Trade and Investment

The Tort Of Passing Off

Recently, I made some liquid soap at home and decided to pour some into the branded empty liquid soap containers I had. My friend (a non-lawyer), jokingly commented that the companies whose brand names were on the containers could sue me for passing off.  That conversation led to me giving her a free lecture on the Tort of passing off. A lot of people may never have heard of Passing off or know what it is. Or more importantly, what it is not.

INTRODUCTION:

Black Law Dictionary defines passing off as the act or an instance of falsely representing one’s products as that of another in an attempt to deceive potential buyers.

Passing off is a civil wrong that occurs when an individual or a company intentionally or mistakenly sells goods or services that are so similar to those belonging to an existing brand, thereby causing confusion and deception in the marketplace.

For instance, there’s a popular seasoning brand in Nigeria called Maggi. If another company chooses to make its own seasoning and call it “Naggi”, then replicate the former’s trademark on Naggi, this could give rise to a cause of action against it as many people could mistakenly pick up Naggi in the grocery aisle of the mall without knowing it is a different product.

WHY IS PASSING OFF A CIVIL WRONG?

Passing off does not only protects trade interests, it also protects members of the public from being swindled by those who seek to exploit the goodwill enjoyed by known brands.

Branding a product till it gains popularity and trust among consumers takes time, efforts and money. The law does not allow competitors to unfairly reap where they did not sow. Passing off protects brands that have meticulously worked to get to where they are in the market by preventing unfair competition.

In the case of Rickett & Coleman products Ltd v Borden inc., the Supreme Court of Nigeria held that Borden had committed the Tort of passing off by misrepresenting its product called “Klim” as the plaintiff also had a product named “Klim”. In the instant case, the defendant had also used a bottle and label similar to that of the plaintiff. The court ordered all the infringing products in the market be destroyed with an injunction preventing Borden Inc. from further manufacturing the product.

ELEMENTS OF PASSING OFF

Before a suit for passing off can succeed in court, the plaintiff has to prove some elements. These elements also dubbed the Trinity are: 1. Goodwill established by the plaintiff, 2. Misrepresentation made by the defendant and 3. Damage caused by the defendant.

  1. GOODWILL AKA REPUTATION: every brand has a reputation—no matter how obscure—in the community that patronizes it. Reputation is the goodwill enjoyed by the brand which shows in its sales, referrals, and brand loyalty. Reputation is the perception the populace has of the brand. To determine the damage to goodwill, the court considers factors such as the uniqueness of the trademark, the duration of the brand in the market, and the money spent over time to promote the trademark.
  •  MISREPRESENTATION: this is a false impression created by the defendant about their goods or services, intended to deceive consumers into thinking their product is associated with the plaintiff’s brand. This can involve creating a similar trademark or design that can mislead shoppers to mistake one product for another.
  • DAMAGE: Plaintiff must show that the goodwill his product enjoys in the marketplace has suffered or is about to suffer damage caused by the defendant’s misrepresentation.

Worthy of note is the fact that generic colours or marks cannot qualify as unique marks deserving of protection as marks must be distinct and distinguishable from other brands.

In the case of Nigerian Bottling Co. Ltd. v. Cadbury Nigeria Plc., Cadbury had pushed a new product into the market called “Tigris” that closely resembled another product made by the plaintiff. Cadbury had used the colour scheme and several other similar imitations of seven-up that could mislead buyers that their product was seven-up. The Supreme Court of Nigeria held that Cadbury had committed the tort of passing off.

In the UK case of the purple inhaler, where Glaxo Group Limited sued Sandoz Limited and others, alleging they passed off their inhaler because they copied the same purple colour Glaxo used for its popular inhaler, Glaxo claims for both passing off and Trademark infringement over the purple colour identity failed.

The court held in its judgment that the plaintiff had to prove the following elements to succeed in an action of passing off:

  1.  Goodwill, misrepresentation, and damage.
  • Deception must be shown to have occurred. This means that beyond intent to misrepresent the goods as belonging to another, it must be shown that buyers were indeed confused and misled by the similarities in the products.
  •  That misrepresentation can either be deliberate or innocent but will be regarded as misrepresentation all the same.
  • That if the only distinction is in colour or shape, it must be proven that the public indeed associates said colour or shape as a unique mark of the plaintiff. Failure to prove this, the court held that buyers could think a colour could be used by different brands offering similar products and it wouldn’t be considered misleading.
  • The date a cause of action for starting off arises is the date the defendant started offering his goods under a similar trademark of the plaintiff.

In Nigeria, Passing off came into our legal system as one of the received English laws called Statutes of General Application and is currently regulated by case laws, Statute of General Application, and the Trade Mark Act Of Nigeria. The Trade Mark Act provides protection for registered trademarks against passing off. But the trademark must be a registered one, as non-registration robs the court of jurisdiction. This is encapsulated in Section 3 of the Act.

CONCLUSION

Passing off, as an area of Law, remains largely unknown to many people, hence, many unknowingly infringe on the right of the owner of a trademark or design by trading under similar marks and designs. Even the aggrieved party may not know he has a cause of action in court.

Reliance is still placed on the Statute of General Application (The received English Laws) and case laws when it comes to deciding cases on passing off in Nigeria. The Trademark Act and Nigerian Consumer Protection Council Act make some provision but not adequate, hence our courts often recourse to established case laws for guidance.  

Several important cases have helped shaped the Law as it concerns Passing Off in Nigeria, providing ample guidance for individuals and companies in Nigeria.  These cases have established precedence for actions of Passing off in Nigeria.

CASES CITED

  • Glaxo Wellcome UK Ltd and Anor v. Sandoz Ltd and ors [2019] EWCA Civ 227
  • Nigerian Bottling Co. Ltd. v. Cadbury Nigeria Plc [1988] 1 NWLR (Pt. 74) 330
  • Rickett & Coleman Products Ltd. v. Borden inc. (1998) 6 NWLR (Pt. 561) 275
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About Toiyoabasi N. Ekong Esq.

Toiyoabasi N. Ekong Esq. is a Barrister and Solicitor based in Abuja, with expertise in Intellectual property and Environmental Law. She loves research, reading Law Reports and biographies. She is a writer with over a decade of experience under her belt, and some published works to her credit. An active member of International Federation of Women Lawyers (FIDA), Ms. Ekong particularly enjoys working with young women to advocate for socio-economic empowerment of women in the country. she is the host of “Today’s Woman” on 98.1 Amana FM., a show that promotes women’s rights and female education. You can reach her via email Toiyoabasiofficial@gmail.com or +2349056270573