Delhi High Court stops trademark infringement of PUMA

The Delhi High Court has recently passed an exhaustive judgment on trademark infringement by an e-commerce platform. The suit was filed by the well-known brand PUMA against an online marketplace, Indiamart. 

PUMA alleged that Indiamart was facilitating the sale of counterfeit PUMA products on its website by allowing sellers to register themselves as sellers of PUMA products without verifying their authenticity. PUMA also alleged that Indiamart was using PUMA’s trademarks as keywords and meta tags to attract online traffic to its website. PUMA sought an injunction to restrain Indiamart and the other defendants from using its trademarks in any manner whatsoever.

The court passed an order on 13 February 2023 that prevents Indiamart from displaying the registered trademarks of PUMA as choices in its dropdown menu during the registration process for potential sellers on its website. The court stated that an online platform cannot become a safe haven for infringers. Emphasizing Indiamart’s inherent duty to put enough safeguards in place to stop counterfeiters from posing as genuine sellers, Justice C Hari Shankar said, “It is not illegal for Indiamart to provide a dropdown menu from which perspective sellers, on the Indiamart platform, can choose the brand that they want to sell. However, if there are not enough safeguards and measures to stop counterfeiters from posing as genuine sellers, the protocol cannot pass judicial scrutiny. Considering the purpose and intent of the Trade Marks Act, and the need to protect intellectual property rights, Indiamart cannot claim that they have no role to play in the process.”

The court also observed that by offering ‘Puma Shoes’ as an option in the dropdown menu to the prospective seller, Indiamart was prima facie aiding the seller in their counterfeiting scheme. The court said that e-commerce websites have a responsibility to diligently protect the intellectual property rights of others. The court said, “They cannot, for their financial gains, put in place a protocol that allows infringers and counterfeiters to infringe and counterfeit. Any such protocol has to face firm judicial disapproval.”

The court granted an interim injunction in favor of PUMA and directed Indiamart to remove PUMA’s trademarks from its dropdown menu and website. The court also directed Indiamart to disclose the details of the sellers who had registered themselves as sellers of PUMA products on its website. The court further directed Indiamart to file an affidavit stating the steps taken to prevent trademark infringement and counterfeiting on its website.

Furthermore, the court noted that Rule 3(1)(b)(iv) of the IT Rules requires the intermediary to take reasonable steps to ensure that the use of its platform does not result in any infringing listing. In this regard, the court observed and passed valuable remarks, “It is no use to lock the stable doors after the horses have escaped. An online platform cannot become a sanctuary for infringers. Humans are not angels. When easy money is in sight, the conscience sometimes sleeps.” 

The court said that it would consider the issue of damages and costs at a later stage.

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