Competitive ads permissible, without disparaging competitors' product: HC [Read Judgment]

New Delhi: The Delhi High Court has said that it is permissible to bring out a comparative advisement but it must not disparage the products of other companies.

The High Court's division bench upheld a single judge's order that restrained Hindustan Unilever Limited from publishing a print advertisement and airing three YouTube videos for toilet cleaner 'Domex' which were found "prima facie" to be disparaging towards Harpic, a product sold by Reckitt Benckiser.

A bench of Justices Vibhu Bakhru and Justice Amit Mahajan, after having gone through the advertisements, held that the overall message is "loud and clear: if one uses Harpic to clean the toilet, the toilet bowl will emanate a foul smell but if one uses Domex, then the toilet would smell pleasant" with HUL attributing it to the use of "FreshGuard technology" which used saline as one of the ingredients in the product.

"There can be little doubt that the impugned advertisement is disparaging to Reckitt's product. It mentions Harpic in particular and claims that Domex fights bad smells for a longer period of time," the bench said.

The court also said while an advertiser can indulge in "puffery to reflect its product in a good light", it cannot claim that its competitor's product's "use would be detrimental to the interest or well-being of the customers".

"We find no infirmity with the decision of the learned single judge in interdicting HUL from publishing the advertise- ment on the ground that it, prima facie, denigrates and disparages Harpic," the bench held upholding single judge's order.

"Undisputedly, the balance of convenience lies in favour of Reckitt. A false advertisement campaign would cause irreparable loss to Reckitt while postponing broadcast of an advertisement referring to Reckitts product may not have any material effect on HUL, considering that it is free to advertise its product without reference to Reckitts products," the bench added.

The bench further said there is no dispute that comparative advertisement is permissible. However, the same cannot disparage the products of the competitors.

"It is permissible to advertise that a particular feature or quality of the product is better than that of the competitor. However, this is clearly subject to the condition that the overall advertisement must not be misleading. A statement of fact or a representation made in an advertisement must not only be accurate but should not be misleading, as well. This has to be viewed from the standpoint of the customers that the advertisements seek to target. For instance, it is possible that a particular feature of the product, which has no material relevance, is compared with the feature of the competing product to craft an advertisement reflecting the product of the advertiser to be superior to the product of its competitors. Whilst the statement regarding comparative features may be true, the overall commercial advertisement may be grossly misleading," the bench said.

"It is not necessary that an advertisement must expressly and clearly mention the competitors product. It would be impermissible if the disparaged product is likely to be identified as that of a rival," the bench added.

[Read Judgment]