SkyKick ruling reveals a need for linguistic clarity
The questions referred had the potential to strike at the heart of trademark specifications and render large numbers of registrations potentially invalid, particularly if the court followed the approach taken by the CJEU’s Advocate General.
However, despite expectations, the judgment handed down in late January largely confirmed the current position and status quo rather than radically altering trademark law and practice.
The CJEU ruled that a trademark registration can’t be declared wholly or partially invalid on the grounds of lack of clarity and precision of terms in the specification, a decision that was undoubtedly a relief for trademark proprietors, and British telecommunications company Sky in particular.
Keep it clear
Instead of introducing a new route for potentially disruptive challenges to trademarks with broad specifications, the decision is a reminder (possibly even a warning) that unclear or imprecise terms can be challenged on the grounds of non-use once a mark has been registered for five years or more.
At paragraph 70 the CJEU ruling stated: “a national or Community trademark registered for a range of goods and services designated in a manner which lacks clarity and precision is, in any event, capable of being protected only in respect of the goods and services for which it has been put to genuine use”.
The decision is also a reminder of the ability to challenge on the grounds of bad faith. While applicants are not required to indicate or know precisely the use that will be made of a trademark at the time of filing, a registration may be open to challenge on the grounds of bad faith if the application was made without any intention to use it in relation to the goods and services covered and, when the application for a trademark was filed, there was an additional element present to suggest behaviour other than in accordance with honest practices.
Paragraph 77 of the ruling stated that the “registration of a trademark by an applicant without any intention to use it in relation to the goods and services covered by that registration may constitute bad faith, where there is no rationale for the application for registration in the light of the aims referred to in Regulation no 40/94 and First Directive 89/104”.
“Such bad faith may, however, be established only if there are objective, relevant and consistent indicia tending to show that, when the application for a trademark was filed, the trademark applicant 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 trademark.”
Post-Skykick applications
The recent increased focus on the breadth of specifications in SkyKick and other cases may suggest a trend where applications containing terms that are potentially too broad or lacking precision, such as “ computer software”, may begin to receive greater scrutiny.
Specification drafting goes to the heart of a trademark registration’s scope. The shift towards a greater focus on the language used, to ensure precision and clarity, should be generally welcomed, as it will allow the trademark registers to function without becoming unnecessarily congested and to ensure the scope of monopolies granted is clear and warranted.
This is all part of the general move away from the very broad specifications which have traditionally been accepted in the EU. EU Intellectual Property Office ( EUIPO) practice has evolved from applicants being able to claim all goods or services in a class simply by using the wording of the class heading from the Nice Classification, to a more precise position, whereby terms are given their literal meaning.
In recent years case law has focused with increasing frequency on specifications, and it seems there will be a requirement to be ever more precise in relation to identifying the goods or services covered.
It seems possible that terms such as “computer software”, “financial services”, or “telecommunications services” without further detail may be subject to greater scrutiny at the applications stage, particularly in the UK. Such terms will likely also face additional justification during non-use challenges five years from registration.
As the trademark registers become more cluttered, and overly broad registrations cause barriers to entry because the supply of suitable trademarks is diminished, it seems logical that more attention will be given to the clarity and precision of specifications.
Post-SkyKick: the impact on existing registrations
In essence, the law remains unchanged and the CJEU decision does not open up a new ground for challenging registrations. However, there is a potential softening within the scope of bad faith.
It remains to be seen how this decision will be applied in future bad faith decisions and we look forward to the ruling of the High Court in the ongoing SkyKick dispute, set for some time in the next few months.
The position remains that registrations are vulnerable to revocation on the grounds of non-use once they have been registered for five years or more. Before relying on a registration for opposition, cancellation or infringement purposes it is worth reviewing the specification to determine any areas of vulnerability.
It is good practice to review any IP rights on a regular basis to ensure they adequately cover current and expected future activities. It’s also worth considering voluntary limitations where appropriate to reduce the likelihood of a counter-attack for non-use, or even bad faith, when relying on a broad specification.
Charlotte Duly is the head of brand protection at Charles Russell Speechlys LLP. She can be contacted at: Charlotte.Duly@crsblaw.com
