Passing Off for Registered and Unregistered Trademarks
The Trademarks Act, 1999 (hereinafter referred to as ‘the Act”) gives rights and protection in the form of remedies to not only registered but also unregistered trademarks. Even though a registered trademark is given a statutory remedy under section 28 of the Act, but 27(2) of the Act also provides for a remedy for unauthorized use of an unregistered trademark. Passing off is a common law tort that is most commonly used to protect goodwill that is attached to the unregistered trademarks. Passing off is basically when one person is passing off his goods or services as that of another person. The action of passing off is available to both registered and unregistered trademarks, but a suit for infringement is available for only registered trademarks. While the objective that is aimed to be achieved remains the same in both suits, still they are very different concepts. Kinds of relief available in both the suits are permanent injunction, interim injunction, damages or account of profits, delivery of the infringing goods for destruction, and cost of the legal proceedings.
The burden of proof under a suit of infringement is not as high as it is under a passing-off action. While in an infringement suit, proving deceptive similarity would be enough to establish that the infringer is liable, under the action of passing off, the plaintiff will not only have to prove deceptive similarity but also prove how the defendant’s mark is likely to cause confusion among the public and also has a likelihood of causing injury to plaintiff’s goodwill. It is important for the plaintiff to prove how his mark has become distinctive to his goods and people associate the mark with his own goods. The first step to proving passing off is for the plaintiff to establish that the plaintiff was a prior user of the mark. As stated in Consolidated Foods Corporation v. Brandon & Co. Pvt Ltd., “Priority in adoption and use of a trademark is superior to priority in registration”. Supreme Court has also laid emphasis on prior use in the case of Satyam Infoway Ltd. vs. Siffynet Solutions (P) Ltd, (2004) 6 SCC 145.
“The action is normally available to the owner of a distinctive trademark and the person who, if the word or name is an invented one, invents and uses it. If two trade rivals claim to have individually invented the same mark, then the trader who is able to establish prior user will succeed. The question is, as has been aptly put, who gets there first? It is not essential for the plaintiff to prove long user to establish a reputation in a passing-off action. It would depend upon the volume of sales and extent of advertisement.”
Another very important ingredient in a passing-off action is Misrepresentation. Misrepresentation can be both intentional and unintentional, what has to be seen is whether the defendant is selling his goods in such a way that a common ordinary man would confuse his good to that of the plaintiff’s. As stated in the of Telemart Shopping Network Pvt Ltd vsTvc Life Sciences Ltd & Anr:
The word misrepresentation does not mean that the plaintiff has to prove any malafide intention on the part of the defendant. What has to be established is the likelihood of confusion in the minds of the public, (the word “public” is understood to mean actual or potential customers or users) that the goods or services offered by the defendant are the goods or the services of the plaintiff.
Under a passing off action, establishing goodwill and harm caused or possible harm that could be caused to the goodwill is a major ingredient. An unregistered trademark thus has a higher burden than a registered trademark. While under an infringement suit, a legal right is already available with the plaintiff, a user of an unregistered trademark doesn’t have this inherent right. The House of Lords in the case of Reckitt & Colman Ltd V Borden Inc called Reputation, Misrepresentation, and Damage to goodwill the “Classical trinity” under a case of passing off. These are the fundamental elements that have to be established by a person. Passing off suits also face another drawback when it comes to filing of suits. While a suit for infringement as per section 134 of the Act can be filed in District Court / High Court (enjoying Ordinary Original Civil jurisdiction such as High Court of New Delhi, Mumbai, Kolkata or Chennai) wherein the registered proprietor can file suit in the local limits of where actually and voluntarily resides or carries on business or personally work for gain, during the institution of the suit. But a suit of passing off has to follow the regular rules of jurisdiction as per section 20 of Code of Civil procedure which means that a passing off suit can only be filed in a District Court.
Thus, it is evident that an infringement suit has clear benefits over the passing-off suit. Even though the procedure of a passing off suit remains the same for both registered or an unregistered mark, the burden of proof becomes higher when it is for an unregistered mark as establishing goodwill and reputation becomes difficult. A registered proprietor will always prefer filing an infringement suit over passing off suit due to the reasons mentioned above. Allowing unregistered trademarks, a certain extent of protection under the Act is a relief to many users who otherwise wouldn’t have been able to get any sort of legal remedy for the violation of their marks.