Implications of false representations regarding the connection of brands
Goodwill attached to business names
Assisted by Kirstie Barfoot
California based ridesharing company Uber recently forced a small Queensland company by the name of 'Muber' to change their registered business name. Muber general manager, Manne Padowitz, was contacted by Uber about the similarities between the names of the companies, in circumstances where Uber is a successful and internationally recognised brand.
The nature of the business undertaken by Muber is conducted through a Smartphone application which allows users to order food, alcohol, and other goods to be delivered directly to their homes around the Gold Coast. Drivers for the service, similar to Uber, use their own cars and sacrifice a percentage of their fees to Muber.
Whilst Muber did not directly copy the Uber brand or business model, it intentionally created an association between the companies in the minds of consumers. Padowitz acknowledged in a public statement that the name was a deliberate decision, and that it "gave the public an idea of the concept of the app." Whilst in this case, the matter did not proceed beyond threats from Uber's legal representatives; conduct of this nature is a potential breach of Australian law in the following areas:
If the company has a registered trademark over their company name, and a name similar to this is used in the same industry, it may be considered a breach of trade mark laws
The company may be considered attempting to 'pass off' the goodwill of the another brand by misrepresenting that a connection exists between the services offered when there isn't one
The company may be in breach of Australian Consumer Law if it is considered that during trade or commerce, the overall impression of the business is misleading or deceptive, or is likely to mislead or deceive consumers into believing the brands are connected.
The above consequences are quite serious and could result in costly and time consuming litigation.
As an established business owner, you should consider registering a trade mark over your business name. The owner of a registered trade mark has the exclusive use of the registered name and can prevent others from using the same or similar name – it's an important step in ensuring that the goodwill associated with your brand is fully protected.
If you are starting a new business, whilst it can be appealing to build off existing success in the corporate world, associating your brand with the reputation and goodwill of other companies can hold serious consequences. Prevention is always better than cure - avoid potential legal ramifications by ensuring that your business name and any trademarks you intend to register aren't easily associated with other brands in your industry.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
