Deceptive Trade Practices: Passing Off


In Minnesota, a person engages in a deceptive trade practice when, in the course of business, vocation, or occupation, the person:

  1. Passes off goods or services as those of another;
  2. Causes likelihood of confusion or of misunderstanding as to the source, sponsorship, approval, or certification of goods or services;
  3. Causes likelihood of confusion or of misunderstanding as to the affiliation, connection, or association with, or certification by, another,
  4. Uses deceptive representations or designations of geographic origin in connection with goods or services;
  5. Represents that goods or services have sponsorship, approval, characteristics, ingredients, uses, benefits, or quantities that they do not have or that a person has a sponsorship, approval, status, affiliation, or connection that the person does not have;
  6. Represents the goods are original or new if they are deteriorated, altered, reconditioned, reclaimed, used, or secondhand;
  7. Represents that goods or services are of a particular standard, quality, or grade, or that goods are of a particular style or model, if they are of another;
  8. Disparages the goods, services, or business of another by false or misleading representation of fact;
  9. Advertises goods or services with intent not to sell them as advertised;
  10. Advertises goods or services with intent not to supply reasonably expectable public demand, unless the advertisement discloses a limitation of quantity;
  11. Makes false or misleading statements of facts concerning the reasons for, existence of, or amounts of price reductions;
  12. In attempting to collect delinquent accounts, implies or suggests that Healthcare Services will be withheld in an emergency situation; or
  13. Engages in any other conduct which similarly creates a likelihood of confusion or of misunderstanding.

Minn. Stat. § 325F.44, Subd. 1.

Passing Off

The doctrine of “passing off” happens when a person or business passes off the goods or services of another as their own and creates confusion as to the origins of the goods. Krueger v. State Farm Fire and Cas. Co., 510 N.W.2d 204 (Minn. Ct. App. 1993). More specifically, United States District Court for the State of Minnesota has stated that for a plaintiff

“to prevail on a passing off claim requires proof that a defendant engaged in conduct that deceived, or is likely to deceive, a consumer exercising ordinary care in the making of a purchase of the particular goods, and that such conduct induced such a consumer to purchase defendants goods in the belief that they are those of plaintiff.” Fair Isaac Corp. v. Experian Info. Solutions, Inc., No. 06-4112, 2009 WL 4263699, at *2 (D. Minn. Nov. 25, 2009).

The only relief afforded under Minnesota’s Deceptive Trade Practices Act is injunctive relief. See Dennis Simmons, D.D.S., P.A. v. Modern Aero, Inc., 603 N.W.2d 336, 339 (Minn. Ct. App. 1999).

Passing Off Under the Lanham Act

Under the Lanham Act, the use of “false designations of origin” in connection with goods, services, or their containers that are “likely to cause confusion, to cause mistake, or to deceive as to the affiliation, connection, or association of the user with another person, or as to the origin, sponsorship, or approval of his or her goods, services, or commercial activities” is prohibited. The Lanham Act is available for a federal cause of action for types of passing off claims that deal with trade name infringement and trade dress infringement.

United States Supreme Court has limited the “passing off” cause of action under the Lanham Act. The case of Dastar Corp. v. Twentieth Century Fox is a prime example. In that case plaintiff failed to renew the copyright on a World War II documentary that it had created. Failure to renew the copyright can cause the documentary to fall into the public domain. Defendant seized the opportunity and created its own documentary regarding World War II using footage from plaintiff’s documentary. Plaintiff sued alleging reverse passing off, meaning that consumers would believe that plaintiff was copying defendant when in fact plaintiff is the one who originally produced the documentary. The Supreme Court found in favor of defendant claiming that defendant had done more than merely copying the plaintiff’s documentary and instead created its own copies from the footage that was in the public domain and made some modifications. The Court emphasized that the “origin of goods” was no longer the plaintiff because the plaintiff had not created the ideas or communicated the ideas in defendant’s product and that defendant was now the “origin” of the videos. 123 S.Ct. 2041 (2003). Specifically, the Court stated,

[T]he gravamen of [plaintiff’s] claim is that, in marketing and selling [the documentary] as its own product without acknowledging its nearly wholesale reliance on [plaintiff’s original documentary], [defendant] has made a false designation of origin, false or misleading description of facts, or false or misleading representation of facts, which is likely to cause confusion as to the origin of his or her goods. That claim would undoubtedly be sustained if [defendant] had bought some of [plaintiff’s] videotapes and merely repackaged them as its own. [Defendant’s] alleged wrongdoing, however, is vastly different: it took the creative work in the public domain—the Crusade television series—copied it, made modifications (arguably minor), and produce its very own series of videotapes. If origin refers only to the manufacturer product of the physical goods that are made available to the public (in this case the videotapes), [defendant] was the origin. If, however, origin includes the creator of the underlying work that [defendant] copied, then someone else (perhaps [plaintiff]) was the origin.

* * *

The phrase [origin of goods] refers to the produce of the tangible goods that are offered for sale….

Id. at 31, 37.

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