The Court of Justice of the European Union (CJEU) has now issued its much awaited judgment in the case of Sky v SkyKick which is widely considered to be one of the most significant trade mark actions of recent years, both in the UK and the EU.
To recap, UK broadcaster Sky brought trade mark infringement and passing off proceedings in the High Court against US software specialist SkyKick in 2018. The judge, Mr Justice Arnold, subsequently referred a series of questions arising from the case to the CJEU, requesting clarification on the issues they raised:
- Can a trade mark be declared wholly or partially invalid on the ground that some/all of the terms of the specification lack clarity and precision?
- If the answer is yes, is a term such as “computer software” too general to be considered “clear and precise”?
- Can it constitute bad faith simply to apply to register a trade mark without any intention to use it in relation to the specified goods or services?
- Is it possible to conclude that an applicant made an application partly in good faith and partly in bad faith, where they had intention to use the trade mark for some goods/services but not for others?
- Is the “intention to use” requirement under UK law in respect of UK trade mark applications compatible with EU law?
In response to questions 1 and 2, the CJEU has held that a trade mark cannot be declared wholly or partially invalid on the ground that the goods/services of the specification lack clarity and precision.
In response to questions 3 and 4, it has ruled that a lack of intention to use a trade mark "may" constitute bad faith, but it would be dependent on “objective, relevant and consistent indicia” showing the applicant either wanted to undermine third parties or obtain a monopoly right for reasons “other than those falling within the functions of a trade mark”. In addition, it has held that partial invalidation on the basis of bad faith is, in theory, possible 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 covered by the registration.
On the final question, the CJEU has found that the “intention to use” requirement under UK law is not inconsistent with EU law.
Advice for brand owners
The good news for brand owners is that a trade mark registration cannot be invalidated simply because the specification of goods or services contains a broad term such as “computer software”.
Furthermore, in terms of the test for bad faith, broad specifications alone are not sufficient to establish bad faith. However, it appears that the burden of proof will fall on brand owners to establish the reasons for including all of the goods and services in their specification. As such, it is advisable that (where very broad specifications are included) brand owners retain records of their decision making process (such as business plans) in case this evidence is required at a later date. Although the CJEU did not deal directly with the issue of re-filing or ”ever greening”, it remains possible that such practices could fall within an intention to undermine third parties or obtain a monopoly right for reasons “other than those falling within the functions of a trade mark”. The law, however, remains unclear on this point.
The case will now go back before the High Court of England and Wales for a final decision.