ALAN WILLIAMS ENTERTAINMENTS LIMITED & Anor v MICK CLARKE & Ors

Goodwill in a band name belongs to the undertaking that carries on the relevant trade, although individual musicians may acquire concurrent goodwill where they trade independently in circumstances supporting that conclusion. Membership of an original band does not, by itself, confer a right to use its name.

Use of a distinctive band name as a badge of origin may amount to passing off where it is likely to suggest a connection with the goodwill-owning undertaking and cause damage. A private agreement restricting a party’s use of a name does not, without more, abandon that party’s goodwill against third parties. Registration of a trade mark to interfere with another trader’s legitimate business may constitute bad faith.

The claim concerned the name “the Rubettes” and related names used for live music, merchandising, music sales and associated services. The claimants contended that AWEL owned the relevant goodwill and that the defendants’ later band, use of the name, domain names and social-media accounts constituted passing off.

The claimants also challenged a trade mark registered by Mr Clarke under sections 3(6) and 5(4)(a) of the Trade Marks Act 1994. The central issues were ownership of goodwill, misrepresentation and damage, abandonment or dissipation of goodwill, and whether the trade mark application was made in bad faith.

1. Goodwill. The relevant date was autumn 2018, when the defendants began seeking work separately. Goodwill is attached to a business and is generated by trade. Where an incorporated body carries on trade under a band name, it owns the goodwill generated by that trade. Individual musicians may acquire concurrent goodwill, but only where the evidence establishes that they traded independently in a way capable of generating it. The defendants had not done so. Their original membership of the band, performance fees and lack of involvement in promotion or business arrangements did not give them concurrent goodwill.
2. The goodwill generated before 1983 remained with the dissolved 1976 Company and, absent an effective transfer by that company, passed to the Crown under section 654 of the Companies Act 1985. The alleged shareholder agreements could not themselves transfer corporate goodwill. AWEL nevertheless acquired goodwill through its trading from 1983 onwards.
3. The 2002 agreement restricting the claimants’ trading style did not itself abandon or extinguish their goodwill in “the Rubettes” against third parties. Neither abandonment nor dissipation was established. The 1 July 2018 email concerned the then-current line-up and did not evidence an intention to cease trading.
4. Passing off. The defendants’ use of “the Rubettes” as a badge of origin was a misrepresentation likely to cause confusion about a connection with AWEL. The fact that some defendants were original members did not prevent passing off. The use of domain names, social-media accounts and the registered mark supported the finding of misrepresentation and damage. The claimants established actual and likely damage, including lost promotional opportunities.
5. The court did not determine at that stage whether formulations such as “the Rubettes featuring …” would avoid liability, leaving that issue for submissions on the final order.
6. Trade mark. The application date governed bad faith, although later evidence could illuminate the applicant’s state of mind. Applying the principles summarised in Red Bull, the court found that Mr Clarke knew of AWEL’s business, lacked a genuine basis for believing it had been abandoned, and registered the mark to interfere with that business. His conduct fell below the standards of acceptable commercial behaviour. The mark was therefore invalid under section 5(4)(a) and section 3(6) of the Trade Marks Act 1994.
7. The claimants succeeded. Flagrancy and the consequences of success remained to be determined.