Trademark Infringement vs. Passing Off

What is a trademark?

A trademark falls under the ambit of ‘Intellectual Property Rights’. Intellectual property refers to the creative work of the human intellect. Thus a trademark may include the following:

  • Device
  • Brand
  • Heading
  • Label
  • Ticket
  • Name
  • Signature
  • Word
  • Letter
  • Numeral
  • Shape of Goods
  • Packaging or combination of colours
  • Any other combination thereof

A trademark indicates the source of origin and the quality of goods. It also distinguishes the goods and services of one person from others.

Examples of good trademark

‘KFC’ is the trademark for Kentucky Fried Chicken. So if you see the word ‘KFC’ you immediately associate the same to fried chicken. Another example would be ‘Amul’. A person seeing this word would immediately associate the trademark to the dairy goods it produces like milk, butter etc.

A trademark can also be associated with a service.

An apt example for the same would be ‘Radisson’ Hotels. The word signifies the hospitality services it provides.

A trademark is also capable of being recognized geographically.

For example, Darjeeling Green Tea. This tea has been associated with a specific geographical location, that is, Darjeeling.

Any person who claims to be a proprietor of a trade mark, used or proposed to be used by him, may apply to the Registrar in the prescribed manner given in the Trade Marks Act, 1999 and get the trademark registered.

A trademark can be a word mark, service mark or logo mark. An example has been given below for the company Apple Inc., well known for their electronic goods.

Following images represents word mark and logo mark of Apple.

Apple Word Mark
Apple Logo Mark

Functions of a trademark

a) It identifies the goods or services of one trader and distinguishes them from the goods of another trader.

b) It signifies that all goods bearing a particular trademark come from a single source and are of an equal quality.

c) It is a prime instrument in advertising and selling the goods or services.

What is trademark infringement?

Infringement is when there is a contravention or a violation of a specific act, law or agreement. With respect to trademarks, there is a violation when you use a trademark without the authorization of the owner.

To be more specific, the infringer ( the person doing the infringing act) uses a trademark which is confusingly similar or identical to a trademark that is already registered. When this happens, the people who buy certain goods or use the services, will not be able to distinguish between the brands; hence, the user who has the trademark registered will face losses.

Infringement can only take place if a trademark has been registered. A trademark owner whose trademark has not been registered cannot bring an infringement suit. Section 29 and 30 of the Trademarks Act, 1999 specifically lays down the provisions for protection of the registered trademark when infringed.

In the below images, one depicts the registered McDonalds trademark while the other depicts a copycat. Hence Mc Dowell’s has infringed McDonald’s trademark.

mc donalds Registration
McDonalds Registered Trademark
Copycat McDowell’s

Infringement of trademark: Essential factors to be considered

Likelihood of confusion

Sometimes the trademark relating to a particular set of products and goods may cause confusion in the minds of the buyer if they are similar. So when two trademarks resemble each other, this will cause deception among buyers thus defrauding the customers and infringing the right of the registered user of the trademark. For example, if A sells matchsticks with the registered trademark ‘ABC MATCHES’ and B, who newly enters the market decides to sell matches with the trademark ‘ABCD MATCHES’, the people who go to buy the products will be confused and thus may end up buying B’s products thus causing loss to A.

Deceptive marks

Deceptive marks are likely to cause confusion in the general public. Thus to know if there is a case of infringement, an overall similarity of the goods are taken into account. Deception takes place in the three following ways:

a) Deception as to the trade origin

Let’s take an example of a textile company A that sells silk sarees called ‘Mysore Silk’. All the products have “Made in Mysore” or “Product of Mysore” written on the trademark, which indicates its geographical indication, is Mysore. It was later found that A manufactures all its goods from Kerala and not Mysore. Hence, there is deception as to the trade origin and this is a clear cut case of infringement by deception as to the trade origin.

b) Deception as to goods

If A sells, ORLWOOLA for shawls, it would suggest that the shawls are made of all wool when in fact it is made of cotton. Here, this is a case of deception as to the goods.

c) Deception as to the trade connection

If there is A who deceptively sells cars with the trademark ‘ TATA ROADSPEED’, it is a case of infringement as it is very well know that ‘TATA’ is a registered trademark by the TATA Group. Thus the buyers might associate A’s car to the TATA group.This is a case of deception as to the trade connection.

Identical marks

When both the trademarks are clearly identical to each other that is, without change in the spelling, style of writing, logo and phonetically similar, it is a case of infringement. For example, if, A sells butter with the registered trademark ‘SUCAM’ and D sells butter also with the name ‘SUCAM’, it is a clear case of trademark infringement.

What is passing off?

“Nobody has any right to represent his goods as the goods of somebody else”. This is the underlying rule that has been laid down in the whole sphere of Intellectual Property Rights.

In simple words, if a person sells his goods as the goods of another, then the trademark owner can take action as this becomes a case of passing off. Passing off is used to protect the goodwill attached with the unregistered trademark.

When the trademark has been registered by the owner, it becomes a suit for infringement, but if the trademark has not been registered it becomes a case of passing off.

Example:  A runs a company that sells electronic goods. The trademark for his company is ‘SPEEDELECTRO’. He has been using the trademark for over 12 years, but has not registered the same. A company XYZ decides to sell their electronic goods also as ‘SPEEDELECTRONICS’. In the mind of the people who decide to buy the goods, they would associate ‘SPEEDELECTRONICS’ as ‘SPEEDELECTRO’ and thus because of the acquired good will of A’s company, they would purchase XYZ’s products.

Here XYZ is committing a case of passing off of goods as he is representing his goods as the goods of A’s company. A can file a suit for passing off.

Passing off: Essential factors to be considered

The nature of the trademarks

That is, whether it is a word mark or the logo mark that has been deceptively used. For example, A is a well known manufacturer of toothbrushes with the trademark ‘TOOTHY’ and the logo mark has a symbol of a toothbrush with toothpaste on it. B decides to sell toothpastes with the same trademark ‘TOOTHY’ and the same logo. This is a case of passing off and A can take action against B.

Degree of resemblance between the marks

Whether they are phonetically similar or written in the same way. For example, A runs a business ‘OYO ROOMS’ which is famous for their hospitality services and this is the trademark that they have been using for several years. It was found out that B was also providing the same services but with the trademark ‘TOYO ROOMS’. The public would be confused and would think that since ‘TOYO ROOMS’ and ‘OYO ROOMS’ sound phonetically similar, they are from the business run by A. Thus B would get profits because of the resemblance between the trademarks. This is a case of passing off.

Nature of goods in respect of which they are being used

For example A is an established, well known seller of soaps by the trademark ‘123Soaaps’ and B decides to sell soaps by the trademark ‘ 567 Soaaps’. The nature of the goods is soaps and so the consumers will be confused regarding the products. They would assume that both the soaps are from A’s well known business and purchase B’s goods, thus causing losses to A. This is a case of passing off.

Mode of purchasing the goods or placing the orders for goods

For example A is an established seller of vegetables. To order vegetables, consumers have to go onto the internet and use A’s website called ‘VEGGIES’ where orders can be placed. B decides to copy A and also starts ‘VEGGIES’ a website, which allows consumers to place orders for vegetables online. This is a case of passing off since not only is the trademark similar but also the mode of purchasing the goods is similar (The Website).

Similarity in nature, character and performance of the goods

Let’s take a case where a person, X, sells washing machines by the name ‘WHIRLPOOL’ and he has been carrying out this business for over 20 years. Y also decides to sells washing machines named ‘WHIRL-POOL’. Both of the washing machines have the same price and the same features, thus confusing the consumer and causing harm to A, who has been using his brand for a long time. This is a case of passing off.

This is a pictorial representation of an example for passing off of goods where OREO biscuits have been passed off as GO-GO’s biscuits.

go-go and oreo

Difference between Trademark Infringement and Passing Off

TRADEMARK INFRINGEMENT
i. Statutory remedy
ii. Registration of trademark is required
iii. Prosecution under Criminal Law is easier.
iv. Presumption of confusion among the public is the main criteria to be proved by the Plaintiff in case of infringement of a trademark.
v. Can institute the Trademark infringement suit where the proprietor resides or carries on professional/ personal business.[ As per Section 134, Trademarks Act,1999]
PASSING OFF
i. Common Law Remedy
ii. Registration of trademark is not necessary
iii. Prosecution under Criminal Law is relatively harder.
iv. Not only presumption of confusion among the public but also deception of the public and injury to the goodwill of the Plaintiff has to be proved.
v. Can institute the Passing Off suit only where the defendant resides or carries out work.[ As per Section 20, Civil Procedure Code,1908]

Takeaways

The reason behind protection of a trademark is so that no one else is entitled to sell your goods under the guise that it belongs to them.

The need for passing off arises whenever there is a requirement to protect an unregistered trademark whereas infringement actions arise in case of registered trademarks.

For an action for infringement of trademark to prevail, there has to be an identical imitation of the registered trademark in respect of similar goods/services.Whereas for passing off action, there has to be an identical imitation which is causing considerable confusion in the minds of the users and likelihood of injury to the goodwill of manufacturer or service provider.

Registration gives an exclusive right to the manufacturer with regards to the mark and in the case of an infringement, the right is statutorily protected.

You should always be aware as an owner of a particular trademark, whether there are other people selling goods under the same trade name that you are using. This will decrease the value of your goods in the market and you will have to face losses. Better be safe than sorry!

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