The case involves the well-known broadcaster Sky which was involved in a trade mark dispute with Skykick, a cloud migration company. Sky brought proceedings against Skykick alleging that its use of the mark SKYKICK amounted to infringement of its various SKY marks.
By way of counterclaim Skykick sought a declaration that Sky’s trade marks were invalidly registered, on the basis that the specifications lacked clarity and precision and had been filed in bad faith. This was because Sky’s trade marks were registered for an extremely wide range of goods/services, far wider than the broadcasting type services that one might expect (the likes of “whips” and “bleaching preparations” being amongst the more unlikely of goods/services included within the specification). The argument from Skykick was that Sky had no intention of ever using its marks for such a wide range of goods/services and thus the applications were filed in bad faith.
The High Court referred a number of questions to the Court of Justice of the European Union (CJEU) (discussed in Issue 2 of OwnershIP) the key points being:
- Can an EUTM (EU trade mark), or national mark, be found partly/wholly invalid on the ground that some or all of the terms in the specification are lacking in sufficient clarity/precision?
- If so, does ‘computer software’ lack sufficient clarity/precision?
- Is an application made in bad faith if there was no intention to use the mark in respect of the goods/services for which it is filed?
- If so, should the mark be declared wholly invalid or invalid only for the goods/services that were applied for in bad faith?
In October 2019 the Advocate General (AG) gave his opinion on the questions which left many brand owners concerned about the validity of their portfolios moving forward.
However, the CJEU (partly at least) deviated from the AG’s opinion ruling that:
- A EUTM or national trade mark cannot be declared invalid (whether wholly or partially) on the ground that some, or all, of the terms in the specification are lacking in sufficient clarity/precision.
- An application for a EUTM or national trade mark filed without any intention to use the mark could constitute bad faith if the application had the intention of undermining, in a manner inconsistent with honest practices, the interests of third parties, or of obtaining, without targeting a specific third party, an exclusive right for purposes other than those falling within the functions of a trade mark.
- Even where such lack of intention to use, and bad faith, can be shown it applies only to those goods/services for which lack of intention/bad faith can be made out i.e. the mark as a whole will not be invalid, just the goods/services that were applied for in bad faith.
On return to the High Court, Sky’s specification was trimmed down to the goods/services for which it could be argued that Sky intended to use the marks at the time of filing the applications. This is important because this test resulted in Sky retaining a wider specification than Skykick had argued for – Skykick argued that the list of goods/services should be cut down to cover only those goods/services for which Sky had used the mark.
The result was that Sky’s registrations were partially invalidated but, ultimately, Skykick were found to have infringed Sky’s registrations and thus Sky succeeded.
Whilst brand owners will be breathing a sigh of relief as the risk of invalidity for over-wide specifications has reduced. It feels that this was somewhat of a missed opportunity for the CJEU to tackle the growing problem of clutter in EU trade mark registries, and provides little incentive to brand owners to tighten up specifications voluntarily.
Moving forward however we are likely to see UK & EU trade mark registries taking a more rigorous approach in examination of trade mark specifications at the point of filing. Furthermore, we may also see consideration taken by the tribunal/court when seeking to enforce those rights. This may force brand owners to further specify their lists of goods/services when filing new applications.
Brand owners will want to ensure that they are not over-reaching in seeking to cover goods/services for which they do not intend to use their marks, as this will still render them at risk of counterclaims, for bad faith, at the enforcement stage. Whilst, following the decision by the CJEU, the mark as a whole is unlikely to be deemed invalid it is nonetheless potentially an expensive, and time-consuming, distraction to defend against such an action.