Supreme Court decides SkyKick case

Trade mark owners and practitioners have been on tenter hooks for this judgment since the hearing back in June 2023, nearly 18 months ago.

The case is concerned with whether the filing of a trade mark application for an overly broad range of goods and services can constitute bad faith and, if it does, what are the implications?

Background

Sky, the well-known broadcaster and telephony and broadband provider, own various registered UK and EU trade marks for the mark SKY.

SkyKick provide email migration and cloud storage services, under the mark SKYKICK.

Sky issued proceedings against SkyKick, alleging registered trade mark infringement.

SkyKick countered by alleging that Sky’s registered trade marks were wholly invalid, because Sky had applied to register its trade marks in bad faith.

Section 3(6) of the UK’s Trade Marks Act 1994 (TMA) states: “A trade mark shall not be registered if or to the extent that the application is made in bad faith.”

SkyKick asserted that Sky had applied to register its marks for an overly broad range of goods and services, which it does not deal in, and for which it had no plans to do so. In other words, they were applied for without any genuine intention to use them in relation to all of the goods and services covered by the registrations.

What happened at first instance and before the Court of Appeal?

At first instance, the court held that Sky had acted in bad faith, but only partially invalidated its registered trade marks, so as to delete certain goods and services which had no connection with Sky’s established business.

On appeal, the Court of Appeal held that Sky had not acted in bad faith. In particular, it held that an applicant is not required to have a prospect of, or strategy for, using a mark in relation to each and every type of goods and services failing within a category of goods and services for which registration is sought.

For example, the fact that Sky only had an intention to use the mark SKY for certain types of computer software (e.g. that relating to the provision of telecommunications services), rather than all possible varieties of computer software (e.g. that used to control the flight of a helicopter, or for operating the controls to a nuclear power station, etc.) did not mean it was bad faith to register the mark for the general description ‘computer software’.

SkyKick appealed to the Supreme Court, asking the court to decide:

1. What is the test for determining bad faith in s3(6) of the TMA?; and
2. If bad faith is found, what is the correct approach for determining the specification of goods/services for which the trade mark can remain registered?

What did the Supreme Court decide?

The Supreme Court’s 145 page judgment contains lots of nuggets of law and practice.

However, for the purposes of this article, the most important ruling it has made is that where a trade mark is registered for a broad description of goods or services, which includes distinct categories or subcategories of goods or services within it, as the terms 'computer programs' and 'computer services' undoubtedly do, then the owner of the registered trade mark may be found to have acted in bad faith in relation to one or more of those.

In other words, if the trade mark owner had, at the time of filing the trade mark application, no genuine intention to use the trade mark across the full range of goods/services covered by a very general term like ‘computer software’ or ‘computer services’, then to seek to register the mark for such an overly broad range of goods/services may be an abuse of the trade mark system and may constitute bad faith, entitling a court to narrow down the registration, so that it only covers a coherent subcategory of goods/services capable of being viewed independently – for example, computer software used for controlling the performance of nuclear power station. 

Implications for trade mark owners 

It is the writer’s prediction that from now on when brand owners face oppositions to their registered trade mark applications, or infringement proceedings, and they are brought against them by the owner of an earlier registered trade mark registered for an overly broad category of goods/services, they will in some cases result in a counterclaim that the earlier mark was filed in bad faith. Hopefully, by taking such a step, this will result in a successful reduction as to the breadth of the goods/services covered by the earlier registration, leading to a finding that the later filed or used trade mark does not infringe the earlier registration.   

For more information please contact Carl Steele.