Trademark | Passing Off Action Requires Only Likelihood Of Confusion, Not Strict Proof Of Counterfeiting: Madras High Court

"The standard is preponderance of probabilities and likelihood of misrepresentation, not conclusive proof of counterfeiting." Madras High Court, in a significant ruling, held that a plaintiff in a passing off action is not required to provide conclusive proof of counterfeiting or produce material objects to succeed.

A Division Bench of Justice P. Velmurugan and Justice K. Govindarajan Thilakavadi observed that the standard of proof in such cases is the "preponderance of probabilities" and whether the defendant's conduct is likely to cause confusion in the course of trade. The Court set aside a Single Judge's order that had dismissed a passing off suit by an Italian manufacturer and awarded defamation damages to its former Indian distributor.

The appellant, an Italian manufacturer of brass plumbing products under the trademarks "RB" and "Rubinetterie Bresciane," filed a suit against its former Indian distributor, the respondent. The appellant alleged that the distributor was selling non-genuine products and misusing its trademarks after receiving customer complaints. A Single Judge dismissed the suit for lack of material proof of counterfeiting and simultaneously awarded Rs. 10 lakhs in defamation damages to the distributor for warning letters sent by the appellant to customers.

The primary question before the court was whether a passing off action requires strict proof of counterfeiting through material objects or if circumstantial evidence of misrepresentation suffices. The court was also called upon to determine whether a manufacturer's communication to the trade regarding the termination of a distributorship and suspected counterfeit goods constitutes actionable defamation.

Standard Of Proof In Passing Off Actions

The Court emphasized that the Single Judge adopted an "unduly strict approach" by requiring material objects or technical evidence to prove counterfeiting. The Bench clarified that passing off is a species of unfair trade competition where the concern is the protection of goodwill and the prevention of consumer confusion.

It was observed that it is not necessary for the plaintiff to establish actual counterfeiting by strict proof, so long as the materials reasonably indicate a likelihood of misrepresentation. The Court noted that in such actions, it is sufficient if the defendant’s conduct is likely to cause confusion or deception in the course of trade.

"The test to be applied is whether the conduct of the defendant is likely to cause confusion or deception in the course of trade."

Cumulative Circumstantial Evidence Is Sufficient

The Bench held that the case must be assessed on the cumulative effect of circumstances. It noted that the respondent admitted the appellant's prior adoption of the "RB" mark. Furthermore, the respondent generated quality certificates internally by mimicking the appellant’s documents and sourced similar products from China while refusing to disclose manufacturers under "business secrecy."

The Court found that these factors, combined with invoices (Ex. P-15) showing the sale of valve sizes the appellant never manufactured, pointed toward a course of conduct capable of misrepresenting the origin of the goods. Such conduct, the Bench noted, collectively creates a likelihood of confusion among purchasers.

"Once prior adoption and user are admitted, the conduct of the opposite party has to be examined with greater care."

Clerical Errors In Evidence Not Substantive Inconsistencies

The Court addressed the Single Judge's rejection of evidence based on a typographical error in an email where the year "2012" was used instead of "2014." The Division Bench held that since the invoice number remained identical and the appellant’s witness explained the clerical error, it could not be treated as a substantive inconsistency.

The Bench also critiqued the rejection of a third-party laboratory report (Ex. P-10) solely due to the absence of an official translation. It held that the lack of a certified translation is a curable procedural defect and should not lead to the wholesale rejection of relevant documentary evidence.

Commercial Warnings To Customers Are Not Defamatory

Regarding the defamation suit, the Court held that the Single Judge erred in assuming that the failure to establish counterfeiting automatically made the appellant’s communications defamatory. The Bench noted that the communications were issued post-termination to protect legitimate commercial interests and brand reputation.

The Court held that statements made in good faith, based on reasonable apprehension, do not ordinarily amount to actionable defamation. Since the respondent failed to produce convincing material demonstrating actual loss of reputation or business, the decree for damages was found to be legally unsustainable.

"Communications issued in good faith for protection of legitimate commercial interests do not ordinarily constitute actionable defamation."

Final Directions and Setting Aside of Defamation Decree

The Division Bench partly allowed the appeal in C.S. No. 405 of 2014, granting a permanent injunction against the respondent. The Court restrained the respondent and its agents from using the appellant’s trademark or any deceptively similar mark likely to represent their goods as those of the Italian manufacturer.

However, the Court rejected the appellant's claim for damages as no quantifiable loss was proven. Critically, the Court set aside the decree for damages in the respondent’s defamation suit (C.S. No. 891 of 2015), concluding that the appellant’s actions were bona fide attempts to safeguard its trademark rights.

The Madras High Court reaffirmed that the gist of passing off is misrepresentation and likelihood of confusion, not the criminal standard of proof for counterfeiting. By setting aside the defamation award, the Court protected the right of trademark owners to issue good-faith warnings to the trade regarding the status of their authorised distributors and the genuineness of products.

Date of Decision: 17 April 2026