Passing Off
Passing off is the law that allows trader A to prevent competitor B from passing his goods off as if they were A’s. The current test used for establishing passing off is the one derived from the case of Reckitt, the test involves establishing three parts:
- that the claimant has “goodwill”.
- a misrepresenting made by D that is deceives or is likely to deceive the public
- damage to the good will of C caused by that misrep.
1 – Goodwill is a form of intangible property that leads customers to return to the same business or buy the same brand because of the quality of the reputation of the goods or services provided by the trader. Goodwill can manifest in a name, symbol, logo, packaging, get-up, and advertising style. Descriptive words cannot usually manifest goodwill unless if it can showed that the word has become distinctive in fact or has taken a secondary meaning. (Reddaway v Banham - Camel hair + Belts / Mothercare v Penguin Books) The secondary meaning must be specific to the goods and services of the source, at times the new acquired meaning could be understood as a generic name for that type of product making it unprotectable. (Linoleum Manufacturing Co v Narin). Goodwill can also manifest in the packaging, get up and trade dress. (Reckitt & Colman). It is usually unlikely for someone to acquire good will if he just started, but in Stannad v Reay (Mr Chippy for mobile fish and chips van) , three weeks were sufficient, it can be instantly acquired by intensive advertising. The goodwill is usually related to customers in the UK, but a business that is run outside the UK can acquire goodwill if it is internationally known and has customers in the UK. (Sheraton Corp of America v Sheraton Motels)
2 – Misrepresentation does not have to be intentional, an innocent misrep is not a defence, but the state of mind would be relevant for remedies. The misrepresentation could be related to the identity of the goods, the quality, the origin of the goods, or even the way in which the yare made, regardless of the aspect, the misrep must be material in that it leads or is likely to lead to confusion on the part of consumers. (Morning Star v Express Newspapers [1979]) The customers are to be taken on their actual states and is not an argument that with careful inspection mislead would not take place (Reckitt & Colman v Borden). There is currently no rule that requires the misrep to be in the same field, but there must be some association with the two. In Stringfellow v McCain Foods the claimant could not stop D from using the name of the nightclub on their chips, but in the case of Annabels v Schock the nightclub and escort agency were held significantly associated to have a possible confusion. In the case of Lego Systems v Lego M Lemelstrich D was stopped because of the possible expansion of C’s business in to the field which it was currently not involved with.
3 – Damage to Goodwill could be related to loss of existing trade and profit, loss of potential trade and profit, loss of licensing revenues, damage to reputation, and even to the dilution of the goodwill (damage to brand or name).
