INTRODUCTION
The word ‘Disparagement’ carries with itself a special significance in the field of trademarks. Disparagement in the aforesaid area means that when the reputation of a registered trademark is derogated or denigrated by one way or the other, it takes the form of infringement within the functional domain of the IPR.
One of the methods by which disparagement of a trademark may occasion is by way of comparative advertisements. When a trader puffs his product to the extent of derogating a competitor’s product, such commercial advertisement would be liable to be restrained on account of being disparaging to the competitor or his products.
The case at hand, PEPSI CO. INC. V. HINDUSTAN COCA COLA LTD. deals with one such aspect of disparagement of trademarks through commercial advertisements.
FACTS
The appellants, Pepsi company incorporation, had filed a suit against Hindustan Coca Cola for infringement of its trademark and copyright with respect to the following:
- PEPSI
- Globe device
- Slogan line ‘Yeh Dil Maange More’
- Roller coaster commercial
Along with the infringement, the appellant’s had claimed for an injunction order be passed against the respondent’s commercials as the same were disparaging to the products of the appellant’s company and were thus affecting its goodwill and reputation. However, the judge ruled against the appellants, and it was in this context that this appeal was filed.
ISSUES FRAMED BY COURT
The court framed three issues to be decided upon, namely:
1. Whether the impugned commercials of the respondent were disparaging to the products of the appellant?
2. Whether the globe device and the line ‘Yeh Dil Maange More’ were copyrightable assets of the appellant and if so, had the copyright in them been infringed by the respondent’s advertisements?
3. Whether the roller coaster commercial of the respondent was a copy of the essence of the roller coaster commercial of the appellant, and if so, what would be the effect of the same?
OBSERVATIONS OF THE COURT
The court was of the view that commercial advertisements in electronic media with the aid of visual effects have a deep impact in the psyche of the people and thus discrediting a product of a competitor would amount to disparagement.
- The court cited the reference of Article 3(a) of Kerly’s Law of Trademarks and Trade Names by David Kitchen and Anr. which lists down the criteria through which comparative advertisements would not lead to infringement or disparagement to the competitor:
- The comparative advertisement does not create a confusion between the trademarks, trade names, distinguishing marks, services or goods etc. of the advertiser and the competitor.
- It does not denigrate the products, trademarks, trade names etc. of the competitor.
- It doesn’t take unfair advantage of the competitor’s reputation of a trademark, trade name, distinguishing marks, etc.
- It does not portray his own goods and services as replica or imitations of a protected trademark.
From the inference drawn from these rules, the court observed that a comparative advertisement cannot be allowed with denigrates or discredits the tradename or trademark of the competitor.
2. The court in order to determine that whether the word PAPPI used in the commercials of respondents stands for Pepsi or not, made three observations:
a) When the boy who is called from the audience to tell about his preference for a cola drink, speaks Pepsi, which though mute, could be deciphered through his lip movements.
b) The drinks other than PAPPI in the commercial were that of thumbs up and Coca Cola, both of which are of the same company of the respondent’s.
c) The color used in the bottle along with the globe device with the word PAPPI written on it are that of appellants.
Therefore, the court observed that these inferences conclusively establish that the commercial was aimed to draw a comparison between the products of the respondent with that of appellant’s PEPSI.
3. The court after establishing that the commercials dealt with relate to comparative advertisements, delved into the question of what constitutes disparagement. It through the aid of Webster’s dictionary and oxford dictionary came to the conclusion that disparagement means to reproach, ridicule, disgrace, insult or bring discredit upon.
4. The court observed that it becomes easy to disparage the products through electronic visual commercials as they leave an indelible impact on the minds of the audience.
5. The court then observes the three commercials of the respondents which have been based on relatively same lines. A boy is asked which of the cola drinks is his favorite and he answers Pepsi, which is muted, and then the actor asks that which of the following drinks will a kid like, to which the boy points out at one saying ‘Woh meethi hai, Bacchon ko meethi chize pasand hai’. Then the actor opens up the lids from the bottles and the one that is pointed is shown to be ‘PAPPI’. The boy then feels embarrass for choosing PAPPI or Pepsi as his favorite drink, as that drink would be liked by children.
6. The court observed that mere puffing of goods is not actionable, and a trade man can also say that his goods are best or better but while doing the comparison, he can neither slander or defame the goods of the other or call them bad or inferior.
7. The court observed that by calling the Pepsi as ‘Yeh toh bacchon wali hai, Bacchon ko yeh pasand aayegi or Wrong choice baby’ depict the product of the appellants in a negative and derogatory manner. The repeated message conveyed through such commercials, that only kids like pepsi because it is sweet and so if a kid wants to grow up, he should drink thumbs up than pepsi, would remain in the minds of audiences so that they would start looking at Pepsi as a drink not made for grown-ups or growing children.
8. The court looked into the precedent of the case of Reckitt & Colman of India v. Kiwi TTK Ltd. which laid that one can boast of the new technological advancement of his products and can also compare the advantages of his product with those of the others available in the market, but he cannot say that the known technology is bad or inferior.
9. The court in this light compared the present case by stating that the commercials of the respondents try to portray the image of Pepsi as being unfit for growing children or grown-ups as it is too sweet and hence of inferior quality. This by no way can be coined as mere comparison or boasting of one’s own technological advancement.
10. The court also held that merely by saying that Pepsi is for children would not have derogated the product but the action of the boy holding his head in embarrassment after being shown that he had chosen his favorite drink as the one which he thinks would be liked by kids, depicts the product in low estimation. This low image of the product is further emphasized when the lead actor of the commercial says to the boy’s selection of ‘PAPPI’ as ‘wrong choice baby’.
11. By laying that learned judge was wrong in claiming the commercials as only poking fun, the court iterated that puffing does not mean that one would denigrate the products of a competitor.
12. The court opined that in the cloak of puffing up, the respondent aimed to make the appellant’s product appear inferior.
13. The court observed that comparison is allowed until it doesn’t undervalue or insult the product of the competitor. In these impugned commercials, the message given is that young people should not like sweet cola and therefore ‘Pepsi’. In this way the respondents in a conniving manner manage to convey that the product of the appellant’s is rubbish or unworthy. Taking account of the respondent’s arguments, the court was of the view that past conduct of the appellants could not be taken as a defense to denigrate their product.
WITH RESPECT TO COPYRIGHT INFRINGEMENT
1) In relation to the slogan of appellant’s “Yeh Dil Maange More”, the respondents cited the case of Sinanida v. La Maison Kosmeo 5 ; and Kirk v. J & R Fleming Limited which laid that when a sentence is in common usage that it would not be copyrightable for being lack of original composition. But the court negated this contention by saying that this sentence has been originally composed by the appellants with a combination of words of two different language and has become associated with the distinguishing character of the appellant’s company.
2) In relation to the question of infringement of registered Globe device trademark of the appellant, the court explained the meaning of section 29(1) of the Trade Marks Act, 1999, which implies that a registered trademark will only be infringed when the respondents have used in a course of trade a mark which is identical or deceptively similar to the trade mark of the appellant’s so to indicate that the origin of the goods as being his. In the case at hand, the appellants did not even claim that the respondents have tried to use their globe device for the purpose of showing it as theirs or associating its product with it. Therefore, the court expressed that there is a difference between comparative advertising and infringement and since comparative advertising is permissible, as has been held in the Reckitt & Coleman v. Kiwi TTK Ltd case, any action of comparative advertising would not be amount to infringement of the trademark ispo facto.
3) Similarly, the court observed that the slogan ‘Yeh Dil Maange More’, though copyrightable, cannot be said to be infringed by the line “Yeh Dil Maange No more”. This line used by the respondents can be said to mock in the context it has been used, but not infringement.
4) In relation to the matter of roller coaster commercial, the court observed that a copy is something that comes so near to the original that it suggests being original to the minds of everybody seeing it. The court observed that the roller coaster commercial of the respondent is a copy of the theme of roller coaster commercial of the appellants as not only the roller coaster is a replica but also the dress of the boys in the commercial.
DECISION OF THE CASE
1. The first issue of whether the commercial was disparaging to the appellant’s products was answered in the affirmative for the following reasons:
Ans. The court opined that to answer the question of disparagement, the following points need to be considered:
- Intent of the commercial
- Manner of the commercial
- Storyline of the commercial and the message that is being tried to be conveyed through the commercial.
The court reasoned on the lines of the decision of the court in the case of Reckitt & Coleman v. Kiwi TTK Ltd 8 that if the manner is of ridiculing of condemning the product of the appellant, then it would amount to disparagement. However, if the manner is only to portray one’s product best or better, without derogating the product of the other, then it would not be a case of disparagement.
The court also observed that mere puffing or calling one's product as best or better is not actionable until by such comparison, the tradesman slanders or defames the good of the competitor.
The court for granting of injunction order took the aid of the case of Reckitt & Colman of India Ltd. v. M.P. Ramchandran 9 which held that the point to be looked upon is that whether the commercial or the advertisement merely puffs the product of the advertiser or in the garb of puffing, directly or indirectly indicates that the product of other tradesman is inferior.
2. Second issue consisting of two sub-issues, namely, whether the globe device and the slogan, ‘Yeh Dil Maange More’ were copyrightable and whether the copyright in them had been infringed, were answered in affirmative and negative, respectively. The court held that even though the works were copyrightable, they were not infringed.
Ans. The court reasoned that since both the globe design, with its distinct color scheme and the slogan with an original amalgamation of words from two different languages, show, that both were not works of common usage but were unique original pieces that were now being distinguishingly identified with the products of the appellants. Therefore, they were original creations and hence copyrightable.
However, comparative advertisement is allowed (as was held in the case of Reckitt & Coleman v. Kiwi TTK Ltd) and infringement according to the scheme of section 29(1) 10 occurs only when the respondent uses a mark in the course of trade, which is identical or deceptively similar with the trademark of the registered owner of that trademark, in order to indicate that the trademark is associated with his goods and services.
In the present case, since the globe device and the slogan, which have been used only for the purpose of comparison and not for linking them in association with the goods of the respondents, it would not be called an infringement.
3. The third issue dealing with whether the roller coaster commercial of the respondent was in essence a copy of roller coaster commercial of the appellant was answered in affirmative.
It was opined that when one would see the commercial of the respondent, it would give an impression that the same has been copied from theme of the roller coaster commercial of the appellant. The court reasoned that it was not merely because of the replica of the roller coaster in the commercial, but also because of the dress of the boys which was similar to that of the appellant’s commercial.
The court further when on to say that since roller coaster of the appellant is an original creation, it would be covered under the provision of section 14 of the copyright act. Placing reliance on the case of R.G. Anand V. Deluxe Films, the court said that the roller coaster commercial of the respondent is nothing but a literal imitation of the copyright commercial of the appellant and hence it should be restrained.
CONCLUSION
Just as the lifestyle and status have now started being associated with the brands that one selects; these brands play an active role of a villain and victim in the screenplay of the commercials as well. The villain becomes the one who disparages the product of another, the victim.
Since a healthy competition only improves upon the quality of market and choices available to the customers, the courts through its judgements have tried to emphasize that comparative commercials are not actionable suo moto. But an unhealthy competition, derogating and disparaging any other competitor or his products in the market cannot be allowed as it would negatively lead to a chaotic situation.
Therefore, the courts have put certain limitations on such comparative advertisements according to which, mere puffing of its own products or calling them to be the best or better than any other product in the market would not be objectionable, even if the advertiser contends the advantages of his product in comparison to other products. However, such comparison would become objectionable when the advertiser tries to portray the product of the other in a bad light.
These limitations imposed by the courts are vitally important in the current scenario where the brands multiply in numbers day by day and the competition keeps growing and hiking. There might arise situations where such stiff competition would create enmities within certain sections of the traders, but it is these limitations that would restrain them from doing anything on the commercial platform to bring the enmity in the sphere of the public domain. This way peace and tranquility would be maintained in the market even if there be any stiff and rough competition among the rival traders.
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