The Bathhouse restaurant in Queenstown. Photo: GOOGLE MAPS / RNZ
A Queenstown restaurant has failed to secure an interim injunction to stop an Australian company opening a spa in the resort town with the same name.
The companies behind the restaurant The Bathhouse have been in dispute with a company planning to open a luxury spa and wellness centre called The Bathhouse Queenstown on Christmas Eve.
The restaurant argued by using a similar name, the spa company was taking advantage of its reputation.
Its High Court bid to temporarily prevent the Australian company from using "The Bathhouse" in any form as its trading name has been dismissed.
Justice Melanie Harland ruled that for now, the spa would be allowed to open provided it changed its trading and marketing name to "The Bathhouse Spa Queenstown". The matter would be heard at a trial next year.
The Bathhouse restaurant on the lake front of Lake Wakatipu was originally a bathhouse built to commemorate King George V in 1911. Since the mid-1990s, the building has housed various restaurants which have traded there using the name "The Bathhouse".
The Bathhouse Queenstown Pty Ltd is an Australian company that registered in New Zealand last month. It is launching a luxury spa and wellness centre in Queenstown's central business district on 24 December.
The plaintiffs (two companies behind the restaurant) claimed the spa company breached the Fair Trading Act by using a similar name.
They argued this was likely to mislead or deceive customers into thinking there was a connection between the restaurant and the spa, and amounted to a false representation as to association, sponsorship or endorsement.
"The plaintiffs contend that the history of The Bathhouse building and the significance of its location are important drawcards which enable it to attract customers and, as such, this is part of its goodwill," Justice Harland said.
The plaintiffs said members of the public had been misled or deceived already as a result of the spa company's marketing and promotion.
In response, the spa company (the defendant) said "The Bathhouse" was a descriptive term and an accurate description of the nature of the business and services it intended to provide.
It said The Bathhouse Queenstown was a legitimate business that had operated a spa and wellness business under The Bathhouse name and banner in Australia since July 2023 and was in the process of establishing similar businesses in other locations.
The spa company said reasonable consumers, particularly tourists, would not be confused and there was no potential for damage to the restaurant.
It said there was no relevant evidence of any customers being confused, misled or deceived as a result of its activities.
"I observe that both parties have taken relatively staunch positions in relation to their respective cases," Justice Harland said.
"I am satisfied that the balance of convenience would favour the injunctions not being issued if the defendant files a written undertaking confirming it will immediately change its trading and marketing name to "The Bathhouse Spa Queenstown" until further order of the Court."
Justice Harland said in her view, inclusion of the term "spa" in the defendant's trading name was likely to reduce confusion between customers while awaiting the substantive proceedings.
"I have also reached the very firm view that damages would be an adequate remedy for any losses or damage suffered by the plaintiffs in the interim if, at trial, they succeed in their claims and are successful in obtaining the substantive injunctive relief they seek," she said.
Sign up for Ngā Pitopito Kōrero, a daily newsletter curated by our editors and delivered straight to your inbox every weekday.