Comparative advertising is allowed under Indian laws. However it has to be done carefully. Recently Hindustan Unilever Limited (“HUL”) started an advertising campaign in which they compared their product – Pepsodent Germicheck Superior Power (“Pepsodent GSP”) with Colgate’s product – Colgate Dental Cream Strong Teeth (“Colgate Strong Teeth”). Upset by the way in which their product was depicted in print and in the TV advertisement, Colgate sued HUL before the Delhi High Court. Colgate also filed an application praying for a grant of interim injunction to restrain HUL from publishing/telecasting the advertisement.

HUL’s advertisement claimed that Pepsodent could deliver ‘130% germ attack power’ as opposed to 100% power of Colgate. It was the contention of Colgate that HUL showed the Colgate Strong Teeth tooth paste in a bad light and these advertisements hurt the character and repute of the trade mark ‘Colgate’. Colgate contended that HUL should have compared Pepsodent GSP with a like product which was ‘Colgate Total’ toothpaste and not ‘Colgate Strong Teeth’ since Colgate Total had the same active ingredient namely Triclosan as Pepsodent GSP. Colgate’s counsel argued that the advertisements implied that use of Colgate results in germ formation and cavities and is therefore harmful. The product and packaging of Colgate were shown in the impugned advertisements completely without the slightest effort to mask them.

HUL countered that the whole purpose of these advertisements was to pose competition to Colgate at the price segment at which it was selling Colgate Strong Teeth. While 100 grams of Colgate Strong Teeth was sold at INR 37, a tube of 100 grams of Pepsodent GSP with Triclosan was priced at INR 39. HUL submitted that Colgate's superior product 'Total' which Colgate wished to compare with Pepsodent GSP was positioned as a premium segment product with a 70gm tube of Colgate Total toothpaste selling at INR 52.

The Delhi High Court observed that comparative advertising is permissible as long as it does not have negative overtones. It was further pointed out that for a plaintiff to succeed in an action based on malicious falsehood, the necessary ingredients are that (i) a false statement was made which is calculated to cause financial damage (ii) that it was made maliciously with intent to cause injury and (iii) the impugned statement has resulted in special damage. While deciding this case, the Delhi High Court also considered the principles that - While saying that his goods are better than his competitors', a tradesman cannot say that his competitors' goods are bad. If he says so, he slanders the goods of his competitors. In other words, he defames his competitor and its goods, which is not permissible. If there is no defamation to the goods or to the manufacturer of such goods then no action lies, but if there is such defamation an action lies and if an action lies for recovery of damages for defamation, then the Court is also competent to grant an order of injunction restraining repetition of such defamation.

As this was the interim stage, the Delhi High Court did not go into the veracity of the claims made by HUL as to Pepsodent being able to deliver ‘130% germ attack power’ as opposed to 100% power of Colgate. The Court held that the neither the TV nor the printed advertisement of HUL disparages/denigrates the product Colgate Strong Teeth of Colgate. Thus, the Hon’ble Court found in favour of HUL and dismissed the application of interim injunction.

Conclusion

Compare your product with your competitors but:

• Conduct proper tests before you advertise;
• Don’t show your competitor’s product in a bad light. It’s all right to say your product is better than your competitor’s product but don’t say that your competitor or his product is bad.