Let's be honest

Intellectual Property Update


It is a familiar problem for rights holders. They become aware of someone who has been using a similar mark. Allegations of trade mark infringement are rebuffed by the infringer on the basis of 'honest concurrent use'. Well maybe not anymore.

In a decision handed down by the Federal Court of Australia on Wednesday, Insight Radiology Pty Ltd has been found to infringe the registered trade marks of Insight Clinical Imaging Pty Ltd.

In two interwoven and complex cases Insight Radiology attempted to rely on its use of the trade mark as 'honest concurrent use' to obtain registration and defeat the infringement claim. Insight Radiology's use has been found not to be honest, due to a lack of diligence and care prior to adoption, and inaction when put on notice of Insight Clinical Imaging's rights. The evidence of use they filed now does nothing but prove the magnitude of Insight Clinical Imaging's damages claim.

The facts

Insight Clinical Imaging was established in Western Australia in 2008 and operates seven medical imaging clinics under the trade marks INSIGHT CLINICAL IMAGING and the following logo:
Australia trademark 2

Despite using the marks since 2008, Insight Clinical Imaging did not apply to register the marks until October 2012.

Insight Radiology applied to register the Insight Radiology Logo in December 2011:
Australia trademark 1

In approximately March 2012 Insight Radiology began operating medical imaging clinics in NSW and then Tasmania under the trade marks INSIGHT RADIOLOGY and the Insight Radiology Logo.

Insight Radiology alleged that it conducted searches prior to adoption of its marks, and did not find any record of Insight Clinical Imaging.

In December 2012 a letter from the trade marks office alerted them to Insight Clinical Imaging's trade marks and in May 2013 it received a letter of demand. Despite this, their use continued.

The proceedings

Initially an opposition before the Trade Marks Office, Insight Clinical Imaging successfully opposed the registration of Insight Radiology's Logo on the basis of its prior rights. The opposition took some time, and Insight Radiology still continued its use of its marks throughout.

Insight Radiology appealed that decision to the Federal Court. Insight Clinical Imaging brought separate proceedings for trade mark infringement. The two proceedings were heard together.

Insight Radiology attempted to rely on its use of the marks as 'honest concurrent use' both for the purpose of obtaining registration of the Insight Radiology Logo and as a defence to trade mark infringement.

Insight Radiology filed evidence of searches it conducted prior to adoption of the mark, and asserted that those searches did not locate Insight Clinical Imaging. Davies J was critical of the evidence of those searches, but stopped short of finding that the evidence was untrue.

Insight Clinical Imaging filed evidence of its Google analytics reports, and expert evidence, that at the relevant time Insight Clinical Imaging would have appeared on the first page of an internet search. Davies J accepted that evidence and found that there had been 'a lack of diligence and reasonable care in carrying out adequate searches before the marks were adopted' such that there was no 'honest' concurrent use.

Expert evidence on Google Analytics played another key role in this case. Insight Clinical Imaging used the geographical information in the analytics as part of its proof that its reputation extended beyond WA. This will be a valuable way for trade mark owners to prove breadth of reputation in this growing online world.

Davies J was also critical of Insight Radiology's failure to take any action upon notice of Insight Clinical Imaging's rights. No evidence was led by Insight Radiology as to why use continued in the face of those known rights. This was found to 'reflect adversely upon a claim to honest concurrent use'.

Insight Radiology also relied on a defence to trade mark infringement on the basis that it was using its own name in good faith. The company changed its name from AKP Radiology Consultants to Insight Radiology over 12 months after use of the marks began, and immediately following receipt of the letter of demand from Insight Clinical Imaging. No evidence was led as to the reason for the name change and the Judge found that Insight Radiology had not proved use in good faith. This will again be helpful for trade mark owners in future as a name change following notification of rights will clearly no longer avoid infringement.

What this means for trade mark owners

This decision gives trade mark owners a clear path to challenge infringers, even if the infringing party have been using the mark for some time.

It will not be enough for the infringer to prove use, they will have to prove the use is honest. Ignorance of the trade mark owner will not be a defence, and it will be necessary for them to show that they have acted with diligence and reasonable care. Continued use, without other explanation, when on notice of the trade mark owner's rights will also be viewed poorly.

This should make it easier for trade mark owners to take action where their rights have been trespassed.

Insight Clinical Imaging was represented by Robynne Sanders and Eliza Mallon of DLA Piper.

Read our update on this case from May 2017.