The Delhi High Court has restrained e-commerce sites such as Amazon, Flipkart and Snapdeal from selling health and beauty products of direct sellers -- Amway, Modicare and Oriflame -- without their consent.
Justice Pratibha M Singh gave the interim order on the pleas of the three direct sellers alleging that products under their brands were being sold on the e-commerce platforms at cheaper rates resulting in financial losses to them.
“…this court has no hesitation in holding that the continued sale of the plaintiffs’ [Amway, Modicare and Oriflame] products on the e-commerce platforms, without their consent, results in inducement of breach of contract, and tortious interference with contractual relationships of the plaintiffs with their distributors,” the court said.
It noted that the manner in which Amway, Modicare and Oriflames’ marks, logos, company names and product images, were being used was “clearly misleading to a consumer” as the sellers names were not fully disclosed.
“Contact details are not disclosed. The consumer, would find it extremely difficult to contact a seller. Consumers cannot be expected to do a fine and detailed examination to find out the actual source. The consumer is not being told that the seller is not authorised and they would, literally, require investigative capabilities to trace the actual seller,” the court added.
It directed that only those sellers who have obtained the consent of Amway, Oriflame and Modicare be allowed to sell their products on the e-commerce platforms.
The High Court also directed the e-commerce platforms to display the complete contact details of the sellers who had obtained the consent of the plaintiffs to sell their products.
