Scholarly article on topic 'A Case Study Approach – An Analysis of the Infringement of Trademark by Comparative Advertising'

A Case Study Approach – An Analysis of the Infringement of Trademark by Comparative Advertising Academic research paper on "Law"

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Abstract of research paper on Law, author of scientific article — Semila Fernandes

Abstract The research topic ‘A case study approach - an analysis of the infringement of trademark by comparative advertising’ will help unfold the various dimensions of comparative advertising and its impact on the registered trademarks of the owners. In this research, the researcher has tried to unleash the dynamics of four jurisdictions namely India, U.S.A, U.K, European Union (EU) and China covering specific cases in each. More detailed emphasize is provided to understand the level India and U.K and European Union undertakes to give justice to the traders and the businessmen to help entertain their customers creatively by way of comparative advertisements. The research will proceed by understanding the concept of Trademark (TM), Comparative Advertisement (CA) and then how the individual Courts from different jurisdictions have analyzed them. Finally from this research topic I will be in a position to know how far this topic on CA has been taken up by the courts and its impact on the advertisers and the consumers.

Academic research paper on topic "A Case Study Approach – An Analysis of the Infringement of Trademark by Comparative Advertising"


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Procedía - Social and Behavioral Sciences 133 (2014) 346 - 357


A case study approach - an analysis of the infringement of trademark by comparative advertising

Semila Fernandes *

Symbiosis Institute of Business Management, Bangalore, Symbiosis International University #95/1, 95/2, Electronics City, Phase-1, Hosur Road, Bangalore-560 100, India


The research topic 'A case study approach - an analysis of the infringement of trademark by comparative advertising' will help unfold the various dimensions of comparative advertising and its impact on the registered trademarks of the owners. In this research, the researcher has tried to unleash the dynamics of four jurisdictions namely India, U.S.A, U.K, European Union (EU) and China covering specific cases in each. More detailed emphasize is provided to understand the level India and U.K and European Union undertakes to give justice to the traders and the businessmen to help entertain their customers creatively by way of comparative advertisements. The research will proceed by understanding the concept of Trademark (TM), Comparative Advertisement (CA) and then how the individual Courts from different jurisdictions have analyzed them. Finally from this research topic I will be in a position to know how far this topic on CA has been taken up by the courts and its impact on the advertisers and the consumers.

© 2014 The Authors. PublishedbyElsevierLtd. This is an open access article under the CC BY-NC-ND license (http://creativecommons.Org/licenses/by-nc-nd/3.0/).

Selection and peer-review under responsibility of the Organizing Committee of ICTMS-2013. Keywords: Comparative advertising; Infringement; Trademark

1. Introduction

Indian Constitution: Explanation of CA: According to the author D.P. Mittal, the concept of TM Infringement -Advertisement was discussed by quoting the definition of commercial advert as 'Commercial advert is a form of commercial speech and is protected under Article 19(1) (a) of the Indian Constitution. But commercial speech which

* Corresponding author. Tel.: +0-000-000-0000 ; fax: +0-000-000-0000 . E-mail address:

1877-0428 © 2014 The Authors. Published by Elsevier Ltd. This is an open access article under the CC BY-NC-ND license (

Selection and peer-review under responsibility of the Organizing Committee of ICTMS-2013. doi:10.1016/j.sbspro.2014.04.200

is deceptive, unfair, misleading and untruthful is hit by Article 19(2) and so could be regulated / prohibited by the state.'

In accordance with the Article 19(1)(a), the fundamental right based on the constitution of India is the freedom of speech and expression for every citizen while the article 19 (2) clearly indicates that no law should change the law of freedom of speech however the sovereignty and integrity of India is maintained. This has made the businessman use the right to advertise the products as a manner they feel is justified. Definition of TM: TM is a known mark of identification of any company or an organization which could be a unique name, symbol, logo, image or a design which helps in defining the product and the repute of the company. (legalserviceindia, 2008).

Damage done to the company's Goodwill: In cases where one company uses the TM of another firm which is registered under the TM Act without the prior permission of the owner, it is strictly causing harm to the company's reputation and brand name. However; although the companies do not directly copy the product's mark, but they adopt similar marks concept to confuse the customers. This amounts to either infringement or Passing Off Action (P.O.A)

P.O.A is derived from common law in which case infringement of a TM is carried out in a manner where-in the mark is not only similar but is also used deceptively to mislead and confuse the end users.

Definition CA: CA is the concept which helps in comparing the advertisements of the goods and services of one seller from another which mostly focuses upon the price, quality, value, durability. The advertisers employ this technique to increase their visibility in the market and to generate higher profits and better sales.

Classification of CA: They can be categorized as indirect CA which showcases the features of one product and compares it favorably with all the other competing brands through a generic or an indirect manner. The next form is the direct CA where-in the features and attributes of one product are directly compared with the similar features and attributes of another specific competitor. CA thus falls into the gamut of TM legislation which falls under the jurisdiction of TM Act of India 1994. It's a known fact that no Indian statute will precisely define the concept of CA but the UK law clearly provides the definition as any advertisement which explicitly or implicitly identifies the goods or services of the competitor of identifies the competitor itself (legal service India, 2008).

2. Research methodology:

The type of research adopted is Analytical research. The Objectives of the study would be A. Study the concept of Comparative Advertisement in relation to infringement of Trademark - Indian Statute. B. Comparative Analysis of the concept of Comparative Advertisement and Trademark infringement - statutes of U.S.A, U.K, China The Research design would follow the causal type of research covering sample design of 4 country statutory laws viz. India, U.S.A, U.K, China. Data collection would be through observational design i.e. primary data through informal interviews with the faculty of law, lawyers and IP consultants. Secondary Data collection through the various websites, journals, articles, magazines and books related to IPR and Law. Data would be analyzed by using tabulations. The research project adopted is causal research which indicates that the test on cause and effect relationship will be considered with reference to the cause of comparative advertisement and its effect on trademark infringement.

3.1 Scope of the study

The purpose of the study is to examine the various cases on comparative advertisement and how different jurisdictions deal with them based on their laws and statutes. This analysis will in turn help in overcoming the present loopholes of the laws and strengthening and regulating future formulation of laws. Limitation:

• The statutes of other countries if also considered would throw more light.

• The study is restricted to the statutes and the laws of India, USA, UK, China.

3. Discussion

A: Jurisdiction India: The existing system depicted with Indian cases:

CA and its relation to Unfair Trade Practices: CA has certain limitations with respect to the practice of Unfair Trade Practice. Under the Monopolies and Restrictive Trade Practices (MRTP) Act of 1984, a new chapter on unfair trade practices was amended where in section 36A indicates that any defective or unfair method or practice which depicts false or misleading information of another product will result in disparaging the goods and products of the competitors. This in turn will directly affect the trade of another person.

Any such disparagement of CA is reviewed and evaluated based on three parameters:

a. Whether the advertisement contains a false statement which could result in influencing and provoking or inducing the consumer to buy or use the goods and products.

b. Whether the advertisement is misleading

c. Finally the effect of such a depiction on the end users or common man.

The Delhi High Court defined the concept of disparagement stating that the manufacturer can make any statements to indicate that his goods are better then the goods of the competitor and in certain cases can also puff their own goods which will give no cause of action to the trader of another product as there is no disparagement or defamation of the goods. But the manufacturer cannot say that the competitors' goods are bad so as to promote and puff their own goods. Therefore CA cannot be allowed if it discredits the TM or the trade name of the competitors. Example: Reckitt & Colman of India Ltd. v. Kiwi T.T.K. Ltd. (India)(1996):

The plaintiff Reckitt & Colman manufactures and markets liquid shoe polish under the brand name Cherry Blossom Premium Liquid Wax Polish. Defendant KIWI is also engaged in the manufacturing and marketing KIWI liquid polish which it claims in its advertisement to be superior than the plaintiff as alleged that cherry blossom has less wax and more acrylic content which in due course will crack and cause damage to the footwear. This is promoted on the website of the defendant showing a bottle of KIWI which does not drip and placing another bottle of polish marked as brand X which drips.

Brand X is shown with a red blob on its surface representing cherry which looks similar to the cherry which appears on the plaintiff's bottle. The defendant also circulated posters with a bottle shown as brand X having a faulty applicator similar to that of the plaintiff's applicator.

The Court held that the defendant was disparaging the goods of the plaintiff and was told to restrain from advertising the competitors product in a disparaging manner. The Delhi High Court added that the advertiser can puff the goods or make statements that his goods are of superior quality but this should not disparage or defame the repute of the competitor.

Example: Reckitt & Colman of India Ltd. v. M.P. Ramachandran and Anr.(1999):

In this case the plaintiff manufacturers blue whitener under the brand name Robin Blue having a particular styling and have a registered TM and a registered design. The defendant also starts manufacturing blue whitener (Ujala) and started promoting their product by disparaging the goods of the plaintiff. The advertisement showed a container similar to that of the plaintiff s and was indicated that it was priced at Rs. 10. As no other blue whitener products in the market were priced at Rs. 10, it was obvious that it was the plaintiff's product Robin B lue. Further the defendant alleged that the plaintiff s goods were uneconomical and was an expensive product to whiten the clothes. It was also promoted in a manner that the plaintiff s product was shown upside-down with the liquid gushing out indicating that the liquid doesn't drip slowly instead gushes and thus becomes expensive.

The Calcutta High Court held that the defendant was disparaging the goods and was liable for infringement and was granted an injunction and laid down five principles to guide future cases of infringement.

Example: The case of 'New Pepsodent' v 'Colgate' (1997):

In the advertisement of the New Pepsodent, HLL disclosed that their product is 102% better in terms of antibacterial activity as compared to the leading toothpaste available in the market. In the TV add, samples of saliva are taken from two boys; one who has brushed with the New Pepsodent toothpaste and other brushed with the leading toothpaste. The experiment was shown as containing maximum amount of germs in the saliva of the latter toothpaste. And when the boys were asked as to with what did they brush their in the morning, one said Pepsodent

while the response was muted in the other case. But his lip movement and the jingle used in the muting made it very obvious that the boy was referring to Colgate. As Colgate has been synonymously been used for a toothpaste, it was evident that the leading brand referred to Colgate. This ultimately led to the disparagement of the goods of Colgate.

Example: Colgate Palmolive v. HLL (1999): case on Suraksha Chakra:

The catchy Colgate Toothpaste tune reminds every person the one which protects tooth decay, kills germs and stops bad breath all these claims which were advertised on Colgate hoardings, TV campaigns and print media by metaphorising using a Suraksha Chakra signifying a ring of protection protecting the family. This commercial boosted the sales of Colgate and decreased that of HLL. HLL in address to this advert alleged that it contained misrepresentation of facts and hence the data were misleading. On the other hand Colgate alleged that New Pepsodent claims to be '102 percent superior' which is again misleading. HLL went to add on that only in India Colgate claims to fight tooth decay in the absence of fluoride where as in other countries this holds true for fluoridated products. As per the MRTP Act puffing of goods was acceptable but not misrepresentation of data. But it was clear after the findings that not a single consumer was reported to have misled due to the advert of Suraksha Chakra and hence no injunction was granted to Colgate as it supported the statement of Suraksha Chakra as its means to provide suraksha to the tooth decay, bad breath and germ killing by using a chakra.

In another example: Pepsi Co. Inc. and Ors. v. Hindustan Coca Cola Ltd. and Anr: (2003):

In this example, Pepsi filed a suit against Coca-Cola for wrongful use of their TM in a commercial where in a lead actor asks a kid to his favorite drink for which he says that he likes Pepsi which was obvious from his lip movement as it was muted. Then the lead actor asks the kid to taste the two samples of drinks after hiding their identity and questions the kid as to 'Bacchon Ko Konsi pasand aayegi'?. The kid points to one drink and says that children would prefer it because it is sweeter and says that he does not like that drink. He likes the taste of the other drink and says that it is a stronger drink and has to be consumed by grown ups. After the lead actor opens the lid of both the bottles, it is revealed that the bottle which the kid likes was 'Thumps-Up' while the other had PAPPI written on it which deceptively resembles PEPSI. The kid feels embarrassed as he had earlier liked the Pepsi taste and hence keeps his hands on his hand as a matter of disappointment. In some other advertisements the commercials read the slogan as 'Wrong choice baby', and that the 'Thums Up' is a right choice, and 'Kyo Dil Maange No More' which amounts to damaging the repute of Pepsi.

The court held Coca-Cola on the grounds of disparagement and depreciating the goodwill of the plaintiffs' products under TM and Copyright Act as the registered TM was been infringed by the use of a Globe Device or the word PAPPI which is deceptively resembling to the TM PEPSI .

Example: Dabur India Ltd. v. Colgate Palmolive India Limited. (2004):

In this case Colgate promoted an advertisement on the visual media where in a cinema start was seen stopping the purchasers from purchasing the tooth powder which was similar to that of Dabur by explaining the ill effects of the plaintiff's products. In addition to this Colgate advertised that their tooth powder was 16 times less abrasive and non-damaging. As per the TM Act 1994, section 29(8) clearly indicates that there should not be any unfair advantage taken by the competitor which will harm the reputation of the TM and be detrimental to its distinctive character. Although the rival can make untrue statements that his goods are the best, he cannot degrade the quality of others products. Hence Colgate disparaged the goods and was granted injunction by the Court.

Indian Court Granted Injunction: Britannia v.Unibic Biscuits India (2007):

Unibic India launched a biscuit named 'Great Day' along with its tag line - Why have a Good Day, When you can have a Great Day!. This was a direct comparison to Britannia's Good Day biscuits which states that consumers must not try any mere biscuit when Great Day biscuit is available. The plaintiff alleged that the defendant has infringed their registered TM 'Good Day' and in turn has tried to emphasize on it through their tagline. Bangalore City Civil Court on December 12 in 2007 led to the grant of an injunction to the defendant for disparaging Good Day biscuits by exaggerating the facts and making an impression that no other facts hold true.

The Court looked at three aspects while reviewing this case which includes examining the intent, the manner the commercial (story line) has been promoted and the message that has been communicated to the public.

Did not enter the Court of Law: Kingfisher v. Jet Airways (2007):

In contrast to Unibic's Great Day case of injunction, Kingfisher airlines came up with a similar advertising campaign without being subject to any injunction. Jet Airways and Kingfisher started flights to New York on a daily basis. To initiate their campaign, Jet put up a hoarding this displayed the tag line 'We've Changed' which was immediately competed by Kingfisher airlines by putting up a hoarding just above Jet Airways hoarding saying 'We Made Them Change'. Although there was no disparagement of the product nor there was any use of Jet's TM on Kingfisher's hoarding, still Jet could file for injunction as it was directly relating to them for exaggeration of facts. But Jet immediately put off their hoarding which was a good move as the present law doesn't have any law in place for Jet or any other company in such situation to sue Kingfisher.

Tablel: In a nutshell, approaches by the courts to the issues/decisions of courts are as below:

Jurisdiction Sl.No Examples Status of the Court Concept

India 1 Reckitt & Colman v. KIWI Disparaging Advertisement campaign for 'KIWI' in comparison with 'Cherry Blossom'

2 Reckitt & Colman v. Ramachandran Disparaging 'Ujala' in comparison with 'Robin Blue' - pertaining to price

3 New Pepsodent v. Colgate Disparaging 'New Pepsodent' in comparison with 'Colgate' -pertaining to the superiority of the product.

4 Colgate Palmolive v. HLL Not Disparaging 'New Pepsodent' v. Colgate - case on 'Suraksha Chakra'.

5 Pepsi Co v. Hindustan CocaCola Disparaging 'Thumps-UP' v. 'PEPSI' - pertaining to PAPPI

6 Dabur v. Colgate Palmolive Disparaging Pertaining to degrading quality of the other

7 Britannia v Unibic Disparaging 'Good Day' v. Great Day' - use of tagline

8 Kingfisher v. Jet Airways Not entered the Court of Law If entered wouldn't clearly indicate the remedy based on the existing statute.

B- Prevailing system in other countries - comparative study of foreign law and cases decided by courts in other countries:

Comparison of CA Laws of USA, UK and China:

In contrast to the Indian Law; USA, UK and China have their own statutes and provisions under CA. Jurisdiction USA:

In the United States of America, consumer welfare and promoting free and a competitive economy is the need of the hour. Therefore CA is an accept table form of advertising and is justifiable by the freedom of speech laws. The Federal Trade Commission (FTC) Policy Statement of 1969 indicates that under CA, comparison of advertisements of different competitors with their name and their products is a favorable act. Therefore clarity was required in FTC to deal with the negative consequences of unfair practices. FTC in their statement has determined that it will benefit the advertisers and the advert agencies on the prevalent issues on CA.

The US TM Act (Lanham Act 1946): This act was later amended in 1988. Even in this amendment there was limited guidance on dealing with false advertising and product disparagement as a part of CA under sub section 43(a). False Advertising v. Product Disparagement:

The authors Dinwoodie and Janis describe false advertising as a misrepresentation of ones own product while misrepresentation about another's product comes under the product disparagement realm. Example: Tommy Hilfiger Licensing Inc. vs. Nature Labs LLC [2002]:

Nature Labs is a shop dealing with pet perfumery which it named as 'Timmy Holedigger' as it's TM and also incorporated a slogan for its commercial as 'If you like Tommy Hilfiger, your pet will love Timmy Holedigger'. Tommy Hilfiger filed a suit against Nature Labs as saying that they were infringing their rights of their TM by unfair means and hence it would result in TM dilution and commercial fraud. The court held that in USA the

similarity doesn't amount to infringement of Tommy Hilfiger's TM as Nature Labs used it as a means of entertainment and a technique to make their consumers laugh. Therefore it was claimed to be a fair parody as it used the concept of freedom-of-speech and hence rejected the plaintiff s charge of infringement against the defendant.

Jurisdiction UK & European Law:

The TM Act of UK 1938 was not a very cautious move by the court to formulate the concept of CA, but the TM Act of UK 1994 makes a cautious move in the context of misuse of CA by means of TM. Under the TM Act UK, 1994, the CA concept is very liberal in United Kingdom and to add to this the UK Parliament stated that the government viewed it as a legal and a legitimate, useful tool that can be adopted in marketing that ultimately helps in the process of stimulating competitive atmosphere and educates consumers. The prime objective is to allow CA as a fair means of promoting ones product.

In the following examples, the plaintiff was unsuccessful as the court favored CA of the defendant which was a fair means as a registered TM can be used to identify them there-by informing prospective customers about the products of the competitors. Example: Barclays Bank v. RBS Advanta (1996).

In this case the defendant RBS Advanta distributed a brochure containing a comparative table of the fees and interest rates of different credit card companies including Barclaycard Standard Visa which is a registered mark. The plaintiff considered that the defendant has infringed their mark but the court held that the use of the mark was objective and for honest practices to inform the consumers. The defendants also told that their comparative chart gave a better deal to the customers. Hence CA was permitted by the court. Example of British Airways plc and Ryanair Ltd (2001):

BA (British Airways) alleged that Ryanair had infringed the TM of BA. Ryanair had prepared a CA by means of a banner add which had the following written on it; 'EXPENSIVE BA....DS' and above all on the top part of the banner a comparison on the pricing was made which said that BA's air fare was 5 times costlier then Ryanair which in reality it was only 3 times costlier. Although Ryanair made a wrong statement of comparison the High Court felt that it did not infringe the plaintiff's TM as the final result would be the same as indicating that BA was expensive.

But the Advertising Standards Authority (ASA) stated that the statement did make false offenses against BA. ASA is now making inroads to be keener on taking action against CA issues more than the courts. Two main sources for the rules on CA: TM Act, 1994

European Commission (EC) Directive on CA dealing with Misleading and Comparative Advertising Directive (MCAD)

The Trade Mark Derivative (TMD) provides protection of TM to those member states registered in the UK register.

Under Article (3) of European Court of Justice (ECJ) indicate the following criteria to be allowed ^not be misleading ^ compares the products meant for the same purpose ^objectively includes primarily price as a comparable item ^doesn't create confusion ^doesn't discredit or disregard the competitors TM or trade name^If the products have a origin the same should be identified in the advert. ^Does not take unfair advantage of the reputation of the TM/Trade name/designation of origin^should not present goods as imitated goods or replicas of goods. Thus the European Union - Comparative Advertising Directive (EU-CAD) promotes CA as a healthy competition between traders.

Both CA and TM law follows unfair advantage concept.

Example: Referring CAD - Bubbles Case: O2 Holdings Limited and O2 (UK) Limited v Hutchison 3G Limited (2006): Case based on branding and not on claims:

In this case O2 a telecom service provider lost its TM claim against Hutchison 3G also a mobile service provider for the latter's use of a bubble imagery in their CA. O2's case was dismissed on the grounds that the CA of Hutchison was not at all creating confusion in the minds of the consumers. Based on the EU directive as stated above, H3G was not infringing as the use of CA was a course of their trade which need not have TM owners' consent having similar or identical product line as the ones of the registered TM. These three were considered as the parameters for checking whether the use of TM by third parties is justified or not (Cristina Romano, 2008). Court of

Appeal for England and Wales also added that such use of trademark which has been registered and used by the competitor is not trademark infringement.

Example: Referring CAD- Smell-Alike Case:L'Oreal SA & ors v Bellure NV & ors (2007):

This case was on the similar lines as the above free-riding concept based on TMD but it was looked upon into the CAD. Bellure started importing, distributing and selling perfumes having similar fragrances in comparison to L'Oreal's perfume. They also prepared a comparison table indicating the list of the luxury brands available with them and L'Oreal which indicated that their brands had similar smell to the latter. But the smell -alike perfumes did not harm the sales of L'Oreal neither affected the sales of the defendant and also did not confuse people that the smell-alike perfume was that of L'Oreal.

The Court held that the packaging of two products of the defendant and the comparison listed in the table gave rise to infringement. This was referred by the Court of Appeal to ECJ which examined the unfair advantage issue in light of the CAD. But the CAD also doesn't explicitly indicate that Bellure's goods have been imitated or made replica with reference to L'Oreal's perfumes just by seeing the comparison made. An explicit statement that the product has been copied needs to be present to imply copying. Hence as L'Oreal has not been affected by the Bellure they cannot be infringing based on unfair advantage unless L'Oreal claim that the economic behavior of the consumers has been changed. (legal500, 2009 & mondaq, 2009).

Example: Referring TMD - Free-Riding Case: Intel Corporation Inc v CPM United Kingdom Ltd (2008) and Unfair Advantage:

In this case, Intel filed an application to sue CPM for using 'Intelmark' as their mark there by claiming that the plaintiff has infringed Intel's TM. The UK court knew that Intel had a good reputation in the market for their mark Intel relating to computer related products. It was considered that the marks used by CPM was similar but applied to different category of products and hence didn't indicate any commercial connection and did not indulge in unfair practice with Intel based on the TMD.

The court referred this case as 'free-riding' stating that CPM has got an advantage and benefit by using Intel's well-known mark as a part of their mark in their trade but this has not affected the trade of Intel as they belong to different category of goods and services. Therefore cannot be termed as taking unfair advantage. CA with Honest Practices - Permitted by Court - ECJ:

Example: In the case of Dior v. Evora which was concerning the principle of exhaustion and parallel imports, Dior distributed its perfumes across selected distribution channels and has TM for its illustrations of the packaging and copyright in the design and packaging of the bottles. Evora was not the selected retailer but acquired legitimate products by parallel imports and started advertising the same as carried out by other retailers. Dior claimed that Evora was not a selected retailer and was infringing their use of the mark by advertising which affected the reputation of Dior. But Court held that as per Article 7(2) such CA must be permitted once the rights of the TM owner have been exhausted after the first sale or first distribution from the right holder by his consent.

Example: BMW v. Deenik: Here BMW claimed that Deenik started services BMW cars without being an authorized dealer for the BMW cars. BMW could object to Deenik's advertising only if the use of it would damage the reputation of BMW or if Deenik tried to make the public believe that BMW had authorized them to do the maintenance and repair of their products. The court indicated that according to Article 5 and Article 3 the owner of the TM cannot prevent the third party from using their TM so as to inform the public that they also carry the servicing of the BMW cars until they try to show that the same was done to create confusion between both the servicing firms (Amanda Michaels & Andrew Norris, 2002).

Dishonest Practices: Not Permitted by Court - ECJ Example: Primark Stores Ltd. V. Lollypop clothing Ltd.

In this case Lollypop started using two marks of Primark namely Denim Co on the sewn labels and Primark on the swing price tags when they acquired the supply of jeans from the suppliers of Primark based on Primark's specifications as part of the order placed by them and in the process of making up the order, Lollypop used the tags and labels of Primark in the manufacture of different kind of jeans which it claimed to be Primark's as they were produced based on their specification. The plaintiff sued the defendant on the basis of infringement although the defendant argued that according to article 10(6), they could use the proprietor's TM. But the ECJ argued that the

defendant may not have counterfeited the goods but since the goods named as Primark by Lollypop were not Primark's goods, subsection 10(6) did not apply either and hence were claimed to be infringing. Example: Aktiebolaget Volvo v. Heritage (Leic) Limited (2000).

The ex dealer of Volvo had used a sign with an expression 'Independent Volvo specialist' stressing on the word Volvo outside his premises and claiming to be still an authorized dealer of Volvo. However the Court declared this act as infringement due to lack of honesty and deceptiveness in the use of the mark shown.

Table 2: In a nutshell, the decisions of the court: UK, EU :

Jurisdicti on


Status of the Court


Barclays Bank v. RBS Advanta

British Airways & Ryanair Ltd.

CA permitted

CA permitted

Distribution of a brochure containing a comparative table of fees & interest rates of credit card companies. Exaggeration and misrepresentation of data - use of tagline

O2 Holding Ltd. & O2 UK Ltd. V. CA permitted Hutchison 3G Ltd.

Intel Corporation Inc. v. CPM UK Ltd. CA permitted

L'Oreal v. Bellure Dior v. Evora

CA permitted

CA with honest practices

Bubbles case

Case on 'Free-Riding'

Smell-Alike case

Principle of exhaustion and parallel imports

BMW v. Deenik

CA with honest practices Servicing of BMW cars

Primark Stores Ltd. V. Lollypop clothing Dishonest practices Ltd.

Use of tags and labels of the competitor on the jeans.

Aktiebolaget Volvo v. Heritage Ltd.

Dishonest practices

Falsity of data - claiming to be the authorized dealer.

Jurisdiction China: The CA laws in China are totally different as compared to the laws existing in USA, UK and India although the laws in USA, UK and India are not the same. This implies that the TM owners need to be very careful about advertising in China. Yes, it is. Aggressive campaigns which could probably be encouraged by other countries but they are not acceptable in China. The laws on advertising are generally focusing on the competitors' interests than consumers' welfare which China is opposing off. According to article 7 and 12, CA is not allowed as it firmly tries to promote the advertisers products and trying to prove them better than their competitors.

Thus in comparison to the various jurisdictions, the concept of CA has been slight different and at times conflicting as well while India as such doesn't give clarity in its definition. USA to a great extent supports CA indicating their truthfulness and beneficial aspect. UK does consider it as a guiding principle by making it legitimate and permits CA fairly while some countries may even ban CA. There is no much definite understanding of disparagement and honest practices discussed in any of the statutes; while MRTP Act has helped in clarifying the issues on unfair trade practices.

4. Findings and Suggestions for Indian and UK / EU statutes on CA:

The following findings will facilitate the process of unfurling the suggestions which I propose the courts should strongly embark on to help smoothen and simultaneously strengthen the unfair trade competition and practices that crop up.

Findings & Suggestions: A: Indian Statute:

1. The TM law permits CA but doesn't allow disparagement.

2. The Indian law looks into the factors of 'Correctness of Representation', 'Scientific and Technical Details', 'Assessing Loss of Business and Profits', 'Interim Injunction: Make or Break' to declare if the advertisement was infringing or not. These facts were checked and applied to the Indian cases specially the Colgate v. Pepsodent case although it was not easy for the courts to decide on the claims. But the above position also has a disadvantage considering the following facts: A manufacturer can claim for disparagement only if the correctness of the product is identified. And if it has been identified then settling the technical and the monetary claims will take time which finally results may be in terms of suspending the advertisement. This finally results in making the existing statute weak and uncertain in terms of CA (iimahd, 2004).

3. The Indian law doesn't encourage firms to make exaggeration of facts which was evident from the case of Britannia v. Unibic thereby discouraging rivals from securing lasting benefits. But in major examples such distinctions might not be identified which would make the system unbalanced.

4. In the present context of the Indian law, if the manufacturers goods have been disparaged there is no proper stated statute to declare that there has been an infringement as the terms 'unfair advantage', 'honest practices', 'disparaged' themselves have not been defined and regulated.

5. Situation in India - The TM act 1999 under sections 29 and 30 speak about use of TM in CA with limitations to the concept of unfair trade practice. Unfair trade Practices were covered under MRTP Act 1969 which stands cancelled now. Hence the only option is the Consumer Protection Act, 1986 but here the sufferers are the firms and not consumers. Hence they wouldn't fall into the ambit of consumers to get an advantage to approach the consumer forum.

6. With reference to the case Jet Airways and Kingfisher discussed above, there is no room in the Indian law to provide justice to Jet Airways or for Jet to successfully sue Kingfisher as kingfisher hasn't indicated any TM reference about Jet on its hoarding, but putting the hoarding right above Jet in itself is not a fair trade.

7. Based on the decision taken up by Calcutta High Court in relation to the case Reckitt & Colman of India Ltd. v. M.P. Ramachandran and Anr.(1999), it was clear that mere puffing of goods is not actionable unless it results in slandering or defaming the goods of the competitor. This indicates that this right of the producer to puff the goods is acceptable which will de-recognize the rights of the consumers as secured under The Consumer Protection Act, 1986. To allow two traders to puff the products in their advertisement without harming each other will finally leave the consumers helpless even if the producers have benefited. Only if one trader gets affected by the CA then only the falsity of the facts produced in the advert relating to the quality, price and the value of the product will get disclosed and the consumers would benefit.

i.e. The consumers should be well informed and hence such adverts should be well probed and tested.

8. Indian law does promote CA as it provides an opportunity for the consumers to compare the goods the producers are advertising.

Findings: B: UK & European Law

1. As per the UK TM Act, Article 10 subsection(6) includes a statement as 'in accordance with honest practices in industrial or commercial matters hall be deemed to be infringing the registered TM' doesn't clearly define the concept of granting infringement as it is unclear. The court should first identify which practices may be acceptable and relevant. To discuss this fact, consider the following situation: Suppose a registered mark is being used in the website of another trader. If the sale on that website is for genuine goods and it includes the name of the supplier in the domain rather and not the TM, then it doesn't amount to infringement as per the subsection 10(6).

But if the registered mark was used as a metatag for its website which in turn would direct the goods to the supplier's website, then would this subsection amount to honest practice? Probably yes if the sale on the website is for genuine goods and if the supplier's website doesn't give the impression that it is the TM proprietor's website. But if competing goods are been sold then will the subsection provide protection? It might still be acceptable based on the nature of the site. Ultimately if it is identified that the metatag is used solely to attract the consumers to the proprietor's own site and moreover if competing goods or infringing goods or not genuine goods are sold then will the subsection provide injunction? These questions still remain unanswered and hence more clarity should be provided in the law.

2. Based on the UK legislation on the TM laws, it is evident that almost all forms of CA are possible and will not be infringing unless if it is said to indicate unfair trade practice. But this doesn't help the producers in knowing the exact distinction between honest practices and unfair trade practices and hence the whole discretion of the judgment is upon the Court of Law as the amendments are not transparent.

3. UK law is coming up with newer directives to help the advertisers in making a fair judgment of their adverts but lawyers do claim that with new consumer protection regulations and directives CA will become more risky and complex. The MCAD is one of the nine consumer protection directives which EU is planning for along with the development of EU Injunction directive.

4. The UK TM law presently is relaxing the position while declaring injunction to the infringers which is obvious from the examples sited. However if the law becomes rigid, then this will curb advertisers from marketing and promoting their products in a creative and entertained manner and will finally result in confusing the advertisers.

5. 'CA must not discredit or denigrate the TM, trade names and other distinguishing marks, goods, services, activities or circumstances of a competitor'. But this law which defines CA is inconsistent to the present UK law as section 10(6) of the TM Act 1994 clearly indicates that discrediting or denigrating is possible unless it is without due cause. This again makes it unclear as to how much flexibility in copying is permissible and hence the laws should be checked carefully along with the regulations.

6. Indian Law discusses the concept of 'Use of TM as Disparagement of goods' which at least differentiates between honest practices or unfair trade practice or disparagement. But this doesn't reflect in the UK TM law.

7. The present English law doesn't define the infringement conditions in cases of passing off, breach of contract, breach of confidence and malicious falsehood shown by the infringers. But the European law has considered a step forward to punish the infringers by regulating the MCAD although are still in the process of regulating their legislature; thus helping in curbing unfair competition which presently lacks in the UK legal systems. (, 2009).

8. The Indian case 'Britannia v. Unibic Biscuits India', the court considered the move of Unibic to use the tagline 'Why have a Good Day, when you can have a Great Day!' as disparaging and hence CA was not encouraged which provided justice to Britannia. In UK there was a similar case 'British Airways & Ryanair' on exaggeration and misrepresentation of data which the court claimed that it was not infringing and hence CA was allowed with a justification that the statement 'BA's air fare was 5 times costlier then Ryanair' which in reality was only 3 times costlier did not make any false offenses. This clearly indicates that there is some laxity in the UK law which doesn't help in providing justice to the TM owner.

9. The case of 'Intel Corporation v. CPM', although the ECJ permitted CA in the use of a well known mark as their own TM even if the goods were not competing each other, there should have been more clarity on this aspect for well-known marks. Since well-known marks have huge reputation in the market, even if the goods are not similar, the consumers could get confused thinking of that mark. Hence the law should draw a line in this aspect.

10.The TM Act UK, 1938 which initially spoke about 'dog-bites-dog' attitude that persisted among the advert companies where by the 'knocking copy' was out from the clients mind; but today the new era is of 'consumers and fair competition' which is favorable considered by the courts.

Finally, a strong suggestion which could be enacted or regulated by the courts is; to consider the grievances of the advertisers or companies and firms who are facing problems due to CA under the 'Consumer Protection Act' which is presently lacking. This would make available double benefit to the competitive arena which would help in balancing the views of the consumers as well as the firms who are under the scanner from their rival firms.

5. Conclusion:

Based on the detailed study carried out in this topic it is observed that CA takes two forms of reference viz. positive reference and negative reference. Positive reference implies that one competitor claims that his products are as good as the competitor's products. This indicates that when the goodwill and reputation of a well-known mark exists, misappropriation of that TM is a general notion. The negative reference implies that one competitor claims that his own products are better than the other and the competitors goods are criticized resulting in disparagement of goods. Both of the consequences of the CA give unauthorized access to comparing the advertising campaigns or promotion of each others products.

Every jurisdiction have dealt with the various cases depending on their own discretion and based on the existing laws on the concepts of misleading and discrediting of the competitors goods. Some countries feel that indicating the goods are superior or are unique or are best than the other amounts to misleading until they are proved to be justified while others consider such exaggerations and misrepresentation to be permitted. With regards to misappropriation and discrediting some countries whose believes in providing a liberal climate on laws until found to be untrue or disparaging will allow CA. While in other countries the businessmen who don't follow honest practices, CA is

severely banned and is strictly taken action. In a few countries using the trade name or the TM without his consent is again considered as discrediting. Even if the comparisons are true they are not encouraged to use them in certain jurisdictions. Although initially CA was forbidden or was considered as unfair competition but today this situation has changed and is changing slowly. In the present scenario proper representation of facts even if compared against a competitor are welcome by the courts. CA has been looked upon positively as a means of providing a detailed study reference which would in turn help consumers in knowing the true facts of the various products and be careful in their purchases. Thus transparency of data is encouraged which will help consumers in lowering their information search costs and conduct a valid buy. Disparagements of goods also have been leveraged by the courts in some countries so as to restrict ban of all statements in comparisons thus allowing truthful CA.

Despite the fact that the views on CA in various countries as perceived by courts have become positive, it's a challenge for the different jurisdictions to draw a line between what is acceptable and what is not based on the present laws available in their countries. And if need arises the laws need to be regulated with newer laws by resulting in satisfying honest trade practitioners and supporting fair trade vis-à-vis the others.

Finally taking the different laws into consideration the following have been taken care of by the courts namely CA, Discrediting competitors, causing confusion, Misleading - especially by ECJ, Free-Riding - especially by ECJ..


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