While clearly observing that malicious falsehood can’t become freedom of speech, the Delhi High Court in FIITJEE Limited v. Vidya Mandir Classes Ltd & Ors has maintained that care is to be exercised in order to avoid disparagement of another’s products or denigration of the goodwill and reputation built by a competitor while engaging in advertising one’s own products. This must be adhered to in totality.
The Bench of Justice Asha Menon was dealing with a plea filed by FIITJEE Limited which is a company engaged in imparting education to students for securing admission to various educational institutions, seeking an ex-parte injunction against the defendants, Vidya Mandir Classes, requiring them to immediately take down an allegedly defamatory and scandalous YouTube video.
The grievance that led to the filing of the present suit was a video that was uploaded on YouTube by defendant No.2, which according to the plaintiff contained falsities. Defendant no.2 was seen in the video introducing the topic as akin to the battle between Shri Ram and Ravan certainly suggesting that the plaintiff was in the position of Raven, by not heeding to the warnings of defendant No.1 on previous occasions, to refrain from disparaging it and thus inviting upon itself the strong rebuttal by defendant No.2.
It was also submitted that the plaintiff was painted in a completely negative light by the use of such metaphors. Words such as ‘gumrah’ were used against the plaintiff, the public was told that the plaintiff misled the parents, held the parents and children, hostages, was focused only on making money, indulged in kidnapping and extortion, while at the same time ill-treating its teachers by not paying salaries and so on. There was also a comment on the refund policy of the plaintiff and other malpractices were alleged. It was also claimed that there was a Central Bureau of Investigation (CBI) case against the plaintiff.
It was submitted on behalf of defendant no.1 that it was raising a defence of justification. It was submitted that the video relied upon material that was disclosed in the description box and therefore the statements made in the video were not baseless. It was further submitted that defendant no.1 having relied on material would require to be given an opportunity to substantiate the statements made in the video. Opinions could differ and what inference is to be drawn may be looked into at a later stage. Finally, it was also submitted that no final relief can be granted at an interim stage.
It was the case of the second defendant that apart from the fact that the interim reliefs sought are materially the same as the final reliefs sought in the plaint, except for damages, and which cannot be granted, the fact remains that in respect of prayer (a), no injunction in anticipation, can be granted. The existence of malice is also to be examined on evidence. Similarly, defendant no.2, who also claims justification in making the statements recorded in the video, has to be granted an opportunity as well, to prove justification during the trial. When such a plea of justification has been raised, there can be no interim injunction granted. Moreover, it was submitted that since the plaintiff had claimed damages, it was disentitled to an interim injunction. It was further submitted that every word in the video cannot be looked into at this interim stage, to determine, whether they constituted defamation or not.
The Court observed at the outset that as traditionally, transfer of knowledge has been considered as the highest of all human action and does not involve the accumulation of wealth, one is hesitant to use the word “business” rivals to describe the plaintiff and the defendants but since both are incorporated entities, there appears to be no other apt word to describe them. Considering that the pool for both of them is the same i.e. the young students in the Higher Secondary Schools, who are desirous of joining premier engineering colleges and institutions, they seek to exert themselves to attract more and more from the common pool. In the normal course, such competition would work for the improvement in the quality of the services and must be welcomed.
However, there are occasions when the competition takes an ugly turn, the Court added. Further, it was stated that to take a cue from the preamble to the Competition Act, 2002, practices having adverse effects on competition needs to be prevented but at the same time competition must be promoted and sustained to protect the interest of consumers and to ensure freedom of trade carried by all participants in the markets, here the field of education.
The Bench then went on to assert that while competing with one another, it is but natural that each player would portray themselves to be the best in the field and that it is equally possible that while doing so, they may adversely comment on their competitors.
Next, addressing the submission of the plaintiff counsel which was to the effect that the defence of justification is not of the same calibre as the defence of truth, the Court opined that truth is an absolute defence and no injunction can follow when the truth is pleaded, but it is undeniable that justification can be established only at trial and a defendant ought to have an opportunity to establish it through evidence.
“When the plea of justification is taken, the courts are slow in issuing injunctions against publication. The general view taken is that if the defendants fail to substantiate their defence of justification, then the plaintiff would become entitled to damages”, the Bench said.
Coming to the question of whether the video in question contained any disparagement or defamatory matter, the Court opined that whether there is one disgruntled teacher or several, as are the varying stances of the plaintiff and the defendants, there may be some material for the defendants to have claimed that the teachers were dissatisfied. The Court further observed that it would be an inquiry during trial whether, on whatever material the defendants had relied on, such an inference can be drawn and statements made.
The Court added,
“Similarly, criticizing the refund policy on the basis of the decisions of the Consumer Disputes Redressal Forum prima facie does not appear to be defamatory and that too of a scale which would require immediate directions to pull down the video. Criticism of the various programs of the plaintiff in this video and the elaboration of how the defendant No.1 conducts its programs would also be only in the nature of competitive advertisement. The comparison would naturally be tested during the trial to determine whether the inferences drawn were justified.”
Further, the Court adjudged,
“But, to accuse someone of kidnapping, extortion etc. is different. Use of such strong words is inappropriate to say the least. It directly impacts the parent who would be discouraged with such negative description of the plaintiff. These words ex facie are untrue. These words cannot be allowed to remain. This Court, however, does not agree with the submission of the learned senior counsel for the plaintiff that removal of the offensive words will not be sufficient to meet the ends of justice at this interim stage.”
In conclusion, the Court observed that while the defendants established that the balance of convenience is in their favour as no harm would be caused to the plaintiff if the video remained, that cannot be compensated through the award of damages, the Court was of the considered view that the defendants will have to take down the aforementioned sentences in the video and ensure that no version with such content is in circulation, depicting the plaintiff as a set of criminals.
Case Details
Case Name: FIITJEE Limited v. Vidya Mandir Classes Ltd. & Others
Case Number: CS(OS) 656/2021
Delivered On: February 16, 2022
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