E-Commerce Platform Cannot Become A Haven For Trademark Infringers: Delhi HC Passes Injunction Order Against Indiamart In Suit Filed By PUMA

The Delhi High Court has restrained the e-commerce platform Indiamart from including the registered trademarks of PUMA as search options in its dropdown menu during the registration process for potential sellers on its e-commerce platform.

The court said that an e-commerce platform cannot become a haven for infringers.

Stressing on Indiamart's inherent obligation to place sufficient checks and balances to prevent counterfeiters from misrepresenting themselves as genuine sellers, the Bench of Justice C Hari Shankar observed that, "There is nothing inherently illegal in IIL providing a drop down menu from which prospective sellers, on the Indiamart platform, can select the brand which they intend to sell. If, however, there are not, in place, sufficient checks and balances to prevent counterfeiters from misrepresenting themselves as genuine sellers, the protocol cannot withstand judicial scrutiny. Given the intent and purpose of the Trade Marks Act, and the need to protect intellectual property rights, IIL can hardly be allowed to maintain a defence that they have no participatory role to play in the process."

In light of the same, the e-commerce platform was restrained from providing any goods holding the registered trademarks of the plaintiff, and it  was said that, "the defendant shall stand restrained from providing any of the registered trade marks of the plaintiff, including PUMA, in respect of any goods whatsoever, as search options in the drop down menu presented to prospective sellers at the time of their registration on the Indiamart platform. The defendant shall also forthwith take down all infringing listings containing any of the plaintiff’s registered trade marks, relating to goods being sold on its Indiamart platform, on the plaintiff bringing the listings to its notice."

Counsel Ranjan Narula and Counsel Shivangi Kohli appeared for the plaintiff, while Senior Advocate Rajshekhar Rao, along with others, appeared for the defendant. 

In this case, PUMA alleged that when using Indiamart's search function to look for the term "PUMA," multiple counterfeit products featuring fraudulent "Puma" marks were presented by third-party sellers for sale.

The High Court took the position that by providing 'Puma Shoes' as a drop-down option to the prospective seller prima facie aids the seller in his counterfeiting design. With that background, it was held that IIL prima facie aided the commission of the unlawful act of counterfeiting and infringement.

It was observed that e-commerce websites have an obligation to sedulously protect intellectual property rights of others. In that context it was said that, "They cannot, with a view to further their financial gains, put in place a protocol by which infringers and counterfeiters are provided an avenue to infringe and counterfeit. Any such protocol has to meet with firm judicial disapproval." 

The Court stressed that Rule 3(1)(b)(iv) of the IT Rules requires the intermediary to take reasonable steps to ensure that the use of its consumer resource does not post any infringing listing. In that context, it was further said that, "There is obviously no use in closing the stable doors after the horses have bolted. An e-commerce platform cannot become a haven for infringers. Men are not angels. Where easy money is visible, the conscience at times takes a nap."

Resultantly, the defendant was ordered to take down all infringing listings containing any of the plaintiff’s registered trademarks, and was restrained from providing any of the registered trade marks of the plaintiff.

Cause Title: Puma SE vs Indiamart Intermesh Ltd.

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