[Guest post] SkyKick’s back with a bad faith shocker from the Court of Appeal of England and Wales

Trade mark-focused IPKat readers are well familiar with the SkyKick legal saga, which also included a reference to the Court of Justice of the European Union [Katposts here]. Recently, the Court of Appeal of England and Wales delivered its own ruling on the matter.

Former GuestKat Darren Meale (Simmons & Simmons) analyses the judgment for us. Here's what Darren writes:

SkyKick’s back with a bad faith shocker from the Court of Appeal of England and Wales

by Darren Meale

SkyKick has fought a desperate battle against Sky, raising some incredible arguments and bringing to the fore a number of important trade mark issues. It has lost at almost every turn, but last July it did succeed in having some of Sky’s voluminous trade marks trimmed ever so slightly based on the High Court’s finding that Sky’s filings were made in bad faith.

The Court of Appeal has now undone this in a judgment handed down in July. Led by Sir Christopher Floyd, the Court of Appeal has decided that Sky never acted in bad faith. The Court conducted an exhaustive review of UK and EU case law on bad faith. It concluded that, so far as the goods and services which were relevant to the infringement by SkyKick were concerned, the allegation of bad faith against Sky essentially amounted to an allegation that when it applied for goods such as “software”, it intended to use its marks for a type of software, but not all types of software. Sir Christopher held that this was not bad faith. Accordingly, there is nothing wrong with filing for a broad category of goods or services where the intention or commercial justification is available for at least one item within that category. Further, he held that the fact there were many items in a specification was not relevant to whether specific items were applied for in bad faith.

The Court of Appeal also found that the trial judge had made a procedural error in not requiring SkyKick to specify what restricted version of Sky’s goods and services was appropriate, so that Sky could then defend itself on those specific contentions.

Bad faith?

The end result is a disappointment for the UK trade mark system. SkyKick was an opportunity to deal with several issues that are a real and worsening problem for trade mark lawyers: (1) long specifications; and (2) the use of broad terms like “computer software”. In effect the Court of Appeal has given these practices the thumbs up.

One comment from Sir Christopher Floyd suggests to me that he may not appreciate the problems (1) and (2) cause businesses who try to clear and launch new brands. At paragraph 42 of his judgment, he indicated that it would impose an “increasingly impossible burden” on applicants if they had to finely specify the goods and services they applied for, rather than use broad terms. But that is the system adopted elsewhere, such as the US, and while it can be painful the alternative is the increasingly impossible burden imposed at the brand clearance stage.

SkyKick has stated that it will seek permission to appeal to the UK Supreme Court for a final say on these important issues.

July’s judgment is about the ninth in this case, a short history with links to each decision and commentary in past volumes of Retromark is below.

A history of the proceedings

• July 2017: High Court refuses a pre-trial reference to the CJEU as premature [2017] EWHC 1769 (see Retromark Volume II)
• February 2018: High Court’s 358 paragraph judgment finding infringement subject to referral questions [2018] EWHC 155 (see Retromark Volume III)
• April 2018: High Court sets the questions for the CJEU [2018] EWHC 943
• October 2018: Court of Appeal refuses SkyKick’s initial attempt to appeal the High Court’s decision [2018] EWCA Civ 2004
• October 2019: AG’s Opinion, some exciting signs C-371/18_O (see Retromark Volume VI)
• January 2020: CJEU’s disappointingly conservative judgment, no bombshells C-371/18 (see Retromark Volume VII)
• April 2020: High Court judgment post-CJEU, restricts some of Sky’s registrations but still infringement by SkyKick [2020] EWHC 990 (see Retromark Volume VIII)
• July 2020: High Court follow-up judgment dealing with cloud backup services, remedies and costs [2020] EWHC 1735 (see Retromark Volume VIII)
• July 2021: Court of Appeal rejects bad faith and restores Sky’s registrations [2021] EWCA Civ 1121 (this post)

The future: an appeal to the UK Supreme Court?