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DATE: Thursday 7 May 2020, 10:00am - 11:00am- delivered via Zoom Video Conference
Passing off: Confusion or Deception
A recent case (Glaxo Wellcome UK Ltd v Sandoz Ltd  EWHC 2545 (Ch) (04 October 2019)) has highlighted that protecting your intellectual property at the outset should be a high priority. The Glaxo case involved two pharmaceutical competitors who were each marketing their own asthma inhalers, each of which had brand packaging in varying shades of purple. Glaxo objected to this use of purple by Sandoz and issued proceedings to protect its position.
The principle underlying the misdemeanour of passing off stems from 19th Century case law which determined that "A man is not to sell his own goods under the pretence that they are the goods of another man". Fundamentally, it protects the goodwill of one party from misrepresentation by preventing another party from holding out his goods as having some association or connection with another when this is not the case.
Passing off is not governed by statutory law, rather it has developed in the courts, which have taken the view that impudent offenders should neither benefit from ill-gotten gains, by riding on the coat tails of another party’s successes, nor should they avoid being held accountable.
One of the more well known cases of passing off is the Jif Lemon case (Reckitt & Colman Products Ltd. v Borden Inc.  1 WLR 491), which was decided in the House of Lords. This case established the three main elements that must be proved when bringing a passing off claim:
The Jif Lemon case involved a UK party, Reckitt, which had been selling lemon juice in a plastic container in the shape of a lemon since 1956. This plastic lemon had become renowned with the general public who identified it with the Jif brand of lemon juice. An American company, Borden, also sold lemon juice in a lemon shaped plastic container but it did so on the other side of the Atlantic. In 1975 the American company entered the UK lemon juice market and, initially, sold its lemon juice in ordinary plastic bottles under the brand name RealLemon. By 1980 RealLemon had cornered 25% of the lemon juice market and in 1985 it started to sell its lemon juice in its lemon shaped containers. Reckitt objected to this and brought a claim to protect its position.
Lord Oliver explained the standard, which became known as the “Classic Trinity”, asking:
Finding in favour of Reckitt, the House of Lords concluded that all three elements had been satisfied and permanently barred Borden from marketing its lemon juice in lemon shaped containers in the UK.
The Glaxo case has now reminded us that deception is a key factor in passing off cases. Lord Justice Arnold referred to an older 1994 judgment in which the judge in that case, Mr Justice Jacobs, stated:
"I turn to consider the law and begin by identifying what is not the law. There is no tort of copying. There is no tort of taking a man's market or customers. Neither the market nor the customers are the plaintiff's to own. There is no tort of making use of another's goodwill as such. There is no tort of competition. …
At the heart of passing off lies deception or its likelihood, deception of the ultimate consumer in particular. Over the years passing off has developed from the classic case of the defendant selling his goods as and for those of the plaintiff to cover other kinds of deception, e.g. that the defendant's goods are the same as those of the plaintiff when they are not, or that the defendant's goods are the same as goods sold by a class of persons of which the plaintiff is a member when they are not. Never has the tort shown even a slight tendency to stray beyond cases of deception. Were it to do so it would enter the field of honest competition, declared unlawful for some reason other than deceptiveness. Why there should be any such reason I cannot imagine. It would serve only to stifle competition. The foundation of the plaintiff's case here must therefore lie in deception…"
The claimants in the Glaxo case, market two types of inhalers, each are coloured with shades of purple. In the case of one inhaler, the shades of purple vary with the dose of medication in the inhaler. Both are sold in packaging featuring a shade of purple.
The defendants, Sandoz, launched a branded generic competitor to Glaxo’s inhaler, which is largely coloured a shade of purple and is sold in packaging featuring a shade of purple.
Glaxo claimed that Sandoz has passed off their inhaler as being:
Although Glaxo’s case also relied upon certain other aspects of the get-up and packaging, by the end of the trial the only feature they really counted on was the use of the colour purple.
The High Court found that:
The judge dismissed both claims of passing off in relation to patients. This is perhaps unsurprising given that it is a legal requirement to prescribe inhalers to patients who rely on the healthcare professionals’ knowledge and expertise. However, the issue of misrepresentation in respect of equivalence where healthcare professionals were concerned was not as simple, but it was also dismissed. It was proved that there is a high level of awareness among healthcare professionals regarding the differences in the operational techniques of different inhalers; which is why inhalers are increasingly prescribed by brand. Both sides' evidence showed that healthcare professionals would not make assumptions about the scope of a product's marketing authorisation on the basis of colour; they would instead check the characteristics of a product in relation to the relevant patient’s symptoms before prescribing.
Glaxo intends to apply to the Supreme Court for permission to appeal.
The Glaxo case makes it clear that, in passing off cases, a claimant must be able to prove all three elements of the Classic Trinity and where this is not possible caution should be exercised before bringing a claim before the courts. It also demonstrates the importance of protecting your brand and/or your products as far as is possible. Where applicable, this may be done by registering trademarks, registered designs or in some cases patents. If you don’t, the threshold for bringing a passing off claim is high.
If you would like to find out more about how you can protect your intellectual property please contact Jon Rathbone, Director in the Corporate and Commercial Department at Hughes Paddison, on 01242 586832.