AAMI insured against infringing use of AAMIC

In Australian Associated Motor Insurers Ltd v Australian Automotive Motor Inspection Centre Pty Ltd, the Federal Court of Australia has issued an interlocutory injunction restraining the defendant from using the acronym AAMIC as a business name. The court held that there were serious issues that required consideration at full trial and that the plaintiff had an arguable case in claiming that the defendant's business name was confusingly similar to its registered and well-known AAMI mark.

Australian Associated Motor Insurers (Australian Associated) is a major Australian insurance company that provides, among other things, car insurance. It is the registered proprietor of a well-known mark that consists of the acronym AAMI. The acronym is the main visual feature of Australian Associated's trademarks and has been used extensively in advertising since 1970.

In early 2003 the Australian Automotive Motor Inspection Centre (Inspection Centre) incorporated and registered the business name AAMIC. It provides inspection services on car repairs made by insurance companies and requests that any defective repairs are rectified by the insurer. It had been using the acronym AAMIC on business cards, fax forms, in newspaper advertisements and as a large sign on its shop front.

Australian Associated sought and obtained an interlocutory injunction in the Federal Court restraining Inspection Centre from using the acronym AAMIC on the basis of trademark infringement, contravention of the Trade Practices Act 1974 and passing off.

It was not in dispute that there was a triable issue for passing off on the basis that Australian Associated has a very substantial reputation in Australia in the acronym AAMI.

When examining the case for trademark infringement, the Federal Court stated that both parties used their marks in similar fields of activity and that the consumer may not detect a difference between the two companies. Even if it was argued that the services provided by Inspection Centre were of a different description to those of Australian Associated, the court said that it was plainly arguable that consumers would make a connection between the two acronyms because the AAMI mark is so well known.

The court held that there was an arguable case that Inspection Centre deliberately chose its company name to lead consumers to believe that its business is connected with Australian Associated, on the basis of:

• the visual similarity between AAMI and AAMIC (the latter sign includes the whole of Australian Associated's registered trademark);
  
  
• evidence of confusion (a courier delivered a parcel to Australian Associated, which was intended for Inspection Centre); and
  
  
• the tautology contained in Inspection Centre's company name (ie, 'Automotive' and 'Motor') was superfluous unless it was intended to bring a perceived benefit.

For the same reasons, it held that there was a serious issue to be tried in relation to contravention of the Trade Practices Act 1974.

In addition, the court stated that the balance of convenience clearly favoured the granting of an injunction to restrain the use of the acronym AAMIC, on the grounds that:

• Inspection Centre had been in business for such a short period of time;
  
  
• Inspection Centre was free to carry on its business under a name that did not infringe Australian Associated's intellectual property rights; and
  
  
• Australian Associated had given an undertaking to pay for the costs of changing Inspection Centre's company name.

Justin Hooper and Stephen Stern, Corrs Chambers Westgarth, Melbourne