Practice note on use of 'without prejudice' material issued

United Kingdom
The Company Names Tribunal has issued Practice Note 01/10 on the use of 'without prejudice' material, reminding practitioners that 'without prejudice' material is inadmissible in proceedings before the tribunal, just as it would be in any other legal forum. 
Section 69 of the Companies Act 2006, which came into force on October 1 2008, allows a brand owner to make a complaint against a company name that appears to have been registered in order to take advantage of the goodwill in its brand or trademark. An objection may be on the basis that the registered company name is:
  • the same as that associated with the brand owner and in which the latter has goodwill; or 
  • sufficiently similar to such a name that its use in the United Kingdom is likely to mislead by suggesting a connection between the company and the brand owner.
Under Section 69(4) of the act, a registrant is required to change a company name which conflicts with a pre-existing name unless it can show:

"a) that the name was registered before the commencement of the activities on which the applicant relies to show goodwill; or

 b) that the company -

(i) is operating under the name; or

(ii) is proposing to do so and has incurred substantial start-up costs in preparation; or

(iii) was formerly operating under the name and is now dormant; or

c) that the name was registered in the ordinary course of a company formation business and the company is available for sale to the applicant on the standard terms of that business; or

d) that the name was adopted in good faith; or

e) that the interests of the applicant are not adversely affected to any significant extent."

The above prima facie defences can be rebutted if the brand owner can show that the main purpose of the registrant in registering the name was to obtain money (or other consideration) from the brand owner or prevent it from registering the name. The motive of the registrant is thus relevant only if the registrant has raised a prima facie defence.    
According to the practice note, where the parties have legal representation, their representatives should prevent 'without prejudice' material from being admitted into the proceedings. In these circumstances, the adjudicator will not, upon his or her own volition, act to exclude such material. Where the parties are not represented, the adjudicator will form on opinion on the admissibility of the material due to its 'without prejudice' nature. The parties will be informed and will be free to contest this decision in an interlocutory hearing. If it is decided that the material should be excluded, a different adjudicator will step in to determine the substantive dispute.
The normal criteria applies for determining whether material should be excluded under the 'without prejudice' rule. The marking of 'without prejudice' is not necessarily decisive as to its nature. Material has to relate to a genuine attempt to settle the dispute. Guidance also comes from the judgment in Marks & Spencer plc v One in a Million Ltd ([1998] FSR 265). In that case, an offer to sell the domain name '' to Burger King for a vastly inflated price was not excluded, as it was not considered to be part of genuine negotiations.

The practice note acknowledges that a protracted correspondence between the parties is more likely to be indicative of genuine negotiations and therefore excluded.
In practice, correspondence between the parties is commonly included in statements of case and evidence before the tribunal. This is frequently the best evidence of the motives of the registrant. The practice note was published as a reminder that the 'without prejudice' rule applies in proceedings before the tribunal.
Cheng Tan, McDermott Will & Emery UK LLP, London

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