DELHI HIGH COURT HOLDS TRIAL COURT COMMITTED ERROR BY NOT FOLLOWING THE PROCEDURE FOR RETURN OF PLAINT

INTRODUCTION

A Single Judge Bench of the Hon’ble High Court of Delhi comprising of Justice Dharmesh Sharma passed an Order dated 07.11.2023 in Patanjali Ayurved Ltd Vs. Meta Platforms Inc & Ors in FAO 280/2023, CM Appl. 56965/2023 and held that the Trial Court failed to follow the procedure for return of plaint and directed the Trial Court to hear the Parties afresh and thereupon decide the issues.

FACTS

i) The Appellant, Patanjali Ayurved Ltd., is a Company incorporated under the Companies Act, 1956 and is engaged in manufacture and distribution of various healthcare products throughout India as well as abroad using its registered trademark “PATANJALI”.

ii) The Respondent No. 4 had uploaded a video on the internet platform, which is controlled by Respondent No. 1 to 3 and 5 i.e. Meta Platforms Inc. (earlier Facebook) and YouTube LLC. The said video was an advertisement of men’s undergarment, wherein the Appellant’s Trademark along with pictures of brand ambassadors and Directors were displayed unauthorizedly.

iii) Further, the Appellant had no available information about the Respondent No. 4, who had uploaded the video, however, the said video was being displayed on the internet platform of YouTube LLC, the Respondent No. 5 who are providing access to the internet users, and generating revenues on the same.

iv) The Appellant’s contention is that the Respondents were violating its statutory common law rights to use its Trademark “PATANJALI” which is exclusive to the Appellant.

v) Further, the Summons of the Suit which were sent to the Respondents 1 to 5, were only issued to Respondents 1 to 3 and 5, who appeared before the Ld. Trial Court on 19.10.2022 and the said video was played before the Court.

vi) The Ld. Trial Court after considering the aforesaid averments as also the content of the following video, vide Order dated 28.07.2023, held as under;

“6. A perusal of the above extract from the plaint and entirety of the plaint would show that plaintiff’s are claiming damages for unauthorized user of their trademarks by defendants. Though the plaint is drafted in such a way that the use of the words trademark or its infringement have not been explicitly used. However this suit is basically filed to restrain the infringers from using the trademark of the plaintiff in this video and further to injunct them from promoting their own product i.e. their own channel where is posted under the trade name of the plaintiff. 7. Since the parody was made not for the sole purpose of criticism or defaming the plaintiff but in order to increase the viewership of the channel/ web link where it was posted, hence it amounts to infringement of plaintiffs trademark. Further it is the own claim of plaintiff that it has been used by You Tube and Facebook for the purpose of generating revenue while the video was played and in order to increase their own viewership/TRPs, hence it amounts to infringement. 8. Further perusal of the video would show that the intent to make the video is not to defame the trademark of the plaintiff as such, as plaintiff is not into manufacturing of men’s undergarment but advertisement/video has been made in a comic way so that it is viewed by the viewers to be enjoyed. Such videos would increase hits to the URL/ web link where they are posted. Needless to say, You Tube and Facebook also generate revenue as is claimed. Further as per the own case of plaintiff, the publishing and continuous viewership of such videos has adversely affected the reputation of the plaintiff and has caused business losses to them . Hence this advertisement/ video has been used by defendants to promote their own business on various website/ URLs/ web links/ YouTube/ Facebook. It is generating revenue for the defendants and is causing losses to the plaintiff. The hits are being generated as the video has name of Patanjali, in it and hence viewership is sought in the name of plaintiffs’ trademark. Hence there is loss of reputation of plaintiff’s trademark by the usage of this trademark in the present parody. This parody is commercial transactions by the defendants to promote their own business online. 9. In the garb of the present injunction suit, an injunction is sought thereby injuncting the defendants from playing the said trademark infringement video on their website/ portal/URL. 10. This being a suit for trade mark injunction/ infringement and seeking damages for infringement of their trademark beside other reliefs, it lies within the jurisdiction of Commercial Court. The present suit is not maintainable before this Court, hence it is hereby returned with the liberty to file in the Court of appropriate jurisdiction. 11. Original plaint and documents be returned to the plaintiff after obtaining certifies copies on record.”

HIGH COURT ANALYSIS

Aggrieved by the Trial Court Order dated 28.07.2023, the Appellant-Patanjali filed a First Appeal against Order bearing FAO 280/2023 before the Hon’ble High Court of Delhi. The High Court, vide Order dated 07.11.2023, made the following observations;

1) The Ld. Counsel for the Appellant urged that the Ld. Trial Court has committed grave error in holding that the Suit is of commercial nature and invited the attention of the Court to the definition of ‘Commercial Dispute’ as given in Section 2 (c) (xvii) of the Commercial Court Act, 2015. The Appellant urged that the offending video is not only infringing its Trademark but is also defamatory and disparaging in nature towards its brand ambassadors and subsequently asked for compensation for purported defamation.

2) The Ld. Counsel for Respondents 1,2,3 and 5 urged that no proceedings could be brought against them, as they were simply an “intermediary” in terms of Section 2(w) of the Information and Technology Act, 2000 (IT Act) and are exempted from any liability in terms of Section 79 of the IT Act (Exemption from liability of intermediary in certain cases.).

3) The High Court after hearing both the Parties, opined that the Ld. Trial Court’s Order dated 28.07.2023 cannot be sustained.

4) The High Court observed that the Ld. Trial Court did not follow the mandate / procedure for return of plaint provided under Order VII Rule 10A(1) of the Code of Civil Procedure, 1908 (Power of Court to fix a date of appearance in the Court where plaint is to be filed after its return).

ORDER

Thus, the High Court of Delhi, after considering all the facts and circumstances of the case held that the Ld. Trial Court shall hear the Parties afresh and thereupon, decide the issues involved in the Suit afresh. The Parties were directed to appear before the Ld. Trial Court for hearing on 01.12.2023.

Kartik Khandekar

Associate

The Indian Lawyer