TRADEMARK, PASSSING OFF AND REVERSE PASSING OFF:

A CRITICAL ANALYSIS

INTRODUCTION

Intellectual property is centripetal in modern times, in modern businesses. It is a

synonyms of all the human intellects, copyright, trademark, design, Geographical
indication, patent, industrial design etc and not vis-a-vis.

The Trademark Act of 1999, enshrines both in letter and spirit, lays down that, while
it encourages fair trade in every way and aims to foster and not to hamper
competition, it also provides that no one, especially a trader, is justified in damaging
or jeopardizing another’s business by fraud, deceit, trickery or unfair methods of any
sort. This necessary precludes the trading by one dealer upon the good name and
reputation built up by another.

India enacted the Trademarks Act 1999 and the Trademarks Rules 2002 1 to ensure
adequate protection for domestic and international brand owners, in compliance with
the TRIPs Agreement. The act states that a trademark includes the shape of goods,
their packaging and colour combinations. Further, the Trademarks Act gives
protection to well-known trademarks and provides for the registration of convention
applications, for which the priority deadline is six months. The term of a trademark
has been increased to 10 years, renewable upon expiration.

The reputation of a business symbolized by a mark, under common law, can be

protected only by an action for Passing off. Registration of a trademark under the
Trade Marks Act of 1999 gives statutory rights and slight infringement of it can invite
an action for Infringement. However, even the unregistered trademarks are also
protected as the Act itself provides that an action of passing off remedy is available
for unregistered trademark.

1
It came into effect from September 15, 2003.
A BRIEF INTRODUCTION TO THE DRESS UP CONCEPT:
PASSING OFF

The law of passing off origins from common law of the United Kingdom (the UK).
Passing off action can be regarded as the oldest action for the protection of goodwill.
The basic principle of the law of passing off was better expressed by in Reddaway v.
Banham2

“For my self, I believe the principle of law may be very plainly stated, and that is
that nobody has any right to represent his goods as the goods of somebody else.
How far the use of particular words, signs, or pictures does or does not come up
to the proposition which I have enunciated in each particular case, must always
be a question of evidence, and the more simple the phraseology, the more like it
is to a mere description of the article sold, the greater becomes the difficulty of
proof, but if the proof establishes the fact the legal consequence appears to
follow.”

In other words, it is a tort that the goods of the defendant are falsely represented as the
goods of the plaintiff, usually, by using the plaintiff’s indications as means of
misrepresentation.The law of passing off prevents one person from misrepresenting
his goods or services as that of another. Passing off action is based on common law
principle. The damages claimed for in an action for passing off is “un-liquidated
damages”. The action against passing off is based on the principle that “a man may
not sell his own goods under the pretence that they are the goods of another man.3

In another case, ICC Development (International) Ltd.v. Arvee Enterprises4 that “the
passing off action depends upon the simple principle that nobody has any right to
represent his goods as the goods of somebody else”. In a passing off action, the
priority in adoption and use of trade mark is superior. Passing off is not defined in the
Trademark Act, 1999. It is referred to in Section 27 (2), 134 (1)(c) and 135 of the Act.

2
(1896) 13 R.P.C. 218 at 224 (HL)
3
N. R. Dongre v. Whirlpool Corporation, (1996) 5 SCC 714
4
ELEMENTS OF PASSING OFF
To come under the preview of passing off, there are three elements, often referred to
as the Classic Trinity, in the tort which must be fulfilled5:
1. Goodwill owned by a trader
2. Misrepresentation
3. Damage to goodwill
Plaintiffs have the burden of proving goodwill in its goods or services, get-up of
goods, brand, mark and/or itself per se. The Plaintiff also has the burden of proof to
show false representation (intentional or otherwise) to the public to have them believe
that goods or services of Defendant are that of the Plaintiff, thus, there must be some
connection between Plaintiff‟s and Defendant‟s goods or services or trade. 6 They
must show likelihood and or actual deception or confusion in the public. Deception or
confusion, however, does not consider a „moron in a hurry”.7
1. Goodwill:-
The Plaintiff has to establish a goodwill or reputation attached to the goods and
services which he supplies, in the mind of the purchasing public by association with
the identifying get-up under which his particular goods and services are offered to the
public as distinctive specifically of his goods or services.
As Lord Macnaghten has stated:
“Goodwill is the benefit and advantage of a 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 the new
established business at its first start. The goodwill of a business must emanate
from a particular center or source. However, widely extended or diffused its
influence may be, goodwill is nothing unless it has power of attraction sufficient
to bring customers home to the source from which it emanates.”8

The action of passing off lies where there is a real possibility of damage of goodwill
to some business or trading activity. Therefore, the plaintiff has to establish a
5
7 Lord Oliver reduced the guidlines laid out by Lord Fraser in Erwen Warnick B. V vs. J Townend &
Sons (Hull) Ltd [1979] AC 731, 742 (HL) [Advocaat] to the three items in Reckitt and Colman
Products [1990])
6
See Morning Star Cooperative Society v Express Newspapers Limited [1979] and Newsweek Inc. v.
BritiSH Broadcasting Corp., [1979] R.P.C. 441 by Lord Denning.
7
Id.
8
Commissioners of Inland Revenue vs. Muller & Co.’s Margarine Ltd. (1901) A.C. 217
goodwill in his business or his goods or services with which the trade or public will be
led to associate the defendant’s activities.

It is the Court's duty to decide similarity of the marks the criterion of which often fall
under three elements:-
1. Oral & Visual
2. Conceptual similarity (often applied in trademarks infringement cases).
In relation to the element of damage to goodwill, there may be loss or diversion of
trade or dilution of goodwill. The Plaintiff need not prove actual or special damage;
real and tangible probability of damage is sufficient. This damage should however be
reasonably foreseeable. It is insufficient to simply show likelihood/actual deception
and/or confusion.9

Given the limits of the alternative areas of the civil law, the industry has turned to the
tort of passing off- with its uncertain limits - to protect itself against interlopers who
reap the benefit of their endeavours.10 The modern starting point for a consideration of
the tort is the definition provided by Lord Diplock in Warnink (Erven) B Vv Townend
and Sons Ltd, the 'Advocaat' decision."11
For Lord Diplock, five characteristics provided the essence of the tort: a
misrepresentation; made by a trader in the course of trade; to prospective customers;
calculated to injure the business or goodwill of another; and which does so injure or
probably will do so. Without these characteristics there can be no action for passing
off, but they will not always add up to the tort. Lord Diplock accepted that there may
be factual situations that contain the five characteristics but do not give rise to the
tort."12
Cargill India (P) Ltd. v. M.M. Oil Enterprises13
In March 2017, Cargill India Private Limited (plaintiff) filed a suit along with a notice
of motion against the defendant who was infringing the plaintiff's copyright subsisting
in the label mark/trade dress “GEMINI—Refined Sunflower Oil”. The plaintiff also

9
Id.
10
See Tolley vFUy [1930]
11
[1979] AC 731, HL. The classic analysis of the tort involved a consideration of
whether there had been a relevant misrepresentation, whether it had or was likely to cause
confusion, given the plaintiff's reputation and whether damage was likely.
12
Id.
13
Notice of Motion No. 1107 of 2019, decided on 18-4-2019 (Bom).
alleged that the defendant had committed an act of “passing off” by adopting a
deceptively similar impugned mark/packaging material “GENUINE—Refined
Sunflower Oil” as against the plaintiff's label mark/trade dress “GEMINI—Refined
Sunflower Oil”.

14

The court found the defendant guilty inter alia of the Trade dressing/ passing off. The
above case is a latest pronouncement on the subject. It also signifies, how prominent
intellectual property rights’ infringement is in the commercial industry in India

SAIL v. SKS Ispat and Power Ltd.

REVERSE PASSING OFF

In 1918 in the classic International News Service v. The Associated Press case 15, the
Supreme Court of the United States expanded the unfair competition concept to
include situations where one misappropriates what equitably belongs to another.
Instead of misrepresenting by selling his goods as coming from the plaintiff, the
defendant tells the world that he is the creator of what he has appropriated from the
plaintiff. This has been called inverse passing off.

In Gloag & Son Ltd. v. Welsh Distilleries16

14
The pictorial demonstration is taken from Cargill India (P) Ltd. v. M.M. Oil Enterprises
15
, 248 U.S. 215
16
(1998) FSR 718.
FACTS
The complaint of the plaintiff was that defendants who were manufacturing Welsh
whisky were using Scotch Whisky as one of the ingredients and, therefore, activities
of the defendants would dilute the reputation and goodwill attached to scotch whisky
because by selling scotch whisky as Welsh whisky, the defendants would be
achieving a reputation for "Welsh whisky which truly belongs to Scotch whisky so
that in the end the reputation which belong exclusively to the latter would be shared
by welsh whisky as well. The defendants moved an application for striking of the
statement of claim as disclosing no cause of action. The application of the defendant
was dismissed.

DECISION

Speaking on the concept of The borderline between reverse passing off and cases
falling outside the tort was difficult to define and the plaintiffs claim was not bound to
fail. They had a particular interest in the exclusive reputation of the words "Scotch
whisky" which interest clearly extended to preventing those words from being used
on a beverage which was not Scotch whisky but which could well extend further to
prevent authentic scotch whisky from being used for the purpose of building up or
reinforcing a misleading reputation in a misleading geographical denomination."

Sheila Mahendra Thakkar v. Mahesh Naranji Thakkar17.

The Court in this case observed that "the reverse passing off or inverse passing off is
not a nominate tort in its own right but a further example of actionable
misrepresentation to which normal principles of passing off apply."18

It is seen from the decided cases that reverse passing off or inverse passing off is not a

nominate tort in its own right but a further example of actionable misrepresentation to
which normal principles of passing off apply.

CONCLUSION

17
2003 (27) PTC 501 (Para 12 ).
18
Id.
From the study of the concept of passing off action is applied in unregistered goods
and services, and in infringement of suit and passing off in both the cases the remedy
will be same. Then the passing off is arise in three cases first when it is injured the
claimants good will, secondly in misrepresentation and thirdly in damages, where the
position is same like in infringement suit. And lastly when the concept of passing off
is reading with domain name and technological changes then the concept of passing
off is in different dimension.