The English High Court recently confirmed that where a business wishes to prevent the use of a mark on the grounds of passing off, it is necessary for the business to show that it has acquired goodwill in the business associated with the mark and not just a reputation. In order to fulfil the requirement of goodwill, it is necessary for the business to show that it is has customers or a business in the relevant territory.
PLENTYOFFISH was a US website providing online dating services since 2001. The PLENTYOFFISH website had 4 million hits from UK visitors but none of the UK visitors had signed up as members. In 2006, a competing online dating website, PLENTYMOREFISH, was created. The owner of the PLENTYMOREFISH website registered a UK trade mark including the words “PLENTYMOREFISH” for services including dating agency services.
The owner of the PLENTYOFFISH website sought to invalidate the registration of the logo on the grounds of passing off. The UK trade marks office rejected the opposition to the registration, finding that PLENTYOFFISH had failed to show goodwill, a necessary element of a passing off claim, as it could not prove that it had any customers or business in the UK at the relevant time.
PLENTYOFFISH appealed this decision and argued:
- That the law does not require customers in this context
- That it was sufficient if there was a “trade connection”
- That the UK visitors to the website should be regarded as customers despite the fact that there was no evidence that they were members
The court agreed with the decision of the trade marks office. Goodwill is an element of passing off and it is necessary for a business to show that it has customers or a business in the UK in order to fulfil the element of goodwill. It disagreed that a trade connection was sufficient to show goodwill. The court also considered the concept of “customers”. It noted that “customers” also includes people to whom services are provided for free. It emphasised, however, that in order to be a customer there still has to be some sort of provision of a service. PLENTYOFFISH could not prove that it had any UK members and therefore the court found that it had no UK customers.
In order to succeed in a claim for passing off, goodwill must first be established. In order to fulfil the requirement of goodwill, it is necessary for the business to show that it is has customers or a business in the relevant territory. Reputation alone is not enough. It will be interesting to see if this decision is followed by the Irish courts in the future.
Contributed by John Magee and Leo Moore.