Australia: ICON – trading names, trade marks and reputation risk

Last Updated: 30 January 2019
Article by Peter English

"Please be advised the matter surrounding the Opal Tower Homebush was not built by our company. The building was built by a company with a similar trading name. Note the two companies have nothing to do with each other."

This statement appears on the landing page of the website of a Sydney based construction company (Icon Construction Group) that effectively shares it name with a major company at the centre of the Opal Tower debacle in Homebush (Icon Co).

Brand Value

Business owners usually give a lot of thought to their business name. It's their brand. Their marketing edge. Their point of difference. Get it right, invest in a logo, website and social media and it can be worth a lot of money. In 2018 Forbes calculated the value of the Apple brand at $182.8 billion. Not far behind were the usual suspects – Google, Microsoft and Amazon.

Not surprisingly, business owners with strong brands usually invest in brand protection. That includes a combination of a registered trade mark strategy, control of domain names and marketing teams keeping an eye on competitors and sharp operators who set up businesses with similar names in competing industries. Conversely, some business owners see value in adopting elements of a competitors branding, expecting some of that value will spill over to them.

So you might be surprised to know that in the local construction industry that there are at least 9 companies sharing the ICON brand in their names. Icon Co (https://icon.co), Icon Construction Group (http://iconconstructiongroup.com.au), Icon Oceania (http://iconoceania.com.au), Icon Property Management (http://iconpm.com.au) , Icon Homes (http://www.iconhomes.com.au) , Icon Living (http://www.iconliving.com.au) , Icon Construction & Building (http://www.iconnsw.com.au) , Icon Building Group (http://www.iconbuilding.com.au), Icon Projects (https://www.iconprojectsnsw.com.au)

Trading Names and ASIC

Some business owners mistakenly believe that registering their company name with ASIC, that incorporates their brand name, is all they need to do to operate lawfully and give them brand protection. They can and should do a company name (or business name) availability check before they register – https://asic.gov.au/online-services/search-asics-registers/companies-and-organisations/check-name-availability/

The ASIC website says:  "To see if your proposed company name is too similar to a name already held by ASIC, you can use 'Check name availability'. You cannot register a company name that is identical to one that already exists."

The reality is, that ASIC will allow any number of versions and derivations of names incorporating the word ICON. If you search the ASIC database for ICON, there are up to 100 company and business names Australia wide in various industries that incorporate ICON in their branding.

The legal position is that company name or business name registration will not protect you if you chose a name where it may be argued that you are trading off a competitor's reputation and/or are engaging in false and misleading conduct. There are no proprietary rights in a business name or a company name, although evidence of reputation and goodwill may support actionable claims of passing off, or false and misleading conduct. Also, your registered business name or company name may not protect you if your competitor has a trade mark registered that is substantially identical, or deceptively similar, to a registered trade mark.

So why are there so many ICONS in the building industry? For many, maybe there is a belief that associating their construction work with a result that is "iconic" is aspirational and that their work is intended to be "iconic". Also, if there are a number of successful building brands that use ICON in their name, that couldn't hurt, right?

Well.....

Icon Debacle

Icon Construction Group is a privately owned company based in suburban Hurstville in Sydney that has developed a number of apartment buildings around Sydney. Icon Co is controlled by the Japanese listed construction giant Kajima, which purchased Melbourne based Icon Co in 2015 and then merged with also Melbourne based Cockram Constructions in 2018 to create a construction services business with an estimated turnover in 2018 of $1.4 billion.

Icon Co uses the ICON brand through an entity called Kajima Cockram Holdings Pty Ltd. That company has a registered trade mark for ICON for "construction services and project management services; property development" and has applied for significant extensions to the claims. There is also a trade mark with a logo for the exact existing claims in favour of "Icon Developments Australia Pty Ltd" that appears to be related.

Reputation Risk

Here is where reputation risk becomes an issue. Usually, there is reputation risk for a trade mark owner of infringers offering up inferior goods and/or services. In the ICON case, it's Icon Construction Group (no trade mark) having to disassociate itself with Icon Co (the billion-dollar construction business) because of the negativity associated with the Opal Tower fail.

So why hasn't Icon Co ever relied on its registered trade mark to prevent others from using the ICON brand in their trading names? Usually, when a trade mark is registered, it gives the owner a monopoly to use the brand in connection with the goods and services for which it is registered.   More on that in another article.

The takeaway from all this?

Today, in a digital world where social media and powerful search engines produce information on key words (including brand names) in seconds, brand management has never been more important.

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.

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