Passing Off available for continental businesses

It may be possible to succeed in a passing off claim even where the claimant does not have any physical residence in the UK.

Passing off is a common law tort allowing businesses to defend themselves against others using their trading reputation to obtain an unfair advantage. To succeed, a claimant must show it has goodwill in a distinguishing feature (such as a name or mark), that the defendant has caused a misrepresentation leading to confusion, and that the claimant suffers real or perceived damage to its business.

In Hotel Cipriani SRL and others v Cipriani (Grosvenor Street) Ltd and others it was held that the Claimant, the well-known European hotelier company Hotel Cipriani, owned goodwill in the UK despite not operating any business there.

The Defendant, owner of the London restaurant "Cipriani London", was sued by the Claimant for trade mark infringement and passing off. The Defendant argued that, as the Claimant did not physically operate in the UK, it could not have goodwill. 

It was held though that as the Claimant had a large base of customers in the UK accounting for a significant amount of its bookings, the Claimant's reputation was attractive to English consumers meaning it did own goodwill. The claim was upheld.

The court observed that using online bookings as evidence of goodwill is not guaranteed to succeed, as many businesses offer such services worldwide and a more detailed legal test may be required in future. However, this case is a warning that just because a mark is not physically used in the UK, it may still be protected by the law of passing off. 

Posted on: 28/02/2011

This article is for general guidance only. It provides useful information in a concise form. Action should not be taken without obtaining specific legal advice.

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