When another business trades on your name, get-up, or another distinctive feature, it can confuse customers and chip away at your business goodwill. Passing off is a legal principle that stops lookalike branding and other misrepresentations that make people think someone else’s goods or services are connected with your business.
This quick guide is for founders, brand and marketing leads, and in‑house counsel. We explain what passing off is, how it differs from trade mark infringement, the common warning signs, and your practical options, without the jargon.
If you are worried a competitor is presenting their goods or services as yours or you have received an allegation of passing off, our trade mark solicitors can step in quickly to assess the risk, preserve evidence, and devise a proportionate strategy to protect your goodwill or defend your position quickly and cost-effectively.
Contents:
- What is passing off?
- Passing off defences
- What are the remedies if a passing off claim is successful?
- Do I need a registered trade mark to bring a passing off claim?
- What is the process for making a passing off claim?
- What evidence do you need to bring a passing off claim?
- Are there time limitations to bringing a passing off claim?
- Can you make a passing off claim if the person or business is based in a different jurisdiction?
- Summary
What is passing off?
Passing off occurs when a party, deliberately or unintentionally, offers its goods or services in a way that deceives the customer into believing they are doing business with someone else.
This misrepresentation can negatively impact a business in several ways:
- its goodwill may be harmed
- It may suffer financially if sales are diverted to the other business
- Its reputation can suffer if the other party’s products or services are inferior
Elements and characteristics of passing off
There are three key requirements that must be satisfied to prove passing off. They are:
1. Goodwill
The claimant must have goodwill attached to their goods or services in the minds of the relevant purchasing public. Goodwill has been described as 'the benefit and advantage of the good name, reputation, and connection of a business. It is the attractive force which brings in custom'.
The goodwill must exist in the UK at the time of the alleged passing off, and it must be associated with the claimant's name, mark, get-up or other distinctive feature, which might be:
- Its name, for example, ADVOCAAT.
- The style or shape of its packaging, for example, the JIF lemon bottle.
- The colour it uses, for example, the purple packaging of Cadbury chocolate.
The length of time required to build up goodwill depends on the circumstances. A motor manufacturer launching a new model might spend so much on advertising that the model’s name is recognised as soon as the car hits the market.
Goodwill may also be limited to a particular area, in which case the claimant must prove that the other side’s acts have taken place within the geographical limits of its goodwill.
Proving goodwill can be a challenge. A claimant must show that the public genuinely associates the identifying feature used by the other party with the claimant’s business. In other words, through its trading activity, the claimant must have built up a real connection in the minds of the relevant public between its name, mark, or get-up and its goods or services. The assessment varies from case to case, depending on the size of the market, the nature of the business, and the strength of the evidence put forward.
2. Misrepresentation
The second element the claimant must show is that there has been a misrepresentation, whether intentional or not, by the defendant at the point of sale. The misrepresentation must have led, or be likely to lead, to the confusion, deception or misleading of the public into believing its goods and services are connected with the claimant.
The most common type of misrepresentation is where the defendant represents that their goods originate from the claimant, but there are many variations on this basic idea.
The misrepresentation may be an express statement or may be implied from the defendant’s use of the same or similar distinguishing marks in respect of their goods or services. The key point is that the misrepresentation must be in relation to the source of the goods or services, not in relation to other characteristics, such as their quality. It follows that the claimant and defendant’s goods or services must be the same or at least overlap; if they don’t, the claimant is unlikely to establish confusion or deception on the part of the public.
It is not necessary to prove that the public at large was confused by the defendant’s misrepresentation. A relatively small number of confused consumers may suffice to make out a passing off claim if, for example, the market is particularly specialist or niche. The court looks at the size and nature of the relevant market, the purchasing context, and the likely effect on those consumers who would actually encounter the defendant's goods or services.
3. Damage
The final element that a claimant needs to establish passing off is that the defendant’s misrepresentation caused, or is likely to cause, damage to the claimant’s goodwill.
This damage must arise from reliance on the defendant’s misrepresentation and can arise:
- where the claimant has lost sales because they have been diverted to the defendant as a result of the misrepresentation; or
- as a result of dilution to the claimant’s goodwill, for example, due to the inferior nature of the defendant’s goods.
There are several other less obvious ways in which the claimant may suffer damage. An ‘injurious association’ may occur where the defendant misrepresents it has an association with the claimant, and this claim damages or could damage the claimant’s goodwill, for example, if the defendant has a poor reputation.
A claimant may also claim for the loss of opportunity to expand, where the claimant alleges a misrepresentation by the defendant has restricted the claimant’s scope to expand.
If a claimant would struggle to show a direct financial loss, it may consider a ‘dilution’ or ‘erosion’ of goodwill claim. In this scenario, if another trader starts using the claimant’s mark, the claimant may be able to claim its goodwill has been damaged by the fact the public will no longer exclusively associate that particular mark with the claimant.
The claimant may be able to claim for ‘initial interest confusion’ if a defendant lures customers through deception and then seeks to take advantage of the deception to close a sale. An example of when initial interest confusion may arise is when a third party sets up a website with a very similar domain name to the claimant, and uses it to sell goods or services to customers who think they are actually buying from the claimant.
Passing off defences
While passing off does not require proof of intention, it is fairly difficult to establish. Some common defences relied on by businesses facing a passing off claim include:
- Use of defendant’s own name
- Use other than in the course of trade
- Claimant cannot show sufficient goodwill
- Claimant’s mark is not distinctive
- Claimant’s mark is generic
- Claimant delayed in taking action
- No proof of misrepresentation
- Misrepresentation has not caused damage to the claimant. This can be difficult to show once a misrepresentation has been established, since even very little damage will suffice.
- Claimant gave consent
- Claimant encouraged use of the mark
What are the remedies if a passing off claim is successful?
A claimant in a passing off action may claim the usual remedies that are available in intellectual property cases. They include:
- An inquiry to establish loss
- Damages for loss of reputation and/or profit
- An account of the defendant’s profits, so the claimant takes the ill-gotten gains
- An order for the delivery up or destruction of the infringing articles or products
- An injunction to prevent further actions that amount to passing off
Do I need a registered trade mark to bring a passing off claim?
You do not need a registered trade mark to bring a passing off claim. They are entirely separate causes of action. Passing off is often referred to as an ‘unregistered trade mark’, since it protects the same assets as a trade mark, namely a business’s branding that does not rely on a registered right.
That said, passing off claims are more difficult to make out than trade mark infringement claims. Registering a trade mark gives you clear, enforceable statutory rights and allows you to issue proceedings based on the registration alone. By contrast, to establish passing off, you must satisfy the three-stage legal test.
For most businesses, trade mark registration offers a more robust and cost-effective route to enforcement, with passing off acting as an important fallback where registration is unavailable or does not fully cover the issue.
What is the process for making a passing off claim?
Before issuing proceedings, you must make the defendant aware of the issue by sending a detailed cease and desist letter and allowing them an opportunity to respond. Often, a cease and desist letter from a law firm like ours can be enough to put a stop to the defendant’s actions.
If the cease and desist letter does not achieve the desired result, it may be necessary to think about pursuing legal proceedings. While most passing-off cases will go to the High Court, smaller claims could be handled by the Intellectual Property Enterprise Court at much less cost to the parties.
We firmly believe that our clients’ resources are better spent on building their businesses than on litigation. That is why we always strive to resolve issues as quickly and cost-efficiently as possible. Often, we are able to achieve extremely favourable settlements for our clients through negotiations with the other party or their legal advisors. In other cases, we might advise our client to explore alternative dispute resolution methods, such as mediation, before resorting to court proceedings. These methods are faster and cheaper than litigation and can achieve excellent results in the right cases.
What evidence do you need to bring a passing off claim?
Passing-off cases are very fact-dependent and evidence heavy. The judge needs to know that your business has goodwill, and that the defendant’s misrepresentation has damaged that goodwill. Usually, the only way to convince the judge on either of these points is to produce witnesses who will explain how seeing the identifying feature in question made them think that they were dealing with you, and that the defendant’s misrepresentation led them to do business with them instead. Survey evidence, when it is allowed, is tightly controlled to avoid the questions putting answers into the respondents’ minds: hearing it directly from the witness in their own words can be far more compelling.
Are there time limitations to bringing a passing off claim?
Passing off claims must be made within six years from when the cause of action accrued. This means that if you did not become aware of the unlawful activity for some time, your claim in connection with the defendant’s earlier acts will be time barred if they occurred over six years earlier. Because passing off typically involves ongoing conduct, each fresh act of misrepresentation may give rise to a fresh cause of action, meaning the claim is not necessarily time-barred entirely, even if some of it is out of time.
Can you make a passing off claim if the person or business is based in a different jurisdiction?
If a foreign defendant’s actions are harming goodwill, you may be able to make a passing off claim against them in the English courts.
Suing a foreign defendant is more complicated than suing a defendant based in the jurisdiction. Special rules apply to serving the claim, which include obtaining the court’s permission. If the court gives permission and you win your case, you may face further issues in enforcing that judgment against the defendant.
Identifying a party in the supply chain located in the jurisdiction and making the claim against them if possible, is usually preferable to pursuing a foreign defendant. Our intellectual property solicitors will consider the parties involved in the misrepresentation in your case and advise on your options.
Summary
Passing off disputes are complex and fact-sensitive. A misjudged pre-action step or weak evidence can backfire and lead to cost consequences.
If you are considering a claim or defending one, our trade mark solicitors can step in quickly, assess the merits and devise an appropriate strategy. Depending on the circumstances, that might involve sending a cease and desist letter to the other side and opening negotiations, or seeking urgent interim relief if the harm is ongoing and severe. We will help you preserve evidence, manage communications with the other side, and weigh the commercial upside of each route so you can act decisively while protecting your reputation, budget, and commercial operations.
