Classical Trinity of Passing Off

In the market place we often come across products which are pretty much identical to other products we already use in our daily life. So, there are times when customers get confused by looking at similar products in case, they exist in market places. The likelihood of confusion in the minds of prudent customers regarding the origin of product or the services would be enough to establish an infringement of the trademark.

The questions that struck the minds of prudent customers on coming across identically similar products can be:
– Whether every product or services we come across is a registered trademark or not? 
– What are the remedies available in case a person dishonestly uses an unregistered trademark of another person?
– Can unregistered trademark get protection in India?
– Are there any remedies available to owner of unregistered trademark?

To answer the above questions, the first and foremost thing that needs to be kept in mind is that The Indian Trademarks Act, 1999 do not provide any statutory remedy to the owner of an unregistered mark. Section 27 of The Trade Marks Act, recognizes the unregistered mark and states a passing off action may be taken up if one person falsely represents his/her goods and services as those of another person. Though it is not compulsory to get the mark registered, registration of the mark protects the mark from possible chance of infringement. In everyday life, we come across variety of products and services, some of them might be very popular among purchasers but the same might not be necessarily a registered trademark.

What is passing off?

Passing off is a common law tort that is used for enforcing unregistered trademark rights. The passing off protects the interest of those owners whose trademark is not registered. For example,

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If any party is using the registered trademark of another company without their due consent, it clearly means that the party is committing a crime, as well as causing enormous loss to the business and brand name of the company.

Trinity of passing off:

In the case of Reckitt and Colman products Ltd Vs Borden INC, the House of Lords held that the three elements that need to be taken into consideration while instituting a suit of a classical trinity of passing off are: Goodwill and reputation; consumer confusion; losses suffered.
– Goodwill: Goodwill do not have a particular definition, but it has a nexus with the reputation of the goods/services related to the product. The action of passing off can be initiated when there is an actual damage caused to the goodwill of the company. The conditions of goodwill vary from case to case however, the goodwill of a company can be set up by showing evidences of marketing projections, money spent on publication of items of the company, press inclusion, grants, websites or online media references. The activity of passing off would lie where a genuine chance of harm to reputation in a business happens. Henceforth the plaintiff needs to establish goodwill in his produces directly linked with defendant’s trading activity.
– Misrepresentation: Misrepresentation is an essential element of passing off. For initiating a suit for passing off the plaintiff must prove that the defendant is trading identical goods/services in the pretext of the plaintiff thereby causing consumer confusion.
– Damages: Last but not least damage caused to the plaintiff because of the misrepresentation by the defendant must be established by the plaintiff. The offended party must prove, that he endured harm by way of damages, caused as a result of the defendant’s trading activities.

Difference between infringement and passing off:

• A suit for infringement can be filed when trademark is registered and passing off suit when the mark is unregistered as well in registered mark.
• In case of infringement the defendant cannot escape the liability, whereas on the other hand in the case of passing off defendant may escape from his liability if the goods are adequately distinguished from that of the plaintiff.
• The scope of passing off is broader than infringement as passing off action is based on the common principle that no one can portray his/her products as that of another person.

Case laws:

• Singer Manufacturing Co. vs. Loog: The term ‘passing off’ is explained in this case where it was stated that no one is permitted to render his/her goods and services under pretence of another person. No one is even allowed to use any mark, symbol, logo which will ultimately double-cross the end consumer.

• HONDA Motors Co. Ltd Vs Charanjit Singh & Ors: The mark HONDA was used by the plaintiff in the automobile business, and the defendant started using the same mark for selling of pressure cookers. A suit for passing off was initiated by the plaintiff against the defendant for misrepresenting his mark, and causing damage to the goodwill of his business in the market at large. This suit was allowed by the court as the use of identical mark was clearly creating confusion in the minds of people.

• Monetary Overseas v. Montari Industries Ltd: When a defendant does trade under a name that is adequately similar to the name under which the plaintiff is dealing, and that name has acquired a status and the community at large is likely to be deceived that the defendant’s company is the company of the plaintiff, or is a division or department of the petitioner, the respondent is liable for an action of passing off.

• Harrods v. Harrodian School: An action for the violation, which is a legislative right, is dependent on the validity of the registration of the mark. It is an illegal incursion of a property right vested in the plaintiff. A passing-off action is always recognized by proof of status and goodwill of the business.  

• Satyam Inf. Ltd v. Siffynet Solutions(P) Ltd: The plaintiff doesn’t have to prove that he is a prior user to establish a reputation in a passing off action. It would depend upon the volume of sales and the extent of the advertisement of the company.

• N. R Dongaree v. Whirlpool Corporation:  A man may not sell his goods under the pretence that they are goods of another man.
  
• Sri Shadi lal Enterprises v. Kesar Enterprises Ltd: The purpose of passing off action is to protect commercial goodwill of the company and to ensure that the purchasers are not exploited, and fraudulent trading is prevented. For that, the plaintiff must establish that his business and goods/services have acquired the required reputation. Where the defendants’ goods/services are marked with the trademark of plaintiff or made-up or described as such that it misleads the ordinary purchaser, this tendency to mislead or confuse the consumers leads to an action of passing off. There is no need to establish fraud or actual deception, or actual damages in such cases.

Remedies under Passing Off Action:

The remedies available for passing off action for trademark has been mentioned in Section 135 of the Trademarks Act, 1999.

The remedies usually pronounced by Courts include:
– Permanent or interim injunction.
– Damages or an account of profits.
– Delivery of the infringing goods for destruction or cost of the legal proceedings.
– Appointment of a local commissioner for search and seizure of infringing goods.

Conclusion: 

Passing off can be regarded as a truly adaptable right which can be utilized to secure goodwill and reputation in a wide scope of circumstances. The unique adaptability feature makes it unimaginably appealing to applicants.