Law of passing off

Section 27: no person shall be entitled to

institute any proceeding to prevent, or to
recover damages for, the infringement of
an unregistered trademark.
Nothing in this act shall be deemed to
affect the rights of action against any
person for passing off goods or services
as the goods of another person.

Classic trinity
Establish a goodwill attached to the goods or
services in the mind of the purchasing public.
Demonstrate a misrepresentation by the
defendant to the public to believe that goods or
services offered by him are goods or services of
the plaintiff.
Demonstrate that he suffers or is likely to suffer
damage by reason of erroneous belief that the
source of the defendants goods or services is the
same as the source of those offered by the
plaintiff.

Modification in the test

Erven Warnink v. Townend (advocaat) [1979] AC

731

Facts: plaintiff manufactured and distributed an alcoholic

drink advocaat. It was made out of eggs and spirit.
Though it was manufactured in Netherlands but was sold
in England for 50 years. It had 75% of market share.
Defendants manufactured an alcoholic drink made of
different ingredients and called it old English advocaat/
keelings old English advocaat. it was cheaper in price.
Inexperienced persons could not make out difference
between the two.

 Court observed; advocaat understood as

distinct and recognizable species of
beverage.
It had gained reputation and goodwill.
Keeling caused and continued to cause
damage to warnink in trade and goodwill.


1.
2.
3.
4.
5.

Justice Diplock laid down a five point test

which is still followed
There should be misrepresentation
Made by a trader in the course of trade
To the prospective customers or his ultimate
consumers of goods/services supplied by him.
Which is calculated to injure the business/
goodwill of another trader
Which causes actual damage to a business or
goodwill or the trader by whom the action is
brought or will probably do so.


1.
2.
3.
4.
5.

Lord Fraser formulated it as;

That his business consists of, or includes, selling in England a
class of goods to which the particular trade name applies.
That the class of goods is clearly defined and that in the minds of
the public or a section of public in England , the trade name
distinguishes that class from other similar goods.
That because of the reputation of the goods, there is goodwill
attached to the name.
That the plaintiff as a member of the class of those who sell the
goods, is the owner of the goodwill in England which is of
substantial value.
He has suffered or likely to suffer damages.

Goodwill:
goodwill is the benefit or advantage of good
name, reputation and connection of a business.
It is also something which distinguishes old
established business from a new business.
Goodwill pulls or attracts customers towards the
business.
It has no independent existence apart from
business to which it is attached.
It is local in character.

Misrepresentation
Direct Misrepresentation
A says that these good I am selling are
Bs goods.
Any indirect misrepresentation can also
amount to passing off
Representations as similar to or better
than, substitute etc may not amount to
passing off.

 Direct deception/misrepresentation is rare.

Indirect misrepresentation is often done by
adopting similar get-up or similar marks.
Following factors to be considered in case of
indirect misrepresentation.

The nature of the marks

Degree of resemblance
The nature of goods
Class of purchasers
The mode of purchasing goods
Any other surrounding circumstances.

 A. G. Spalding Brothers v. A.W. Gamage Ltd.

(orb football case) 1915
It was held the proposition that no one has a
right to represent has a proposition that no
one who has in his hands the goods of another
of a particular class or quality has a right to
represent these goods to be goods of a different
quality or belonging or to a different class.

 A purchaser is not permitted to use any

mark, device or other means whereby
although he does not make a false
representation to a direct purchaser of his
goods, he enables such a purchaser to
make a false representation to ultimate
purchasers of the goods.

 Reddaway v. Benham (1869) A.C. 1990

Purely descriptive term camel hair belting
for machine belting
Court found that large section of public
recognized the name camel hair belting
as plaintiffs product. He could also
demonstrate that the public was in fact
getting misled.
Hence the action of passing of succeeded.

 Rekitt v. Coleman Products Ltd. v. Borden

inc. 1990
Reckitt sold lemon juice under the name jif
lemon in a peculiar container. It was copied.

Court applied the classical trinity test and held

that there was passing off.

First, he must establish a goodwill or reputation attached to the goods

or services which he supplies in the mind of the purchasing public
by association with the identifying "get-up" under which his
particular goods or services are offered to the public, such that the
get-up is recognised by the public as distinctive specifically of the
plaintiff's goods or services.
Second, he must demonstrate a misrepresentation by the defendant
to the public (whether or not intentional) leading or likely to lead the
public to believe that goods or services offered by him are the
goods or services of the plaintiff. ...
Third, he must demonstrate that he suffers or ... that he is likely to
suffer damage by reason of the erroneous belief engendered by
the defendant's misrepresentation that the source of the
defendant's goods or services is the same as the source of those
offered by the plaintiff.

Budweiser case
An heuser-Busch v. Budejovky Budvor Narodni Podnik 1984 FSR
413]
An heuser-manufactured BUDWEISER BEER
Def: selling boutique beer in England BUDWEISER BUDVAR
Claimants beer widely knownbut confined to stores in American
Airforce bases
Held: no goodwill in UK as sales not available to general public
MAXIM V. DYE case 1978 2 All ER 55
Graham J : globalization was making world grow smallerclaimants
existing goodwill in this country which is derived from and is based
on foreign businessmay be regarded as prospective but none the
less REAL in relation to any future business which may be later set
up by the plaintiff in this country

Regarding the similarity of goods the change in English law of passing

off is reflected in following three paragraphs Halsburys Laws of
England.
The presence or absence of common field of activity in which the
claimant and defendant are engaged is a factor to be taken into
account in case of passing off.
Where the defendant's activities, although not in an area of business
which the claimant is engaged in, are in an area of business which
might be assumed to be the natural extension of the claimants
business, likelihood of deception would be readily inferred.
However even where the fields of activity in which the claimant and
defendant are engaged are remote from each other, it is possible for
deception to occur if the name or mark used is highly distinctive or if
it is a well known mark or mark with reputation.

 Irvine v. Talksport ltd.

This is a case where the picture of a famous F1
driver was used to advertise the launch of sports
radio channel.
The famous sportsperson initiated the action of
passing off.
There appears to be no good reason why the
law of passing off in its modern form should not
apply to false endorsement cases.

 Following two points to be proved for an action

to succeed:
That at the time of the acts complained of he
had a significant reputation or goodwill
That the actions of the defendant give rise to a
false message which would be understood by a
not insignificant section of his market that his
goods have been endorsed, recommended or
approved by the claimant.

 Irvine had huge reputation

Misrepresentation was proved on the basis of
his friends testimony who was misled into
believing that Irvine signed endorsement
contract with talk sport and hence had
congratulated Irvine.
A distinction was drawn between the
merchandising and endorsements. It was said
that passing of can arise only in cases of
endorsements.

Indian case law

In India also there is a shift from orthodox
position which required the same field of
activity and also presence of business in
the area to a position which considers
these as important factors but not the
decisive factors.
The following cases reflect the position.

 Rustom Ali Molla and others v. Bata shoe

Company AIR 1957 cal 120
In our view, the mark Bata not having been
associated in the public mind with lungis or
handkerchiefs, these goods being totally
different character from those of respondents
goods,, this action cannot amount to passing off.
Court held that the acquisition of an exclusive
right to mark or name in connection with a
particular trade cannot entitle him to stop others
from using the mark on completely different
goods.

 Cadila Health Care Ltd. V. Cadila Pharma Ltd. (2001)

5 SCC 73
Plaintiffs drug: Falcigo for the treatment of cerebral
malaria commonly known as falcipharum
Defendants drug: falcitab
Court observed:
While dealing with cases relating to passing off, one of
the important tests which has to be applied in each case
is whether misrepresentation made by the defendant is
such as to confuse the consumer.
The test is to be strictly applied when we talk about
medicinal products.

 While confusion in non medicinal products

may cause only economic loss, in case of
medicinal products there may be
disastrous consequences.
Court enumerated the factors to be
considered while talking about deceptive
similarity:
The nature of marks
The degree of resemblance

 The nature of goods in respect of which

they are used
The class of purchasers
The mode of purchasing
Court also observed that the importance of
each one may vary according to the
circumstances.

 N.R. Dongre v. Whirlpool Corp. (1996)

The issue was whether the reputation of
Trademark Whirlpool in respect of
washing machines of the respondents has
traveled trans border to India?
The knowledge and awareness of a
Trademark in respect of Goods of a trader
is not necessarily restricted to the people
of country where goods are sold.

 The knowledge and awareness can reach

even the shores of those countries where
the good have not been marketed.
When the product is launched and hits the
market in one country, the cognizance of
the same is also taken by the people in
other countries through adds in
magazines, television, video films etc.

 Hence in the present day world it cannot be said

that the goods sold in another country have no
goodwill. Reputation in country where they are
not available.
Can an action of passing off be sustained
against the owner of registered trademark?
Under section 27 (2) an action for passing off
against a registered user of TM is maintainable
at the instance of a prior user of the same,
similar, identical mark.

 As laid down by SC in cadila health care, the

similarity in nature, character and performance
of the goods would be one of the factors in
adjudication a passing off action.
In courts view it was one of the important
factors, but just because the goods were
different, this very factor should not
automatically result in failure of an action
founded on the tort of passing off.