Bombay HC explains law regarding disparagment through TV commercials while deciding dispute between Kwality Walls and Amul

Bombay High Court: The Division Bench comprising of B.R. Gavai and Riyaz I. Chagla, JJ. partly allowed an appeal filed against the judgment allowing notice of motion restraining appellant from inter alia (i) telecasting or broadcasting or otherwise howsoever communicating to the public or publishing two Television Commercials (impugned TVCs) or any part thereof or any other advertisement of a similar nature in any language or in any manner causing the impugned TVCs or any part thereof or any other advertisement of a similar nature to be telecast or broadcast or communicated to the public or published in any manner and (ii) disparaging or denigrating the plaintiff’s KWALITY WALL’S products or the plaintiff’s business in any manner whatsoever.

Factual matrix of the case states that, plaintiff-Hindustan Unilever Limited (HUL) are one of India’s well-known and reputed company in the FMCG sector. Plaintiff states that “KWALITY” has been a well recognised brand in India, having been in the market for over 70 years and was acquired by the plaintiff before entering into the business of ice creams and desserts in India and KWALITY has been used along with plaintiff’s own global brand WALL’S as KWALITY WALL’S.

“KWALITY” enjoys a special status in the eye of public being a very popular trade mark.

Plaintiff’s state that the two impugned Television Commercials (TVCs) advertised by defendant 1 and 2 had an effect of disparaging the frozen desserts, majority of which are manufactured and marketed by the plaintiff. In the said TVCs, it is shown that the product of Defendant 1 is manufactured by using 100% milk whereas frozen desserts are manufactured by using Vanaspati. The point of concern placed by the plaintiff is that Vanaspati is considered to be having bad effects on the health of the consumers and plaintiff is not using Vanaspati, in fact it uses edible vegetable oil in its products. Further, the plaintiff has stated that as far as frozen desserts are concerned, they contain a small amount of edible vegetable oil. However, the impugned TVCs depict that frozen desserts contain 100% Vanaspati oil. The said TVCs are not permissible in law.

Defendants stand:

According to the defendants, the advertisements did not show product of the plaintiff, however only a comparison between the product of the defendants and the frozen desserts. The contention of the defendants was that at least 30% of the manufacturers of the frozen desserts use Vanaspati.

Learned Single Judge’s decision:

It had granted an order of injunction, due to which the aggrieved filed the present appeal.

Detailed contentions of the parties:

Learned Counsel Mr Kadam on behalf of Appellant/Defendant 1 stated that as far as the first TVC was concerned, the word used by the defendants was ‘Vanaspati’, and since plaintiff had an objection to use the word ‘Vanaspati’, the same was omitted in subsequent advertisement with the word ‘Vanaspati tel’ meaning ‘edible vegetable oil’.

Perusal of the complaint made by the plaintiff to ASCI i.e. Advertisement Standard Council of India would show that the objectionable word for them was ‘Vanaspati’. Therefore, it was submitted that defendants omitted the word ‘Vanaspati’ and substituted the same with ‘Vanaspati tel’, which is in fact used by the plaintiff in its product, the grievance could not survive. To determine whether a particular TVC disparages the product, Court needs to apply the “test of an ordinary person with reasonable intelligence”, but the procedure adopted by learned Single Judge was not permissible in law.

“While considering the advertisement, rival is not expected to be hypersensitive to the advertisement.”

Injunction passed also bars the appellant from even airing similar advertisement without defining the scope thereof. At the most, injunction passed should have been in respect of the TVCs which were impugned in the suit. It has been stated that the learned Single Judge has gone far ahead and granted injunction in the widest possible terms.

Counsel for the respondent Mr Chinoy stated that if TVCs are seen in its entirety, the impression that the ordinary person with reasonable intelligence would get is that, the product of the appellant is manufactured by using only milk whereas, frozen dessert, in which market, the Respondent 1/plaintiff holds majority shares, is manufactured by using ‘Vanaspati’. Further, it was stated that, “Insofar as puffing up of the product of the appellant is concerned, nobody could have objection, even if an untrue statement is made. However, the advertisement carrying the message which disparages the product of the competitors, would not be permissible in law.”

The present appeal is an appeal against the grant of injunction in favour of the plaintiff.

Decision of the High Court in the instant matter with in-depth analysis on the aspect of ‘disparagement’:

The bench stated that first impression upon seeing the advertisement one would get is that the product of the appellant, ice cream is manufactured by using 100% milk, whereas frozen desserts are manufactured by using 100% Vanaspati or Vanaspati tel.

“For deciding the question of disparagement, Court will have to take into consideration intent of the commercial, manner of the commercial and storyline of the commercial and the message sought to be conveyed by the commercial.”

Further, it was noted that it is clear on perusal of the TVCs that the manner in which the advertisement is aired, message that is sought to be given is that the frozen desserts are manufactured by using only Vanaspati tel which is harmful for the health. Therefore, the appellant cannot be permitted to air the advertisement which disparages the product of its competitors.

“While hyped-up advertising may be permissible, it cannot transgress the grey areas of permissible assertion, and if it does so, the advertiser must have reasonable factual basis for the assertion so made.”

Bench opined that the view taken by the learned single judge bench stating the TVCs to be disparaging in nature requires no interference. Though blanket injunction is not required as the entire TVC is not of objectionable nature. The appeal was thus partly allowed. [Gujarat Co-Operative Milk Marketing Federation Ltd. v. Hindustan Unilever Ltd., 2018 SCC OnLine Bom 7265, decided on 13-12-2018]

Join the discussion

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.