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Businesses need customers to protect a trading name

Posted: 2nd November 2011   In: Residential Conveyancing

The High Court has made it clear that having a business reputation is not enough to justify the protection of a trading name – the business must also be able to show that it has customers in the UK.

The issue arose in the case of two online dating agencies. One was a free service called which was set up in 2001. The other was a paid for service called and was set up in 2006.

The free service, which was based outside theUKand received its income through advertising, began receiving complaints from people who were angry at being charged for a service they thought was free. It turned out they had subscribed to the paid for service and then took their complaints to the owners of the free service by mistake.

The free service began proceedings to have the other firm’s trademark declared invalid.

However, the High Court ruled against the owners of the free service. It held that the law required a business to have customers in order to protect a trading name. 

The free service had not been able to show that it had any customers or business in theUK.  Having visitors to the website was not enough. People could only be classed as customers if they became members and used the dating services. Those services could be provided free, but people had to actively subscribe to them to be classed as customers.

The free service didn’t have such members in theUKand so could not protect its trading name.

Please contact us for more information about the issues raised in this article.