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Passing Off Actions on the Net
By
Aashit Shah
(This article was published in NAMASTE dated October 1, 1999, a four-monthly
letter circulated by Aashit Shah)
One of mankinds greatest achievements in the 20th century has been the establishment of another universe: the Internet. Limitless and unconfined by geographical boundaries, the Internet offers a plethora of information to its users. However, it is lamented that this arena has also been corrupted by some of the nefarious elements of the human race.
As the Internet is an unregulated zone, crimes over the Internet are rampant. Legislating for the Internet is at a very nascent stage. In the absence of these much-desired laws, judicial authorities around the globe use traditional concepts of copyright and trademark infringement and common law doctrines of passing off and unfair competition to curb some of these anti-social activities over the net.
Various courts in deciding trademark infringements over the Internet have extensively used the common law doctrine of passing off. In a laymans terms it means to pass off your goods as someone elses. For example: You sell a beverage as champagne though it may not be made in Champagne or may not be even close to a grape beverage. In this case the buyer, believing it to be champagne, will purchase the beverage, which he would not have done normally. In the cases of Glaxo Plc v. Glaxwellcome Ltd. (1996) and Marks & Spencer and Others v. One in a Milion (1998), the English Courts have qualified practices of trademark infringement under the tort doctrine of passing off.
In a recent case, the Court of Appeal (UK) laid down that in a successful action of passing off, the Claimant must establish the following ingredients:
When people use the goodwill of companies and businesses that have worked their way to the top in order to sell their own wares, these reputed establishments are deprived of their rightful benefits. Several people use the domain names similar to those of well-known companies, thereby confusing the customer and inducing him to buy their wares. These acts are against the common law doctrine of passing off. For example: If a person creates a website to promote his business and deliberately gives it the domain name "www.maxtouch.com", this domain name can be confused by the customers as that of "Maxtouch" a well-known company and thereby may encourage the customers to buy wares from that particular company. This act can be termed as passing off.
In the case of Marks & Spencer Plc and others v. One in a Million Ltd. and others, the deputy judge of the English Court held that:
"Any person who deliberately registers a domain name on account of its similarity to the name, brand name or trade mark of an unconnected commercial organization must expect to find himself on the receiving end of an injunction to restrain the treat of passing off, and the injunction will be in terms which will make the name commercially useless to the dealer."
French and Indian Courts have also dealt with matters regarding passing off on the Internet with great concern and urgency. In Yahoo Inc. v. Akash Arora (1999), the courts held that the provisions of the Indian Trademark Act could be used for domain names on the Internet. Furthermore, in the case of Rediff Communication Limited v. Cyberbooth and Ramesh Nahata of Mumbai (1999), the Bombay High Court supported an action of passing off when the Defendants used the term RADIFF (similar to the name REDIFF of the Plaintiff) to carry on business on the Internet.
Some countries such as USA, Japan, Canada, Singapore and UK already have certain laws governing the net. However, it is time that legislators around the world realise the urgent need for the development of this branch of law. Though traditional methods are being used to penalise Internet criminals, many a times, these methods may not be applicable to the Internet. All these and many more issues make it imperative and indispensable to have Internet Laws.
* The articles or opinions expressed in the articles must not be construed as any legal advice.