The trademark was the name of a spirit-based product called ADVOCAAT. The product had gained a reputation and goodwill for that name in the English market and the defendants were seeking to take advantage of that name by misrepresenting that their wine-based product was of the same type as ADVOCAAT. The court considered the law on comparative advertising as prohibited by the law against passing off in its extended form where the goodwill is alleged to reside in a class of producers of a product sharing a common name or get up.
Held: Whether the name denoted a product made from ingredients from a particular locality or whether the goodwill in the name was the result of the product being made from particular ingredients regardless of their provenance, since it was the reputation that the product itself had gained in the market by reason of its recognisable and distinctive qualities which had generated the relevant goodwill. In The remedy is intended to prevent unfair trading practices.
Lord Fraser formulated the action of passing off as it applied to goods: ‘It is essential for the Plaintiff in a passing off action to show at least the following facts:
(1) That his business consists of, or includes, selling in England a class of goods to which the particular trade name applies;
(2) That the class of goods is clearly defined, and that in the minds of the public, or a section of the public, in England, the trade name distinguishes that class from other similar goods;
(3) That because of the reputation of the goods, there is a goodwill attached to the name;
(4) That he, the Plaintiff, as a member of the class of those who sell the goods, is the owner of goodwill in England which is of substantial value;
(5) That he has suffered, or is really likely to suffer, substantial damage to his property in the goodwill by reason of the Defendant selling goods which are falsely described by the trade name to which the goodwill is attached.’
Lord Diplock said: ‘in an economic system which has relied on competition to keep down prices and to improve products there may be practical reasons why it should have been the policy of the common law not to run the risk of hampering competition by providing civil remedies to everyone competing in the market who has suffered damage to his business or goodwill in consequence of inaccurate statements of whatever kind that may be made by rival traders about their own wares. The market in which the action for passing off originated was no place for the mealy mouthed; advertisements are not on affidavit; exaggerated claims by a trader about the quality of his wares, assertions that they are better than those of his rivals even though he knows this to be untrue, have been permitted by the common law as venial ‘puffing’ which gives no cause of action to a competitor even though he can show that he has suffered actual damage in his business as a result.’
and ‘Nevertheless the increasing recognition by Parliament of the need for more rigorous standards of commercial honesty is a factor which should not be overlooked by a judge confronted by the choice whether or not to extend by analogy to circumstances in which it has not previously been applied a principle which has been applied in previous cases where the circumstances although different had some features in common with those of the case which he has to decide. Where over a period of years there can be discerned a steady trend in legislation which reflects the view of successive Parliaments as to what the public interest demands in a particular field of law, development of the common law in that part of the same field which has been left to it ought to proceed upon a parallel rather than a diverging course.’
The goodwill of a manufacturer’s business may well be injured by someone else who sells goods which are correctly described as being made by that manufacturer but being of an inferior class or quality are misrepresented as goods of his manufacture of a superior class or quality.
Lord Diplock identified the elements necessary to establish passing off: ‘(1) a misrepresentation; (2) made by a trader in the course of trade; (3) to prospective customers or ultimate consumers of goods or services supplied by him/her; (4) which is calculated to injure the business or goodwill of another trader (in the sense that it is a reasonably foreseeable consequence); and (5) which causes actual damage to a business or good will of the trader bringing the action or will probably do so.’
Lord Diplock, Lord Fraser, Viscount Dilhorne, Lord Salmon and Lord Scarman
1A IPR 666, [1979] FSR 397, [1979] AC 731, [1980] RPC 31, [1979] 3 WLR 68, [1979] 2 All ER 927
England and Wales
Citing:
Cited – Perry v Truefitt CA 8-Dec-1842
The court considered the nature of the tort of passing off. ‘I think that the principle on which both the courts of law and of equity proceed, in granting relief and protection in cases of this sort, is very well understood. A man is not to sell his . .
Cited – Spalding (A G ) and Brothers v A W Gamage Ltd HL 1915
The House considered the requirements for the tort of passing off. The judge has the sole responsibility for deciding whether anybody has been misled. He will hear evidence, but must not surrender his assessment to others.
Lord Parker said: . .
Dicta Approved – Star Industrial Company Limited v Yap Kwee Kor trading as New Star Industrial Company PC 26-Jan-1976
(Singapore) The plaintiff Hong Kong company had manufactured toothbrushes and exported them to Singapore, for re-export to Malaysia and Indonesia, but with some local sales as well. Their characteristic get-up included the words ‘ACE BRAND’ and a . .
Cited by:
Cited – Cadbury-Schweppes Pty Ltd And Others v Pub Squash Co Pty Ltd PC 13-Oct-1980
(New South Wales) The plaintiff had launched and advertised a soft drink. A year later, the defendant launched a similar product using similar names, styles and advertising, but then registered trade marks. The plaintiff sought damages, and for the . .
Cited – British Airways Plc v Ryanair Limited ChD 25-Oct-2000
The claimant alleged that disparaging adverts by the defendant infringed its trade marks and amounted to the tort of malicious falsehood.
Held: There was no dispute that the mark had been used. The Act could not be used to prevent any use of . .
Cited – British Telecommunications Plc; Virgin Enterprises Ltd; J Sainsbury Plc; Marks and Spencer Plc and Ladbroke Group Plc v One In a Million Ltd and others CA 23-Jul-1998
Registration of a distinctive Internet domain name using registered trade marks and company names could be an infringement of a registered Trade Mark, and also passing off. It was proper to grant quia timet injunctions where necessary to stop . .
Cited – Fletcher Challenge Ltd v Fletcher Challenge Pty Ltd 1982
(Supreme Court of New South Wales) The plaintiff company was formed from three companies well-known in New Zealand. The defendant company were formed anticipating being sold to the plaintiffs at a substantial profit. Defence Counsel told the judge . .
Cited – Chocosuisse, Kraft Jacobs Suchard (Schweiz) Ag, Chocoladefabriken Lindt and Sprungli (Schweiz) Ag v Cadbury Limited PatC 29-Oct-1997
The plaintiffs brought actions in passing off against the defendant company in respect of their chocolate products. They objected to the use of the terms ‘Swiss Chocolate’ applied to chocolates not made in Switzerland.
Held: The claimant had . .
Cited – Chocosuisse, Kraft Jacobs Suchard (Schweiz) Ag, Chocoladefabriken Lindt and Sprungli (Schweiz) Ag v Cadbury Limited PatC 29-Oct-1997
The plaintiffs brought actions in passing off against the defendant company in respect of their chocolate products. They objected to the use of the terms ‘Swiss Chocolate’ applied to chocolates not made in Switzerland.
Held: The claimant had . .
Cited – Anheuser-Busch Inc v Budejovicky Bodvar Narodni Podnik; Budejovicky Bodvar Narodni Podnik v Anheuser-Busch CA 7-Feb-2000
The registration of two trade marks (‘Budweiser’) with the identical names was against the Act since it would appear to encourage the very confusion the Act sought to avoid. Nevertheless, where there was genuine honest concurrent use, that use might . .
Cited – Starbucks (HK) Ltd and Another v British Sky Broadcasting Group Plc and Others SC 13-May-2015
The court was asked whether, as the appellants contended, a claimant who is seeking to maintain an action in passing off need only establish a reputation among a significant section of the public within the jurisdiction, or whether, as the courts . .
Cited – Starbucks (HK) Ltd and Another v British Sky Broadcasting Group Plc and Others SC 13-May-2015
The court was asked whether, as the appellants contended, a claimant who is seeking to maintain an action in passing off need only establish a reputation among a significant section of the public within the jurisdiction, or whether, as the courts . .
Lists of cited by and citing cases may be incomplete.
Updated: 16 October 2021; Ref: scu.221001