The Delhi High Court has restrained e-commerce platforms Amazon, Flipkart, Healthkart and Snapdeal and several sellers from displaying, advertising and offering for sale the products of companies that are ‘direct selling entities’ without their consent, as Bar and Bench reports. The interim injunction was passed on July 9th by a Single Judge Bench, in clubbing of suits filed by direct selling entities like Amway, Modicare and Oriflame. Amway, Modicare and Oriflame deal in healthcare and beauty products. The companies alleged that the aforementioned e-commerce platforms are sourcing and selling their products in an unauthorized manner at cheaper rates, resulting in financial losses to companies. The companies' arguments against e-commerce platforms The companies have pleaded that their trademark, names, logos, etc. being used by the e-commerce platforms without their consent. Further, they argued that several sellers are selling their products on these platforms in violation of the Direct Selling Guidelines, 2016. Issued in October 2016, The Direct Selling Guidelines provide a framework for direct selling. Under the Guidelines, a Direct Selling Entity is expected to also enter into a specific agreement with the Direct Sellers, before enrolling them as part of the distribution network. The companies also alleged that their products are being tampered and sold without unique codes and QR codes on these platforms while hiding the sellers’ names and contact details. It is their contention that such tampering is in violation of Section 30(3) of the Trade Marks Act, 1999 as the sales of tampered products through unknown sellers on these platforms constitute…
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