I have never heard of a Cat 111 fail passive approach. Is the documentation you have from Boeing or a third party?
The B777 autopilot system consists of 3 autopilots which, subject to full serviceability, will give LAND 3 system status and full autoland/rollout capability in CAT 3,( in fact, ANY) conditions. This means the following are possible: either a CAT3 NDH approach (no decision height) and RVR of 75 meters, or a CAT 3B approach to (say) 15R/125m if your company minima are more restrictive. A downgrade from LAND 3 to LAND 2 is fail operationaland will permit continued operation down to CAT 3A minima of 50R/200m, or CAT 2 minima of 100R/300m. Reversion to NO AUTOLAND is fail passive i.e CAT 1 minima and manual landing. This means a go-round in less than 550m RVR as below that RVR it has to be an autoapproach and landing on the B777.
Fail operational means that the system can downgrade but autoland is still possible to higher CAT 3 or CAT 2 minima.
Fail passive means that a major system downgrade will keep an autopilot engaged and the aircraft will not be left in a mistrimmed or unmanageable situation. Autoland capability is lost
In summary:
LAND 3 allows: CAT 3 no decision ht - 75m RVR OR CAT 3B 15R -125m RVR
LAND2 allows: CAT3A 50R -200m RVR OR CAT2 100R- 300m RVR
NO AUTOLAND allows: CAT 1 200R- 550m RVR manual landing
LAND3 downgrade->LAND 2 is fail operational
LAND2 downgrade-> NO AUTOLAND is fail passive
So, strictly speaking LAND 2 can mean CAT 3 limits ( 50R/200m)