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Comparative Advertisement vis-à-vis Trademark Infringement

As per the words:
Good advertising does not just circulate information. It penetrates the public mind with desires and belief.

This is just exactly advertising performs: it not only offers a commodity but it also renders that commodity as crucial component of one's life beyond which one cannot live in harmony. The advertising technique used by businesses and the importance community places on commercials have also changed dramatically in the last half-century. The field of marketing is no longer limited to recruiting major personalities to advertise a product or to elicit the feelings that people associate with it. Modern business environment is focused on establishing one brand's superiority over another.

Advertisement is, without a doubt, a critical factor in assessing a product's potential success. This is the most effective and tested method of attracting the interest of prospective customers in the industry. Since customers have such a wide range of goods to select from marketers often compare their items to those of their rivals. Although this is an appropriate strategy, rivals often use such strategies in order to obtain more financial advantages and exposure, which either deceives consumers or leads to disparagement of the competition's item.

Comparative advertising is marketing that measures one good or service to the other, as the title implies. The aim of the competition is to increase the marketer's profits by implying that the marketer's commodity is of the same or better value than the related brand. The purpose of all such advertising is to make a fair contrast of one's goods to those of rivals known to the general populace.

The aim is to increase transparency and accountability, but there are many benefits as well, including price control and increasing competitiveness to enhance goods.[i]

Comparative advertising is more like a commodity pretending to be something that another service or product isn't. Every company's brand promotional plan nowadays is to assert dominance over the competition.[ii] In particular, comparative advertising benefits new or unexpected brands. Consumers can make more fair and educated buying preferences thanks to comparative advertising, which increases customer knowledge and broadens the scope of the product in growth.

The essence of competitive claims is complex. They can specifically or indirectly relate to a rival. They can draw attention to the goods' differences and similarities. The purpose of this theory is to enable for a proper assessment of the reasons that differentiate one dealer's goods from those of the other; such a correlation would invariably entail the use of registered trademarks identified by the goods in issue. In the lack of regulations, this usage may be considered trademark violation. While no Indian law describes comparative marketing the UK Legislation determines it as any advertising that “expressly or by inference, recognizes a rival or the products or facilities provided by an opponent.”[iii]

Comparative advertising are divided between two kinds- those that explicitly contrast competitive services and those that contrast competitive services implicitly, the same are known as puffery and disparagement. Consider a manufacturer who makes exceptional statements about his goods in order to persuade the audience to purchase it. When the identical point is made by undermining the reputation of a clearly recognizable competitor product it goes beyond the narrow reach of puffery and leads to brand disparagement.

This may not only be slander of the opponent's commodity but it may also deceive customers, as most manufacturers do not have a legitimate reason to say that the rival's item is inferior.[iv] Although both forms of comparative advertising are permitted in some nations, such as the United Kingdom, comparable advertising is prohibited in others. Comparative advertising, on the other hand, is legal when a merchant may not plan or claim that his rival's products are weaker or unacceptable when contrasting the products. All they can do is exaggerate the benefits of his goods, but he can't dismiss the benefits of his competitor's goods. Puffery is legal in India as far as it is contextual.[v]

This assignment will majorly focus on the trademark infringement caused due to comparative advertisement and the remedies available to the people regarding the same violations. It further discusses how the other countries like UK and the US with the help of various case laws deal with them. Lastly, it will focus upon the constitutional aspect of advertisement and analyse whether such marketing can

Comparative Infringement And Trademark Infringement

Trademark refers to a label that can be visually depicted and that can differentiate one individual's products or services from that of another, and can involve the form of the products, their labelling, and material combinations. Trademarks are any term, title, logo, or method implemented and adopted by a producer or retailer to distinguish and differentiate his products from those produced or offered by the others, or any variation thereof.

In a period when the entire globe is seen as one globalized economy, marks are critical in discerning the goods of one company of another. A trademark is a label or mark that separates one product from its competitors of the same kind. Its objective is to determine an item's origin and differentiate it from other products of identical type. It gives a commodity personality, making it easier for consumers to distinguish it from other goods of the same kind.

Trademarks not only identify the source of an item but they also guarantee its reliability and tend to create a market reputation by advertising it. Businesses use logos, brand names, as well as other market labels to combine informative and convincing components in their promotional tactics in a competitive world to show their goods as the highest. Not only will have their own brand evolves in prominence, but so does the use of their competitor's trademark.[vi]

Ralph Brown claims in Advertising and Public Interest why trademarks were useless to the community on their own; the opinion of the community was in the capacity of brand symbols to warn and avoid misunderstanding. He also claims that the statutory defence of trademarks must be based on an assessment of how well advertisement represented the interests of the public.[vii] The key goal of a trademark is to "differentiate one individual's products from those of someone other." As a result, a trademark allows a buyer to recognize products and its sources.

As a result, if a marketer uses a rival's trademark to render a distinction among his products and that of his rival, disparaging it in the course, one such action on the marketer's behalf not only will raise concerns of comparative advertisement and brand disparagement, as well as of trademark violation. The core issue of Ralf's argument would be that trademarks seemed to have no inherent meaning besides the symbolically conveyed knowledge about the goods they followed.

That being said, given how businesses nowadays use their registered trademarks to advertise their logos, the aforementioned assertion appears to be false.[viii] These days, customers tend to place a great deal of importance and trust in the trademark and the item for which it is connected.

Trademark Infringement:
Customer misunderstanding is at the heart of the trademark violation problem. Is that one symbol so similar to the other one that an average buyer might be deceived, misled, or confused about the origin of the service or product?" To reach a violation decision, the judiciary want to understand what's on the minds of consumers, how he's responding to the two marks if he's going to be misled.

Although customer misunderstanding has been the primary cause of trademark violation there have been two additional causes of misunderstanding that are more related to the market than the wider populace: trade misunderstanding and passing off. Although representatives of the industry are less likely to be misled or deceived than regular customers, evidence of market misunderstanding has been deemed highly useful in violation situations. In violation cases, proof of "passing off," in which a merchant intentionally and purposely tries to pass one commodity off as the other, is also essential.[ix]

Trademark Infringement and Comparative Advertisement:
Comparative advertising is a word intended to define advertisements in which one dealer's products or services are contrasted to those of other merchant. It implies that although it is legal to use the other's mark, the marketer may not discredit another's services or products in doing so. Any action denigrating the other's products or services is not just an action of violation, as well as an action of brand denigration. A trademark is simply a ‘label' used by one company to differentiate its goods or products from those of others. This is one of the fields of property rights, and its primary purpose is to preserve the item's name, which includes services and products.
  • In India, a trade mark is described as a label sufficient of it being portrayed visually and sufficient of identifying one individual's products or services than those of another, which may contain the form of the products, their labelling, and colour combinations as per the S. 2 (1) (zb) of The Trademark Act 1999.[x]
  • A trademark is described as any mark suitable of being depicted visually and sufficient of separating products or services of one seller from that of other ventures according to the United Kingdom's Trade Marks Act, 1994. Terms (including individual names), patterns, symbols, numbers, or the form of products or their labelling may all be used as trademarks. Unless the meaning demands differently, comparisons to a trademark in this Legislation often involve referring to a common mark or registration mark.[xi]

In India, the legislation on relative marketing and brand deprecation in trademark is focused on the decision of Irving's Yeast Vite Ltd v FA Horsenail[xii]. The Trademarks Act of 1999, Section 29(8)[xiii], defines circumstances in which the utilization of a trademark in advertisement can be considered violation. It states that any advertisement that is not in compliance with ethical standards, or that is harmful to the unique identity or respectability of the brand, is an instance of violation.

Simultaneously, Section 30 (1)[xiv] makes comparative marketing an inconsistent to actions that violate Section 29[xv]. It states that any marketing that complies with the law is permissible. It states that any advertisement that follows fair procedures and does not damage the trademark's unique personality or reputation is acceptable and therefore does not entail violation.

Even though the trademark is quite common and well-known, comparative advertisements could be considered trademark violation. The MRTP Act gives rise to the principle of "denigration of some other individual's products," which contributes to discriminatory trading practices That is also prohibited by section 29(8)(a)[xvi] of the Trademarks statute. Trademark problems occur only if a rival's trademark is being used in comparative advertisements and brand disparagement.[xvii]

In this lawsuit, Pepsi sued Coca-Cola for unfair utilisation of their trademark in an advertisement in which a main character asks a child about his favourite beverage and the child replies Pepsi, that was evident from his subdued mouth movements. The main character then prompts the child to experience the two beverage specimens after concealing their identities and challenges the child.

The main character then removes the lids of both containers, revealing that the child's favourite beverage is "Thumps-Up," whereas the other looks suspiciously like PEPSI. In many other promotions, the phrase "Thumps Up" is a wise option was popularized, and this has harmed Pepsi's reputation.

The judge determined Coca-Cola liable under the Trademark and Copyright Act for disparaging and devaluing the reputation of the plaintiffs' brands because the protected Trademark was violated through the usage of a Globe System or a term that misleadingly mirrored the PEPSI Mark.

The Trade Marks Act, specifically the violation clauses, may be used by the owner of a licensed trademark to prohibit it from being used in comparative marketing.

Briefly, the law on comparative advertisement can be stated as:
  • There is hardly anything inconsistent with stating the quality of rival services and products or using licensed trademarks to distinguish these as far as the usage of a rival's label is truthful
  • The copyright owner bears the weight of demonstrating that the conditions mentioned in the section's proviso apply.
  • There would be no violation until the symbol is used in an unethical manner.
  • The critical measure is whether a fair person will conclude that the commercial is truthful after seeing it.
  • For the reasons of Section 29 (8) and Section 30(1), legislative or industry-agreed rules of ethics are insufficient to determine if a conduct is truthful
  • Fairness must be measured against something that is fair for the target audience of the advertised products or services.
  • It's important to remember that the wider populace is used to this type of campaign.
  • For the requirements of Sections 29 (8) and 30(1), an advertising that is substantially deceptive is not true.

Comparative Advertisement: Indian Perspective And Other Nations

It is mainly to maximize income by claiming that the products are the strongest in the industry, regardless even if this claim is false. The same had been considered in the decision Reckitt Benckiser (India) Ltd. vs Hindustan Unilever Ltd.[xviii], in which Judiciary decided that a merchant is permitted to assert their products to be of highest, defendant's contrast of his commodity "Lifebuoy" to the plaintiff's item "Dettol" in his commercial breached the narrow line among puffery and deprecating, and the commercial was found to be in violation of Section 30(1).

Publicity occurs when an advertising company attempts to attract a customer's focus by presenting overly generous assertions about his goods that are anything more than his own belief of his own commodity instead of testable claims of reality. Section 30(1) of the Trademarks Act of 1999 permits this. But at the other end, puffery cases often overstep their bounds and attempt to cast the other commodity in a poor context. The same would be then deemed to be defamation, which is defined as the violation of several privileges of another individual, which include trademark violation as defined by Section 29 (8) of the Statute.[xix]

The sole aim of such advertisements must be for the advantage of buyers to allow them to make an educated decision among two items[xx]. In reality, the very foundation of trademarks is the defence of the national interest alone, because the judiciary consider an undiscerning consumer who might purchase a counterfeit item under the delusional notion that it is product "x." This very same principle should underpin any measure taken in response to defamatory commercials.”

Position in US:
As of 1915, the Federal Trade Commission has criticized deceptive advertisements in the United States. According to part 32 of the Lanham Statute, a person is accountable for trademark violation if they utilize "in business any duplication, replica, clone, or colourable resemblance of a known trademark in association with the sales, delivery, or promotion of any items and/or services on or in association with which such use would be potentially misleading”. To prove trademark violation the complainant must show that the respondent is using a logo that is amusingly identical to his or her own.

A decision namely in Playboy Enterprises, Inc. v. Frena [xxi], Playboy accused Frena, the owner of an online message forum system where members often posted and accessed clones of Playboy images for swap. Several of the pictures featured Playboy's licensed PLAYBOY and PLAYMATE trademarks. Frena was charged with copyright violation by Playboy. Despite Frena's contention that he had no control over what his customers posted on the notice board, the court determined that violation had occurred:
It is probable that users of Respondent Frena might assume that Playboy was the origin of Respondent Frena's photos and that therefore funded, supported, or allowed usage of photos.

Position in United Kingdom:
S.10 (3) under UK's Trademarks Statute 1994 notes, it is not mandatory to show probability of misunderstanding in attempt to establish violation under this clause, even if the products in dispute are unrelated.

In BMW v. Deenik[xxii], a workshop holder used the terms "BMW Expert," to promote his experience in fixing and maintaining BMW vehicles. BMW opposed to the utilization of its authorized trademark in this manner and filed a complaint with the ECK, citing Article 5 of the Regulation as the basis for its complaint.

The Court determined that the respondent's utilization of BMW's recognized trademark was acceptable in these situations because the workshop holder therefore might be unable to advertise his business, and that it also falls within the meaning of Article 7 of the Regulation because the respondent was appealing to legitimate BMW vehicles. According to Article 7[xxiii], the trademark owner cannot, despite his permission, ban the usage of his products in the marketplace under its trademark. According to the circumstance that the products are altered or harmed when they've been placed on the market, or for some other valid reason.

Remedies Against Advertisement Infringement

The phrase 'ubi jus ibi remedium' implies that wherever there is a right, there must also be a solution. In all instances of violation and passing off lawsuit, any court not subordinate to a Lower court with authority may award remedy. The following are some of the forms of reassurances to which a claimant is permitted:
  • An enforcement order prohibiting the usage of the vitiating logo in the future.
  • Compensation or benefit accounts are two options.
The Delhi High Court ruled in a matter regarding two supposedly identical labels. The plaintiffs and defendants were selling ice cream and similar milk goods, but still at various price points. The Court ruled the Individual Judge's ruling providing a temporary injunction against the appellant-respondent usage of the latter symbol. [xxiv]

Permanent Injunction:
The Respondent was barred from utilizing white and red in its manufacturing and selling in the lawsuit of Colgate Palmolive Company v. Anchor Health and Beauty Care Pvt Ltd [xxv]because the claimant had exclusive privileges to the mixture when it was designed for toothpastes. As a result, the appeal is granted, and respondents are barred from including the colour scheme of white and red in that case on the vessel of their products, namely “Tooth Powder,” for an ad interim injunction.

While court orders have long been the standard recourse for trademark violations Indian judges, particularly the High Courts, have finally begun issuing both corrective and severe compensation. With the ruling in Time Incorporated v Lokesh Srivastava[xxvi], the pattern of granting compensatory damages in trademark cases began.

Other than this the other remedies available for the infringement can be sought under the Consumer Protection Act, The Motor vehicles act, The Prevention of Food and Adulteration Act etc.

Constitutional Protection In Comparative Advertisement

Many commercials may claim that their right to the freedom of speech and expression is mentioned in Article 19 (a) of the Indian Constitution. In regards to comparative marketing, it is essential that we examine Article 19 (1) (a) of the Statute.

As we all know, social speech, radio, cable, and the media are all protected under the ambit of this article. Even then, this fundamental right has its limits, which are limited by the government enforcing fair constraints under Article 19 (2). The Apex Court ruled in Tata Press Ltd. vs Mahanagar Telephone Nigam Ltd.[xxvii] that:
business communication cannot be refused the immunity of Article 19(1)(a) simply since it is provided by merchants.

The Apex Court applied a broad understanding of Article 19(1)(a), holding marketing as "commercial expression" have dual aspects. Advertisements raise awareness about the promoted brand. The details made accessible via the advertising benefits the general public.[xxviii]

The constant stream of economic knowledge is important in a free society. Without the independence of "commercial expression," a democracy's economic model will be disadvantaged. Since no specific area is stated in Article 19 (2), Mahanagar Telephone cannot stand in the path in the name of "public good". Advertising expression is now afforded the same level of rights as other forms of speech. However, if comparative marketing is performed in a way that infringes on another individual's freedom or reputation, or impedes trade, the advertising would not be covered under the Indian Constitution.

Conclusion
This can be argued that comparative marketing is unquestionably advantageous because it enhances trade competitiveness, customer interest, and commodity identification in the industry, and as such should be permitted. However, there must be controls in place to ensure that merchants engaged in comparative commercials are not deceptive, engaging in unfair trading practices, demeaning other competitors' goods, violating on their trademarks, and thereby spreading disinformation when marketing their item. The Indian Constitution, the Trademarks Law of 1999, and other laws and codes govern advertisement in India.

As a result, it can be inferred that relative advertising was widespread in the west, and now is popular in our country as well. However, as a result of this rise, trademark violation in comparative marketing by deceptive and fraudulent business practices has gotten very common. The courts and laws play a significant role in preventing and redressing unfair discrimination in this country.

End-Notes:
  1. Trademark violations in Comparative Advertisement, (BananaIP) https://www.bananaip.com/ip-news-center/posts-7/ Accessed on 28th March 2021
  2. Indralina Sen, Comparative Advertisement and Trademark Infringement: A Comparative Analysis, (2019) 1 International Journal of Legal Sciences and Innovation, Vol. 2
  3. Sujay, Comparative Advertisement & Infringement of Trademark(Legal services India)
    http://www.legalservicesindia.com/article/604/Comparative-Advertisement-&-Infringement-of-Trademark.html. Accessed on 1st April 2021
  4. Khurana &Khurana, Comparative Advertisement: A Perspective (Mondaq) accessed on 1st April
  5. Indralina Sen, Comparative Advertisement and Trademark Infringement: A Comparative Analysis, (2019) 1 International Journal of Legal Sciences and Innovation, Vol. 2
  6. Apoorva Sharma, Comparative Advertisement and Infringement of Trademarks: A Perspective from Consumers https://ssrn.com/abstract=1896367 or http://dx.doi.org/10.2139/ssrn.1896367 accessed on 2nd April 2021
  7. Ralph S. Brown, Advertising and the Public Interest: Legal Protection of Trade Symbols, 57 YALE L.J. 1165, 1206 (1948), reprinted in 108 YALE L.J. 1619, 1659 (1999
  8. Ralph S. Brown, Advertising and the Public Interest: Legal Protection of Trade Symbols, 57 YALE L.J. 1165, 1206 (1948), reprinted in 108 YALE L.J. 1619, 1659 (1999).
  9. Sujay, Comparative Advertisement & Infringement of Trademark(Legal services India)
    http://www.legalservicesindia.com/article/604/Comparative-Advertisement-&-Infringement-of-Trademark.html. Last Accessed on 2nd April 2021
  10. DR. B.L. WADEHRA, Law Relating To Intellectual Property, 133 (Universal Law Publishing Co. Pvt. Ltd. 4THed. 2007)
  11. The Trademarks Act, 1994 (United Kingdom)
  12. Irving's Yeast Vite Ltd v FA Horsenail (1934) 51 RPC 110
  13. The Trademarks Act, 1999, S 28(8)
  14. The Trademarks Act, 1999, S 30(1)
  15. The Trademarks Act, 1999, S 29
  16. The Trademarks Act, 1999, S 29(8)(a)
  17. Pepsi Co. Inc. and Ors. v. Hindustan Coca-Cola Ltd. and Anr (27) PTC 305 Del
  18. Reckitt Benckiser (India) Ltd. vs Hindustan Unilever Ltd. 2008 (38) PTC139
  19. Selvam & Selvam, Comparative advertisement and trademark infringement (Lexology)
    https://www.lexology.com/library/detail.aspx?g=1cf2e8f0-927c-4c06-8d22-5485e6be541e Accessed on 2nd April 2021
  20. Tata Press Ltd. v. Mahanagar Telephone Nigam Ltd 1995 AIR 2438
  21. Playboy Enterprises, Inc. v. Frena 839 F. Supp. 1552 (M.D. Fla. 1993).
  22. BMW v. Deenik (1999) ETMR 399
  23. Article 7 (1) of the First Council Directive (89/104/EEC)
  24. M/s South India Beverages Pvt. Ltd. v. General Mills Marketing Inc. & Anr (2015 (61) PTC231 (Del)
  25. Colgate Palmolive Company v. Anchor Health and Beauty Care Pvt Ltd 2003 (27) PTC 478 (Del
  26. Time Incorporated v Lokesh Srivastava 2005 (30) PTC 3 (Del).
  27. Tata Press Ltd. vs Mahanagar Telephone Nigam Ltd. 1995 AIR (SC) 2438
  28. Indralina Sen, Comparative Advertisement and Trademark Infringement: A Comparative Analysis, (2019) 1 International Journal of Legal Sciences and Innovation, Vol. 2

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