Summary
In a trademark infringement dispute between IndiaMART Intermesh Ltd. (“IndiaMART”) and PUMA SE (“PUMA”), the Division Bench of the Delhi High Court set aside a prior injunction restraining IndiaMART from offering the PUMA trademark as an option in its seller registration drop-down menu. The Court permitted IndiaMART to continue offering trademark-based menu items and search terms, subject to obligations regarding takedown of infringing listings.
Brief Background
The case arose from an interim injunction granted in a suit filed by PUMA alleging trademark infringement, passing off, and inducement of counterfeiting on the IndiaMART platform. PUMA claimed that unauthorised sellers were listing counterfeit goods using its registered trademarks through drop-down options made available by IndiaMART at the time of seller registration. Puma argued that providing such facilities amounts to infringement on IndiaMart’s behalf as such an activity fell outside the scope of the exception available to intermediaries.
Injunction for Puma
In the proceedings before the Single Judge, PUMA sought a temporary and permanent injunction restraining IndiaMART from using or offering the PUMA mark as a keyword, brand suggestion, or search term, and from facilitating the sale of goods bearing its registered trademarks without authorisation.
The Single Judge granted interim relief in favour of PUMA. The Judge stated that:
- IndiaMART’s use of the PUMA mark in its seller registration drop-down menu constituted “use” under Section 2(2)(b) and 2(2)(c)(i) of the Trade Marks Act.
- The act of providing the trademark in a visual form on the registration page satisfied the requirement of “use” in relation to goods.
- IndiaMART’s actions amounted to use of the trademark “in advertising” under Section 29(6)(d) of the Act.
- The platform’s enabling of sellers to tag their goods as “PUMA” facilitated infringing listings, amounting to infringement under Sections 29(1), 29(2), and 29(4) of the Act.
- IndiaMART’s conduct disqualified it from the intermediary safe harbour under Section 79(1) of the Information Technology Act, 2000.
- The company had not made reasonable efforts as required under Rule 3(1)(b)(iv) of the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021.
- IndiaMART’s design of the drop-down menu and failure to verify sellers indicated active participation in trademark infringement and inducement of counterfeiting.
Based on the afore-mentioned, The Single Judge restrained IndiaMART from using the trademark PUMA in its drop-down menu and directed it to remove all listings infringing PUMA’s rights.
IndiaMart’s Appeal
IndiaMART challenged the injunction, contending that it functions as a neutral intermediary offering listing services, not as an e-commerce operator. It argued that the drop-down options were only a categorisation feature to aid sellers, and not a form of trademark use. IndiaMART further claimed that it had instituted a takedown mechanism and did not profit from the use of the trademark.
The Division Bench examined whether such drop-down functionality constituted use of a trademark as understood under the Trade Marks Act, and whether IndiaMART was entitled to the protection under Section 79 of the IT Act.
The Division Bench on Trademark Infringement observed that:
- Offering the term “PUMA” in a drop-down menu does amount to “use” under the Trade Marks Act.
- The use of the trademark by IndiaMART was not for identifying its own goods, but to facilitate classification of seller products.
- Describing a seller’s goods as “PUMA Shoes” using the drop-down would constitute use by the seller, but IndiaMART’s role was limited to providing keyword suggestions.
- The drop-down system was not mandatory; sellers were free to input product descriptions manually.
- IndiaMART’s platform is akin to a digital index or listing service rather than a direct seller or marketplace.
Intermediary Liability
On the issue of intermediary liability, the Court held:
- IndiaMART qualifies as an intermediary under Section 2(1)(w) of the IT Act.
- The conditions under Section 79(2) were prima facie satisfied, given that IndiaMART does not initiate the transmission, select receivers, or modify transmitted content.
- There was insufficient material to show that IndiaMART conspired, abetted, or aided the infringement so as to disqualify it under Section 79(3).
- IndiaMART’s content guidelines and user agreements contained undertakings against infringement.
- However, IndiaMART has to improve its registration process by prominently informing sellers of their obligations and ensuring that sellers whose listings had been taken down could not re-register under the same details.
Final Decision
The Division Bench set aside the order restraining IndiaMART from including the PUMA trademark in its seller registration drop-down menu. However, it sustained the direction that IndiaMART must promptly remove all infringing listings upon receiving notice and follow effective due diligence mechanisms.
Citation: IndiaMART Intermesh Ltd. v. PUMA SE, FAO(OS)(COMM) 6/2024, CM APPL. 2216 & 2219/2024 (Del. HC, June 2, 2025). Available at: http://indiankanoon.org/doc/85285346/, Visited on: 05/06/2025.
