Victorian Plumbing had infringed the registered trade mark of Victoria Plum. However, in a tit-for-tat case, Victoria Plum was also found to have been passing off as regards purchasing keywords for the name "Victorian Plumbing".
The facts of the case were as follows. Both the parties are bathroom retailers and began trading in 2001. Victoria Plum claimed that Victorian Plumbing's attempt to purchase search advertising keywords containing Victoria Plum's trade mark was an act of infringement. Victorian Plumbing claimed that Victoria Plum had also purchased keywords containing Victorian Plumbing and therefore could not consider their respective actions an infringement. On this basis, a counterclaim was issued by Victorian Plumbing for passing off.
Victorian Plumbing sought to rely on the defence of honest concurrent use against the trade mark infringement claim. This defence provides for the situation where two separate entities which have co-existed for a long period using the same or similar name causes confusion and this confusion is to be tolerated.
The judge in this case noted that this was the first time that this form of defence had been used in the context of keyword bidding and, as a result, he considered it carefully. The judge acknowledged that the honest concurrent use defence was not limited to a situation where two entities were using identical trade marks. It could also be applied to situations where two entities were using closely similar marks, as in this case.
Ultimately, however, the defence was considered flawed as the criteria for honesty had not been satisfied by Victorian Plumbing by virtue of its failure to act fairly in relation to Victoria Plum's trade mark. This had been identified through Victorian Plumbing's decision to substantially increase its spending on keyword bidding without a suitable explanation for doing so and in spite of it knowing that its name was confusingly similar to Victoria Plum. In addition to this, if the defence was to be applied it would only have allowed for Victorian Plumbing to purchase keywords associated with its own name rather than "Victoria Plum" because of Victoria Plum's protected status as a trade mark. This defence did not, therefore, get around the argument that the trade mark "Victoria Plum" had been infringed.
The High Court concluded that, on the basis of the defence of honest concurrent not being established here and Victorian Plumbing had been seeking to purchase keywords using Victoria Plum's trade mark, the claim for infringement was successful.
In addition, the High Court decided that Victorian Plumbing's counterclaim against Victoria Plum for passing off was also justified. When Victoria Plum had begun bidding on Victorian Plumbing as a search advertising keyword in 2011, Victorian Plumbing had sufficient goodwill in its name to warrant passing off protection because there was a likelihood of confusion to the public that the two organisations were connected in some way.
Businesses want to build their presence online. The law around bidding for keywords is complicated and there have been cases around whether users of search engines would be confused by the results. The position becomes even more complicated when using a name that is similar to a competitor's, as in this case.