Passing off is a form of tort, or civil wrong, where a person misrepresents products and services to make them appear to be coming from someone else. Claims that products are affiliated with a party who is not involved in their production are also a form of passing off. If people can demonstrate that this caused damages, they can pursue the case in court and collect compensation. This concept is part of intellectual property law and is designed to provide people with legal measures for addressing situations involving misuse and abuse of branding, service marks, and other identifying features of a business.
In a simple example of passing off, someone could sell a product with another company's brand on it, or claim that a celebrity had endorsed a service when this is not the case. In both instances, the person is trading on the goodwill the company or celebrity has built up. Established reputations take time to build. Investments of time, money, and energy in creating a solid reputation are one cost of doing business, and passing off can allow people to profit from the expenditures of other parties.
In addition, passing off can potentially cause financial damages. People may buy a cheaper branded product to save money, not realizing that it's not from the same source as the more expensive product. This creates unfair competition, depriving companies of money they should have earned. It can also damage reputation; if someone buys, for example, a backpack that falls apart, he might start associating poor quality with the brand on the backpack, and this can damage the original company's reputation.
To pursue a passing off case in court, people must be able to show how a product or service was passed off, with clear evidence that the respondent intended to traffic on a company's reputation and goodwill, such as a packaging color scheme identical to the plaintiff's. Additionally, the plaintiff provides proof of an established reputation, and offers evidence of damages caused by the respondent's activities.
Fines can be imposed on companies engaging in passing off, and they can also be subject to cease and desist orders. If the defendant wants to stay in business, any suggestions that the company's products originate from another party, or are endorsed by another person or company, must be eliminated from marketing material, packaging, and so forth. Companies can also attempt to pursue a legitimate licensing deal, allowing them to use branding, likenesses, and other recognizable markings on their products for a fee.
