The UK High Court in Sky plc and others v SkyKick UK Limited and other  EWHC 155 will refer five questions to the CJEU on trade mark issues relating to bad faith (for filing with no intention to use) and clarity issues with trade mark specifications. Mr Justice Arnold found that the use of "SKYKICK" infringes the claimants' 'SKY' marks pursuant to Article 9(2)(b) of the Trade Mark Regulation 2017/1001 as there is a likelihood of confusion between the marks, but only if the claimants' trade marks are valid. Therefore, the outcome of the case depends upon the validity of the claimants' trade marks, which can only be decided once the CJEU has answered the questions referred by the High Court.
- The CJEU's answers to these questions will be of importance to all brand owners as it will impact existing trade mark registrations and may inform the breadth of specifications for future trade mark applications.
- Trade mark applicants should carefully consider the breadth of trade mark specifications as this case signals increasing scepticism for the filing of overly broad specifications.
- Trade mark applicants should focus on the detail of what the mark is used for/is likely to be used for. Applicants should seek to be precise in specifying likely intended use in specifications and should avoid the use of standard wording, such as "computer software" or "financial services", if such terms do not accurately describe the detail of what a business really does/sells.
- Given the current timing for Brexit, the CJEU could decline to answer and provide guidance.
Sky is the registered proprietor of a large number of 'SKY' trade marks and the coverage of these marks includes "computer software" in class 9. SkyKick is a provider of cloud management software. Sky issued proceedings against SkyKick alleging trade mark infringement and passing off in May 2016 for the use of the 'SkyKick' sign.
Clarity of trade mark specifications
In seeking to defend the trade mark infringement claims, SkyKick alleged that Sky's trade marks are invalid because the relevant parts of the specifications of goods and services lack clarity and precision. This is a point which follows on from the IP Translator case in 2012 (Chartered Institute of Patent Attorneys v Registrar of Trade Marks C-307/10), where the CJEU provided guidance on how trade mark owners in the EU are required to specify the goods and services covered by their trade mark applications, particularly if they adopted the broad class headings for specifications under the Nice classification system. However, IP Translator concerned the rejection of trade mark applications which lacked clarity. The current case raises a different point on clarity as it relates to marks which have already been granted and whether such marks can be declared invalid for lack of clarity and, as such, the Judge thought it necessary to make a reference to the CJEU on this point.
Bad faith arguments
SkyKick also claimed that Sky's trade marks are wholly or partly invalid because the applications were made in bad faith, since Sky did not intend to use the marks in relation to all of the specified goods and services. The Judge has already concluded that Sky did not intend to use the marks for all of the goods and services for which they are registered and as such, its declaration pursuant to s.32(3) of the Trade Marks Act 1994 ("TMA") was partially false. S.32(3) requires that a trade mark application "shall state that the trade mark is being used, by the applicant or with his consent, in relation to the goods or services, or that he has a bona fide intention that it should be so used". However, the question is whether this constitutes bad faith and the Judge felt it necessary to make a reference to the CJEU on this point.
The questions for the CJEU
The precise language for the CJEU reference still needs to be formalised in an Order, but it is anticipated that five questions will be referred along the following lines:
- Can a EUTM or a national trade mark 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?
- If the answer to (1) is yes, is a term such as “computer software” 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?
- Can it constitute bad faith to apply to register a trade mark without any intention to use it in relation to the specified goods or services?
- 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 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?
- Is s.32(3) of the TMA compatible with the Trade Mark Directive and its predecessors?
Own name defence
SkyKick had previously sought a pre-trial reference to the CJEU in relation to the applicability of the own name defence to trade mark infringement for corporate entities, but this was refused in July 2017 (see coverage of this decision in our Trade Mark Update for 2018 here). The Judge rejected SkyKick's contention that the amendment to Article 12(a) of Trade Mark Regulation 207/2009 by Regulation 2015/2424 (which limits the own name defence to natural persons) was invalid. Further, the Judge found that the own name defence could not apply as SkyKick had not acted in accordance with honest commercial practices, because it had not acted fairly in relation to Sky's legitimate interests.
Brand owners should watch this space for the CJEU decision. This will be an important judgment which is likely to have an impact for many trade mark proprietors who have broad class coverage trade mark registrations. The case may open the door to an attack on the partial validity of UK or EUTMs with broad specifications on the grounds that they lack clarity and precision, either (i) because they were registered using class headings which would be taken to include all of the goods or services in the list, post-IP Translator or (ii) where the applicant used some of the same broad language as in the class headings. Further, the case opens up the possibility of an attack on the validity of the whole or part of UK or EUTMs with very broad specifications on the basis that they were filed in bad faith, with no intention to use the trade mark across all of the goods and services covered (including the possibility that the entire mark is cancelled). It is clear that the UK High Court feels that broad specifications with terms such as "computer software" and similar wording are unjustified and contrary to the public interest for being improper monopolies.