In Mohanlal case, how Kerala HC outlined liability in endorsements, Pg17

Key Highlights:

• The Kerala High Court set aside proceedings against actor Mohanlal in a consumer case involving Manappuram Finance.
• The court stated a brand ambassador cannot be held liable for a company’s unfair trade practice unless directly linked to the consumer's transaction.
• The case involved borrowers who claimed they were charged a higher interest rate on gold loans than advertised, featuring Mohanlal as the brand ambassador.
• The court emphasized that merely appearing in advertisements does not establish direct involvement or persuasion in the transaction.

Detailed Insights:

• The Consumer Protection Act of 2019 defines "endorsement" broadly, covering depictions that consumers believe reflect the endorser's opinion.
• Section 21 of the Act allows penalties against manufacturers and endorsers for false or misleading advertisements, with a provision for due diligence.
• The court considered the 2022 guidelines on misleading advertisements, issued by the Central Consumer Protection Authority, but treated them within the scope of Section 21.
• The ruling clarified that an unfair trade practice arises when the service provider fails to provide the service as advertised, attributable to the company, not the endorser.
• The court found no direct link between Mohanlal and the borrower's transaction, as the assurance of lower interest rates came from the company's manager.

Key Concepts Involved:

• Endorsement: Depiction in advertising that leads consumers to believe it reflects the endorser's opinion or experience.
• Unfair Trade Practice: False representation about the price or quality of goods or services.
• Due Diligence: Reasonable steps taken by an endorser to verify the claims made in an advertisement.