Starbucks (HK) Ltd & Anor v British Sky Broadcasting Group PLC & Ors

Factual and Procedural Background

The Appellant is a Hong-Kong based media group that has offered a subscription Internet Protocol Television (IPTV) service under the mark “NOW TV” since 2003. Its closed-circuit service, delivered through set-top boxes, is not available in the United Kingdom. Nevertheless, some Chinese-speaking residents in the UK had become aware of the service through (i) free streaming on the Appellant’s own websites, (ii) videos placed on YouTube, (iii) limited in-flight video-on-demand and (iv) personal exposure while in Hong Kong.

In March 2012 the Respondent, a UK-based broadcaster, announced an over-the-top IPTV service also branded “NOW TV” and released a beta version the following July. On 19 April 2012 the Appellant issued passing-off proceedings, contending that the Respondent’s use of the mark would cause confusion. At first instance, Judge [Arnold] found that although the mark enjoyed a modest reputation within the UK Chinese-speaking community, the Appellant had no UK customers and therefore no protectable goodwill. The claim was dismissed. The Court of Appeal affirmed the decision. With permission, the Appellant appealed to the Supreme Court.

Legal Issues Presented

1. Whether a claimant in a passing-off action must prove goodwill (i.e., a business with customers) within the jurisdiction, or whether a mere reputation among a significant section of the public is sufficient.
2. If goodwill is required, whether UK-based viewers of free online streams or in-flight videos are “customers” capable of generating such goodwill.

Arguments of the Parties

Appellant's Arguments

• The requirement of local customers is outdated in an era of global travel and internet media; reputation alone should suffice.
• Even if goodwill is required, UK residents who view the service on the Appellant’s websites, YouTube channel, or on international flights are customers, creating goodwill in the jurisdiction.
• Earlier authorities should be re-interpreted or, if necessary, departed from to reflect modern commercial realities.

Respondent's Arguments

• Long-standing UK jurisprudence—confirmed by leading House of Lords cases—mandates proof of goodwill, not mere reputation.
• Viewers in the UK do not pay for, contract for, or receive the Appellant’s service in the UK; hence they are not customers and generate no goodwill here.
• Section 56 of the Trade Marks Act 1994 already protects truly “well-known” foreign marks; extending passing-off further would upset the statutory balance between competition and protection.

Table of Precedents Cited

Court's Reasoning and Analysis

Judge [Neuberger], delivering the unanimous judgment, reaffirmed the traditional “hard-line” position that:

• Goodwill is a territorial, proprietary right; mere reputation is insufficient.
• Goodwill arises only where customers purchase or contract for the claimant’s goods or services within the jurisdiction, or through an authorised UK agent.
• UK consumers who merely view free online content or in-flight entertainment are not customers; the activity constitutes advertising aimed at the Hong Kong market, not trading in the UK.
• Historical House of Lords and Privy Council authority from 1915 onward consistently supports this stance; any departure would undermine legal certainty.
• Comparative jurisprudence shows no clear international trend away from the goodwill requirement, and section 56 of the Trade Marks Act 1994 already affords limited protection to foreign “well-known” marks.
• The balance between protecting traders and preserving free competition would tilt unfairly if reputation alone sufficed, especially given the ease of creating global awareness via the internet.
• The Court left open—without deciding—whether a claimant might succeed where it has launched a substantial, public, pre-launch advertising campaign in the UK with imminent trading plans.

Holding and Implications

Appeal Dismissed.

The Court held that the Appellant lacked protectable goodwill in the UK because it had no UK customers for its IPTV service. Consequently, its passing-off claim failed. The decision reaffirms the territorial nature of goodwill and confirms that internet visibility or overseas custom, without domestic trade, is insufficient. No new precedent was created; rather, existing authority was consolidated, signalling that claimants targeting the UK market must secure actual customers—or rely on statutory protection for “well-known” marks—before invoking the common-law tort of passing off.