A Case Study by Deepansh Guwalani

CASE STUDY: LATEST TRENDS IN PASSING OFF

I. MEANING OF PASSING OFF

Passing off is a form of tort. The object of this law, which is based on common law, is to
protect the goodwill and reputation of a business from encroachment by dishonest
competitors.1 An unregistered trademark, which has been used, can be protected only by an
action for passing off or by criminal proceeding.2

‘No man is entitled to represent his goods as being the goods of another man, and no man is
permitted to use any mark, sign or symbol, device or other means, whereby, without making a
direct false representation himself to a purchaser who purchases from him, he enables such
purchaser to tell a lie or to make a false representation to somebody else who is the ultimate
customer.’3 To put it shortly, it is an actionable wrong for any person to pass off his goods or
business as and for the goods or business of another person by whatever means that result
may be achieved.

II. FACTS OF ERVEN WARNINK V. TOWNEND & SONS LTD.

Also known as the Advocaat case, this case is a leading decision of the House of Lords that
further developed common law tort of extended passing off for the commonwealth as
originally established in Bollinger v. Costa Brava. Prior to this case, "collective goodwill", as
required for an action in passing off, only applied to names indicating geographic origin. The
Court held that wares whose name falsely suggests its character or quality can be prevented
from selling the product under that name.

The facts are as follows- Warnink was one of the primary market producers of a Dutch
liqueur made from a blend of hen egg yolks, aromatic spirits, sugar, and brandy, which it sold
under the name "Advocaat". Townend produced a similar alcoholic drink but using egg and
Cyprus wine which it sold as "Keeling's Old English Advocaat".

The Court held that Townend was passing off their goods as those of Warnink. In applying
the test for passing off, the Court developed what is known as the "extended" tort of passing

1 P. Narayanan, Intellectual Property Law, 230 (3rd ed., Eastern Law House 2015)
2 s. 27, s.103 and s. 104; The Trade Marks Act, 1999.
3 Singer v. Loog (1881) 18 Ch D 395 at 412.
 A Case Study by Deepansh Guwalani

off which included any situation where goodwill is likely to be injured by a

misrepresentation.

III. ANALYSING LORD DIPLOCK’S DICTUM

Lord Diplock established five criteria for a claim of extended passing off. There must be:

(1) misrepresentation,
(2) made by a person in the course of trade,
(3) to prospective customers of his or ultimate customers of goods or services supplied by
him,
(4) which is calculated to injure the business or goodwill of another trader (in the sense
that this is a reasonably foreseeable consequence), and
(5) which causes actual damage to a business or goodwill of the trader by whom the
action is brought or (in a quia timet action) will probably do so.4

It was decided that the concept of ‘distinctiveness’ should be applied sufficiently liberally to
allow for the deceptive use of a designation to be prevented by means of an action for passing
off not only: (i) where the designation serves to individualise particular products to a single
economic undertaking; but also: (ii) where, as in that case, it serves to individualise particular
products to a definable and defined class of independent economic undertakings.5

The reasoning in Advocaat widens the range of designations in relation to which there can be
locus standi to sue for protection against deceptive use in an action for passing off. Examples
of designations which have been protected in cases decided upon the basis of that reasoning
are: CHAMPAGNE; SHERRY; ADVOCAAT; SCOTCH WHISKY; WHISKY; SWISS
CHOCOLATE; VODKA and GREEK YOGHURT.

IV. CONTROVERSIAL ISSUES AND LATEST TRENDS

1) PASSING OFF APPLIED TO NON-TRADING ACTIVITIES

The principle of passing off has been extended to non-trading businesses as well. For
example, professional associations, business of looking after children, beauty contests etc.6

4 Erven Warnink B.V. v. J. Townend & Sons (Hull) Ltd., [1979] AC 731.
5 Geoffrey Hobbs QC, “Relying on extended passing off”, 01/05/2016, < https://euipo.europa.eu/tunnel-
web/secure/webdav/guest/document_library/contentPdfs/law_and_practice/mediation/IP_CL_Conference_05-
05-2016/Geoffrey_Hobbs_en.pdf> (accessed on: 14/08/2016)

6 P. Narayanan, Intellectual Property Law, 214 (3rd ed., Eastern Law House 2015)
 A Case Study by Deepansh Guwalani

2) SHARED GOODWILL

The plaintiff in a passing off action need not be the exclusive owner of the goodwill. There
can be a multiplicity of plaintiffs or possible plaintiffs in a passing off action all suing or
capable of suing in respect of one and the same alleged misrepresentation.7

3) SECOND HAND ARTICLES AND ADULTERATED GOODS

Sale of second hand articles as genuine articles of the plaintiff and sale of adulterated goods
of the plaintiff as that of the plaintiff will constitute passing off.8

4) GOOD OR BUSINESS DIFFERENT- COMMON FIELD OF ACTIVITY

In a passing off action there is no requirement that the defendant should be carrying on a
business which competes with that of the plaintiff or which would compete with any natural
extension of the plaintiff’s business. Authorities on these are- Eastman Photographic
Materials v. John Griffiths Cycle Corporation (1898) 15 RPC 105 (cameras and bicycles),
Lego Systems v. ego [1983] FSR 155 (plastic toy construction kits and plastic irrigation
equipment), Walter v. Ashton (1902) 2 Ch 282 (The Times Newspaper and Bicycles).

5) IMITATION OF GET-UP

The get-up of goods comprises the shape of the package or container, labels and wrappers,
the style of writing etc. If the appearance of the goods has become distinctive as in the case of
washing blue sold in a wrapper or bag of cotton with a stick protruding, injunction may be
granted.9

7 Bulmer v. Bollinger [1978] RPC at 96, 97.

8 P. Narayanan, Intellectual Property Law, 219 (3rd ed., Eastern Law House 2015)
9 Edge v. Niccols (1911) AC 693