The Tussle Between Trademark Rights and Consumer Rights

The Government of India released the Plastic Waste (Management and Handling) Rules, 2011, and the Plastic Waste Management Rules, 2016 post ban on the usage of plastic. These rules together state that no carry bags should be made available for free so as to promote re-use[1] and that only the shopkeepers who are registered with the local body can provide plastic carry bags to the consumers[2]. However, this rule was eliminated in 2018.

In order to circumvent this rule, the retail brands started charging the customers for the carry bags and it has become a common practice even after the above rules were omitted. Further, the carry bags with the brands’ logos printed on them were charged. However, Chandigarh Consumer Forum[3] held that printing the brands’ names and then charging for those bags is a violation of consumer rights. Post this, various State Consumer Forums and the National Consumer Forum[4] have held the same. The following consumer rights are held to be in violation:

• Printing the logo on the carry bags is a way for retail brands to advertise their brands at the expense of the consumer, thus it is an unfair trade practice.

• Retail brands usually have many branches and the cumulative sale of carry bags from all the branches will lead them to make undue profits from the customers.

• It is an essential practice that the brands provide carry bags as a service at the end of the purchase for free as the customers are not expected to carry the goods in hand. Not providing carrying bags is a deficiency of service.

• Retail brands are misusing the legal provisions and finding loopholes to exploit customers.

The District Consumer Disputes Redressal Commission-II, Hyderabad[5] held that the retail brands are at liberty to charge plain bags or bags which do not have logos printed on them. However, this information should be provided to the customers beforehand by displaying it in the form of a notice in a prominent place within the premises of the shop.

WHETHER IP RIGHTS OF THE RETAIL BRANDS ARE BEING VIOLATED?

Retail brands register their names and logos as wordmarks and device marks respectively. It is a known fact that registration of a trademark comes with a set of rights for the proprietor. One such right is to use the trademark for the sale of goods and services for which the mark is registered. Considering this, a few questions arise out of the entire tussle between trademark rights and consumer rights.

One of the important questions to be considered is whether the carry bags provided by retail stores are goods or not. The National Consumer Disputes Forum in the case of Big Bazaar Future Retail Pvt Ltd v. Ashok Kumar[6] stated that carry bags are also ‘goods’ and that a price can be charged for each bag by putting up a notice at a prominent place mentioning that the carry bag will be charged. This means that the carry bags are also commodities of the brands and that they can enforce their trademark on such goods like any other good. For instance, in the case of Gaurav Bangia v. Decathlon Sports India Private Limited[7], the customer was charged Rs 10 for a biodegradable carry bag that had Decathlon’s logo on it. The shop consisted of displays at various places stating that the customers are supposed to bring their own bags. However, the Forum held that the case was frivolous as the retail shop had put a notice and thus the consumer was supposed to pay due to his fault of not carrying the bag.

The Consumer Forums have held that the customer has a right to know that there is a charge levied even before he or she proceeds to put efforts to finalize the products to buy. If there is no such disclosure in the form of a notice displayed on the premises of the shop, then it shall be considered an unfair practice. This gives rise to the contention that if the information is given to the customers beforehand and with that awareness, they proceed to buy the required goods, it is not unfair trade practice for the brands’ to imprint their logos as well as to charge the same as a commodity.

The practice as of now is that the retail brands are at liberty to charge for plain bags. However, providing free bags is a part of their service whether there is a logo imprinted or not. If it is considered that charging plain bags is not a deficiency of service, then it is contrary to the contention that brands imprinting their logos on the bags is a deficiency of service.

Since there has been a ban on plastic usage for environmental protection, retail brands have invested their R&D in coming up with eco-friendly alternatives. This process is time-consuming and requires large financial investments. If this is so, then the eco-friendly bags are commodities of the brands and thus the brands should be at liberty to charge the bags. This process is not undue profiteering as claimed by the Forums.

In a situation where the brands are not allowed to put the logos but they have a unique way to represent their brand through trade dress, then it is very unclear if this situation is an example of unfair trade practice and thus a charge cannot be levied on it because there is no logo imprinted.

CONCLUSION

This topic is a tussle between consumer rights and retail brands’ trademark rights. Due to the rules laid by the Government of India to ban plastic, the onus was on the retail brands to provide alternatives.[8] At the same time, there was an onus on the customers to carry their own bags and reduce unnecessary wastage. However, the National Consumers Forum believes that customers are not allowed to carry bags that have items in them inside the stores but are asked to deposit them at the entrance and thus they cannot be expected to carry their own bags[9].

In light of the above reasons, there has been no clear explanation regarding this issue and if brands’ are being ripped off their trademark rights at the expense of upholding customers’ rights.

---

[1] Rule 10 of The Plastic Waste (Management and Handling) Rules, 2011. [2] Rule 15 of the Plastic Waste Management Rules, 2016. [3] Dinesh Prasad Raturi v. Bata India Limited, District Consumer Disputes Redressal Forum-I – UT. Chandigarh, CC/64/3019. [4] Baglekar Akash Kumar v. D-Mart Avenue Supermarts Ltd, 2021 SCC OnLine NCDRC 420; [5] Baglekar Akash Kumar v. More Megastore Retail Ltd, Consumer Case No. 310 of 2019. [6] 2020 SCC OnLine NCDRC 495. [7] District Consumer Disputes Redressal Commission, Gurgoan, CC No 747 of 2019. [8] Big Bazaar (Future Retail Ltd.) Vs. Ashok, F.A. No.238/2019; Ashok Kumar v. Mini So Uniy, District Consumer Disputes Redressal Commission-II U.T. Chandigarh, Consumer Complaint No. : 709/ 2019. [9] Baglekar Akash Kumar v. D-Mart Avenue Supermarts Ltd, 2021 SCC OnLine NCDRC 420.