3 Reasons Not to Rely on Passing Off to Protect Your Brand
The law of passing off prohibits one merchant from portraying their goods or services as those of another and falsely claiming that their goods or services have any link or connection with another. Passing off is a civil offence, and can be used to protect your unregistered trade mark.
While passing off exists, it is not an ideal protection mechanism for your brand. While claims of passing off may protect your unregistered trade mark, it may not be robust enough to protect you properly. This article will set out three reasons not to rely on passing off to protect your brand and why you should instead pursue trade mark registration.
What Is Passing Off?
You must be able to display the following to prove passing off:
- that you have goodwill in your products, brand, label, or other distinguishing feature that people associate with your goods;
- another party made a false depiction, leading some to assume the products were yours; and
- the misrepresentation harmed your brand.
You must prove these three elements on the balance of probabilities for you to prove passing off successfully.
Why Should I Avoid Relying On Passing Off?
1. It Is Hard to Prove
It is well-known that passing off claims are difficult to verify. You must demonstrate that at least some members of the public are likely to confuse your company with the one posing as you. This requires you to prepare a significant amount of evidence, which may be costly.
When a misrepresentation happens, it is not always easy to spot. Subtle differences in branding can make it difficult to establish passing off, especially with unregistered trade marks, which need significant public awareness and goodwill to exist.
2. Registered Trade Marks Have More Protection
Although passing off is frequently mentioned, it is seldom tried in the courts. This is most likely due to the challenging thresholds involved. To begin with, while many people have successful companies, their brands do not all have the same degree of prestige. This may be problematic, particularly if passing off is alleged to have occurred due to another person’s use of a similar good or service.
Suppose you are concerned about someone using a confusingly similar brand name to yours. In that case, we strongly advise clients to register their branding as trade marks, as proving a trade mark infringement allegation is often much simpler than relying solely on passing off or misleading and deceptive conduct claims.
Therefore, relying on these laws is essentially the same as gambling with your business. You will need to demonstrate the assumption of misrepresentation in the general public and public deceit and damage to your goodwill. Registering your trade mark costs money, but it is a no-brainer, just like insuring your house, contents, and vehicles.
3. Your Business May Not Have a Reputation
You might not effectively bring a passing off action if you do not have the right reputation. For example, if you are a small local business (even if you have been using your brand for a long time) and do not have an especially high level of recognition in the marketplace by customers in general.
Someone on the other side of the world, for example, may start using a similar brand. This is unlikely to harm you because your credibility (if you have one) is small. That other use of a similar brand is unlikely to be considered or thought to be associated with yours. While you could win a passing off lawsuit, you would almost certainly win an infringement claim with a registered trade mark in the same circumstances.
Before deciding whether you are going to rely on passing off to protect your brand, you should consider:
- whether you have a good reputation in your brand;
- if you have goodwill in your product or service; and
- whether another party is likely to falsely depict their product as yours.
However, it is important to remember that registered trade marks will always have more robust protection. If you have any questions about the law of passing off and how to formally register your trade mark, contact our experienced trade mark lawyers on 1300 657 423 or fill out the form on this page.
Frequently Asked Questions
While it is available, passing off is not easy to prove. You should instead register your trade mark with IP Australia.
You obtain clear and concrete rights when you trade mark your brand. You do not obtain clear rights when you claim passing off.