Sky (well known for its TV and broadband services) brought action against Skykick (a global cloud management software provider) for infringement of its registered Trade Mark ‘Sky’ by Skykick and Passing Off. Skykick defended those proceeding and advanced a counterclaim, seeking a declaration that Sky’s Trade Mark is invalid on 2 main grounds:
- That it was registered in bad faith;
- That the marks were not sufficiently clear.
This case has seen numerous appeals, challenging numerous issues and most recently, came before the Court of Appeal on 26th July 2021, where Sky came out victorious. Skykick’s counterclaim ultimately did not succeed, and it was found that the Trade Mark ‘Sky’, registered for a wide variety of services, including “apparatus for recording, transmission or reproduction of sound or images” (Class 9), “telecommunications” (Class 38) and “entertainment” (Class 41) was not registered in bad faith. Skykick’s argument was essentially that Sky did not intend to use the mark ‘Sky’ in relation to some of the goods and services covered in the specifications for which it was registered and so should be declared invalid. This is a common counterclaim and/or defence advanced by opponents in these types of cases. In order to evade liability, the idea is to challenge the validity of the Trade Mark of the Claimant itself.
When applying to register a Trade Mark, applicants have to choose from a list of goods/services, what they want their mark to be protected against. Effectively, an applicant would have to confirm that they have acquired, or will acquire, goodwill in a mark for specific goods/services. I.e. McDonalds would choose restaurant/fast food services under the relevant class of goods. Thereafter, the applicant has to confirm whether they are using the mark (or, if they have not yet commenced using the mark, that they intend to use it in good faith) in relation to the goods for which they have applied to register. The Sky v Skykick case is particularly interesting as Sir Christopher Floyd (in his Judgment of 26th July 2021) has now provided commentary on the bad faith element of challenging validity of Trade Marks, as follows:
“Suppose an applicant applies for registration of a trade mark in relation to “detergents”. Its business in goods of that kind is, however, limited to household detergents and it has no intention of branching out into industrial detergents. The applicant makes a declaration that it is using the mark (or if it has not yet commenced using the mark, that it intends in good faith to use the mark) in relation to goods for which it has applied to register it (i.e. detergents in general). In my judgment, it is not possible to say in those circumstances that the applicant’s declaration is false, or even partially false. The applicant is not saying, and is not required to say, that it has used, or intends to use, the mark for all the possible types of goods which fall within the category for which it has applied to register it. The applicant is only required to say that it has used or that it intends to use the mark for goods of that kind or description. Any other interpretation would, as it seems to me, create an increasingly impossible burden on applicants depending on how finely one sliced up the category of goods or services for which the application is made.”
In short, Sir Floyd found that in lodging an application to register a Trade Mark, the applicant does not have to declare that they have used, or intend to use the mark, for all the possible types of goods which fall under that class of goods/services they are applying to register. The applicant need only say that they intend to use the mark for goods/services of that kind. However, the courts have ruled that in certain circumstances, lack of intention to use a Trade Mark could be relevant to, and evidence of, bad faith.
Before commencing litigation, both parties should now be closely reviewing their cases to determine if there is the possibility of infringement counter-claims on the grounds of overly-broad specifications and bad faith. The burden of proof still falls on brand owners to establish the reasons for including all the goods and services in their specification and brand owners are encouraged to keep a record of their decision making process at the time of filing (eg business plans, advertising proposals and marketing strategy reports) should they need to produce evidence going forward.
As shown by the many appeals in this case alone, these are complex, ever evolving matters. If you require assistance with any Trade Mark or Passing Off disputes, or alternatively, need advice on registration, please do not hesitate to contact our IP experts, Gabriella Shepherd or Craig Kelly on 0330 058 5222.
