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Clear first, launch second: what the High Court’s decision in Zip Co Limited v Firstmac Limited [2026] HCA 16 means for new brands.

Choosing a new brand can be an exciting part of launching a product, service or business. Once the preferred name has gained internal support, however, commercial momentum can build quickly: domains are secured, packaging is commissioned, regulatory documentation is prepared and marketing plans begin to take shape.

A recent High Court decision provides a timely reminder that trade mark clearance needs to occur before that momentum becomes too difficult (and expensive!) to reverse.

In Zip Co Limited v Firstmac Limited [2026] HCA 16, the High Court considered whether buy-now-pay-later provider Zip Co could rely on “honest concurrent use” as a defence to infringement of an earlier trade mark registration for the word mark ZIP by non-bank lender, ‘Firstmac’.

The lessons from the decision apply to any business developing a new brand, but are particularly important for pharmaceutical and healthcare companies, where a proposed name can become embedded in regulatory, clinical and commercial workstreams well before a product reaches the market.

What happened in Zip Co v Firstmac?

Firstmac was the registered owner of an Australian trade mark registration for the word mark ZIP in relation to financial services in class 36 since 2004.

The founders of Zip Co independently selected the ZIP and ZIP MONEY brands without initially knowing about Firstmac’s registration. However, evidence established that Zip Co did not search the Australian Trade Marks Register or obtain legal advice before filing its trade mark applications.

In October 2013, IP Australia issued adverse examination reports identifying Firstmac’s earlier registration as an obstacle to registration of Zip Co’s ZIP and ZIP MONEY brand names on the basis that the marks closely resembled one another and covered similar services.

The reports received only cursory attention from Zip Co’s founders, and despite becoming aware of Firstmac’s earlier registration, Zip Co proceeded to launch under ZIP-formative branding the following month. In the years that followed, Zip Co subsequently developed a substantial business and reputation in its ZIP brands.

When Firstmac later commenced infringement proceedings, Zip Co sought to rely on the honest concurrent use defence. Broadly, honest concurrent use can provide a pathway to registration – and, in some circumstances, a defence to infringement – where similar marks have been used honestly alongside one another without any instances of consumer confusion.

However, the High Court unanimously found that Zip Co had not established the requisite ‘honesty’ component.

Why didn’t Zip Co’s later success solve the problem?

The High Court confirmed that honesty must be assessed at the time of each potentially infringing use. Zip Co therefore needed to establish an honest state of mind from the point at which it first launched its services under the ZIP-formative marks.

At that time, Zip Co had received examination reports specifically identifying Firstmac’s earlier registration as an impediment. The critical issue was not that the Zip Co founders had originally selected the ZIP-formative marks dishonestly: their independent and honest adoption of the marks before learning of Firstmac’s registration remained relevant. Rather, Zip Co bore the onus of positively establishing that its state of mind was honest when potentially infringing use began in November 2013, by which time it knew that IP Australia considered the earlier registration a material impediment to legitimate use of its marks.

Zip Co had chosen not to engage with the adverse reports and did not lead sufficient evidence that, despite the warning, its decision-makers genuinely believed that consumers would not be confused or that Zip Co would not benefit from any confusion. Nor was there sufficient evidence to establish that its failure to turn its mind to those matters was not reckless. Those gaps meant that Zip Co failed to prove the requisite honesty. Its later commercial success and substantial reputation could not retrospectively supply the evidence missing at the time use commenced.

Importantly, the High Court did not hold that knowledge of an earlier trade mark is invariably fatal to honest concurrent use, or that carelessness is itself equivalent to dishonesty. A failure to search the Register will not, without more, establish a lack of honesty. The inquiry is directed to the user’s actual state of mind, assessed against the standards of ordinary, decent people. However, knowledge of an earlier registration will ordinarily weigh strongly against a finding of honesty – particularly where the business has received a specific warning that the registration may materially impede its proposed use and then elects not to engage with it.

What does the Zip Co decision mean for brand owners?

Businesses sometimes assume that a trade mark issue can be dealt with later, once the proposed brand has been tested in the market or sufficient use and reputation has been established. And this can sometimes be true, but the ZIP decision illustrates the danger in that approach.

The central lesson is therefore not simply that businesses should search before launch – it is that the discovery of a potentially conflicting right creates a real decision point. A name may have been selected independently and in good faith, but that does not answer whether the business acts honestly when it later commences or continues use with knowledge of the obstacle. What the business investigates, believes and decides at that point may become critical.

An adverse search result or examination report should therefore be actively assessed rather than parked while the brand gathers momentum. If the business wishes to proceed, it should obtain advice, test the basis on which use is considered legitimate and document the reasoning at the time. Honest concurrent use may remain available in an appropriate case, but it must be proved by evidence of the user’s actual state of mind – it cannot be assumed that later reputation, market success or an absence of known confusion will fill an evidentiary gap left at launch.

Why is early trade mark clearance critical for pharmaceutical and healthcare launches?

For pharmaceutical and healthcare businesses, changing a brand late in the development process can be particularly difficult.

Before a product becomes publicly available, its proposed name may already appear in:

• regulatory applications and supporting dossiers;
• clinical trial and investigator materials;
• product information and consumer medicine information;
• packaging, labels and instructions for use;
• manufacturing, supply and distribution agreements;
• healthcare-professional education;
• patient-support programs; and
• websites, applications and other digital platforms.

This can create understandable resistance to changing a preferred name. However, the fact that a brand has become costly or operationally difficult to change does not resolve the underlying infringement risk or establish an entitlement to continue using it. By the time the issue is revisited, the business may have lost the practical flexibility it had when the name was first selected, without having improved its legal position.

The practical objective should therefore be to identify and assess trade mark issues while alternative names remain commercially viable, not after the business has become committed to a single option.

Four practical steps for brand owners

1. Conduct trade mark clearance while several names remain available

Trade mark clearance should take place before a proposed name is approved internally or incorporated into regulatory, packaging and launch workstreams.

A search should extend beyond identical marks. Depending on the brand and the markets in which it will be used, it may need to consider:

• visually, aurally and conceptually similar marks;
• related goods and services;
• unregistered brands and marketplace use;
• company names, domain names and digital use; and
• relevant overseas jurisdictions.

Pharmaceutical naming may also require consideration of regulatory requirements, International Nonproprietary Names, protected stems and medication-safety concerns.

2. What should a business do if trade mark clearance identifies a conflicting mark?

A problematic search result or examination report should not be treated as an administrative matter that can simply be parked until closer to launch.

The business should promptly determine:

• whether the earlier registration presents a genuine infringement risk;
• whether the earlier mark may be vulnerable to challenge;
• whether consent or a coexistence arrangement may be available;
• whether changes to the proposed mark or commercial scope could reduce the risk; and
• whether an alternative name should be selected.

Not every citation requires a rebrand. The important point is that the issue is investigated and an informed decision is made before use begins.

3. Why should businesses document their trade mark clearance assessment?

If a business decides to proceed despite an identified earlier right, it should carefully document the basis for that decision.

Relevant records may include legal advice, information about the selection of the name, differences between the respective marks and offerings, the intended market, investigations into the earlier owner’s use and any attempts to obtain consent.

This is not merely an evidence-gathering exercise. It helps ensure that the risk has been properly considered by the relevant decision-makers.

4. When should trade mark clearance be completed before launch?

The most effective protection is often procedural. Businesses should incorporate trade mark clearance into their formal approval process for new products, services and campaigns.

Ideally, legal approval should be obtained before:

• the proposed name is treated as final;
• regulatory applications are submitted;
• packaging or labels are commissioned;
• public announcements are made; or
• significant launch expenditure is incurred.

This is particularly important where legal, regulatory, product and marketing teams operate on different timelines.

The key takeaway

The ZIP decision does not mean that businesses can never proceed after discovering an earlier mark. Some obstacles can be distinguished, negotiated, challenged or otherwise overcome.

It does mean that a known obstacle should not be ignored in the expectation that commercial success will eventually cure the problem.

The best time to resolve naming risk is while the name is still changeable. Early clearance preserves options, supports an informed launch decision and can prevent a trade mark issue from becoming a much larger commercial problem.

Pearce IP can assist with the clearance, protection and management of new product and corporate brands in Australia, New Zealand and internationally. Use our Contact Form or email us at info@pearceIP.law or call Australia Tel: +61 (0) 2 9023 9988 or New Zealand Tel: +64 (4) 886 1199.

About Pearce IP

Pearce IP is a privately owned/independent, specialist, life-sciences focussed, intellectual property/law firm offering lawyers and attorneys in Australia and New Zealand.

Our lawyers and attorneys specialise in pharma, biopharma, biotech, ag-tech, food-tech, med-tech, although our work is broader than these industries.

Pearce IP and its leaders are ranked in every notable legal directory including: Chambers & Partners, Legal 500, IAM Patent 1000, IAM Strategy 300, MIP IP Stars, Doyles Guide, WTR 1000, Best Lawyers, WIPR Leaders, Best Law Firms, among others. In 2025, Pearce IP was honoured by Australasian Lawyer and New Zealand Lawyer as a Top Specialist Firm, 5 Star Employer of Choice, and the “Standout Winner” for Inclusion and Culture (<100 employees).  

Pearce IP is the only leading IP firm in Australia and New Zealand with a female founder, and is certified by WEConnect International as women owned.

Kutti Bay Investments Pty Ltd v Rattlejack Innovations Pty Ltd [2026] FCA 422

Introduction

Justice Rofe of the Federal Court of Australia has delivered yet another decision in the long running dispute between Kutti Bay Investments Pty Ltd (Kutti Bay, formerly Jusand Nominees Pty Ltd) over patents for a “Safety System and Method for Protecting Against a Hazard of Drill Rod Failure in a Drilled Rock Bore”.  In this decision, Justice Rofe held that Kutti Bay’s application to amend three standard patents (the Standard Patents) constituted an abuse of process, insofar as it sought to “overcome” the Court’s decisions in Jusand Nominees Pty Ltd v Rattlejack Innovations Pty Ltd [2022] FCA 540 and Jusand Nominees Pty Ltd v Rattlejack Innovations Pty Ltd [2023] FCAFC 178 (the Jusand Proceedings).  See our reports on these decisions here and here.

Background

Kutti Bay commenced proceedings alleging infringement of the Standard Patents against Rattlejack Innovations Pty Ltd, Pan Australis Pty Ltd, Murray Engineering Pty Ltd and Leigh Maurice Sutton (together, Rattlejack).  Shortly after commencing proceedings, Kutti Bay applied to amend the Standard Patents under s 105(1) of the Patents Act 1990 to correct “obvious mistakes” in the Standard Patents.  Rattlejack opposed Kutti Bay’s patent amendment application, ultimately on the basis that the amendment application (and the expert evidence intended to be relied on for the purpose of that application) gave rise to an abuse of process.

So, what was the basis for Rattlejack’s abuse of process allegation? The answer to this question requires us to delve into the previous patent disputes between these parties, which led to the decisions in the Jusand Proceedings.

In the Jusand Proceedings, Rattlejack had successfully defended Jusand’s allegations of infringement in respect of three innovation patents (the Innovation Patents).  The Federal Court (at first instance and on appeal) had also found the Innovation Patents to be invalid for lack of disclosure and support.  Relevantly:

• the Standard Patents had the same priority date as the Innovation Patents;
• the Standard Patents (in their unamended form) were in materially the same terms as the Innovation Patents.  The Standard Patents were also in substantially the same terms as each other; and
• in the Jusand proceedings, the Court had made findings as to the construction of the Innovation Patents and as to the common general knowledge.

In November 2024, IP Australia re-examined all the patents in the same patent family as the Innovation Patents, including the Standard Patents.  The examiner considered that each of the claims of the Standard Patents lacked disclosure/support, for the same reasons as those identified in the Jusand Proceedings.  Given the examiner’s view, Kutti Bay considered it necessary to file the current patent amendment application to prevent revocation of the Standard Patents.

Kutti Bay relied on the evidence from three new expert witnesses, none of whom gave evidence in the Jusand Proceedings.  Justice Rofe noted that it was clear in the case of one of these experts that he did not read the Standard Patents to describe and claim the same invention that the Court found to be disclosed and claimed in the Innovation Patents.  Her Honour also noted that the conclusion of a second expert as to the routine nature of material selection was at odds with the findings in the Jusand Proceedings, and that this conclusion was only available based on an enlarged body of common general knowledge beyond what was found to exist on the evidence at first instance during the Jusand Proceedings.

Key Issues

Rattlejack filed an application alleging that Kutti Bay’s amendment application constituted an abuse of process to the extent that it sought to “overcome” the decisions in the Jusand Proceedings, for the following reasons:

• The amendment application sought to re-agitate and/or challenge issues of construction determined by the Full Court.
• The amendment application sought to invoke the Court’s statutory power in a manner that would undermine its earlier decisions.

In these circumstances, Rattlejack argue that allowing the amendment application to proceed would bring the administration of justice into disrepute, create a material risk of inconsistent findings and prejudice Rattlejack (including by exposing Rattlejack to being “twice vexed”).

Kutti Bay, however, argued that no such abuse of process arose as the proposed amendments merely corrected an “obvious mistake” in the Standard Patents, that is, a mistake which was apparent on the face of the Standard Patents and for which the correction was also obvious.

Consideration

Justice Rofe held that Kutti Bay’s patent amendment application was an abuse of process for the following key reasons:

• On the basis of the evidence before it, the Court in the Jusand Proceedings had made findings as to the common general knowledge of the person skilled in the art as at the priority date.  The Court then construed the claims of the Innovation Patents, based on the findings as to the state of the common general knowledge at the priority date and assisted by the experts’ evidence as to their understanding of the claims.
• The Standard Patents were materially identical to the Innovation Patents construed by the Court in the Jusand Proceedings.The Standard Patents and the Innovation Patents also shared the same priority date.
• The amendment application, however, was premised on evidence which was not before the Court in the Jusand Proceedings and would require her Honour to reconsider the construction of the Standard Patents in light of this new evidence.  More particularly, Justice Rofe held at [93] and [94] that:

“Kutti Bay’s “obvious mistake” contention requires the Court to read relevantly the same specification that it construed in the Jusand Proceeding, and in order to allow the amendment, agree with the new person skilled in the art experts that a different invention is actually described and claimed, than the one previously identified and considered by the Court.

As the Respondents identify, the vice in Kutti Bay’s approach is that in order to accept the existence of an obvious mistake, the Court must accept the evidence of the new experts as to the safety system of the claimed invention.  Doing so would necessarily involve adopting a different construction of the claimed invention different from that reached in the Jusand Proceedings.”

Outcome and Implications

Justice Rofe held that Kutti Bay’s application to amend the Standard Patents constituted an abuse of process, insofar as it sought to “overcome” the Court’s decisions in the Jusand Proceedings.  Justice Rofe also ordered Kutti Bay to pay Rattlejack’s costs of and incidental to its abuse of process application.

Justice Rofe’s decision is a salutary lesson for patentees: where construction of one patent in a patent family has already been the subject of a judicial decision, this construction may impact later litigation (including future amendment applications) in relation to other materially identical patents in the same family.

The proceedings continue, albeit very slowly, with the matter set down for a case management hearing in February 2027.

About Pearce IP

Pearce IP is a privately owned/independent, specialist, life-sciences focussed, intellectual property/law firm offering lawyers and attorneys in Australia and New Zealand.

Our lawyers and attorneys specialise in pharma, biopharma, biotech, ag-tech, food-tech, med-tech, although our work is broader than these industries.

Pearce IP and its leaders are ranked in every notable legal directory including: Chambers & Partners, Legal 500, IAM Patent 1000, IAM Strategy 300, MIP IP Stars, Doyles Guide, WTR 1000, Best Lawyers, WIPR Leaders, Best Law Firms, among others. In 2025, Pearce IP was honoured by Australasian Lawyer and New Zealand Lawyer as a Top Specialist Firm, 5 Star Employer of Choice, and the “Standout Winner” for Inclusion and Culture (<100 employees).  

Pearce IP is the only leading IP firm in Australia and New Zealand with a female founder, and is certified by WEConnect International as women owned.