Business

Passing Off Claims

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Sometimes, it is not possible for a business to protect its brand via trade mark registration. Usually, this is as a result of a lack of distinctiveness in its trading name or brand and likelihood of association with the goods and services that it provides. It is therefore common that businesses trade via unregistered trade marks, signifying their apparent ownership over that mark with the "TM" symbol. However, this then raises the following question: a third party has been using my unregistered trade mark, what recourse is available to me?

In short, it may be the case that the third party has infringed your unregistered intellectual property rights under the laws of passing off. Unlike registered trade marks (which are primarily governed by the Trade Marks Act 1994), passing off claims have no statutory basis, and are instead based on the historical principle that "A man is not to sell his own goods under the pretence that they are the goods of another man" (Perry v Truefitt (1842) 5 Beav. 66). In more recent years, it has been widely accepted that in order for a passing off claim to succeed, the following must be established:

  1. A goodwill or reputation is attached to the goods/services provided by the innocent party;
  2. A misrepresentation has taken place by the guilty party, leading ordinary members of the public to believe that the goods/services provided by the innocent party are actually provided by the guilty party; and
  3. Damage to the innocent party, caused as a result of the mistaken belief.

Our intellectual property solicitors have extensive experience in bringing and defending passing off claims on behalf of clients, and in the majority of cases the likelihood of success depends on whether element 1 of the above test can be established.

Additional Information

Is there a goodwill or reputation attached to my business' goods/services?

 

Firstly, goodwill is often established when a business has a strong trading name and brand, that as a result brings in custom for its goods/services. Unlike registered trade marks, under passing off a business' goodwill protects that business as a whole, rather than the individual marks that is uses. Therefore, passing off is concerned with a misrepresentation of that business as a whole, rather than copying of individual goods (albeit, if a third party was to copy your products unique name or logo, this could be sufficient).

Questions as to whether the innocent party has a goodwill or reputation in its business are assessed on a case-by-case basis. However, where there is an alleged infringement of a potentially descriptive mark, it must be established that ordinary members of the public associate that trade mark with the innocent party and nobody else; this becomes more complex when regional goodwill is considered, and a party is seeking to rely on that regional goodwill against a party trading in a completely different region.

Our intellectual property solicitors can assist you when determining whether your business (or - if it is being alleged that you have passed off your business as being that of another - the opposing business) has sufficient goodwill in order to establish this element of a passing off claim.

Misrepresentation

 

Once the innocent party has established that it has a goodwill or reputation attached to its goods/services, it must then be established that the guilty party has misrepresented itself as being the provider of those goods/services, causing the public to believe that it is the provider of those goods/services. Importantly, it is not a requirement for this misrepresentation to be deliberate; and it is common for an otherwise innocent misrepresentation (i.e. one that has been made without any knowledge of the existing goodwill/reputation held in the trading name/brand by a third party) to satisfy this requirement, providing of course that the claimant can establish that the public are or may be confused as a result.

Damage

 

In order for a passing off claim to succeed, the claimant must establish that the defendant's misrepresentation has caused identifiable damage to the claimant's goodwill, or that such damage is reasonably foreseeable. Typically, this element of the claim is based upon a diversion of sales from the claimant's business to the defendant's business and the loss of profits that is caused to the claimant as a result. However, damage to the claimant's reputation and goodwill (as the provider of the goods/services) is also generally sufficient to establish this element of the claim.

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Our dedicated Intellectual Property team

Daniel Fletcher

Daniel Fletcher

Solicitor

Commercial

PinCentral Lancashire

Call0333 207 1145

John Pickervance

John Pickervance

Partner and Head of Commercial

Commercial

PinCentral Lancashire

Call0333 207 1134

Contact Us

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Call0800 689 0831

CallRequest a call back

EmailSend us an email

Contacting Us

Monday to Friday: 09:00 to 17:00
Saturday and Sunday: Closed