Background of the Case:
This case involves a legal dispute between Zydus Wellness Products Limited (the plaintiff) and Mr. Prashant Desai (the defendant). Zydus Wellness is a prominent player in India's food and nutrition market, well-known for its popular brands such as 'COMPLAN,' 'Nycil,' 'Glucon-D,' and 'Sampriti.' The company has established a significant market presence with a strong reputation for quality. On the other hand, Mr. Prashant Desai is a social media influencer who has gained traction for sharing his views and insights on various products, including nutritional supplements.

The dispute arose when Mr. Desai uploaded a video concerning Zydus Wellness's product 'COMPLAN,' which allegedly contains disparaging remarks about the product. The implications of this video prompted Zydus Wellness to take legal action against the defendant, leading to the current litigation.

Issue of the Case:

The crux of the issue revolves around the defendant's actions, specifically the content of the video he posted. Zydus Wellness claims that the video disparages and denigrates their registered trademark 'COMPLAN,' thereby harming their brand's reputation. They are seeking a restraining order to prevent Mr. Desai from making further disparaging comments about their products, including 'COMPLAN' and 'COMPLAN PISTA BADAM.'

Contentions of the Parties:

Plaintiff's Contentions (Zydus Wellness Products Limited):

• Allegations of Disparagement: The plaintiff contends that Mr. Desai's video is not only false but also malicious. They assert that the video has caused them special damage, satisfying the legal criteria for disparagement under Indian law. They draw upon precedents such as Dabur India Limited vs. Colortek Meghalaya Pvt. Ltd. and Hindustan Unilever Limited vs. Cavincare Private Ltd. to support their claims of reputational harm and seek legal remedies.
• Impact on Reputation: Zydus Wellness argues that the content of the video could mislead consumers about the efficacy and quality of their products, leading to a decline in sales and loss of consumer trust. They emphasize the importance of protecting their brand image and maintaining the integrity of their registered trademarks.
• Right to Protect Intellectual Property: The plaintiff maintains that they have the right to protect their intellectual property from false claims that could damage their business. They assert that the defendant's actions not only undermine their brand but also misinform the public regarding their products.

Defendant's Contentions (Mr. Prashant Desai):

• Freedom of Speech: Mr. Desai argues that his video serves an informative purpose and is protected under the freedom of speech provisions enshrined in Article 19(1) of the Indian Constitution. He contends that any restrictions on his ability to express his views should be carefully scrutinized and justified, especially when balanced against the public's right to information.
• Credibility of Statements: The defendant claims to have a background in nutrition science and related fields, asserting that his statements are based on factual information. He believes that his expertise lends credibility to his critiques of the product, thereby serving the public interest by providing insight into nutritional choices.
• No Malicious Intent: Mr. Desai asserts that his intention was not to disparage the product but rather to provide an honest review based on his knowledge and experience. He may argue that such reviews are commonplace in the digital age and contribute to consumer awareness.

Issues Dealt with by the Court:

• Territorial Jurisdiction: The court had to establish whether it had the jurisdiction to hear the case based on where the alleged disparagement occurred and where the parties are located.
• Continuous Cause of Action: The court considered whether the actions of the defendant constituted a continuous cause of action that justified the plaintiff's request for relief.
• Balance Between Freedom of Speech and Protection of Reputation: The court weighed the fundamental right to freedom of speech against the need to protect a brand's reputation and intellectual property rights, particularly in the context of disparagement.
• Criteria for Disparagement: The court examined the specific legal standards for determining whether disparagement had occurred, including whether the statements were false, misleading, and made with the intent to harm the plaintiff's reputation.
• Defendant's Qualifications: The court considered the defendant's claimed expertise in nutrition and how it relates to the credibility of his statements about the plaintiff's product.

Reasoning and Final Decision:

After hearing the arguments and evaluating the evidence, the court concluded that Zydus Wellness had established a prima facie case for disparagement. The court reasoned as follows:

• Lack of Basis in the Defendant's Claims: The court determined that the video uploaded by Mr. Desai lacked a factual basis and contained unverified claims that could harm the plaintiff's reputation. The statements made in the video were not substantiated by credible evidence, leading the court to believe that they could mislead consumers about the product's value.
• Potential for Consumer Confusion: The court acknowledged the likelihood that consumers could be confused by the defendant's video, especially considering the direct references to the 'COMPLAN' brand. The potential for consumer misinterpretation and the adverse effect on the plaintiff's sales were significant considerations in the court's ruling.
• Infringement of Trademark Rights: The court concluded that the defendant, by mentioning and targeting the plaintiff's trademark 'COMPLAN' directly in the video, had infringed upon the plaintiff's trademark rights. Such actions were deemed unacceptable, especially given the absence of a legitimate purpose behind the disparaging remarks.
• Limitations on Social Media Influencers: The court emphasized that even social media influencers must adhere to standards of truthfulness and fairness when discussing products. The defendant's responsibility to provide accurate information was underscored, as misleading claims can lead to serious consequences for established brands.

Conclusion:
In light of the findings, the court issued a restraining order against Mr. Prashant Desai and anyone acting on his behalf, prohibiting them from publishing, uploading, or disseminating the impugned video or any content that could disparage the 'COMPLAN' brand. This decision highlights the critical balance between freedom of expression and the need to protect intellectual property rights and reputations in the era of social media influence.

Case Citation: Zydus Wellness Products Vs Mr Prashant Desai: 26.09.2024: CS(COMM) 684/2024: 2024:DHC: 7432: Delhi High Court: Saurabh Banerjee, H.J.

Disclaimer:
The information shared here is intended to serve the public interest by offering insights and perspectives. However, readers are advised to exercise their own discretion when interpreting and applying this information. The content herein is subjective and may contain errors in perception, interpretation, and presentation.

Written By: Advocate Ajay Amitabh Suman, IP Adjutor - Patent and Trademark Attorney
Email: [email protected], Ph no: 9990389539