Delhi HC reserves order on HUL-Beco advertising dispute over territorial jurisdiction

New Delhi: The Delhi High Court has reserved its order on a preliminary objection over territorial jurisdiction in Hindustan Unilever Limited’s suit against Kwick Living (I) Private Limited, the company behind cleaning products brand Beco.

Justice Anup Jairam Bhambhani reserved the matter after hearing detailed arguments from both sides. The Court also made it clear that it would not consider any request for interim or ad-interim relief until the jurisdiction issue is settled.

The jurisdictional challenge stems from Kwick Living’s contention that the alleged product disparagement has no sufficient connection with Delhi.

Appearing for HUL, senior advocate Amit Sibal argued that Delhi courts can hear the case because the disputed advertisements are being circulated through online and social media platforms accessible to consumers in the capital.

HUL’s argument, however, goes beyond simply saying that the advertisements can be viewed in Delhi. The company pointed to Beco’s website, which allows consumers in the city to place orders for its products. This, it argued, creates a direct commercial connection between the advertising campaign and Delhi.

Sibal relied on judicial precedents involving online advertising and e-commerce to distinguish between digital content that is merely accessible in a jurisdiction and websites that facilitate actual commercial transactions there.

The distinction could prove important in deciding whether Delhi has a sufficient territorial connection to the dispute. HUL’s position is that consumers in the capital are not just passive viewers of the campaign but can also engage commercially with the brand.

Kwick Living, meanwhile, argued that product disparagement is similar to defamation because it involves alleged harm to the reputation of goods. It therefore contended that the jurisdictional principles applicable to such claims should determine where HUL can pursue the case.

HUL disputed that approach, arguing that the statutory provision cited by Kwick Living applies to suits seeking damages, while its present proceedings primarily seek an injunction against the advertisements.

The company also maintained that product disparagement and personal defamation are separate legal causes of action. As a result, it argued, precedents limiting territorial jurisdiction in defamation cases cannot automatically be applied to disputes over advertising claims concerning commercial products.

The Court has not yet considered the merits of HUL’s request for an injunction. Sibal indicated that Kwick Living had not fully addressed that aspect of the case and that further material remained to be placed before the Court.

Justice Bhambhani indicated that those issues would be taken up only if the Court first finds that Delhi has territorial jurisdiction over the dispute.

For now, the advertising campaign remains untouched by any interim direction. With arguments on jurisdiction complete, the next step is the High Court’s ruling on whether the case can proceed in Delhi.