PASSING OFF – AN IMPORTANT POINT OF PROVENANCE (ORIGIN OF GOODS)

PASSING OFF – AN IMPORTANT POINT OF PROVENANCE (ORIGIN OF GOODS)

The unlawful act of passing off occurs when X misrepresents that his goods and/or services are the same as Y’s. To be successful in a passing off claim, Y must show that, (1) he has a reputation in the goods and/or services, (2) that X has misrepresented to the public that its goods and/or services are the same as his and (3) that, due to this misrepresentation, Y has suffered damages.

The issue of passing off was raised recently before the SCA in the case of Herbal Zone. In it, the Appellant was not successful in its claim of passing off because it could not prove that it had a reputation in the goods – it is an interesting exercise to explore why. To be frank, however, the Herbal Zone judgment was coloured more by the paucity of evidence than it was by any issue relevant to passing off – but where that judgment does present something new and interesting is in the issue of provenance, as we explore below.

The evidence that was led by the Appellant created some confusion as to which company held the rights and goodwill in the product. Several players were involved in a confusing, veritable rabbit’s warren of intersecting rights and allegations. To complicate matters further, neither of the parties had attempted to register any trade marks for the product in question before this matter went to court. It appears that only once the relationship had soured between the parties did they both attempt to register the trade mark. [This issue, of which party can lay claim validly to the trade mark, now lies before the Trade Marks Office Tribunal]. Before the SCA, neither party could lay claim to the reputation vested in the trade mark because neither party had proprietorship of any trade mark. As a result, the court then had to look at the issue of provenance. In other words, which company is the primary source of the products in question?

This was the second critical issue that had to be dealt with by the SCA. To summarise the detail: while one of the Appellants was able to demonstrate that he was the proprietor of another product of the Appellants, he could not demonstrate, on the evidence, that the Appellants had built-up goodwill and a reputation in the product. Accordingly, the first hurdle to proving passing off could not be overcome – and the matter ended there.

The important element to be crystallised from the Herbal Zone judgement is that the courts may rely on the issue of provenance when deciding on the matter of reputation. This places tremendous pressure on the Applicant, if it does not have a registered trade mark relating to the goods and/or services in question. In such cases, for an Applicant to show that it has a clear and direct link to those goods and/or services it must, at a minimum, produce very strong, clear evidence of this provenance.

The moral of the story is: to avoid a situation such as this, it is always advisable to file trade mark applications for your logos.

 

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