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Club Factory

Club Factory assures court it will stop misleading advertising

Club Factory

A legal tussle between Snapdeal and Club Factory over misleading advertising seems to have been resolved at the moment as the Vincent Lu-led firm has informed the Delhi High Court that it will stop using any combination of the line it was earlier barred from advertising. 

Snapdeal had got an injunction against Club Factory in March that restrained the latter from advertising the line “everything cheaper than Snapdeal”. 

However, in a fresh petition, Snapdeal said that the injunction order was violated by Club Factory by “ingeniously, turning the problematic by-line around and instead employing the expression “everything lower price than Snapdeal”.

Responding in court on June 9, Club Factory said that it had discontinued such advertising after 04.06.2020 and the firm would henceforth not use such or similar meaning expressions “which involves play of words”.

This is not the first time Club Factory has been dragged to court. In February this year, a court in Gurugram had refrained the company from sharing, divulging and using Snapdeal’s trade secrets, financial data and confidential information that it had gained access to by hiring an ex-employee of the Kunal Bahl-led firm.

A recent TechCircle report had also mentioned a complaint made to the Enforcement Directorate against Club Factory for apparent violations of Indian laws relating to FDI in multi-brand retail.

Club Factory has continued to face the ire of the consumers and government authorities for facilitating the sale of fake products, for apparent under-invoicing of imports and for flouting the price controls mandated by the Indian government during the current pandemic. 

Its inability to pay the sellers and logistics partners due to a sharp downturn in business is the latest in a string of controversies swirling around the company. 

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