Horlicks Ltd. and Ors.Vs.Heinz India Private Limited
2019 SCC OnLine Del 7580 : (2019) 258 DLT 407 (DB) : (2019) 78 PTC 294 (DB)
Coram: Hon’ble Justice S. Muralidhar and Sanjeev Narula
Forum: Hon’ble High Court of Delhi
Case No.: FAO(OS) (COMM) 309/2018 & CM APPL. 54176/2018
Date of Decision: 15 May,2019

Facts:

  • Plaintiff No. 1 holds the registered trademark "HORLICKS" in India under Classes 25, 28, 29, 30, and 32.
  • Plaintiff No. 2, licensed by Plaintiff No. 1, has extensively used the mark "HORLICKS" in India for many decades. In 2017, within 10 months of launching the product, they generated revenue of Rs. 2668 crores and spent Rs. 425 crores on advertising and promotion.
  • On November 11, 2017, the Plaintiffs learned that the Defendant had published an advertisement in the "Telegraph" newspaper (Kolkata and Patna editions) disparaging their health food drink, HORLICKS.
  • The case was filed before the Learned Single Judge seeking a temporary injunction. They sought to restrain the Defendant from issuing, communicating, or publishing an advertisement disparaging their product, Horlicks, and its goodwill.
  • The appeal arose from an order dated 17th December 2018 passed by the Learned Single Judge in IA No.13793 of 2017 in CS (Comm) No.808 of 2017.

Background:

  • The case was initially filed before the Learned Single Judge where the application filed by the Plaintiffs under Order XXXIX Rules 1 and 2 of the Code of Civil Procedure, 1908, seeking a temporary injunction to restrain the Defendant from issuing, communicating, or publishing an advertisement that disparaged the goodwill and reputation of the Plaintiffs' product, Horlicks, and its associated trademark was dismissed.
  • The Plaintiffs aggrieved by the decision of the Learned Single Judge, filed the present appeal under Section 13(1) of the Commercial Courts read with Order XLIII Rule 1 of the CPC challenging the dismissal of their application for a temporary injunction by the Learned Single Judge.
  • Hence, the present appeal was filed.

Impugned Order of Single Judge:

  • The court emphasized that advertisements were protected under Article 19(1)(a) of the Constitution as part of the public's right to information. It also clarified that the right to privacy does not apply to the Plaintiffs in this context, as the information was publicly available and the K.S. Puttaswamy judgment was inapplicable here.
  • Comparative advertising was permissible as long as it did not mislead consumers. The court upheld that a certain amount of disparagement was implicit in comparative advertising, but it must remain factual and not misleading.
  • Both parties use of a 'per serving' size on their packaging was in line with the Food Safety and Standards Regulations, 2011. The court determined that 'per serving' size was the appropriate basis for comparison to avoid misleading consumers and ensure safe consumption.
  • The court agreed with the Defendant that comparing products based on 100 grams rather than the recommended serving size would be misleading. It further found the Defendant's advertisement accurately compared the protein content in the recommended serving sizes, deeming this comparison material, relevant, and verifiable.
  • The comparison made according to the method of preparation indicated on the product labels complied with the CODEX Guidelines. The court supported the Defendant's selective comparison of special features, stating it was permissible and did not require the comparison of all product parameters.
  • The Plaintiffs cannot prevent the Defendant from using their trademark for product identification, was not detrimental to the trademark's distinctiveness. The use of trademarks in comparative advertising was permissible when clear distinctions between products was maintained.
  • The impugned advertisement was found to be in compliance with the Advertising Standards Council of India (ASCI) orders. The modifications made to the advertisement addressed concerns about misleading claims and disparagement, focusing solely on protein content comparison based on 'per serving' sizes.
  • The court concluded that the modified advertisement was not misleading, did not disparage the Plaintiffs' mark, and focused on a material, relevant, and verifiable feature of the products. The application was dismissed, with no order as to costs, endorsing the legality and fairness of the Defendant's comparative advertising practices.(Paragraphs 15 &16)

Main issue:

Whether the Learned Single Judge could adjudicate the issues related to the modified advertisement?