Passing Off
INTELLECTUAL PROPERTY PROTECTION HAVERING – PASSING OFF
Passing Off
Passing off is the act of misleading prospective customers into believing that their goods or services are their own when they in fact belong to another business under an unregistered trademark.
The law of passing off exists to protect the reputations of businesses and their consumers. Consumers who are led to believe they are purchasing goods from a particular organisation that they are loyal to or see as reliable may suffer. Naturally, the business will potentially suffer from bad publicity – serious instances of passing off may undo years of marketing efforts and brand building.
Passing off is a dynamic area of the law and claims will often involve discussion of registered trademarks and other intellectual property rights.
Remedies
Businesses who suffer loss as a result of passing off have a remedy in tort and will receive compensation should a case be found in their favour.
The liability is strict. Even if the business did not intend to pass off, it will still be liable.
To stop another business passing off your goods or services, you may also apply for an injunction.
Misrepresentation
To prove your services have been passed off, you will have to show that the defendant misrepresented the goods or services they were selling.
The misrepresentation must be made in public and have actually lead or have been likely to lead the public into believing that your goods, services or name were the defendant’s. In civil law cases (i.e. non-criminal cases), likeliness is a concept determined on the balance of probabilities. So rather than proving beyond all reasonable doubt that the misrepresentation mislead the public, it will have to be shown that there was a greater than 50% chance of this happening.
As stated previously, the intention of the defendant is irrelevant and the defendant will not able to argue that they made an unintentional or negligent misrepresentation.
Goodwill
Goodwill, which in simple terms can be described as the benefit and advantages of a company’s name or brand, is a type of common law property right. When a passing off claim is brought, it will have to be shown that this goodwill was been infringed by another business or businesses.
The definition of goodwill extends beyond the definition given here and has developed over the course of many years in the courts. The most famous and illuminating definition of goodwill was given in the case of IRC v Muller and Co’s Margarine:
“What is goodwill? It is a thing very easy to describe, very difficult to define. It is the benefit and advantage of the good name, reputation and connection of a business. It is the attractive force which brings in custom. It is the one thing which distinguishes an old-established business from a new business at its first start.”