Delhi High Court: In Claim of Disparagement the Test to be Applied is the Impact of Advertisement on an Ordinary Average Consumer

Delhi High Court: In Claim of Disparagement the Test to be Applied is the Impact of Advertisement on an Ordinary Average Consumer

The Delhi High Court has restricted the Indian multinational consumer goods company Dabur from circulating its WhatsApp advertisement on “Dabur Amla Hair Oil.

The single judge Justice Navin Chawla in his order observed that while judging the claim of disparagement, the test to be applied is of an ordinary average consumer and the impact the advertisement would have on such a consumer. Further, it must be considered whether the advertisement is defamatory of the plaintiffs’ goods individually or as a class.

A suit was filed by the plaintiff- Marico Limited alleging disparagement of the goodwill and reputation of its product “Nihar Natural Shanti Badam Amla Hair Oil” and registered “Nihar” trademarks.

Marico sought an ad interim injunction to restrain Dabur from circulating or forwarding its WhatsApp Advertisement or Print Advertisement on Amla hair

While refusing to injunct the print advertisement on the hair oil, the Court at the outset stated that a party seeking discretionary relief in form of an ad interim injunction, must approach Court with clean hands and with full and fair disclosure of all material and vital facts and document, failing which, concealment/misstatement itself would be a sufficient ground for the Court to deny the discretionary relief, without going into the merits of the dispute.

“The mere fact that the interim order granted to the plaintiff was suspended on account of such concealment, cannot absolve the plaintiff of the repercussion of the concealment and misstatement of facts. The plaintiff cannot make a virtue out of the fact that when confronted with allegation of concealment, it conceded to suspension of the benefit obtained through such concealment,” the Court observed.

Similarly, the mere fact that the plaint was filed in urgency, cannot absolve the plaintiff of making a truthful, honest, and complete disclosure of facts, opined the judge.

The Court found merit in the submission of the learned senior counsel for the defendant- Dabur India Ltd., that the plaintiff had indulged in forum shopping. The Court noted that the plaintiff had filed an earlier suit before the High Court of Bombay almost on similar averments and complaints against a similar advertisement issued by the defendant. High Court of Bombay vide its orders dated 4 December, 2019 and 14 February, 2020 found that the plaintiff had failed to make out a prima facie case in its favor for grant of an ad interim injunction.

In this regard, the Court referred the decision passed in the case of UoI & Ors vs. Cipla Ltd & Anr, (2017), wherein the Supreme Court held that forum shopping takes several hues and shades.

A classic example of forum shopping is when a litigant approaches one Court for relief but does not get the desired relief and then approaches another Court for the same or similar relief.

The Court was of the view that the above judgment squarely applied to the facts of the present case as well.

Therefore, the Court prima facie found that the plaintiff had indulged in forum shopping, which disentitled the plaintiff to any relief.

As far as the Print Advertisement was concerned, it was the case of the plaintiff that the opening statement “Yaad Rakhna, Sasta Aawla, balo ko mehenga padega” is alarming and threatening the consumers against all cheaper in price Amla Hair Oils as being inferior and harmful. The plaintiff claimed that this amounted to generic disparagement.

Apropos to the same, the Court observed, “while judging the claim of disparagement, the test to be applied is of an ordinary average consumer and the impact the advertisement would have on such a consumer. It is to be considered whether the advertisement is defamatory of the plaintiffs‟ goods individually or as a class.”

Therefore, the Court was of view that it was merely suggestive of the fact that there could be severe repercussions in using cheaper Amla Hair Oils-cheaper being in quality and price.

The Court further clarified that, “advertisement is to be judged from point of view of an ordinary consumer and his perception of the advertisement, which in my prima facie opinion would be to see the advertisement as a puffery, rather than from a sensitive competitor like the plaintiff.”

The Court found that while the plaintiff had not been able to make out a prima facie case against the Print Advertisement, at the same time, the plaintiff was successful in making out a prima facie case as far as the WhatsApp message/Advertisement was concerned.

Accordingly, the Court restrained the defendant, either directly or through its servants, agents, employees, or any other persons working under it, from circulating the WhatsApp message/Advertisement, during the pendency of the Suit.