NZ FINTECH LIMITED T/A MOOLA v CREDITCORP FINANCIAL SOLUTIONS PTY LIMITED T/A WALLET WIZARD

High Court of New Zealand

Gault J

15 March, 2 April 2019

[2019] NZHC 654

Trade mark infringement – Google Adword – whether use ‘as a trade mark’ – no visibility of trade mark bid on for Google Adword – passing off – s 9 Fair Trading Act 1986 (NZ) – s 89 Trade Marks Act 2002 (NZ)

Facts:

The plaintiff was a digital consumer finance company that provided short term loans.  It had used the trade mark MOOLA since 2013 and provided its lending services through its website. Subsequent to commencing business it registered the trade mark MOOLA.

The defendant was an Australian company which commenced business in New Zealand in September 2015 as WALLET WIZARD, operating through its website.  Potential customers could apply online for loans.  In September 2015 the defendant commenced purchasing Moola as a Google Adword.  The plaintiff alleged that this conduct amounted to misleading or deceptive conduct or passing off.  The defendant denied this.  The plaintiff claimed that the defendant appeared to stop the practice of bidding on Google Adwords for Moola (something denied by the defendant) but that it again began purchasing Moola in or about August 2018. 

The plaintiff issued proceedings in November 2018 seeking an interlocutory injunction and alleging trade mark infringement, passing off and a breach of s 9 of the Fair Trading Act 1986 (NZ). 

Held, refusing an interlocutory injunction:

Trade Mark Infringement

(i)      The plaintiff had not established a serious question to be tried as to trade mark infringement [52].

(ii)      As to trade mark infringement under s 89(1)(a), it was common ground at least in relation to one of the defendants’ purchased Adwords that the defendant had used in the course of trade an Adword identical with the MOOLA registered trade mark [28].  The key issue was whether purchase of Google Adwords constituted use as a trade mark as required by s 89(2).  Here (as in other cases) there was no evidence that the internet users seeing a Google Adword ever see the use of the key word “Moola” [43].  There was a conflict of evidence as to whether a sufficient number of consumers undertaking a Google search for “Moola” would perceive Wallet Wizard’s purchase of the Adword “Moola” when they saw an   [Ad]  search result returning the Wallet Wizard website [49].  A central issue here was whether the use could be “taken” at all for the purpose of s 89(2) given the hidden nature of the Google Adword [50].

(iii)     The court could not rule out the possibility that evidence at trial could show that a significant number of normally informed or reasonably attentive internet users would understand Adwords sufficiently to know or understand that when they searched “Moola” on Google, and saw an Adword result that the word  “Moola” has been purchased by the defendant [51].

InterCity Group (NZ) v Nakedbus NZ Limited [2014] NZHC 124; Mainland Products Limited v Bonlac Foods (NZ) Limited [1998] 3 NZLR 341; Tasman Insulation New Zealand Limited v Knauf Insulation Limited [2015] NZCA 602; Veda Advantage Limited v Malouf Group Enterprises Pty Limited [2016] FCA 255; (2016) 241 FCR 161 referred to.

(iv)    Considering the matter by reference to the function of a trade mark, while visibility may not always be essential, the fact that the purchaser of a Google Adword is not using the trade mark as a badge of origin for its own goods and services but rather to place its comparative or competitive offering in the search results indicated that there was no use as a trade mark.  Taking that approach, evidence as to consumer understanding would make no difference [52].

Passing Off; Breach of Fair Trading Act 1986

(v)     No serious question had been demonstrated on the passing off or Fair Trading Act causes of action.  The plaintiff’s own evidence that consumers understood the essential features of Google Adwords indicated that a purchase of a trade-marked Adword (without use of the trade mark in the resulting advertisement) did not involve a representation which would lead or be likely to lead members of the public to believe that the services it offered were those of the plaintiff [55].

Balance of convenience and overall justice

(vi)    The relative strength of the parties was a relevant factor in the balance of convenience where it can be appropriately ascertained.  Here the relative strength of the parties’ case weighed against interim relief [70].

(vii)    The fact that the plaintiff had also bid on the defendant’s trade mark WALLET WIZARD during the period when the court accepted that the plaintiff was not aware that the defendant was purchasing its “Moola” Adword showed that the plaintiff was engaging in the very conduct it complained about in a manner that went further than a legitimate reaction.  This weighed against interim relief [73].

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