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IN THE HIGH COURT OF DELHI AT NEW DELHI
PRATHIBA M. SINGH, J.
Christian Louboutin Sas - Petitioners
Versus
Nakul Bajaj & Ors. - Respondents
CS (COMM) 344 of 2018, I.As. 19124, 20912, 23749 of 2014 & 9106 of 2015
Decided On : 02-11-2018
The Court held that the Defendant e-commerce platform was not an intermediary entitled to protection under Section 79 of the Information Technology Act, 2000 (IT Act) and granted an injunction restraining the Defendant from using the Plaintiff's trademarks, name, and photographs without permission.
Fact of the Case:
The Plaintiff, a manufacturer of luxury shoes, filed a suit against the Defendant, an e-commerce platform, for trademark infringement, passing off, and dilution. The Plaintiff alleged that the Defendant was selling counterfeit products bearing the Plaintiff's trademarks and using the Plaintiff's name and photographs without permission. The Defendant claimed that it was an intermediary and was not liable for the actions of its sellers.
Finding of the Court:
The Court found that the Defendant was not an intermediary because it was actively involved in the sale of counterfeit products. The Court noted that the Defendant had control over the products sold on its platform, it promoted the products to its members, and it used the Plaintiff's trademarks and name without permission. The Court also found that the Defendant did not take any steps to prevent the sale of counterfeit products on its platform.
Issues: Whether the Defendant was an intermediary entitled to protection under Section 79 of the IT Act; Whether the Plaintiff was entitled to relief, and if so, in what terms.
Ratio Decidendi: The Court held that an e-commerce platform is not an intermediary entitled to protection under Section 79 of the IT Act if it is actively involved in the sale of counterfeit products. The Court found that the Defendant was actively involved in the sale of counterfeit products because it had control over the products sold on its platform, it promoted the products to its members, and it used the Plaintiff's trademarks and name without permission. The Court also found that the Defendant did not take any steps to prevent the sale of counterfeit products on its platform.
Final Decision: The Court granted an injunction restraining the Defendant from using the Plaintiff's trademarks, name, and photographs without permission. The Court also ordered the Defendant to disclose the complete details of all its sellers, their addresses and contact details on its website; obtain a certificate from its sellers that the goods are genuine; notify the plaintiff of any counterfeit product being sold on its platform; and remove all meta-tags consisting of the Plaintiff's marks with immediate effect.
The facts of the case involve a luxury shoe manufacturer alleging that an e-commerce platform was selling counterfeit products bearing their trademarks and using their brand name, photographs, and trademarks without permission. The platform was also accused of using meta-tags and images that alluded to a connection with the brand, thereby infringing on the proprietary rights of the plaintiff. The platform claimed to act merely as an intermediary, facilitating bookings from various sellers, and maintained that it did not actively participate in the sale or promotion of counterfeit goods. It also argued that it was not liable under the safe harbor provisions of the IT Act, 2000, as it was only providing a technical service and did not actively promote or aid in infringement.
The court held that the platform was not a mere intermediary because it was actively involved in selling counterfeit products, controlling the products sold on its platform, promoting them, using the plaintiff’s trademarks and photographs without permission, and not taking adequate steps to prevent the sale of counterfeit goods. The court observed that such active participation disqualifies the platform from claiming safe harbor protection under the IT Act. It was further held that the platform’s use of meta-tags, photographs, and model names, which alluded to a connection with the brand, also constituted infringement and did not qualify for immunity.
The court concluded that platforms involved in actively promoting, aiding, or abetting infringement could not be entitled to exemption under the safe harbor provisions. It emphasized that the immunity is meant for passive intermediaries that do not participate in or promote unlawful acts. When a platform conspires, aids, or actively participates in the sale of counterfeit goods, it loses the protection of Section 79 of the IT Act. Therefore, in this case, the platform was held liable for infringement and was directed to disclose seller details, obtain authenticity guarantees, and remove infringing content, including meta-tags.
PRATHIBA M. SINGH, J.
1. The present suit has been filed by the Plaintiff, who claims to be a manufacturer of luxury shoes. The name of the Plaintiff Company - Christian Louboutin (hereinafter, ‘Plaintiff’) is based on the name of its founder, namely Mr. Christian Louboutin, a famous designer of high end luxury products. The Plaintiff claims that the name, likeness and photographs of Mr. Louboutin enjoy goodwill and protection under the Trademarks Act, 1999 (hereinafter, ‘TM Act’). The products of the Plaintiff are worn and preferred by a large number of celebrities. The Plaintiff claims that it enjoys enormous repute and goodwill in the fashion industry and was rated amongst top 5 prestigious women’s luxury shoe brand. The name “Christian Louboutin”, in word form and logo form, as also the red sole mark, are registered trademarks in India, and there are various other applications which are also pending registration. The Plaintiff further claims that its products are sold only through an authorized network of exclusive distributors. In India, there are two stores in Mumbai and one in Delhi which are authorized by the Plaintiff.
2. According to the Plaintiff, the Defendants operate a website by the name www.darveys.com (hereinafter, ‘Darveys.com’). It is the Plaintiff’s allegation that the Defendants, offer for sale and sell various products on their website, bearing the luxury brands/names of the Plaintiff. The Defendants’ website contains the complete “Christian Louboutin” product catalogue. The website further claims that the products are 100% authentic.
3. As per the plaint, the goods of the Defendants are impaired or are counterfeits. Apart from offering for sale and selling the Plaintiff’s products, on the website of the Defendants, the image of the founder of the Plaintiff is also used, and the names “Christian” and “Louboutin” are also used as meta-tags. By using these meta-tags, the defendants attract traffic to their website. According to the Plaintiff, the Defendants’ website gives an impression that it is in some manner sponsored, affiliated and approved for sale of a variety of luxury products bearing the mark of the Plaintiff’s genuine products. This results in infringement of the trademark rights of the Plaintiff, violation of personality rights of Mr. Christian Louboutin and dissolution of the luxury status enjoyed by their products and brands.
4. This Court had on 26th September, 2014 granted interim relief in the following terms.
“11. Learned counsel for the plaintiff has referred to various paras of the plaint as well as documents placed on record. It appears to the Court that the plaintiff has been able to make out a strong prima facie case for grant of ex-parte ad-interim order. In case injunction is not granted, the plaintiff will suffer irreparable loss and injury. The balance of convenience lies in favour of the plaintiff and against the defendants. Thus, the plaintiff is entitled for ex-parte ad-interim injunction. Till the next date of hearing, the defendants, their partners, officers, servants, agents, distributors, stockists and representatives are restrained from selling, offering for sale, advertising, or directly or indirectly dealing in footwear and leather goods including shoes, handbags, purses, footwear or any other goods bearing the registered trademarks of the plaintiff or any similar trademark amounting to an infringement of registered trademarks of the plaintiff, in particular trademark registration No.1644051 for word mark CHRISTIAN LOUBOUTIN through their ecommerce website www.darveys.com and/or any of their outlets and/or during any events or exhibitions or in any manner whatsoever or any similar trademark amounting to an infringement of plaintiffs' registered trademarks, dilution as also passing off.
Compliance of Order XXXIX Rule 3 CPC be made within four days. Dasti.”
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