In SCORM 1.2, up to the point a course is launched, its status (cmi.core.lesson_status) is "Not Attempted." Once the course is launched, that status is changed to "Incomplete" (LMS's often display it as "In Progress"), and that status remains until the learner either Completes the unscored course ("Completed"), Passes the scored course ("Passed"), or Fails the scored course ("Failed").
Depending on your LMS, "Failed" may be interpreted as a completion, meaning the learner has to re-enroll and re-attempt the course from the beginning.
When you get to SCORM 2004, several things change. cmi.completion_status has 4 possible values: Completed, Incomplete, Not Attempted, and Unknown. cmi.success_status has 3 possible values: Passed, Failed, and Unknown. Both of these statuses need to be submitted from the course to the LMS. Again, how your LMS addresses these values in combination determines what happens next.
I have seen, and I myself have in the past, explicitly declared a "Failed" status at course launch, which I have the course update to "Passed" if the learner fulfills the completion requirements. Where this gets tricky is if the learner drops out in the middle, either intentionally or unintentionally. Because the last status the LMS has is "Failed," that can then be interpreted as a Completed status when the session is closed, preventing further access for credit to that attempt.
