SWTOR does not have loot rules, STWOR has "need", "greed" and "pass".
When several players choose need or greed, a random roll determines who gets the item.
That's as fair as it can be.
Of course, you could make specific arrangements with your group.
But such arrangements are strictly voluntary and not enforcible.
In my opinion, there should only be "need" and "pass" - simpler is better:
If you want something you use "need" and let the random roll determine if you get it.
It is irrelevant if you can use the item or not - you did the work, so you are entitled to roll for it.
The issue with this is that global mechanical systems for presumably fair loot distribution are completely different from the socially agreed upon system for fair loot distribution. It's a question of game theory as opposed to cooperative economics.
The developers were *forced* to make a system that is, honestly, stupidly easy to take advantage of (if you understand game theory, you'd see that the only roll that anyone would ever take is "need" since there are no restrictions of any kind) because the system has to be simple (because complex loot systems take more time and money to develop and are harder for players to understand) and manipulable (so that players can choose to operate contradictory to optimal selfish gains if they so choose). The developers could have created a system that analyzes comparative gains from an individual piece of gear by having it go through a number crunching algorithm to determine who gets the most out of said piece of gear normalized for the group by the person's performance (taken as threat generated over the course of a fight normalized for role) before determining who gets a piece of gear they might want (essentially replacing the roll with a benefit:effort ratio comparison, which is what most people do heuristically anyways), but they're not going to. First, it's too much work; second, it's too convoluted (most people who have no clue why one sent DPS got a saber over the other, especially if their gear and damage are close enough that the difference is beneath the conscious observational threshold); and third, it would piss some people off no matter what.
Because the developers (and, in fact, every development team for *every* MMO) has to make a system that allows for all kinds of abuse (because the leeway that makes a loot system functional also makes it abusable), players, as a whole, create a social contract to assign right and wrong action within the system. It's the same reason why, even though you're mechanically allowed to do so, it's considered "wrong" to camp a lowbie for an hour straight and not "fair" to bring in NPCs in open world PvP. *Mechanically*, those behaviors are entirely acceptable. The developers cannot rightly punish those behaviors because it would require punishing all instances of that behavior, which means that it would punish players that aren't trying to exploit the mechanic and are instead simply playing in the intended manner. The only reason some mechanically possible behaviors are considered "bad form", "unfair", or whatever you want to call it, is because of the generally agreed upon social contract inherent in playing the game. You may not have even weighed in when the debate was taking place (for many PvP behaviors, the "debate" took place *decades* ago when multiplayer game culture and open world PvP were first being developed on a not-massive-but-still-multiplayer scale).
There are a number of other behaviors that are treated exactly the same in real life (adultery/cheating, spoiling children, misogyny, racism, etc.) that are seen by our society as deplorable or, at best, not the proper thing to do, but are not crimes. Even for more heinous behaviors that you could probably get away with (killing someone halfway through a 2 month hike across Antarctica and blaming it on a bad storm) would be considered something you shouldn't do, regardless of whether you can or cannot do it (or can or cannot do it without the looming threat of punishment).
Just because you *can* do something (like roll "need" on a piece of gear for your companion) does not excuse the act in and of itself. The game we play is a social one and, as such, is the interactive portion of a larger society. Any society will naturally generate specific rules, both spoken and unspoken. If you break those rules, it *is* appropriate to say that breaking the rule was wrong, just like it's wrong to say that misogynists and racists are reprehensible. Because many of the rules are unspoken or expected to be known (which is why most people don't state the rules at the start of an instance any more; the rules have entered the common knowledge pool and have been generally agreed upon, causing most people to operate under the assumption that everyone *should* know the rules, just like most people *should* know the strats for the fights that have been out since the game's release), most people will give a little leeway when someone indicates ignorance of the given rules (which has been well indicated by people's reactions) after such a mistake. Continued breaking of the rules generally elicits derision (which is well and appropriate; the social contract that you "agree" predicates appropriate behavior upon social acceptance; by refusing or being incapable of behaving appropriately, you sacrifice the right to be treated as socially acceptable and are treated with derision by the community).
This is the entire reason why the developers stuck with single server random grouping functionality. It wasn't because they didn't want to or that it was too much work. The explicitly given reason was to foster and strengthen local communities. If you continually act like an ******, you're going to find yourself excluded from large portions of the community (people putting you on /ignore, refusing to group with you, etc.), but that's what you get for opting out of the social contract. Sure, some people will still tolerate you (some people don't care all that much about the social contract and are willing to excuse all but the most egregious broaches of conduct), but you're sacrificing much of your ability to interact with people for the "right" to act with fewer restrictions.
The long and short of this entire thing is that the justification of "because I/you can" is not an appropriate reason to do so within the confines of a social endeavor (which is what this game is). There are rules agreed upon by the community as a whole. Just because they're not enforced *mechanically* doesn't mean that they're not just as legitimate (murder is wrong but you can still kill people) and pleading ignorance will only get you so far (many people will punish the ignorant as quickly as the willfully disobedient thanks to the rules being within the realm of "expected knowledge" and the ease with which someone can maliciously claim ignorance to defend their willful actions). The entire point of the social contract is to ensure that, on average, everyone is treated fairly (or, at least, more fairly than they would otherwise be treated) within a system that is easily abused. It's about politeness and fun. Turning loot acquisition into a winner-takes-all, the-only-person-that-matters-is-me, Ayn Rand inspired competition might be fun for a few people, but it's not fun for most (especially since that's how most of reality operates and a lot of people game because they want to *escape* that reality to one extent or another).