Delhi HC allows Britannia to sell NutriChoice Zero in blue packaging

Court overturns single judge order in favour of ITC's Sunfeast Farmlite

A division bench of the Delhi High Court on Friday overturned a single judge order restricting Britannia Industries Limited from using the colour blue in their packaging of NutriChoice Zero digestive biscuits. The September 6, 2016 single judge order had come on the backdrop of a passing off and copyright infringement suit filed by ITC, alleging that Britannia had copied its blue and yellow packaging from the wrapper of ITC's own digestive line Sunfeast Farmlite ALL GOOD biscuits.

The single judge had restrained Britannia from using its original choice of packaging, terming it as ‘deceptively similar’ to ITC’s own digestive variant after holding that the basic requirements of passing off had been satisfied sufficiently. The order had directed Britannia to phase out its NutriChoice Digestive Zero stock in the blue and yellow wrapper, within a period of four weeks from the date of the order and maintain accounts of all sales from the date of introduction of the packaging. 

Friday’s order by Justice Badar Durrez Ahmed and Ashutosh Kumar reversed this finding on an appeal made by Britannia, and took a stand that the single judge has erred in his conclusion. The bench held that a passing off action on a product required three components to be successful – goodwill and reputation of the original merchandise, possibility of deception and misrepresentation through the sale of the other item and the likelihood of damage to the aggrieved seller – none of which had been made out to the satisfaction of the appellate court.

“We do not think that in the short span of time and particularly when Britannia has alleged that the first invoice of ITC is of May 2016, the yellow-blue combination in the packaging of ITC’s biscuits had become so identified with ITC so as to enable ITC to prevent its use by competitors,” the bench said in its final verdict.

Britannia’s blue and yellow NutriChoice Zero packaging had been launched in the market in June 2016, only days after ITC started selling their own Sunfeast Farmlite Digestive line. “It is only when it is established, may be even prima facie, that the colour combination has become distinctive of a person’s product that an order may be made in his favour. We feel that the present is not such a case,” the judgment continued to say.

On September 22, 2016 the division bench had heard concluding arguments on the appeal from both sides, before reserving its final verdict. However, the court had refused to make any modifications to the single judge order at that time. Britannia's counsels had argued that as market leader’s in the biscuit category (with a 66 per cent share), the company did not need to copy the packaging of a new entrant. 

According to their advocates, yellow was a characteristic colour in their packaging and the blue represented their sugar-free variants. They also highlighted other differences between the two products, including the prominent presence of the NutriChoice logo in the Britannia product. 

"The judgment is erroneous. This injunction should be kept in abeyance, as it is affecting our business. Law aside, the fight is in the marketplace and it should be decided there," senior advocate Sudhir Chandra, appearing on behalf of Britannia had said in an attempt to convince the court to grant the desired relief at the time.

“The court has now said that ITC has no monopoly on the colour blue. As such the injunction order has been vacated. The facts of the case did not merit any passing off action,” remarked the jubilant Chandra after the pronouncement of Friday’s verdict.

According to an ITC spokesperson, the company will consider filing an appeal after reviewing the order passed by the high court. “We however, understand that Britannia has already withdrawn their label against which ITC filed the suit,” the company spokesperson added.

However, Britannia’s press statement said the company was pleased with Friday’s judgment. “The order is an endorsement of our conviction that the packaging architecture for NutriChoice has been built on a robust strategy, backed by strong portfolio packaging rationale and consumer logic,” the statement said.