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Passing Off Notes

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Passing Off IP LLM Notes Notes

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Table of Contents

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LLM IP Lecture Notes

Introduction to Passing Off Outline of the Course There are two questions to address:

1. Where does passing off come from?

2. Does it amount to a tort of unfair competition?
Then we will go on to the application of the tort to commercial practice. Read Cases, Particularly the Essential, Starred Ones

Introduction What is Passing Off?
The short answer is that it's a body of law that has as its core the idea that Trader A is not to sell goods under the pretence that they are the goods of Trader B. As we've mentioned, it's all judgemade law, compared to the law of registered trademarks, which is governed by statute. Developed from the common law action for deceit, but is now significantly different from the law of deceit in that no intention to cause loss is required, and the misrepresentation can be completely innocent.

History of Passing Off Passing Off has developed incrementally through time - the oldest case we have is JG v Samford, but we don't know much about it before then. Some say that its origin is lost in obscurity, and we have no record of it. We actually don't even know about JG v Samford, all we have is Southern v How, which reports it. The case is about someone impersonating a well-known clothier, but we don't know if it was brought by the customer, or the by the merchant (only the latter would truly be passing off). It has its root in the tort of deceit, but the action is brought by the person whose mark was used to deceive, and not by the person who was deceived. The development can be characterised as being piecemeal, and the rationalisation follows later, rather than by driving decisions forward. Thus, reading the cases can be very difficult, and explains why the decisions that we have now are based in the 19th Century, but their decisions don't have a theoretical basis. The remedies for passing off were brought from the Courts of Chancery. This was controversial, but raised some important questions - it didn't need proof of fraud, so was more likely to be successful, hence why Chancery, and not Common Law.

Modern Basis - Spalding v Gamage The tort is about misrepresentation, not fraud, and the right protected is in a property right in the goodwill that the mark represents. This is the attractive force that brings in custom, the benefit of the name, not the mark itself. The mark is a badge of goodwill, and that is how we treat them, they are representations of goodwill.

Elements of the Action Warnink v Townend The Claimants were members of a class of traders that produced a Dutch liqueur called Advocat. The defendants marketed a similar drink marketed under the name of Keeling's Old English Advocate. Diplock gives five elements to the tort: 1) Misrepresentation, 2) By a Trader, 3) To Customers, 4) Calculated to injure goodwill, 5) Which Causes Damage

4 Don't apply them mechanically - we need to look at competition. Maybe it is a tort of unfair competition, and we will look at this later. Also in the Warnink v Townend case is Lord Fraser, but his criteria are much more fact-specific, so Diplock is better for quoting in exams. Reckitt & Colman v Borden Jif Lemon case - Cs sold lemon juice in plastic lemon containers bearing the mark 'Jif'. After 30 years, D also sold lemon juice in plastic lemons, without the Jif mark. Lord Oliver gives three elements to the tort: 1) Goodwill / Reputation, 2) Misrepresentation that is likely to deceive, 3) Damage to the claimant's goodwill. The fact that the container was descriptive didn't matter. Two leading cases - both authoritative, but they are consistent, so this is okay. Important that we show knowledge in both of them.

What is the relationship Competition?

between

Passing

Off

and

Unfair

International definition - the Paris Convention, to which all WTO countries are signatories, provides for international protection for industrial property, and one of the ways it does this is through preventing unfair competition. Article 10bis(2), Paris Convention The national law of many countries, e.g. France, Germany, has provisions against unfair competition. This includes a broad prohibition on unfair acts. The USA has also adopted a broad approach through misappropriation, stemming from a ruling in the Supreme Court - IMF v [1900s]. We don't have this system in the UK, instead, we have a number of different economic torts, which lack a unifying principle. There is no general law of unfair competition, so at best, we can argue that Passing Off is a species of unfair competition, as it regulates trading practices that involve a misrepresentation, which "lies at the heart of passing off".

Relationship to Injurious / Malicious Falsehood Elements of the falsehood action stem from Glidewell LJ in Kaye v Robertson:

1. Misrepresentation

2. Damage

3. Malice This final requirement, of malice, means that injurious falsehood is much less important than passing off, as you have to prove a state of mind on the part of the defendant. In passing off, this is not the case. Further, it must be shown that they were calculated to cause damage - and have knowledge / be reckless as to whether the words are false or not. The policy of the courts is to ensure that free competition is not stifled. Hodgkinson v Wards Mobility Producer of cushions wanted to claim a monopoly over a particular kind of cushions There is no tort of copying - there needs to be misrepresentation for it to be passing off. Cadbury-Schweppes v Pub Squash A soda drink was marketed in a similar way by two marketing campaigns. Was this passing off?
Held not to be passing off - competition must remain free, and is safeguarded by the requirement that there is a property right in the goodwill.

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