IndiaMART V. Puma| Providing Option For Seller To Choose Brand Not A Ground To Hold That It Aids Infringer In Displaying Counterfeit Products: Delhi High Court
The Delhi High Court held that providing option for a seller to choose the brand of its products specifically describing its goods is not a ground to hold that it aids the infringer in displaying the counterfeit products of a particular brand.
The Court held thus in an Intra-Court Appeal filed by IndiaMART Intermesh Limited (IIL) against the Judgment of the Single Judge in an Application filed by PUMA SE (PSE) under Order XXXIX Rules 1 and 2 of the Code of Civil Procedure, 1908 (CPC).
A Division Bench comprising Justice Vibhu Bakhru and Justice Tara Vitasta Ganju observed, “As noted initially, in the present case, the learned Single Judge has prima facie found that protection of Section 79(1) of the IT Act would also be unavailable by virtue of clause (a) to sub-clause (3) of Section 79 of the IT Act. This is because the learned Single Judge had prima facie found that IIL had conspired, abetted and aided in infringement of the Puma Marks. As observed above, we are unable to concur with the said prima facie finding. The fact that IIL provides an option for a seller to choose the brand of its products specifically describing its goods cannot, prima facie, be held to be a ground to hold that it aids and abets the infringer in displaying the counterfeit products of a particular brand.”
The Bench added that the fact that a particular seller displays his advertisements under a particular sub-category describing products and services cannot lead to the conclusion that the very category is required to be eliminated.
Senior Advocates Sandeep Sethi and Rajshekhar Rao appeared for the Appellant while Advocate Ranjan Narula appeared for the Respondent.
Facts of the Case
PSE (Respondent) had filed a Suit seeking a decree of permanent injunction restraining the IIL (Appellant) from using, facilitating, or offering to any third parties the trademark ‘PUMA’ as a brand suggestion/keyword/search term on its website or use the mark ‘PUMA’ in any manner which may amount to infringement of PSE’s registered trademarks and to restrain IIL from passing off its goods and services as that of PSE. It also prayed for directions to be issued to IIL to remove all listing for sale of its counterfeit products or uploading any product images of its trademarks without verification and due diligence. Additionally, PSE sought compensatory and punitive damages to the tune of Rs. 2,00,00,010/- from IIL.
The Single Judge had restrained IIL from providing any of PSE’s registered trademark including PUMA in respect of any goods as search option in the drop-down menu presented to prospective sellers at the time of their registration on their platform. The Judge also directed IIL to take down all infringing listings containing any of PSE’s registered trademark in respect of goods, which are offered for sale. It was observed by the Judge that IIL’s use of the mark ‘PUMA’ amounts to trademark infringement under Sub-sections (1), (2) and (4) of Section 29 of the Trade Marks Act, 1999 (TM Act). It was further held that IIL could not claim “safe harbor” protection under Section 79(1) of the Information Technology Act, 2000 (IT Act). Being aggrieved by this, the Appellant-IIL filed the Intra-Court Appeal.
Reasoning
The High Court in the above context of the case, said, “There is no dispute that on receipt of knowledge of counterfeiting, IIL would be obliged to take down the link and failure to do so would be actionable. In such circumstances, the safe harbour of Section 79(1) of the IT Act would not be available to IIL.”
The Court noted that PSE’s grievance that sellers are permitted to re-register on Indiamart despite their listings having been taken down earlier, appear justified and the same seller in respect of the same products cannot be permitted to relist after its listing is removed.
“Prima facie, failure to prevent such a seller from re listing itself in a case where its listing has been pulled down on account of infringement of IPR, would fall foul of the requirement of due diligence under Section 79(3)(a) of the IT Act. It may be a different matter if such a seller fraudulently re-lists under a different name or furnishing different particulars, the discovery of which may require a qualitative analysis, which may not be feasible. However, failure to prevent him from re-listing in its own name and with the same particulars would, prima facie, be indicative of IIL being negligent or complicit”, it added.
The Court further observed that the logical sequitur of accepting PSE’s contention, at this stage, would be that IIL cannot accept a description of goods by their brand and it would necessarily have to eliminate references to brands at the time of registration, which is, prima facie, unsustainable.
“In our view, subject to IIL making reasonable efforts, to cause users of Indiamart not to host, display, upload or share any information that infringes the PUMA trademarks, as discussed earlier; IIL is not required to be interdicted from providing options to identify the products/services by their brands/trademarks and operating its B2B portal – Indiamart”, it also remarked.
The Court, therefore, set aside the impugned Order to the extent that it restraints IIL from providing an option to use the PUMA mark for the description of any goods as a search option in the drop-down menu presented to prospective sellers at the time of the registration on the Indiamart platform. However, it sustained the direction that IIL shall forthwith take down all infringing listings containing the PUMA marks on the same being brought to its notice.
Accordingly, the High Court disposed of the Appeal.
Cause Title- IndiaMART Intermesh Ltd. v. PUMA SE (Neutral Citation: 2025:DHC:4819-DB)
Appearance:
Appellant: Senior Advocates Sandeep Sethi, Rajshekhar Rao, Advocates Sidharth Chopra, Nitin Sharma, Naman Tandon, Kuber Mahajan, Riya Kumar, Sumer Saeth, and Harshil Wason.
Respondent: Advocates Ranjan Narula, Shakti Priyan Nair, and Parth Bajaj.
