SkyKick, An Opportunity Missed?

Sky v SkyKick trademark case

The UK High Court’s Final Judgment

Earlier this year, we covered the Court of Justice of the European Union’s (CJEU) preliminary ruling in the Sky v SkyKick case in a webinar and related blog post. The UK High Court recently issued its final ruling.

Why has this case been considered so significant across the trademark community? We think that, amid concerns that trademark registers are becoming cluttered, it really came down to these two questions that were considered by the Advocate General and then the CJEU before the Sky v SkyKick case was sent back to the UK:

• Can a trademark be invalidated where its specification lacks clarity and precision? 

• Is it bad faith to register a trademark without intention to use for the specified goods?

In many territories outside the US and Canada, brand owners have been able to obtain very broad trademark rights across a wide range of goods and services, where it’s not necessary to prove “actual use” of those goods and services. As trademark practitioners, we’re often taught at the outset of our careers to try to obtain the broadest possible rights for your clients. As a result, many brand owners have been granted what is essentially an undue monopoly to use their brand for goods and services in which they have no interest. From a brand owner’s perspective, this can be a useful strategy to prevent others from adopting similar brands. But in the meantime, trademark registers have become cluttered with unused,overly broad trademarks that block other brand owners from legitimately protecting  their own marks.

The Sky v SkyKick case seemed like it might present an opportunity to kickstart the process of fixing up cluttered registers. And the Advocate General seemed to agree - while he found that “lack of clarity or precision of some or all terms in a specification is not an invalidity ground”, he also found that a registration covering the overly broad term “computer software” was unjustified, contrary to public interest and (controversially) likely to amount to a bad faith filing. 

In the end, neither the CJEU or the UK High Court went quite as far on bad faith as the Advocate General recommended.  The UK High Court held that, because Sky did not have a genuine intention to use its trademarks for all the goods and services covered, the trademarks were applied for partly in bad faith. While this finding was not sufficient to invalidate the trademarks as a whole, the High Court did take the opportunity to narrow the scope of the term “computer software” within Sky’s relevant specifications (although ultimately this didn’t affect the finding of infringement in favour of Sky).

So while brand owners will be relieved that their all encompassing  trademarks are somewhat safe for now, the signs do point to the need for brand owners and trademark practitioners to be prepared for a new wave of attacks on trademarks for specifications that lack “clarity and precision”. (See our earlier blog post for our tips on best practice specification drafting.)  It appears that IP offices are also tightening up on their acceptance of acceptable goods and services terms (some, including New Zealand’s, have announced they will no longer accept the term “computer software” without limitation). It seems likely that the days of brand owners obtaining trademarks that are unnecessarily broad in scope and coverage are dwindling.