Delhi High Court judgment examining the liability of intermediaries for trademark infringement
In a very important judgment for e-commerce market places in the country, the Delhi High Court (“Court”) in the case of Christian Louboutin SAS v Nakul Bajaj and Ors. has clarified the role and responsibility of online intermediaries or trademark infringement. The plaintiff, a seller of luxury shoes across the world, sells its shoes in India only through its authorized dealers. The defendant owns darveys.com, a website marketing itself as a luxury brand marketplace.
The plaintiff alleged trademark infringement by the defendant, by, inter alia, selling counterfeit goods, using the plaintiff’s registered trademarks as ‘meta-tags’ and using the plaintiff’s marks on its website. The defendant claimed protection as an intermediary under Section 79 of the Information Technology Act, 2000 (“IT Act”) as it just hosted the sellers who sold such luxury goods and did not sell those goods itself.
The Court examined the definition of ‘intermediary’ under the IT Act, and when online marketplaces could take the defence under Section 79 of the IT Act. The Court noted that the precise role of an online marketplace may be ascertained by looking at two factors:
- The role performed by the marketplace with respect to the goods; and
- The policies of the marketplace with respect to ensuring that the sellers are not engaged in illegal conduct
The Court went into the details of the manner in which the defendant exercised control over its website and the sellers selling their products. It observed that the defendant (i) does not disclose the details of foreign sellers and where such sellers purchase their good from; (ii) charges membership fee from the customers to be its members; (iii) claims that in case the products are counterfeit, the defendant shall return twice the money to the customer. Because of these reasons, the Court concluded that the defendant exercises complete control over the products, it identifies the sellers and promotes them actively to enable them to sell their products in India. Considering these factors, it came to the conclusion that the defendant was more than an intermediary and was not entitled to protection under Section 79 of the Act and would also be liable for trademark infringement if it was found selling counterfeit goods. As the defendant was not selling these goods, it was not held liable for trademark infringement but was told to ensure that no product of the plaintiff without their consent would be sold on the website.
GameChanger Views:
- The judgment is surely a landmark one as far liabilities of intermediaries and trademark infringement is concerned. With the tests being laid down to ascertain the role played by an online intermediary, we feel it is a step in the right direction to ascertain the role of online marketplaces in such cases.
- As a result of this judgment, online marketplaces have to now ensure the veracity of the products being sold on their platform and see that goods infringing any trademark is not sold on their platform.
Delhi High Court Seeks Centre’s reply in a petition seeking regulation of content on online streaming platforms
The Delhi High Court (“Court”) has asked the Central Government to file a reply in a petition which has sought to regulate the content on online streaming platforms such as Netflix, Amazon Prime among others. The Court has asked the Centre if it has any existing guidelines or licensing policies for regulation of content available on such online streaming platforms. The petition has been filed to restrict the broadcast of “unregulated, uncertified, sexually explicit, vulgar, profane and legally restricted content” on such platforms.
GameChanger Views:
- As currently there exists no such regulation policy of the government on regulating the content on online streaming platforms, the Central Government’s reply on this petition is keenly awaited as it will set the ball rolling for regulation of online content in the country.
The Indian Cruise Lines Association (“INCLA”) petitions the Prime Minister’s Office (“PMO”) demanding amendment in gaming laws to allow casinos in ships.
Taking a note of current prohibition on operating casinos and other gaming operations in in cruise ships within the territorial waters of India, the INCLA has petitioned the PMO demanding amendments in law to enable cruise ships operators to make casinos and other games available for their customers when they are on Indian territorial waters.
GameChanger Views:
- As poker and other games are becoming more popular, allowing cruise ship operators to host casinos and other card games on Indian territorial waters might have a ripple effect and we anticipate such games to find more acceptance in the country.
Diclaimer: The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.