TORT LAW OF BRAND DISPARAGEMENT, RESPONSIBILITY OF SOCIAL MEDIA INFLUENCERS AND THEIR FREEDOM OF SPEECH – AN ON-GOING LEGAL BATTLE – Eshwars
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TORT LAW OF BRAND DISPARAGEMENT, RESPONSIBILITY OF SOCIAL MEDIA INFLUENCERS AND THEIR FREEDOM OF SPEECH – AN ON-GOING LEGAL BATTLE

Authored by Aanchal M. Nichani

With the advent of social media platforms, emerged a new vocation – social media influencer, who with their following and reach on social media attempt to influence and sway a viewer/consumer towards purchasing or refraining from purchasing a product available in the market. Most brands and companies make utmost commercial use of the fan following base and reach these social media influencers enjoy in order to promote their product.

The recent legal battle between Marico Limited (‘Brand Owner), the owner of the branded edible coconut oil ‘Parachute’ and Abhijeet Bhansali (‘Social Media Influencer’), a youtuber running a Youtube channel under the name ‘Bearded Chokra’ has thrown light on the questions of law with respect to the caution and responsibility to be exercised by social media influencers vis-à-vis right freedom of speech and expression. It has also clarified the position of law relating to disparagement vis-à-vis defamation in the context of various videos uploaded in social media by social media influencers to express their views on products or services offerings of third parties.

Background:

The Brand Owner was aggrieved by the Social Media Influencer’s claims and statements about its branded coconut oil, published on his channel in the popular social media platform Youtube (‘Impugned Video’), and approached the Bombay High Court, that the Impugned Video disparaging and denigrating its brand, and sought for an injunction against the Social Media Influencer, restraining him from

(i) publishing or broadcasting or communicating to the public the Impugned Video;

(ii) disparaging or denigrating the Brand Owner’s branded coconut oil or any other product of the Brand Owner or the Brand Owner’s business; and

(iii) Infringing the registered trademarks of the Brand Owner.

Plaintiff’s contentions:

It was the Brand Owner’s case that the Social Media Influencer had an intention to malign, disparage, slander the goods and spread malicious falsehood, and the Impugned Video was a targeted attack and that provided incorrect information and deceives the viewer into believing that the tests conducted by the Social Media Influencer substantiate the claim that the Brand Owner’s product is of inferior quality. It was further contended that creation and publication of videos on the platform was the occupation of the Social Media Influencer and thus, his review cannot be equated with any other review of any ordinary consumer. In addition, the Brand Owner also alleged that the Social Media Influencer had unauthorizedly used the Brand Owners registered trademark in course of his trade which is contrary to the honest practices in industrial or commercial matters.

Defence of the Social Media Influencer:

The Social Media Influencer denied intention to malign, and that the contents of the video are true, and constitute his bonafide opinion and that he is protected under the right to freedom of speech and expression. It was further contended that the three ingredients for making out a case of tort of disparagement of goods/slander of goods, viz: i) the statement must be false; ii) the statement must have been made with malice; and iii) the Plaintiff must have suffered special damage, have not been satisfied by the Brand Owner, and that he was neither a trader/manufacturer nor a rival of the Brand Owner’s goods and hence, the tort of disparagement of goods/slander of goods is not applicable to him.

Findings, reasoning and decision of the Court:

The Court recognised and acknowledged the extent, reach, power and ability of social media influencers to sway the public, and their opinion over a particular product. The Court said that a social media influencer cannot deliver statements with the same impunity available to an ordinary person and that such influencers bear a higher burden to ensure that there was a degree of truthfulness in their statements.

The Court while holding that the Impugned Video was false and the statements made therein were with malice, thereby satisfying the first two ingredients for the tort of disparagement/slander of goods, observed no material was produced by the Social Media Influencer that the statements made by him were true, and that he had neither conducted any tests to substantiate his claims, nor the articles relied upon by the Social Media Influencer indicate that the statements made by him in the Impugned Video were true. Further, the Court also took into account the several comments of the public who expressed their decision to stop purchasing the Brand Owner’s product after watching the Impugned Video and hence, the impact of the Impugned Video on the reputation of the  product and the damage caused to the Brand Owner cannot be underestimated and held that the third ingredient of special damages suffered by the Plaintiff was also satisfied.

With respect to the contention of right to freedom of speech, the Court held that the Social Media Influencer created all the videos with a commercial purpose of earning revenue and thus, the publication of the Impugned Video is a commercial activity and his “opinion” amounts to commercial speech. The Court further went on to hold that the fundamental right to freedom of speech and expression is not an unfettered right and that despite commercial speech being part of the fundamental right guaranteed under Article 19(1)(a) of the Constitution of India, such right cannot be abused by any individual to malign or disparage the product of another as is done in the instant case. The Court also observed that the Defendant under the garb of educating/bringing the true facts to public cannot provide misleading information to disparage the Plaintiff’s product. Also, the unauthorised use of the Plaintiff’s registered trademarks by the Defendant in a manner that is detrimental to its distinctive character or reputation cannot be in accordance with the honest practices in industrial and commercial matters.

The Court directed the Defendant to take down the video from Youtube or any other social media platform or medium.

However, before parting with the judgement, the Court cautioned that social media influencing is one of the most impactful and effective ways of marketing and advertising and thus, possess a responsibility to ensure what they are publishing is not harmful or offensive.

Appeal before the Division bench of Bombay High Court

The Appellant challenged the order passed by the single bench of the Bombay High Court which eventually lifted the injunction and stayed the operation of the order passed by the single bench and allowed the Impugned Video to be published subject to certain modifications.

The Division Bench further went on to hold that there is a clear difference between facts and opinions. The Bench held that when a person asserts a matter of fact, he cannot be restrained from expressing himself, because if he fails to make good the facts asserted, damages are awarded. However, incase of opinions and subjective issues, a different yardstick applies and if the statement is defamatory, an injunction must follow. The Court further went on to analyse what would amount to an expression opinion, simple or mixed and what would amount to a fact and also observed that freedom of speech gets primacy over reputation. The Court clarified that in the context of the video made by the Social Media Influencer on the product of the Brand Owner, the Social Media Influencer has expressed an opinion based on certain facts expressly disclosed in the video and hence the same is to be construed as the Social Media Influencer having exercised his freedom of speech and expression based on facts expressly disclosed that is not to be construed as disparagement and hence an action for the same does not lie therein against the Social Media Influencer. Accordingly, the division bench stayed the operation of the impugned judgement of the single bench and allowed the Social Media Influencer to continue making the video available for public viewership subject to certain disclaimers as was agreed to be replaced by the Social Media Influencer in the video.

Conclusion:

The question with respect to freedom of speech and expression and social responsibility and obligation of social media influencers is a very subjective issue and needs to be viewed on a case-to-case basis and hence is more likely will remain to be an on-going legal battle between Social Media Influencers and Brand Owners!

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