CITMA Webinar Sky v Sky Kick John Linneker
CITMA Webinar – Sky v Sky. Kick John Linneker, Fieldfisher
CITMA Webinar Summary of Claim and Defences in High Court Action • Sky’s trade marks. Broad and lengthy spec. Some 30 pages long. Thousands of terms. • Skykick’s product: Office 365 migration and associated services. Sold to IT professionals. • Sky’s claim: A straightforward trade mark infringement claim that the marks “Sky” and “Skykick” gave rise to a likelihood of confusion due to the common component “Sky”. • Skykick’s defences: – No likelihood of confusion. No unfair advantage. No passing off – Sky’s marks invalid (1) on extension of IP Translator principles to invalidity as many terms lacked clarity and precision, (2) marks were invalid in their entirety as they were applied for in bad faith on the basis that Sky had no intention to use the terms. The “infection” argument. – Own name defence. Belgium | China | France | Germany | Ireland | Italy | Luxembourg | Netherlands | Spain | UK | US (Silicon Valley) | fieldfisher. com | 2
CITMA Webinar Overview of the case • High Court first judgment – 6 February 2018 • AG opinion – 16 October 2019 • CJEU judgement – 29 January 2020 • High Court third judgment – 29 April 2020 • Court of Appeal hearing – 25 -27 May 2021 Belgium | China | France | Germany | Ireland | Italy | Luxembourg | Netherlands | Spain | UK | US (Silicon Valley) | fieldfisher. com | 3
CITMA Webinar First High Court judgment • IF Sky’s trade marks are valid, they are infringed on the basis of a likelihood of confusion. e. g computer software. • No wider infringement under 9(2)(c) or passing off. • Invalidity arguments based on IP Translator, and the bad faith arguments based on a lack of intention to use required guidance from the CJEU references made. Belgium | China | France | Germany | Ireland | Italy | Luxembourg | Netherlands | Spain | UK | US (Silicon Valley) | fieldfisher. com | 4
CITMA Webinar Questions referred to the CJEU 1. Can an EU trade mark or a national trade mark registered in a Member State be declared wholly or partially invalid on the ground that some or all of the terms in the specification are lacking in sufficient clarity or precision to enable the competent authorities and third parties to determine the extent of the protection conferred by the trade mark? 2. If the answer to (1) is yes, is a term such as “Computer Software” too general and covers goods which are too variable to be compatible with the trade mark’s function as an indication of origin for that term to be sufficiently clear and precise to enable the competent authorities and third parties to determine on the basis of that term alone the extent of the protection conferred by the trade mark? 3. Can it constitute bad faith simply to register a trade mark without any intention to use it in relation to the specified goods or services? Belgium | China | France | Germany | Ireland | Italy | Luxembourg | Netherlands | Spain | UK | US (Silicon Valley) | fieldfisher. com | 5
CITMA Webinar Questions referred to the CJEU 4. If the answer to question (3) is yes, is it possible to conclude that the applicant made the application partly in good faith and partly in bad faith if and to the extent that the applicant had an intention to use the trade mark in relation to some of the specified goods or services, but no intention to use the trade mark in relation to other specified goods or services? 5. Is section 32(3) of the UK TMA 1994 compatible with Parliament and Council Directive 2015/2436/EU and its predecessors? Belgium | China | France | Germany | Ireland | Italy | Luxembourg | Netherlands | Spain | UK | US (Silicon Valley) | fieldfisher. com | 6
CITMA Webinar AG opinion – 16 October 2019 • A-G Opinion (16 October 2019) – Lack of clarity and precision is not an additional ground for invalidity (Article 51 REG 40/94 is exhaustive); however, this will have “repercussions” on the scope of protection of the registered mark – Unclear and imprecise terms may be invalid on other grounds (namely, contrary to public policy or public order) (Article 7 (1)(f) REG 40/94); ‘computer software’ is one such term – “In that regard, Skykick correctly observe that in modern society a practically limitless array of “smart” goods incorporate, or are supplied with, computer software: game consoles, e-books, domestic appliances, toys, televisions, clocks, etc (let alone such applications as the control software for operating the Large Hadron Collider apparatus). All contain computer software, yet they are entirely dissimilar types of goods. After all, it is not the intention of the EU trade mark rules that a company supplying a smart fridge should be assessed for trade mark infringement on the basis that they supply identical goods – computer software – to that of the supplier of a market trading platform”. – Lack of intention to use a term can amount to bad faith (on its own); however, only those goods tainted by bad faith are invalidated: no "infection" or invalidity of the whole mark Belgium | China | France | Germany | Ireland | Italy | Luxembourg | Netherlands | Spain | UK | US (Silicon Valley) | fieldfisher. com | 7
CITMA Webinar CJEU Decision – 29 January 2020 Answer to Question 1: Lack of clarity and precision is not an additional ground for invalidity 60. "It follows from the foregoing considerations that the lack of clarity and precision of the terms used to designate the goods or services covered by the registration of a national trade mark or a Community trade mark cannot be considered a ground for invalidity of the national trade mark or Community trade mark concerned, within the meaning of Article 3 of First Directive 89/104 or Articles 7 and 51 of Regulation No 40/94. " Belgium | China | France | Germany | Ireland | Italy | Luxembourg | Netherlands | Spain | UK | US (Silicon Valley) | fieldfisher. com | 8
CITMA Webinar CJEU Decision – 29 January 2020 (continued) Question 1: Unclear and imprecise terms will not be invalid on the grounds of public policy 66. " It suffices to note that the concept of ‘public policy’, within the meaning of Article 7(1)(f) of Regulation No 40/94 and Article 3(1)(f) of First Directive 89/104, cannot be construed as relating to characteristics concerning the trade mark application itself, such as the clarity and precision of the terms used to designate the goods or services covered by that registration… 67. “It follows that such a lack of clarity and precision of the terms designating the goods or services covered by a trade mark registration cannot be considered contrary to public policy, within the meaning of those provisions. ” Belgium | China | France | Germany | Ireland | Italy | Luxembourg | Netherlands | Spain | UK | US (Silicon Valley) | fieldfisher. com | 9
CITMA Webinar CJEU Decision – 29 January 2020 (continued) Answer to Question 3: Lack of intention to use a term can amount to bad faith and therefore invalidity: 81. “A trade mark application made without any intention to use the trade mark in relation to the goods and services covered by the registration constitutes bad faith, within the meaning of those provisions, if the applicant for registration of that mark had the intention either of undermining, in a manner inconsistent with honest practices, the interests of third parties, or of obtaining, without even targeting a specific third party, an exclusive right for purposes other than those falling within the functions of a trade mark…” Belgium | China | France | Germany | Ireland | Italy | Luxembourg | Netherlands | Spain | UK | US (Silicon Valley) | fieldfisher. com | 10
CITMA Webinar CJEU Decision – 29 January 2020 (continued) Answer to Question 4: Consequence of bad faith is that only those goods tainted by that ground are invalidated: no "infection" or invalidity of the whole mark 81. “…When the absence of the intention to use the trade mark in accordance with the essential functions of a trade mark concerns only certain goods or services referred to in the application for registration, that application constitutes bad faith only in so far as it relates to those goods or services. “ Belgium | China | France | Germany | Ireland | Italy | Luxembourg | Netherlands | Spain | UK | US (Silicon Valley) | fieldfisher. com | 11
CITMA Webinar CJEU Judgment • Little guidance is found in the CJEU judgment on the consequences of a finding of bad faith in respect of some of the terms in a trade mark specification. Particularly for wide terms such as “computer software”. Belgium | China | France | Germany | Ireland | Italy | Luxembourg | Netherlands | Spain | UK | US (Silicon Valley) | fieldfisher. com | 12
CITMA Webinar High Court third judgment – 29 April 2020 Arnold LJ made a finding of bad faith on the two limbed test. He then provided his interpretation of the consequences of partial invalidity due to bad faith – “ 21. In my judgment Sky applied for the Trade Marks partly in bad faith in each of the three ways referred to in the Main Judgment at [251]. Not merely did they not intend to use the Trade Marks in relation to some goods and services covered by the specifications at the application dates, but there was no foreseeable prospect that they would ever intend to use the Trade Marks in relation to such goods and services. Moreover, Sky made the applications pursuant to a deliberate strategy of seeking very broad protection of the Trade Marks regardless of whether it was commercially justified. Sky thus applied for the Trade Marks with the intention of obtaining an exclusive right for purposes other than those falling within the functions of a trade mark, namely purely as a legal weapon against third parties, whether in threats of infringement claims or actual infringement claims or oppositions to third party applications for registration (as to which, see also the Main Judgment at [69]-[72]). ” Belgium | China | France | Germany | Ireland | Italy | Luxembourg | Netherlands | Spain | UK | US (Silicon Valley) | fieldfisher. com | 13
CITMA Webinar High Court third judgment – 29 April 2020 Arnold LJ took the approach of rewriting terms to narrow them to retain the “good faith” parts whilst removing the “bad faith” parts. “ 28. I consider that bad faith has been proved in so far as Sky applied to register the Trade Marks for “computer software” as part of their strategy without any commercial justification. The main problem with Sky. Kick’s proposed wording, however, is that it is explicitly (although Sky say inaccurately) based upon my findings as to the use which Sky have actually made of the Trade Marks, and no doubt for that reason it is quite specific. But it does not follow that Sky had no commercial justification for seeking protection wider than their actual use. On the contrary, it is well established that trade mark proprietors have a legitimate interest in seeking protection in respect of goods or services in relation to which they may wish to use the trade mark in question in future. Furthermore, as the non-use cases show, even in that context proprietors also have a legitimate interest in seeking a modest penumbra of protection extending beyond the specific goods and services in relation to which use had been proved (but not to distinct categories or subcategories of goods and services). 29. In the absence of any alternative proposal from Sky, I must do the best I can to devise a specification which reflects the extent of the bad faith proved, but no more…” Belgium | China | France | Germany | Ireland | Italy | Luxembourg | Netherlands | Spain | UK | US (Silicon Valley) | fieldfisher. com | 14
CITMA Webinar Current position and looking forward to the Court of Appeal • Doubt as to what the consequences are of lack of intention to use bad faith. The Court of Appeal will resolve that. Four likely scenarios. • Wide terms and large specifications at risk of being partially invalidated. Be prepared for counter claims. • It may be prudent not to “overclaim” in drafting trade mark specifications over broad terms or over populous trade mark specifications. Belgium | China | France | Germany | Ireland | Italy | Luxembourg | Netherlands | Spain | UK | US (Silicon Valley) | fieldfisher. com | 15
CITMA Webinar Contact John Linneker Partner +44 207 861 6787 John. Linneker@fieldfisher. com Belgium | China | France | Germany | Ireland | Italy | Luxembourg | Netherlands | Spain | UK | US (Silicon Valley) | fieldfisher. com | 16
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