Delhi
High Court on Thursday directed entities selling refurbished hard disk drives
(HDDs) to comply with specific disclosure requirements on their promotional
materials, including websites, e-commerce listings, brochures, and manuals..
The
High Court’s decision came in response to a series of lawsuits filed by Seagate
Technology LLC and Western Digital Technologies Inc against several companies
selling refurbished HDDs.
The defendants in the case included Daichi International,
Consistent Infosystems Pvt Ltd, Geonix International Pvt Ltd, and Cubicor
Information Systems Pvt Ltd. Seagate and Western Digital argued that HDDs
manufactured by them become unserviceable after a certain period but still
retain some functionality. These end-of-life HDDs are often refurbished and
sold to consumers by various entities, particularly after being imported into
India.
According
to the plaintiffs, these used HDDs are imported by various importers,
refurbished by removing the original brand marks, repackaged under different
brand names, and sold with an extended two-year warranty.
Seagate
and Western Digital contended that selling these HDDs as refurbished products
without their original branding amounted to impairment, which is not allowed
under Sections 30(3) and 30(4) of the Trade Marks Act, 1999.
However,
the High Court ruled that Seagate and Western Digital failed to demonstrate any
rule, regulation, or policy that prohibits the import of discarded HDDs or
equipment into India.
Presiding
over the case, Justice Anish Dayal emphasised that if the traders who refurbish
fully disclose any alterations or removal of original marks on HDDs and clarify
that the product differs from the original, consumers are sufficiently informed
about their purchase.