Watch out lawyers - do you own your name?

That which we call a rose

Do lawyers own goodwill in their name? The UK's IP Enterprise Court tells all in Bhayani & Anor v Taylor Bracewell LLP [2016] EWHC 3360.

This was a summary judgment decision which focused on the question of whether a partner or the firm owns the goodwill she develops in the course of her professional duties and whether she can stop the firm from continuing to use her name when she leaves the partnership.

The dispute arose when a partner, Ms Bhayani, left Taylor Bracewell but the firm continued to use a sub-brand she had developed and for which the firm had registered a trade mark: Bhayani Bracewell.  Ms Bhayani alleged passing off and revocation of the trade mark on the basis that use of the trade mark was liable to mislead the public that she was still a partner at the firm (under section 46(1)(d) of the Trade Marks Act 1994).  The partnership agreement was also considered in light of both issues.

Season's Greetings and Goodwill to all mankind 

Goodwill, the first limb of the passing off "trinity" was the primary focus of the hearing.

It was accepted that Ms Bhayani had acquired a reputation in the field of employment law.  However, reputation is not the same as goodwill and on its own is not sufficient to found an action for passing off.   So, whilst an individual partner may have a professional reputation, it does not follow that they own the goodwill in their name.  As HHJ Hacon noted "goodwill cannot in law subsist as a thing alone - it is indivisible from the business with which it is associated."  Therefore, in the normal course of things the goodwill generated by a partner's acts will vest in the partnership.

The judgment did go on to consider some circumstances in which an employee (or partner) could generate goodwill of their own.  For example:

Landa v Greenberg [1908] 24 TLR 44 - a contributor to a weekly column in The Jewish Chronicle under the name "Aunt Naomi" was granted a declaration that she was entitled to the Aunt Naomi name and an injunction to prevent the new proprietor from continuing to use the name.  

Dr Crock & his Crackpots

Hines v Winnick [1947] Ch 708 - "Dr Crock" from Dr Crock & his Crackpots (an orchestra on a BBC radio show called Ignorance is Bliss) sued when the defendant tried to replace Dr Crock with a new performer.  The judge was referred to Landa v Greenberg and granted an injunction against continued use of the Dr Crock name on the same basis.

Forbes v Kemsley Newspapers Ltd (1951) 68 RPC 183 - "Mary Delane" wrote various articles in the Sunday Times under a pen name which was chosen by the defendant.  Her contract was terminated but the defendant continued to publish under the Mary Delane name  The judge noted that "a person who writes under a pseudonym is entitled to the property in that name as part of his or her stock-in-trade unless there is a term, express or implied, to the contrary in an agreement with an employer".  There was no such term so the claimant was granted her injunction.

Irvine v Talksport [2002] EWHC 367 - TalkSport created a brochure which used an image of Eddie Irvine with a TalkSport branded portable radio superimposed on the image.  Irvine brought a successful action for passing off on the basis that the brochure falsely represented that Irvine endorsed the TalkSport radio station.

These cases were distinguished on the basis that they either related to (i) writers/performers  so the court assumed that the public would consider the artist to be solely responsible for their creative output or, (ii) in the case of Irvine, to a separate business to his contract with Ferrari as a racing driver.  In other words, Irvine endorsed products as part of a separate business and consequently had generated a distinct goodwill which was his and on which he could found an action for passing off.

Because Ms Bhayani's reptuation had all been carried out at law firms (rather than sole proprietorships), there was no separate business which could be characterised as belonging to Ms Bhayani.  This meant that the goodwill in her name vested in Taylor Bracewell and her previous firm.  No goodwill meant that the passing off action could not possibly succeed.

Careful contract reading can avoid later drama

A further observation

Under this intriguing heading, HHJ Hacon went on to suggest that if a firm continued to represent a solicitor as being employed by them after their departure from the firm it would be possible to take action against them either on the basis that (i) the goodwill associated with the name of the solicitor vests in their new firm and/or (ii) there has been an injurious falsehood.

Partnership agreement

The partnership agreement further strengthened Taylor Bracewell's case although it did explicitly note that Ms Bhayani was free to use her own name in the course of trade now that her employment at the firm had ceased.  This agreement, arguably, also gave Taylor Bracewell a contractual right to continue using the Bhayani Bracewell mark.

Revocation of a trade mark which is liable to mislead the public

Section 46(1)(d) of the Trade Marks Act 1994 provides that:

(1) The registration of a trade mark may be revoked on any of the following grounds— ... (d) that in consequence of the use made of it by the proprietor or with his consent in relation to the goods or services for which it is registered, it is liable to mislead the public, particularly as to the nature, quality or geographical origin of those goods or services.

Ms Bhayani claimed that Taylor Bracewell's use of Bhayani Bracewell was liable to mislead the public that she was still associated with the firm.  The judge agreed that this argument had a realistic prospect of success and thus declined to strike out the claim.