Federal court says too many Virgins

Default judgment was recently obtained in the Federal Court of New South Wales in proceedings commenced on behalf of Virgin Enterprises Limited for:

• breaches of the Trademarks Act of New South Wales;
  
  
• breaches of the Trade Practices Act and the Fair Trading Act of New South Wales, as well as fair trading legislation of Victoria and the Australian Capital Territory; and
  
  
• common law passing off.

The case of Virgin Enterprises Limited v Klapsas [2001] FCA 1502 concerned the defendant's use online of the trade names 'Virgin Limousines' and 'Virgin Car Rentals'. In addition to using the names, the defendant had used a script similar to the VIRGIN trademark.

In his judgment, Justice Madgwick of the Federal Court of New South Wales held that Virgin Enterprises and Richard Branson had a substantial and valuable reputation, and that the word 'Virgin', when used in relation to a business, had come to signify in Australia that the business was conducted by at least one of the companies of Virgin Enterprises. Madgwick also held that all of the trademarks referred to in the proceeding were well known in Australia. Thus, the defendant's use online of the trade names 'Virgin Limousines' and 'Virgin Car Rentals' constituted a misuse of Virgin Enterprises' trademarks in breach of the Trademarks Act. Madgwick also held that the defendant's conduct amounted to passing off and misleading and deceptive conduct (or conduct likely to mislead or deceive) in contravention of the Trade Practices Act.

Madgwick made various orders including injunctive relief, and awarded Virgin Enterprises costs incidental to the proceeding.

Karen Anne Hayne, Coudert Brothers, Sydney