Delhi High Court Today (May 23rd) 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.
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NEW DELHI: The Delhi High Court issued a directive requiring 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. This decision arose from 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, especially 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 emphasized 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.
The Court laid down the following guidelines for the sale of refurbished hard drives
- Name of Original Manufacturer Must Be Stated: Packaging of refurbished HDDs must clearly state the name of the original manufacturer in a way that does not mislead customers into believing they are purchasing a new product.
- Packaging Must Include a Clear Statement That There Is No Warranty: The Court specified that packaging must include a clear statement indicating that there is no manufacturer’s warranty or service on the refurbished product. Instead, it should prominently display that any warranty or service is provided by the refurbishing entity. This statement must also include customer care details and contact information for the respective businesses that refurbish gadgets.
- Features Should Be Clearly Stated on the Package: Packaging must accurately and truthfully describe the features and purpose of the refurbished product. It should avoid any misleading, ambiguous, or deceptive statements that could misinform consumers about the product’s capabilities or intended use.
These guidelines aim to ensure transparency and protect consumers from being misled when purchasing refurbished HDDs. The High Court’s decision underscores the importance of clear and honest communication in the sale of refurbished electronics, thereby safeguarding consumer rights and maintaining market integrity.
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