Last month we wrote about the need for businesses to adopt distinctive, non-descriptive trading names to adequately protect themselves against others. The NZ Tax Refunds case showed us that, short of demonstrating that a descriptive trading name has acquired distinctiveness and that a competitor is deliberately seeking to free ride on another’s goodwill and reputation, competitors are largely free to adopt virtually identical trading names.
The decision of the Dispute Resolution Service (DRS) in Wellington Golf Centre Limited v Ricky Faesen Kloet (DRS No. 846) reinforces this view. The complainant, trading in Wellington as Wellington Golf Centre, registered the domain name www.wellingtongolfcentre.co.nz in December 2010. The respondent, trading throughout New Zealand (including in Wellington) as Golf Warehouse, registered the domain name www.wellingtongolfcenter.co.nz in April 2011.
Given use of the domain name for over two years, DRS found that the complainant did have rights in www.wellingtongolfcentre.co.nz, but that the name was wholly descriptive of the goods and services provided. This meant the complainant was required to establish some acquired distinctiveness or secondary meaning for its domain name to prevent others using it. Unfortunately for the complainant, its evidence of reputation and distinctiveness was inadequate – no evidence of sales, advertising, or other use beyond use of the website was provided. The respondent was therefore allowed to retain the virtually identical www.wellingtongolfcenter.co.nz.
Taking a cynical view, one could question why Golf Warehouse wanted to register a domain name relating solely to Wellington, with American spelling, and which did not reflect its own trading name. Surely Golf Warehouse was aware of its competitor and its competitor’s domain name. Given the lack of evidence of distinctiveness and reputation in the www.wellingtongolfcentre.co.nz name, however, these matters did not require consideration by the DRS. With evidence like that provided in the Tax Refunds case, the result may possibly have been different.
As with the NZ Tax Refunds case, the moral of the story is to choose a trading name that is distinctive. We also recommend registering your trade marks to provide an additional avenue of redress should a competitor adopt a confusingly similar trading name or brand.