HSIL sues ICICI Securities in Delhi HC for report saying Jaquar became top brand

Leading sanitaryware brand, HSIL Limited, has a filed a case against prominent brokerage ICICI Securities for a “defamatory and disparaging” research report, which said that Jaquar has become India’s No. 1 sanitaryware brand. HSIL has claimed Rs. 2.5 crores as damages for the false report. The Delhi High Court issued notice to ICICI Securities in the case. (HSIL vs ICICI Securities)

HSIL said the report led to “widespread defamation” of HSIL and “disparagement of its products and brand”.

This is one of the rare cases where a company filed a suit against a leading brokerage for a research report. There have been some instances in the past, but they have been far and few. Brokerages have analysts tracking sectors and companies who then put out research reports about a company.

“A highly defamatory, libelous, false, disparaging and malicious report published by ICICI Securities Ltd. titled ‘Jaquar pips HSIL; becomes India’s No.1 sanitaryware brand’ on 28th April 2020 which was intended to be read by the public and it was widely publicised to all their clients, thereby leading to widespread defamation of the HSIL Ltd. (now Brilloca Ltd. post demerger) (hereinafter referred to as Company) and disparagement of its products and brand,” HSIL said in a filing.

According to HSIL, the Report is in violation of SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 2003 and SEBI (Research Analysts) Regulations, 2014.

On the failure of ICICI Securities to withdraw the report and issue a clarification as to the false and misleading’ contents of the said report, the company has filed legal a suit titled HSIL Ltd. & Anr Vs ICICI Securities & Ors’ at the Delhi High Court.

The Delhi HC vide the above said order directed deletion of the report from LinkedIn by Jaquar & Company Pvt. Ltd, HSIL said in the filing.

The said report was based on complete falsehood to substantially lower and damage the reputation and goodwill of the company, HSIL said. The report was also uploaded by Jaguar & Company on its LinkedIn account.

“The report was brought to the notice of the company on April 28 whereby the company contacted the concerned persons at ICICI Securities and brought to their notice the fallacies and illegalities of their report. On May 6, ICICI Securities, after acknowledging the incorrect data in its report, suo motu published an addendum (second report) to its false report to cover and save its reputation,” it said.

During the hearing, ICICI Securities undertook to withdraw the report dated April 28, and substitute it with the report dated May 6. “The Delhi High Court was pleased to pass the order, directing ICICI Securities to communicate the fact of the substitution of the report to all concerned. The court vide its order also directed deletion of the report dated April 28 from LinkedIn by Jaguar & Company,” HSIL said.