CASE STUDY 2: Carlill Vs Carbolic smoke Ball Company

BY: M. NEHA REDDY

MBA 1ST YEAR
SECTION- B

1. What are the facts in the case of Carlill Vs Carbolic Smoke Ball Company?

Ans. The Carbolic Smoke Ball Company devised a new marketing strategy
that required them to claim that its Carbolic Smoke Ball was a sure-fire cure
for influenza, hay fever, coughs and colds, headaches, bronchitis, laryngitis,
whooping cough, and other sore throat-related ailments.

In reality, the corporation was highly confident in the utility of its product.
They further claimed that the carbolic smoke ball could heal influenza as well
as prevent users from contracting any sort of common flu. However, the
primary point of their commercial was that anyone who develops a cold or
influenza after using their product (carbolic smoke ball) will be eligible to
claim 100 pounds from the corporation if the product was used for a set period
of time.

The firm also reported that it had deposited 1000 pounds at a specific Alliance
Bank. The corporation placed this deposit in the event that any claims were
made in lieu of their advertisement. Carllil, the complainant, followed all of
the carbolic smoke ball's instructions. She still got the illness despite following
the protocol. As a result, she took legal action against the Carbolic Smoke Ball
Company. Her claim was for 100 pounds from the company because the
product was advertised as such. Her case was upheld by the court. The
defendants, on the other hand, filed an appeal.

2. What is the impact of the case on the present-day law?

Ans. This decision had an impact on English contract law. Particularly the concept of
a unilateral contract, as businesses and advertising agencies are now more cautious
about what they divulge to the general public. A rash marketing plan can result in
significant financial losses for a firm, as they may be drawn into an unnecessary legal
battle.

There are now various possibilities for unilateral contracts. For example, if a
person/pet goes missing and their family/owner puts up a poster with their image and
name on it, offering a reward for any pertinent information or even the safe return of
the missing person/pet, this can be considered a unilateral contract. It's a gift to the
entire globe. Once the person or pet has been located, it is assumed that the offer has
been accepted. As a result, the offeror is now obligated to fulfil his part of the bargain,
which is to compensate the person who discovered them.
Similarly, if the police provide prizes to the general public if anyone offers
information that aids the police in a criminal investigation, this is also considered a
unilateral contract. As a result, the award money is payable.

3. How important are advertisement in legal matters?

Ans. Advertisements have a longer lifespan than word-of-mouth marketing or

networking. Because an advertisement has the ability to reach a huge number of
people and to effect a large number of people, it is subject to numerous laws. When a
commercial is broadcast on television, it is afraid of being imitated, and the creative
inspiration efforts and abilities are wasted. As a result, it's a good idea to keep a
suitable strategy in place to protect your work using the legal methods accessible
within the IP system.

 Make sure your ad is registered and there are no other ads that are similar to it.
Any other copyright material, including your website, must be registered with the
national copyright office.

 It is necessary to ensure that an advertisement does not infringe on the privacy

rights of third parties; it is also necessary to ensure that an advertisement is not
reproduced or the idea is not copied when an advertisement is made.

 If you're creating an advertisement with an e-commerce system, computer

programme advertising technology, or any other technical tool, be sure you have
a formal licence agreement.

 Make sure you're not comparing your product or service to those of your
competitors when you're advertising it. Coca-cola and Pepsi, for example, are
frequently seen competing in taste tests.

 Make sure the commercial that is transmitted is not vague or fake, it should not
be dishonest, and it should not be unjust. When advertising a product or service,
make sure that every branding, statement, or phrase is accurate and true to your
belief, and that the promises they make are backed up by proof.

 When it comes to direct marketing, it's critical to ensure that the organization
follows all applicable federal and state rules. Check to see if you're in compliance
with privacy and spam laws before launching a direct marketing campaign.

 Ensure that the competitor's confidential information is not revealed, as trade

secrets are usually protected. It is widely recognized as being easily accessible to
the general population.

 All advertisements must adhere to the local laws of the area to which they are
directed. There are various local requirements that ads must adhere to; for
example, in India, some commercials are restricted, such as prohibited medical
services and prenatal gender discrimination, although this is not an entire list.