The End of 'Ignorance is Bliss': The High Court Tightens the Honest Concurrent Use Defence in Zip Co v Firstmac

The legal rollercoaster saw Zip Co win at the trial level, only to lose on appeal before the Full Federal Court, which led to the final showdown in the High Court in May 2026. The central question was: at what point in time do you assess whether a business's use of a mark is "honest"?

Zip Co argued that their initial choice to adopt the name in mid-2013 was made innocently before they knew about Firstmac, and that they had built massive goodwill over the years. The High Court unanimously rejected this approach.

1. Honesty is Assessed at the Date of Infringement

The High Court ruled that honest concurrent use is not a blanket status granted because of an innocent initial idea or years of subsequent business success. Instead, honesty must be proven at the time of each alleged act of infringement. For Zip Co, the critical date was November 2013, when they first started trading under the ZIP brand.

2. Knowledge is Power (and Liability)

By November 2013, Zip Co had already received IP Australia's adverse reports. They knew Firstmac owned the "ZIP" trade mark for financial services. The High Court affirmed that the standard of honesty is objective — judged by the standards of ordinary, decent people. Choosing to push forward and use the mark commercially after being officially notified of a conflicting registration, without taking reasonable steps to address the conflict, could not be considered objectively "honest" concurrent use.

Strategic Takeaways for Brand Owners

The Zip Co v Firstmac saga, which ultimately ended with Zip Co having to formally acquire Firstmac's trade mark registration to avoid a forced rebrand, offers critical lessons for all businesses.

• Never Ignore IP Australia Reports: If you file a trade mark application and receive an adverse report citing an existing mark, you cannot stick your head in the sand. Ignoring the report and launching your product anyway will likely destroy your ability to claim honest concurrent use if you are sued later.

• Clearance Searches are Non-Negotiable: Before falling in love with a brand name or spending money on marketing, have an IP professional conduct thorough clearance searches. Discovering a conflict before you launch gives you options; discovering it years later invites disastrous litigation.

• Document Your Reasoning: If a search reveals a potentially similar mark, but you honestly and reasonably believe there is no likelihood of confusion, document that reasoning contemporaneously. Seek formal legal advice to back it up so you have evidence of your honest intent.

• Adding Words Doesn't Always Save You: The courts reaffirmed that simply taking a registered mark and tacking on a descriptive word — like adding "Pay" or "Money" to "ZIP" — does not prevent the marks from being deceptively similar.

The days of relying on a "shoot first, ask questions later" approach to branding are over. The High Court has made it clear that commercial honesty requires diligence.

Are you preparing to launch a new brand or concerned about a potential trade mark conflict? Contact the team at Stellar IP Law today to ensure your brand is cleared, registered, and secure.