The Delhi High Court has directed Delhi-based fashion ecommerce portal Darveys.com to ensure the authenticity of each and every item being sold on the platform.
This verdict comes in after the platform was accused of trademark infringement by French luxury shoe brand Christian Louboutin, named after its founder. According to the shoe company, Darveys was reportedly selling “impaired or counterfeit” goods on its platform using Louboutin’s name.
The Delhi High Court bench, including Justice Pratibha M Singh, added that Darveys.com would have to disclose all the details of its sellers, including their contacts, on its site.
Darvey.com was founded by Nakul Bajaj in 2014. According to the official website, the startup has 300 partner boutiques and sellers who sell luxury fashion goods such as handbags, clothing, shoes, and accessories from over 70 brands on the portal. According to reports, the company records an annual revenue of $2.4 Mn.
In its plea, the French brand also claimed that Darveys was using the founder’s name and image as a meta-tag with an aim to attract consumer traffic on its portal.
The court directed that the ecommerce portal will also have to procure a certificate from its sellers which will prove that the goods being sold on the platform are genuine.
In case the seller is not based in India, the platform will have to inform the brand owner and obtain an agreement before selling the product. If the seller is based in India then the company will have to make an agreement with seller ensuring the authenticity of the products.
Counterfeits: The Bane of Indian Ecommerce
Though ecommerce portals have been clocking in huge sales especially during the festive season, many popular portals have come under fire for selling fake products on their platform.
As per a 2018 IBEF report, the Indian e-commerce market is expected to grow to $200 Bn by 2026.
However along with its rapid growth, ecommerce sites have seen a rise in fake products especially in luxury items such as high-end fragrances. A recent survey by LocalCircles revealed that nearly one out five ecommerce customers has received fake products.
According to the survey results, More than a third of the 27K participants said that fragrances and perfumes are most likely to be counterfeits, while another 35% believed cosmetics to be most the faked goods. Another 22% of the participants said sports products had a high chance of being fakes..
This is not the first time the Indian authorities have taken steps to ensure authenticity of products being sold online.
In October, the Drug Controller General of India (DCGI) had issued notices to various ecommerce platforms including Amazon, Flipkart, IndiaMART that strict action would be be taken against them if they were found selling adulterated cosmetics
Earlier in August, the Delhi High Court had directed Amazon Seller Services to delist some sellers on its platform after they were accused of selling counterfeits on the platform.