The First Hall of the Civil Court, presided over by Mr Justice Mark Chetcuti, in the case ‘Gaming VC Corporation Ltd and GVC Holdings plc, registered society in Isle of Man with registration number 4685V v Harvey Gaming Ltd’, held, among other things, that traders shall not make use of any name, mark or distinctive device capable of creating confusion with any other name, mark or distinctive device lawfully used by others, nor may they make use of any firm name or fictitious name capable of misleading others as to the real importance of the firm.
In its application, GVC Holdings plc, a company incorporated in the Isle of Man, stated that it was an international company which had been operating and working in sports betting and gaming since 2004 and had throughout the years obtained a good reputation in the field both locally and internationally, so much so that it is also listed in the London Stock Exchange. Subsequently, in 2006, Gaming VC Corporation Ltd, a subsidiary company of GVC Holdings plc, was incorporated in Malta and started operating from its online gaming site (www.betaland.com).
During 2012, pursuant to a Licensed Business Transfer Agreement, the respondent company bought Gaming VC Corporation Ltd and its online gaming site from the applicant company. In the said agreement the parties established that: “Within 24 months from completion, the transferee [binds] itself to change its name to a name which cannot be reasonably interpreted as being associated with the transferor or the group of companies to which the transferor belongs in any way and that does not include ‘GVC’ or ‘Gaming VC’ in its name”.
The applicant companies argued that effectively the date of completion was May 4, 2012, that is, the date when the LGA formally approved the transfer of the LGA licence of Gaming VC Corporation Ltd on to the respondent company. In view of this, the applicant companies claimed that in line with the transfer agreement, on May 4, 2014, 24 months after the date of completion, the respondent company, acted in bad faith and continued to illegally operate with the same name, against the obligations assumed by it under the Licensed Business Transfer Agreement and also in violation of article 32 of the Commercial Code, chapter 13 of the Laws of Malta, which provides as follows:
“Traders shall not make use of any name, mark or distinctive device capable of creating confusion with any other name, mark or distinctive device lawfully used by others, even though such other name, mark or distinctive device be not registered in terms of the Trademarks Act, nor may they make use of any firm name or fictitious name capable of misleading others as to the real importance of the firm.”
The applicant companies further claimed that although the court had issued a warrant of prohibitory injunction ordering the respondent company to stop operating with the name GVC New Ltd or Gaming VC, or any other similar name to Gaming VC Corporation Ltd or GVC Holdings plc, it continued to operate and negotiate with a similar name.
The court observed that the parties did not concur on the completion date and therefore proceeded to review the transfer agreement to determine the said date of completion
For these reasons, the applicant companies requested the court to declare the respondent company to be in violation of its obligations under the Licensed Business Transfer Agreement and of article 32 of the Commercial Code and order it to take all the necessary action to ensure that it no longer uses a name similar or related to Gaming VC Corporation Ltd and/or GVC Holdings plc. Moreover, the applicant companies requested the court to declare the respondent company responsible for damages incurred by the applicant companies and order it to pay a sum ranging from €465.87 to €4,658.75 in damages, pursuant to article 37 of the Commercial Code.
In its reply, the respondent company argued that the claims of the applicant companies were unfounded as article 32 did not apply to the present situation as it did not illegally make use of the name of the applicant companies and could not therefore be held liable to pay damages pursuant to article 37. The respondent company argued that it continued to use the name Gaming VC Corporation Ltd in line with the Licensed Business Transfer Agreement for 24 months and not for a longer period as the date of completion was after May 4, 2012, and when this period expired, it proceeded to change its name in line with the said agreement.
The court observed that the parties were basing their arguments on two important points, primarily the Licensed Business Agreement signed between GVC Corporation Ltd and GVC New Ltd and, secondly, the dispositions of the Commercial Code, in particular articles 32 and 37 of the said code which protect against the unlawful use of names, marks or distinctive devices.
As regards the transfer agreement, the court observed that the parties did not concur on the completion date and therefore proceeded to review the transfer agreement to determine the said date of completion. In accordance with the said agreement, the court concluded that completion took place following the execution of the transfer agreement when the LGA issued formal approval in writing for the transfer of the LGA licences, meaning therefore that the completion date was May 4, 2012. Consequently, the court concluded that from May 4, 2014, onwards, the respondent company could not make use of the name GVC in its operations and negotiations. The court observed that despite this, GVC New Ltd was indicated as the licensed operator of the online website (www.betaland.com) and, moreover, the said website stated that Betaland was a trademark of GVC New Ltd.
In view of this, the court concluded that the respondent company was in violation of the transfer agreement and of article 32 as it was unlawfully using the distinctive name of the applicant companies, creating confusion with the registered names of the said companies operating in the same business sector. Taking into consideration the reputation of the applicant companies, the court stated that they were justified in seeking to ensure that their clients could easily identify which online gaming websites they operated. The court therefore accepted the claims of the applicant companies and proceeded to order the respondent company to pay the sum of €3,000 in damages to the applicant companies.
Rachel Genovese is a trainee advocate at Ganado Advocates.