Concurrent yes, but honest? The High Court decision in Zip Co Limited v Firstmac Limited

An important decision has been handed down by the High Court of Australia, clarifying how the “honest concurrent use” defence can be (or in this case, cannot be) used under the Trade Marks Act 1995 (Cth) (the Act).

This decision is significant for businesses, particularly those that are looking to launch or rebrand in high-competition markets (such as finance) where prior similar marks are likely to exist. Contrary to the popular phrase, when it comes to trade marks – ignorance is not bliss.

Dispute background

Firstmac Limited (Firstmac) registered their “ZIP” mark in 2004, covering “financial affairs (loans)” in class 36.

In 2013, after settling on brand names, Zip Co Limited (Zip Co) applied to register 2 trade marks that included the word “ZIP” as a prominent feature (ZIP and ZIP MONEY), with adverse examination reports issued by IP Australia citing Firstmac’s mark and its earlier priority date.

Despite receiving adverse examination reports from IP Australia in 2013[1] citing Firstmac’s earlier mark (which were never responded to by Zip Co, resulting in both applications lapsing), and subsequent reports issued years later in relation to separate Zip Co applications filed where “ZIP” was a feature of the marks[2] (again, citing Firstmac’s earlier mark), Zip Co continued to promote its products using “ZIP” branding.

In 2016, Zip Co unsuccessfully sought to remove the Firstmac mark for non-use. A further non-use application was lodged in respect of the same mark in 2019, resulting in Firstmac filing infringement proceedings against Zip Co in the Federal Court (with the non-use action being heard concurrently).

Following an appeal by Firstmac, after it was found by the trial judge that it had failed in its infringement claim against Zip Co[3] (and its mark being cancelled and removed from the Register), the Full Federal Court overturned the previous decision, reinstating Firstmac’s mark and rejecting Zip Co’s defence that its use of “ZIP” constituted “honest and concurrent use” under s122(1)(f) and 122(1)(fa) of the Act, when read with s44(3),– a view upheld by the High Court, with Zip Co’s appeal being dismissed unanimously.

What determines honest concurrent use?

The High Court’s decision highlights two key principles in determining honest concurrent use:

• The objective assessment of “honesty”

The High Court confirmed that “honesty” should be assessed against the standards of “ordinary, decent people”.[4] Zip Co’s failure to take steps (such as conducting due diligence before filing its marks) and its conduct after it became aware of Firstmac’s mark, made it difficult for Zip Co to prove that it was acting honestly.

• The importance of the timing of the alleged infringement where “honest, concurrent use” is being claimed as a defence

The High Court confirmed that Zip Co had not proved it was acting honestly at the time of its first use of the marks, and determined that the trial judge had, when it came to the assessment of “honest current use”, started her assessment “at the wrong point in time”[5].

The High Court held that the defence of honest, concurrent use should have instead been assessed at the date of each potential infringement (and not at the date of filing a defence nor at the date of trial).

Why is this important?

Continuing to use a trade mark – particularly where no searches for earlier similar marks have been conducted, or where the existence of such a mark has been identified and you have not received advice to satisfy you that your mark will not likely cause confusion – may weaken any later reliance on the defence of honest concurrent use.

Before adopting a new brand, businesses should:

• Conduct thorough trade mark clearance searches
• Seek professional advice should any assessments of trade mark searches identify marks that could lead to a likelihood of confusion and act accordingly if risks are identified
• Implement trade mark monitoring to strengthen brand awareness and protection, particularly in crowded and highly competitive markets

[1] Zip Co Limited v Firstmac Limited [2026] HCA 16 [14].
[2] Ibid [20], [24].
[3] Firstmac Limited v Zip Co Limited [2023] FCA 540 [414].
[4] Zip Co Limited v Firstmac Limited [2026] HCA 16 [57]-[63].
[5] Ibid [66].