Difference of Trademark Protection and Passing off Action Essay

Commerce cannot be denied to be an essential factor in the existence of one nation. This is so because commerce is considered as the backbone of economy. Being an indispensable aspect of economy, serious consideration has been taken to ensure the protection of those forming commerce. In the particular field of commerce, an existence of a business is considerably dependent on its name. A business name is a vital aspect of one business because it carries the reputation that has been built up by the business owner. A business name also has several values. Basically, it is used to distinguish a business from another. It will also ensure security and privacy as others cannot arbitrarily encroach or use it. Hence, businesses are required to be registered. The business name being registered is termed as trademark. In the world of commerce, where millions of business establishments evolve, trademark serves a vital role. With trademark, the goods of another are distinguished from that of another. Primarily, trademark serves as an identification of the origin and ownership of the product. Significantly, trademark will also protect the consumer from confusions as to the sources of the goods or services. Through time, some business owners were also established using the name of others. Some cases were deliberately done while other cases were unintentionally done. Due to acts of copying and using famous names, the other party suffered considerable damages. There were also case where famous trademarks or reputable names have been attached by other business owners in their products, goods or services primarily to attract or to deceive customers as to the origin of the goods or services. These situations have been considered as an impetus for the judicial actions of passing off and trademark infringement. Passing Off and Trademark Protection: Definition and Origin In distinguishing passing off and trademark protection, the two have a slim similarity in a way that both protect the business’ privacy. It has also similarity as both are purposely to prevent other business owners from thefts or unauthorized use of business names of others. In addition, both empower business owners to instigate an action in court in cases others have violated their rights to their business name or trademark. Nonetheless, passing off and trademark protection have various differences as to elements, principles, protection, among others. Basically, passing off has no definite definition. However, it has been commonly defined based on Lord Halsbury’s statement in one of cases he decided which states that, â€Å"nobody has any right to represent his goods as the goods of somebody else. † Contrarily, trade mark has been defined in Trademarks Act 1994 as â€Å"any sign capable of being represented graphically which is capable of distinguishing goods or services of one undertaking from those of other undertakings. † Furthermore, word, design, letter, numeral, or shape of the goods or packaging may constitute trademark. As to origin, Passing off have been recognized by the common law as early as16th century. Few cases tried under passing off includes, Southern v. How and Dean v. Steel . After a century, another passing off case was tried by virtue of Blanchard v. Hill. Although, it was not at that time recognized as passing off, the principle laid down was severally used in many cases. Meanwhile, in Blanchard v. Hill, the plaintiff applied for an injunction to forbid the defendant from using the Great Mogul as a trade mark in the manufacture of the latter’s playing cards. However, Lord Hardwicke refused to grant injunction and reasoned out that the court has no basis to grant an injunction. Besides the court recognized the right of trader to bear a mark for his products or services but it stressed the absence of any instance that will support an injunction. Nevertheless, after several years, through the decision in Blanchard, it has been established that each proprietor has an exclusive right to the mark used in his goods or services offered for sale. In addition, it was interpreted that when the use of other’s mark was stained with fraud, injunction can be granted. In the following century, the term â€Å"pass off† was used in Perry v. Truefit, and it was further interpreted and applied to mean that, â€Å"A man is not to sell his own goods under the pretence that they are the goods of another man. † In the early days, intent was considered as an essential element for passing off. However, in the 20th century cases, the element of intent was abandoned. On the other hand, trademark protection has its recognition in 1863 through Lord Westbury in Edelsen v. Edelsen. In this particular case, the court stressed that there exist a right to property in trade names which is transmissible and enforceable even against innocent infringement. Formally, trade marks were permitted to be registered under the Trade Marks Registration Act 1875. According to this act, anyone was barred from instituting an infringement proceeding provided that the trade mark was earlier registered. The act was further amended by Trade Marks Act 1995. For a mark to serve as a trademark, it must be distinctive by meeting any of the categories namely; arbitrary or fanciful, suggestive, descriptive, and generic. A mark is said to be arbitrary of fanciful if it has no logical relationship with the product it represent. An example is the trademark â€Å"Nike† which does not have logical relationship with shoes. The mark is suggestive if marks evoke or suggest the characteristic of the product like â€Å"Coppertone† which is suggestive of sun tan lotion. A mark is descriptive if the consumers would associate it to the producer rather than on product or services such as â€Å"Holiday Inn†. Lastly, a mark constitutes to be generic if it describes a general category, like â€Å"computers†. Difference Between Passing Off and Trademark Protection Fundamentally, the differences between the two lies on the protection it affords. In passing off, there is no property in the name or design of the business, while in trademark, the registered name or mark is the property being protected. In passing off, the law protects the ownership over the goodwill or reputation of one person which may be destructed by misrepresentation of other people regardless of intention. However, in trade mark protection, the law particularly protects the mark, name, or get- up which has been registered by a business owner. In other words, the property in passing off is the goodwill or reputation while the property in trademark is the trademark itself. Notably, there are three purposes for requiring marks to be registered. One is to guarantee to the consumers of the origin of the marked products or services to avoid the possibility of confusions and serves as a distinction of the goods of one from another having another origin. Second is to protect the customers from deception by other traders. Last purpose is to notify other traders or rival engaged in the same product or services from using the trademarks of another. Having the mark registered, the owner will draw various benefits. One of which is to put off people from using the trademark without permission. The owner can also initiate an action against unauthorized use. Finally, being a property of the owner, he has the discretion whether to sell or have it licensed by other people for a price. As to the acquisition of right, rights to property or goodwill in passing off are acquired in a gradual way because the business owner only builds his business reputation after a long period of time. This is so because a reputation or goodwill is dependent upon consumers, quality and service which necessitate handwork and persistence. Goodwill can also be established on the nature of the mark, degree of distinctiveness, figures of sales, expenses for promotions, marketing of the products and period of use. On the contrary, property right over the trademark and protection of such mark is acquired immediately upon registration. Moreover, goodwill cannot exist independently from the business which has created it even if such can be transferred or assigned to another. On the other hand, trademarks can be licensed or assigned separately from the business by the proprietor provided that such is not spurious or deceiving to the consumers. Furthermore, the two are distinct as to the remedy available in case of unauthorized use of the name or mark. In passing off, the claimant may institute a passing off action while trademark infringement is available in trademark protection. More specifically, a passing off action has been defined as a â€Å"remedy for the invasion of a right of property not in the mark, name or get-up improperly used, but in the goodwill likely to be injured by the misrepresentation made in passing off one person’s goods as the goods of another. † The former is a common law remedy while the latter is a statutory one. It is said to be a common law because it has its genesis from an unwritten law or fundamental practice in the olden days. On the other hand, trademark is statutory because the relief has been created by law or legislations by virtue of Trade Marks Registration Acts. Passing off and trademark protection also differ as to the elements that needed to be proven in seeking judicial intervention. Three elements are required to be satisfied in passing off action while trademark infringement only requires one. In passing off action, the claimant must prove the existence of claimant’s goodwill, the misrepresentation by the defendant, and the damage caused to the plaintiff’s goodwill or reputation. To explicate further, goodwill is the whole benefit derived from a reputation and connection of a firm which has been built up operating honestly and lavishly expending money for a considerable year or period. Likewise, reputation is the public’s opinion on the product that may be associated with the symbol or name under which the product is being marketed. It is considered as a private personal property which is being sold to customer. Through goodwill or reputation, the inherent worth of the product is recognized and the loyalty of the customers to the product is developed. The second element which is misrepresentation must be material one and actionable that is capable of creating real or tangible damage to the plaintiff. Moreover, misrepresentation need not be intentional in order to succeed in a passing off action and any defense of innocence, negligence, or recklessness is not acceptable. Even fraud or malice cannot affect the action but will have effect on the penalty to be imposed. Under misrepresentation, it is necessary for the plaintiff to prove that the public is deceived or is made to believe that the defendant’s goods or business have been authorized or licensed by the plaintiff. The plaintiff must further prove that the customers, actual or prospective, are influenced by the misrepresentation. Since passing off safeguards the good will of the plaintiff, it is important that the misrepresentation being alleged is or had caused material damage to such property. Absence of a clear damage may result in the failure of the action. The damages, tangible or intangible, may be in the form of loss of sales due to confusion or dilution of the reputation. It may be observed that proving damages is difficult, but plaintiff may employ surveys and other statistical methods to show reliable evidence of damages. On the contrary, a claimant in a trademark infringement needs only to establish that the mark alleged to be infringing is deceptive as it is identical or similar with that of the plaintiff’s trademark. The issue involved in passing off is â€Å"whether the use concerned is likely to affect adversely the goodwill of the business. † While injury or damage is necessary in passing off action, the defendant need not cause injury or damage in the case of infringement. It is only necessary that trademark is identically deceptive. This is because the trader considers the trademark as a property and is the only means whereby the manufacturer retains or invites the confidence of the public as to the quality and integrity of the product. From the given elements, it can be observed that it passing off protects the business as a whole which encompasses the name, get- up, style, mode, etc. of the business. However, in trademark infringement only protects the name or symbol of the business.