What happens when two businesses with nearly identical names, operating in different countries, clash over brand identity and online reputation? The Federal Court’s decision in Jacksons Drawing Supplies Pty Ltd v Jackson’s Art Supplies Ltd [2025] FCA 530 is a significant ruling in this regard, focusing on cross-border brand confusion, online reputation, and the limits of injunctive relief under the Australian Consumer Law and the common law of passing off.

Although the Court found that the United Kingdom-based Jackson’s Art Supplies Ltd had engaged in misleading and deceptive conduct and passing off against the long-established Australian business Jacksons Drawing Supplies Pty Ltd, it declined to grant broad injunctive relief. The refusal was based on Jacksons Drawing Supplies Pty Ltd.’s delay in commencing proceedings and the complex cross-border nature of Jackson’s Art Supplies Ltd.’s established trading operations in Australia.

Background of the case

Jacksons Drawing Supplies Pty Ltd has been operating in Western Australia since the 1950s. It trades under the names “Jacksons” and “Jacksons Drawing Supplies,” with multiple physical retail outlets in Western Australia and the Northern Territory. The business also sells art materials and supplies online through its website jacksons.com.au.

Jackson’s Art Supplies Ltd is a company incorporated in the United Kingdom in 2000. It sells art materials internationally through its website jacksonsart.com. By around 2013, this website became accessible to Australian consumers, and in 2018, the company launched an Australian-specific version of its website at jacksonsart.com/en-au. This version displayed prices in Australian dollars and was tailored to serve the Australian market.

In 2022, Jackson’s Art Supplies Ltd established an Australian subsidiary, Jackson’s Art Australia Pty Ltd, which operated a warehouse and dispatch centre in Adelaide. The website for Australian consumers also began displaying an Australian telephone number and local operating hours.

Both companies sell art materials and related products. Neither business held a registered Australian trade mark for any of the disputed names. The conflict arose because both used variations of “Jackson’s,” “Jackson’s Art,” and “Jackson’s Art Supplies” in their branding and online marketing, which caused confusion among Australian consumers searching for art materials.

When did the dispute arise?

Jacksons Drawing Supplies Pty Ltd alleged that Jackson’s Art Supplies Ltd and its Australian subsidiary Jackson’s Art Australia Pty Ltd engaged in misleading and deceptive conduct in contravention of sections 18 and 29 of Schedule 2 of the Competition and Consumer Act 2010 (Cth), known as the Australian Consumer Law. It also alleged that their conduct amounted to the tort of passing off.

Jacksons Drawing Supplies Pty Ltd argued that by using the names “Jackson’s,” “Jackson’s Art,” and “Jackson’s Art Supplies” on the Australian-facing website and in Australian operations, the United Kingdom company and its subsidiary had led consumers to believe that they were connected with or part of Jacksons Drawing Supplies Pty Ltd.’s long-established Australian business.

The Australian features of the website, i.e. such as prices in Australian dollars, the use of an Adelaide dispatch address, and the inclusion of an Australian telephone number, were said to reinforce this misleading impression.

Jackson’s Art Supplies Ltd denied the allegations, arguing that it had been trading online for many years without issue, that its branding made its United Kingdom origin clear, and that the reputation of Jacksons Drawing Supplies Pty Ltd was limited to Western Australia and the Northern Territory.

Jackson’s Art Supplies Ltd also filed a cross-claim, asserting that Jacksons Drawing Supplies Pty Ltd had itself engaged in misleading conduct by registering domain names such as jacksonsart.com.au, by using the name “Jacksons Art Supplies” on its website, and by registering a company and business name incorporating those words.

Issues Before the Court

Justice Jackson of the Federal Court identified several key questions for determination-

  1. What was the extent and scope of the reputation of Jacksons Drawing Supplies Pty Ltd both within and beyond its traditional areas of operation?
  2. Whether the conduct of Jackson’s Art Supplies Ltd and Jackson’s Art Australia Pty Ltd, particularly since the launch of the Australian subdomain in 2018, conveyed representations of association with Jacksons Drawing Supplies Pty Ltd?
  3. Whether those representations amounted to misleading or deceptive conduct and passing off?
  4. Whether Jacksons Drawing Supplies Pty Ltd.’s delay in commencing proceedings should limit the scope of relief?
  5. Whether Jackson’s Art Supplies Ltd.’s cross-claim against Jacksons Drawing Supplies Pty Ltd was established?

Reputation and Market Reach

Reputation was central to the dispute. Jacksons Drawing Supplies Pty Ltd provided evidence showing its long-standing trading history, continuous use of the name “Jacksons Drawing Supplies” since the 1950s, and widespread recognition in Western Australia and the Northern Territory. It had physical stores, a loyal customer base, and significant goodwill in those regions.

However, the Court found that the reputation of Jacksons Drawing Supplies Pty Ltd outside Western Australia and the Northern Territory was limited. Although the company had maintained a website since 2006 and conducted online sales, the majority of its trade was still regional.

That said, Justice Jackson accepted that Jacksons Drawing Supplies Pty Ltd had acquired a modest degree of reputation throughout Australia by 2018 through its website and online sales. Consumers across the country seeking art materials could recognize the “Jacksons” brand in that context.

The Court rejected the argument of Jackson’s Art Supplies Ltd that it operated in a distinct “fine art” segment while Jacksons Drawing Supplies Pty Ltd operated as a general art retailer. Justice Jackson held that this distinction was immaterial, as both businesses competed in substantially overlapping markets for similar goods.

The question of “Misleading conduct”

The central question was whether the conduct of Jackson’s Art Supplies Ltd and its Australian subsidiary Jackson’s Art Australia Pty Ltd was misleading or deceptive to ordinary Australian consumers.

Justice Jackson examined how the online presence evolved over time. From 2018 onwards, Jackson’s Art Supplies Ltd began to include Australian-specific features on its website, such as a subdomain with “en-au,” prices in Australian dollars, references to an Australian warehouse, and local contact information. By 2022, the establishment of the Adelaide warehouse and local dispatch operations reinforced the impression of an Australian business.

The Court concluded that, viewed cumulatively, these elements were likely to lead ordinary Australian consumers to believe that jacksonsart.com/en-au was operated by or affiliated with Jacksons Drawing Supplies Pty Ltd.

Justice Jackson therefore found that the conduct constituted misleading and deceptive conduct under section 18 and false or misleading representations under section 29 of the Australian Consumer Law. The conduct also amounted to passing off, as it misrepresented a commercial connection with Jacksons Drawing Supplies Pty Ltd and was likely to damage its goodwill.

However, the Court drew a distinction between the global operations of Jackson’s Art Supplies Ltd and the targeted Australian operations that began in 2018. Only the latter conduct was found to be misleading or deceptive, as it was specifically directed at Australian consumers.

Accessory and Cross-Entity Liability

Justice Jackson held both Jackson’s Art Supplies Ltd and its subsidiary Jackson’s Art Australia Pty Ltd liable for the misleading conduct.

Jackson’s Art Australia Pty Ltd played an active role in the Australian operations by handling local dispatch, warehousing, and customer support. This made it a principal wrongdoer or, alternatively, an accessory to the misleading conduct of its parent company.

In contrast, other holding companies such as Jackson’s Art Holdings Australia Pty Ltd and Pyrmont Capital Partners Pty Ltd were not found liable because they did not engage in or authorize the relevant conduct.

The “Cross-Claim”

Jackson’s Art Supplies Ltd alleged that Jacksons Drawing Supplies Pty Ltd had engaged in misleading conduct by registering the domain names jacksonsart.com.au and jacksonsartsupplies.com.au, by registering the business name “Jacksons Art Supplies,” and by incorporating a company of the same name.

Justice Jackson dismissed the cross-claim. The Court held that registering domain names and company names does not, by itself, constitute conduct “in trade or commerce.” Moreover, given Jacksons Drawing Supplies Pty Ltd’s long-standing reputation in Australia and the limited reputation of Jackson’s Art Supplies Ltd before 2018, there was no basis to conclude that consumers would be misled.

Accordingly, the cross-claim failed in its entirety.

Delay and Discretionary Relief of court

Despite Jacksons Drawing Supplies Pty Ltd succeeding in establishing misleading conduct and passing off, the Court declined to grant broad injunctive relief.

Justice Jackson noted that Jacksons Drawing Supplies Pty Ltd had known about the presence of Jackson’s Art Supplies Ltd in the Australian market since at least 2010 but did not commence proceedings until 2022. During that period, Jackson’s Art Supplies Ltd had expanded its online business and developed a substantial Australian customer base.

Given this delay, Justice Jackson held that it would be unjust to issue sweeping injunctions that would effectively force Jackson’s Art Supplies Ltd to cease trading under its established name in Australia.

However, the Court accepted that some limited relief might still be appropriate, such as requiring clear disclaimers or “words of disassociation” on the Australian website of Jackson’s Art Supplies Ltd to make it clear that it was not connected with Jacksons Drawing Supplies Pty Ltd. The parties were invited to make further submissions on this issue.

Key Takeaways for Brand Owners and Online Retailers

This decision highlights several important practical lessons for businesses operating in online and cross-border markets.

i. Online presence can establish national reputation, but local recognition remains crucial. A regional business can develop goodwill beyond its physical stores through consistent online engagement. However, courts will closely examine where the reputation actually exists, using evidence such as website analytics, order data, and consumer awareness.

ii. Local targeting creates local legal responsibility. A foreign business that tailors its website to Australian consumers, i.e. by including local prices, contact details, and delivery services, will likely be regarded as carrying on business in Australia and subject to the Australian Consumer Law.

iii. Delay can restrict the remedies available. Even when misleading conduct is proven, a court may deny injunctions if the claimant delayed unreasonably before bringing proceedings. Businesses should act promptly when they become aware of potential confusion or misuse of their brand.

iv. Reputation does not automatically cross borders. A strong reputation in one jurisdiction does not automatically extend to another. Genuine local use and recognition are essential to establish goodwill in Australia.

v. Courts may favor pragmatic remedies. When both traders act honestly and confusion arises through coincidental naming or market overlap, courts may prefer corrective statements or disclaimers rather than severe injunctions. The goal is to protect consumers, not punish legitimate competition.

Conclusion

Thus, this case shows how the principles of misleading and deceptive conduct and passing off apply in the age of online commerce.

The decision reflects the Federal Court’s pragmatic approach to balancing fairness, commercial reality, and consumer protection. It reminds brand owners that reputation and goodwill are now shaped as much by digital presence as by physical trade, but timing, evidence, and consistent brand management remain decisive.

For online retailers, the lesson is clear, i.e. transparency about origin and affiliation is not only good business practice but also essential for compliance with Australian consumer protection laws. In a digital marketplace where national borders are increasingly blurred, clarity and honesty in presentation remain the best safeguards against legal and reputational risk.

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