair competition, stating that courts must not stifle innovation and the defendant must be allowed to use marketing skills, thus protecting the defendant’s right of free speech.
DABUR’S CONTENTION
Trademark Infringement and Passing Off: Dabur said that, in the marketplace, the packaging of its product was very distinctive and had the potential to serve as an indicator for consumers identifying the source. By copying Dabur’s color combination, structure, and format, Emami’s packaging would likely lead consumers into believing that Emami’s product is somehow related or connected with Dabur, and thus passing off arises in a classic way.
Brand Recognition and Dilution: Dabur argued that, over the years, its brand had acquired a very high level of recognition and, therefore, any semblance in packaging would weaken its market position and the uniqueness of its brand’s identity. This dilution, according to Dabur, was likely to cause irreparable harm to its brand, which had established a significant reputation.
Unfair Competition: Dabur had framed Emami’s attempts into a case of an abusive exercise of fair competition practice where Emami attempted to take advantage of the good name and market space which Dabur already built up. It presented itself as not only inadvertent but also intentional for capitalising on the customer goodwill developed on account of the business that Dabur did over time.
Consumer Protection and Trade Dress: Dabur also founded its argument upon the consumer protection principle arguing that letting Emami keep using such packaging would indeed mislead consumers and chip away trust. Dabur argued that a focus upon trade dress protection would suggest that the visual elements present on packaging of products make a big difference in a competitive marketplace when it comes to brands’ differentiation.
EMAMI’S CONTENTION
No Exclusive Ownership of Packaging Elements: Emami replied that Dabur’s claims against the elements involved in the case in issue – color, fonts, and design motifs – were meritless; these were industry generic things, and Dabur could not claim proprietary rights upon them. No company in the world could claim propriety over elements of use in the design field to the extent of creating restraints in the market because of such exclusivity.
Distinctive Packaging: Emami argued that, although their packaging was similar in some ways, it had distinguishing features that would not lead to consumer confusion. They argued that their packaging was unique enough, including the placement of the logo, additional text, and graphics, which distinguished it from Dabur’s products.
No Intention of Misrepresentation: Emami claims it has no intention to deceive any customer and seek identification with Dabur. Instead, they claim they designed the packaging as a self-help process for their product, never intending to copy Dabur’s logo.
REASONING
In order to evaluate whether the modified advertisement amounted to disparagement, the court extensively discussed the laws and guidelines pertaining to comparative advertising and mentioned the following guidelines:
- An advertisement is commercial speech and is protected by Article 19 (1) (a) of the Constitution.
- An advertisement must not be false, misleading, unfair or deceptive.
- Of course, there would be some grey areas but these need not necessarily be taken as serious representations of fact but only as glorifying one’s product.
- While glorifying its product, an advertiser may not denigrate or disparage a rival product.
ISSUES, COURT’S ANALYSIS AND DECISION
The three primary issues dealt by the court were:
I. Whether the defendant, while advertising its product, can be permitted to compare its sugar free variant Chyavanprashad with the Chaywanprash which contains sugar?
The court noted that the plaintiff’s case was of generic disparagement as the plaintiff’s allegation revolved around the disparagement of “chyawanprash” and not its own product. The advertisement makes it apparent that the comparison has been made with the generic product “chyawanprash” and thus, the plaintiff’s product was not the subject matter of comparison. The court asserted that a competitor can declare his goods to be the best in the world, however while claiming that its goods are better than the competitor, he cannot refer to them as “bad”. Reinstating the established principle that puffery is allowed, but slander and defamation of the goods of the competitor is impermissible, the court observed that the proposed print advertisement is only making a comparison with the generic product “chyawanprash” where a declaration has been made that its product does not contain “sugar”.
It further noted that the print advertisement as well as the TVC was only aimed at providing information to the consumer about a healthier alternative to the general chyawanprash. It stated that the defendant’s right of free speech permits it to state the benefit of its product and is also entitled to make a comparison to the extent it has been done in the advertisement in question.
Further, the court did not see any merit in the plaintiff’s contention that the advertisement is malicious and misleading, as the same does not compare defendant’s sugar free variants with other sugar free similar products. The court reiterated the main thrust of the subject advertisement was to showcase the benefit of chyawanprash without sugar and therefore the defendant was not required to compare the product only with other similar products as contended by the plaintiff.
II. Is the defendant misleading and misrepresenting the consumers that chyawanprash is harmful?
Dismissing the plaintiff’s allegations that by comparing different categories of products i.e. sugar-free chyawanprash with sugar-based chyawanprash, the defendant is suggesting that chyawanprash is harmful even for a non-diabetic consumer, the court held that there was no misrepresentation or misleading declarations as the defendant was merely indicating that a healthier alternative is available and the same is in no way jeopardizing the plaintiff’s product. Further, the court stated that no material has been shown to say that the defendant’s product is only meant for diabetic patients.
III. Whether the defendant has disparaged the entire category of chyawanprash by stating in its advertisement that it contains high level of sugar.
Upon examination of the advertisement and TVC, the court concluded that the defendant’s limited comparative analysis cannot be comprehended to be depicting the rival product negatively. The modified advertisement was not disparaging or denigrating the plaintiff’s product or chyawanprash in any manner. The court stated that the pivotal aspect of the case was to examine if the “look and feel” of the advertisements conveys a message that influences the mind against the competitors in a negative way. It observed that the theme of the subject advertisement was to focus on the benefits of healthy sugar free alternatives and not directed to the plaintiff’s product.
Noting that since sugar is the key differentiator of the defendant’s product; naturally, the comparison of a sugar free product would necessarily be with a sugar based one, as the absence of sugar is the unique selling attribute. The court further asserted that in order to send a message that is long lasting and effective, the advertisement has to convey a message comparatively, highlighting the benefits of a sugar free product and thus, the defendant’s right to ensure widespread awareness of the benefits of its products cannot be ignored. It further warned that parties should not be hyper sensitive about the messages conveyed in the advertisement.
The court further explained that the framework of advertisements is designed with the objective to sway the consumers and coax them to buying a particular product or service. There is bound to be creativity, pun and a story line in such messages, so that it creates an impact on the viewers or the readers. The court stated that while some leeway has to given to the advertiser, the right to free speech cannot be stretched to allow them to become defamatory, disparaging or denigrating. It indicated that the intent behind comparative advertising will invariably be to persuade the consumers to give preference to one of the competing products which is permissible in law.
It further stated that the court cannot restrain the defendant merely because the stakeholders in the industry feel that the advertisement is hurting them. It asserted that courts should not be asked to suffocate the competitors on a perceptive understanding of the competitor that the message delivered through the advertisement is disparaging. The defendant’s right of free speech needs to be weighed upon and protected.
ACTS AND SECTIONS
The Dabur India Ltd. v. Emami Ltd. is one such case where several legal principles relating to Indian trademark and competition law were raised. They include the following acts and sections:
The Trade Marks Act, 1999
• Section 29: Relates to infringement of trademarks which explains that where a registered trademark has been used by any person, other than as authorized by the registered proprietor or a court, without due cause or permission, shall amount to infringement.
• Section 30: Relates to defences to infringement of trademarks whereby it states when use of a trademark by others might be permitted.
• Section 135: Deals with the remedies available in cases of trademark infringement, which includes the option of injunctions, damages, or account of profits.
Competition Act, 2002
• Section 4: It deals with the abuse of dominant position. Though this section was not directly applicable in passing off cases, it is often referred to in cases related to market practices.
Specific Relief Act, 1963
• Section 38 deals with the permanent injunction that Dabur wanted to inhibit Emami from using a packaging similar to it.
Principles of Common Law
• Passing Off: Even though it is not defined under the Indian statutes, passing off is a doctrine of common law that aims to halt one party from passing off another’s goods or services. The central doctrine in this case is passing off as Dabur contended that the packaging of Emami presented its products as Dabur’s.
Consumer Protection Act, 2019
• This is not the lead statute, but consumer protection principles of this act were used to argue the case concerning consumer confusion, arguing that consumer confusion is harmful.
Code of Civil Procedure, 1908 (CPC)
• Order XXXIX, Rules 1 and 2: These are the provisions relating to interim injunctions. Dabur prayed for an ad interim relief in the form of injunction restraining Emami from continued use of similar packaging aforesaid, which would cause irreparable injury. Such application are assessed by the court under Order XXXIX, wherein the prima facie case has to be made out by the plaintiff, the balance of convenience, and the chance of irreparable injury.
• Section 9: This means that civil courts have jurisdiction to try all suits of a civil nature except barred by law. It fell under the civil jurisdiction and thus Dabur could file a civil suit to redress the issue.
• Order VI, Rule 17: This rule allows amendment of pleadings where necessary. This rule allows the amendment of pleadings in case one party needed to alter its claims or defenses on new information or evidence. It avails a legal provision that ensures a fair presentation of arguments.
• Section 20: Section 20 provides for filing of a suit in the court where the defendant resides, carries on business, or where the cause of action arises. This is very significant for IP cases where infringement can take place in more than one jurisdiction thus providing the plaintiff with an element of choice of his forum.
• Section 151: If the court needed to make some special orders in the interest of justice, it might rely on the residuary powers under Section 151- controlling procedural aspects or even managing certain aspects of the injunction.
CASE REFERENCES
In the Dabur India Ltd. vs. Emami Ltd. case, several judgments were referred to comment upon principles related to trademark infringement, passing off, and trade dress protection in arriving at its judgment. Of these, the most important references are made by cases similar to the following intellectual properties:
Cadila Health Care Ltd. v. Cadila Pharmaceuticals Ltd. (2001) . This case highlighted the importance of the doctrine of “likelihood of confusion” more than ever. The fact to be considered includes the class of goods or services for which the trademarks are allegedly passed off, their nature and quality, consumers’ fields, and areas of influence, and how the market perceives and distinguishes between the trademark and any other mark being passed off.
Colgate Palmolive Co. v. Anchor Health & Beauty Care Pvt. Ltd. (2003) : This case of Delhi High Court dealt with issues of product packaging and passing off, holding that a company’s reputation and distinctiveness of packaging are vital to avoid consumer confusion.
Amritdhara Pharmacy v. Satya Deo Gupta (1962) : Phonetic similarity in trademarks was tested and developed the concept of “dilute recollection,” where the consumer does not remember the precise brand name but remembers the similar sounds. This concept is widely used in trademark as well as trade dress cases.
Parle Products Ltd. v. J.P. & Co., Mysore (1972) : In such passing off cases, according to the Supreme Court ruling, it should be the overall impression which is the concern and not the individual elements considered in isolation but taken together form an impression of that product. This was one landmark case for trade dress protection under the Indian concept of trademark law.
Laxmikant V. Patel v. Chetanbhai Shah (2002) : It is the case of Supreme Court which holds that protection to goodwill and reputation needs to be made against misappropriation also, despite the fact that specific registration of the trademark is absent. The same strengthened the principle of passing off as a common law remedy.
CONCLUSION AND IMPLICATIONS
This judgment is a sharp reminder to brands about the need to maintain unique brand identities in order not to invite infringement claims. The judgment underlined the need for companies not to use branding elements that could lead to consumer confusion or unfairly capitalize on another brand’s goodwill. This case was a strong precedent for cases dealing with trade dress protection, unfair competition, and passing off, holding that consumer protection and brand distinctiveness are at the core of India’s intellectual property law framework.
CONFLICTS OF INTEREST
Research details have been collected from publicly visible and accessible web based materials which have been free from any watermarking or any legal constraints. Thus the authors declare no conflicts of interest.
REFERENCES
• https://www.lexology.com/library/detail.aspx?g=c836142c-a516-4ab3-bada-69bd5ab802ea
• https://www.courtkutchehry.com/Judgement/Search/t/5106530-dabur-india-ltd-vs-emami
• https://main.sci.gov.in
• https://indiankanoon.org/
