Formerly known as: protecting your old name after a rebrand

A rebrand raises a question that can be overlooked during the launch: what happens to the name being left behind?  Changing the company’s name, preserving the goodwill attached to the old brand and maintaining trade mark registrations for it are all separate questions.

The company name, the brand and the assets are different things

Under section 81 of the Companies Act 2006, a change of name takes effect when the new certificate of incorporation is issued and does not affect the company’s rights or obligations.  The company that owned the goodwill and the registered trade marks before the change owns them afterwards.

A rebrand does not, by itself, extinguish goodwill.  Goodwill is property in a business, not in the name it trades under: as Lord Diplock put it in Star Industrial Co Ltd v Yap Kwee Kor, it “has no independent existence apart from the business to which it is attached”.  If the business carries on, so does the goodwill built under the old name, although the public’s association with that name will tend to fade the longer it goes unused.

That does not give the business an open-ended right to stop others using the old name.  A passing off claim needs goodwill attached to the name at the relevant time, a misrepresentation by the other party and resulting or likely damage.  Whether enough residual goodwill survives is a question of fact, and the business has to prove it.

Residual goodwill can last a long time in an exceptional case.  In Jules Rimet Cup Ltd v Football Association Ltd [2007] EWHC 2376 (Ch), the High Court found that the FA could have prevented, by an action for passing off, the use of WORLD CUP WILLIE marks applied for by another company in 2005, almost 40 years after the activities that created the goodwill in the 1966 mascot.  The facts were unusual, and the case sets no standard period for an ordinary rebrand.

Announce continuity

Goodwill can be lost by abandonment, and a court asked whether it has been abandoned will look at what the business was doing and what it intended.  In the World Cup Willie case, the FA had announced in 1966 that the mascot would afterwards become just ‘Willie’.  The court did not treat that as abandoning the goodwill, because the FA intended to carry on exploiting the figure and the business associated with it.

Announcements form part of that evidence, so the wording deserves some thought.  Wording that presents the change as continuity, such as ‘[Old name] is now [new name]’ or ‘[new name], formerly [old name]’, is clear and accurate.  Wording that reads as a final farewell, such as ‘we have retired the [old name] name’, is better avoided: a third party that later adopts the old name might seek to use it as a concession that the goodwill has been abandoned.  Whether it succeeded would depend on all the circumstances, but there is no reason to offer it.

Update the register

Once Companies House has registered the change, the new name should be recorded against the company’s UK registrations using form TM21A at the UK Intellectual Property Office.  There is no fee, and because the owner remains the same, no assignment is needed.

Watch the non-use clock

An unused registration becomes vulnerable to challenge; it does not expire automatically.  Under section 46 of the Trade Marks Act 1994, it may be revoked if genuine use in the UK for the goods or services it covers has been suspended for an uninterrupted period of five years and there are no proper reasons for non-use.  The period runs from when genuine use of the old mark stops, not from the date of the Companies House change.  A business that last makes genuine use of its old name at the end of February 2027 would find the registration open to challenge from March 2032.

Revocation can also be partial, relating only to registered goods or services for which the mark has not been used.  Continuing to sell one product line under the old name does not necessarily preserve protection across the whole registration.

What ‘formerly’ wording can and cannot do

Wording such as ‘[new name], formerly [old name]’ can help customers understand that the business is continuing.  It should not, by itself, be relied on to preserve the old trade mark registration.  Whether a particular use qualifies as genuine use depends on how the mark is used commercially for the relevant goods or services and the evidence supporting that use.  In easyGroup Ltd v Nuclei Ltd, the Court of Appeal summarised the test as whether, in all the circumstances, there is real commercial exploitation of the mark to create or preserve an outlet for those goods or services.  The assessment includes whether the old name is being used to identify the commercial source of the goods or services, rather than simply recording the business’s history.

Continuing genuine commercial use of the old name can postpone exposure to revocation for non-use, for the goods or services concerned.  Token use solely to preserve the registration will not suffice.  Equally, use need not be quantitatively significant; there is no minimum threshold and modest use can qualify if commercially justified. The test is quality, not quantity.  Whether continued use is worthwhile depends on the old name’s value, the cost and its fit with the new brand. If it is retained, the aim should be real, if limited, trade under it for the registered goods or services, and evidence of that trade. Once genuine use stops, the five-year non-use period becomes relevant.  Even if the registration is subsequently revoked, surviving goodwill may still support a passing off claim.

Checklist

• Present the change as continuity, and check website copy, FAQs and press material for anything that reads as a farewell to the old name.
• Once the new certificate of incorporation has been issued, record the new company name against each UK registration using form TM21A.
• Note when genuine use of the old name stops, diarise the five-year point for each registration, and decide before then whether the old name is worth keeping in genuine use, and for which goods or services.
• Keep evidence of historic goodwill and of any continuing use: dated advertising, invoices and records showing the scale and nature of trade under the old name. The owner must prove use (section 100), and the Court of Appeal has stressed that genuine use cannot be proved by probabilities or suppositions.

This piece was written by Robert Humphreys and Tristan Morse.  Please contact either of them, or another member of the HLaw team, with any questions on intellectual property, including the trade marks and goodwill behind a rebrand.

All the thoughts and commentary that HLaw publishes on this website, including those set out above, are subject to the terms and conditions of use of this website.  None of the above constitutes legal advice and is not to be relied upon.  Much of the above will no doubt fall out of date and conflict with future law and practice one day.  None of the above should be relied upon.  Always seek your own independent professional advice.

Humphreys Law