HUL Vs Honasa: Delhi High Court Directs Takedown Of 'Disparaging' Lakmé Sunscreen Ads

The Delhi High Court on Thursday directed Hindustan Unilever Ltd., which owns the Lakmé brand, to modify its sunscreen advertisement that allegedly disparage Honasa Consumer Ltd.'s Derma Co. product.

As part of the modifications, the FMCG giant has been directed to take down online ads within 24 hours and remove hoardings within 48 hours.

HUL also agreed to change the colour of the product featured in the ad from orange to yellow in order to avoid any resemblance to Derma Co.

Honasa, on its part, agreed to take down their social media posts related to Lakmé sunscreen. Subsequently, the Lakmé-owner said it would not pursue its own legal action filed against Honasa in the Bombay High Court.

Both parties also agreed to remove adjacent hoardings that resulted in the branding conflict, settling the courtroom battle in a quiet truce.

The spat began when HUL launched an ad campaign downplaying the efficacy claims of digital-first sunscreen brands, which was followed by Honasa Consumer putting up a billboard right next to a Lakme ad for its new SPF 50 sunscreen with the message: "Hey Lakmé, congratulations on finally getting SPF 50 in-vivo tested. Welcome to The Derma Co. standard."

Soon, the matter escalated to court, with Honasa filing for lawsuit, seeking relief on the grounds that the ad campaign misled consumers by indirectly discrediting Derma Co.’s SPF 50 claims. HUL, in turn, filed a countersuit.

The contentious Lakmé ad, first aired on April 12, claims that an "online bestseller" of sunscreen is lying about its sun protection factor and the product could cause skin pigmentation. The ad alleges that the absence of strict sunscreen testing regulations allows some brands to falsely claim SPF 50, often providing only SPF 20, while displaying bottles resembling Derma Co.'s packaging.

Honasa, represented by senior counsel Amit Sibal, argued that this campaign was a "classic hit and run", targeting Derma Co. with misleading claims.

HUL contended that it had clinical proof that Honasa's products do not offer SPF 50 but only SPF 14.05 and submitted a report to this effect to the high court. HUL also tested two batches of Lotus Herbals sunscreen, which indicated a discrepancy with the claims of SPF 50.

Challenging the basis of HUL's statements in the ad, Honasa pointed out that HUL had relied on a two-page executive summary from a test report dated Feb. 27 to support its claims. "They haven't submitted the full report — we don't even know what product was tested."

Honasa, on the other hand, has produced full test reports from Clinical Research Pvt. and another laboratory, both certifying that its sunscreen meets SPF 50 standards.

Arguing that generic disparagement of a rival product is objectionable, Honasa said while comparative advertising is permissible within limits, HUL had crossed the "Laxman Rekha" by not only suggesting that its own product is superior but also implying that Derma Co’s product is "bad" and that the competitor brand itself is "not trustworthy".

After considering both arguments, Justice Amit Bansal directed HUL to modify their ad to state "some sellers" instead of "online bestseller" and to make changes to their packaging as well. The court further said that a trader is not entitled to defame his rival's goods while comparing his goods with them. Following this, HUL has agreed to remove the current ads.

The case has now been listed for reporting further progress on Monday. If compliance is met, the case would be disposed of.

"There is no injunction against the Lakmé campaign. We respect the outcome to continue with our sun superiority campaign with some modifications," an HUL spokesperson said in a statement.

"Lakmé has been conducting SPF efficacy and safety tests for over a decade... We will continue to reaffirm our unflinching commitment to consumer safety and scientific excellence and be a leading voice to advocate for transparency and higher standards in skincare, by developing products backed by science, research and innovation," the spokesperson said.

Trademark disputes are common in the FMCG industry, with companies frequently taking legal action to protect their brands and market share. These disputes range from claims of trademark infringement, where one company uses a similar name, logo, packaging designs or slogans to another, to issues of passing off, where a company's actions cause consumer confusion in a competitive market. 

Some prominent FMCG trademark fights in the past include ITC versus Nestle over the use of the phrase "Magic Masala" for their noodles; HUL vs Emami over the use of the "Glow & Handsome" trademark for fairness creams; and Emami vs Dabur in a packaging dispute concerning their hair oil, 'Thanda Tel'.