Is ‘passing off’ the same as trade mark infringement?

While people may sometimes use the term ‘passing off a trade mark’ this is actually a potentially misleading expression.

The terms ‘passing off’ and ‘trade mark’ are two distinct legal concepts requiring different responses.

What are the similarities between passing off and trade mark infringement?

Both terms refer to the act of using another business’s intangible assets in a way that misleads consumers into believing they are buying goods or services from the original organisation.

This could include using a logo, slogan or website design without permission as examples.

Passing off and trade mark infringement can also both have adverse consequences in terms of:

Profitability

The type of intangible assets mentioned above can be the result of considerable investment by a business – and can play a major part in driving its profits. An organisation that makes unauthorised use of these assets can attract customers by misleading them over their true identity.

Reputation

In many cases, a firm that passes off or infringes a trade mark will supply goods or services that are inferior to those of the original company, whose reputation could be damaged as a result.

What is the difference between passing off and trade mark infringement?

The crucial difference is that trade mark infringement can only apply in respect of an item of intellectual property that has been registered with the Intellectual Property Office.

Once registered, such an asset then enjoys strong legal protection under the Trade Marks Act 1994.

This gives the owner of the trade mark the right to:

• Exclusive use of the trade mark in relation to all the goods and services for which it has been registered
• Use the® symbol to act as a deterrent to any infringement
• License the use of the trade mark to another company
• Take legal action against anyone who infringes the trade mark without permission

Passing off, by contrast, provides far less certain protection to an organisation’s intellectual property.

Unlike in the above instance, the concept of passing off is not underpinned by legislation but has developed under Common Law.

Proving that passing off has taken place can be much more onerous than establishing that trade mark infringement has occurred and – even if proved – the protection offered may be more limited in scope. To succeed in a claim of passing off it is necessary to have exclusive and extensive use of the trademark, usually over a number of years.

How do I prove that passing off has occurred?

It has been established by legal precedent that three conditions must be met before a case of passing off can be proved.

Goodwill

The business claiming to be the victim of passing off must be able to show that it possesses goodwill. The concept of goodwill is closely related to an organisation’s reputation and refers to the respect, trust and loyalty that enables it to attract trade. An owner of a local convenience store who has established their business over a number of years and opens longs hours, stocks a wide range of items and is known for being pleasant and friendly to their customers is likely to enjoy considerably more goodwill than a rival shop owner who is newer to the market and opens only when it suits them, has a restricted choice of products and is known for being surly and rude.

In any subsequent legal case, the first owner must be able to show that the goodwill they enjoy is encapsulated in intellectual property such as the business name, logo and slogan.

Misrepresentation

Another element that must be present for passing off to be proved is that of misrepresentation. Should the second shopkeeper in our example above adopt a name, logo or slogan similar to that of their rival, for example, some customers might be misled into thinking that the two stores were part of the same business. In this way the second store owner could then benefit from the reputation and goodwill generated by his more conscientious and personable rival.

It would be no defence for the second shopkeeper to claim that they were unaware that they had encroached on the other store’s goodwill. Passing of is a strict liability tort and so whether someone intended to commit such a transgression is not a consideration.

Damage

Finally, someone claiming to have been the victim of passing off must demonstrate that they have suffered damage to their goodwill. In the case of our shopkeepers, for example, the first owner would lend weight to their evidence if they could show that they had suffered a fall in sales due to the alleged passing off, or that they were erroneously accused of selling goods of inferior quality.

What are the advantages of registering a trade mark?

We have seen above how claims of passing off can be harder to prove than trade mark infringement with the onus on the alleged victim to prove they have suffered an injustice.

Passing off cases are also often a lot more expensive to prosecute than when you own a registered trademark.

In addition, whereas a company can pursue a claim of trade mark infringement against any other organisation within the law’s jurisdiction, passing off can be more limited in its geographic reach.

The first shopkeeper we saw above, for example, might be able to make a claim of passing off against his local rival but may find it harder to prove it against a convenience store further afield using a similar name.

How can Trademark Eagle help me tackle passing off or trade mark infringement?

Both passing off and trade mark infringement relate to complex areas of law and can have profound financial and reputation consequences. Trademark Eagle’s team of legal specialists will be delighted to use their experience and expertise to help you protect your valuable assets.

The formal legal process can be costly in terms of both time and money and so we can initially act on your behalf in seeking an agreement with the other party. Should legal proceedings prove necessary we can ensure that your case is presented as robustly as possible.

In the case of both passing off and trade mark infringement a favourable judgement could see the offender ordered to pay compensation and cease their encroachment on your rights.

Please get in touch for more information on how Trademark Eagle can help you.

Call: 01223 208 624

Email: enquiries@trademark-eagle.com

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