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On appeal from the Full Federal Court, the recent High Court decision of Zip Co Limited v Firstmac Limited [2026] HCA 16 provides clarity regarding when the defence to infringement of a trade mark of honest concurrent use is to be assessed and the meaning of “honest”. The plurality held that: “[5] …the time at which the defences of honest concurrent use are to be assessed is the time of each alleged potential infringement. And the content of the requirement of honesty under s 44(3)(a) is that an alleged infringer must have a state of mind that is honest by the standards of ordinary, decent people”. The critical need to lead positive evidence in circumstances of the prior knowledge attributed to Zip Companies was also highlighted by the Court: in this case, Zip Companies used ‘ZIP’ marks for credit products later in time than Firstmac’s registered mark ‘ZIP’ in class 36 for loan products. Zip Companies failed to establish honesty in the face of circumstances where Zip Companies’ representative became aware of Firstmac’s registered mark as it was cited as an impediment to registration following an application by Zip Companies to register the ZIP marks, and thereafter Zip Companies launched products under the ZIP marks. It was also held that: “[70]… the Zip Companies did not lead evidence sufficient for a finding that, despite knowing of a material impediment to the legitimate use of the Zip Companies' marks, in November 2013 (or subsequently for later potential infringements) Mr Diamond nevertheless considered that consumers would experience no confusion between the Zip Companies' marks and the Firstmac Mark which might enure to the benefit of the Zip Companies. Nor did the Zip Companies lead evidence sufficient for a finding that although Mr Diamond had not turned his mind to these matters, he had not been reckless in his failure to do so. These gaps in the evidentiary record and findings precluded a conclusion that the Zip Companies had proved their honesty.”. We can also take away from the case that it is not fatal to a defence of honest concurrent use that the alleged infringer knew of the existence or registration of the competitor’s mark on or before the alleged infringement/s occurred. A link to the case is here: https://www.hcourt.gov.au/cases-and-judgments/judgments/judgments-1998-current/zip-co-limited-v-firstmac-limited
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