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Large UK brands have been told they will need to rein in “aggressive” intellectual property claims after the country’s highest court found that media company Sky acted in “bad faith” by registering trademarks for a wide range of products it did not intend to sell.
In a highly anticipated ruling on a case dating back eight years, the Supreme Court on Wednesday said some trademarks registered by Sky, which claimed intellectual property rights for goods including antiperspirants, tuxedos and biofuels, were so broad as to be unenforceable.
Lawyers said the judgment, which overturned an earlier decision from the Court of Appeal, could make it harder for companies wanting to prevent others in different industries from using their brand names and logos.
Geoff Steward, partner at Addleshaw Goddard, said the ruling would require a “radical rethink” among brand owners who had long sought “the widest possible intellectual property protection”.
“Gone are the days of overreaching to gain wider trademark monopolies,” he said.
Peter Vaughan, chartered trademark attorney and associate professor at Nottingham Law School, described the ruling as “a victory for David over Goliath in many ways”.
“Some of the more aggressive [trademark] enforcement strategies of major brands are likely to have to stop to some degree,” he said.
Sky brought a High Court claim against US tech company SkyKick in 2016, alleging that it had infringed five of its trademarks. But the Seattle-based company challenged the validity of Sky’s trademarks, which covered products including shampoo, carbon monoxide detectors and slippers as well as the goods and services for which it is better known.
The High Court, in a series of judgments, found that Sky had to an extent applied for trademarks in “bad faith”, as they covered such a broad range of goods and services that the company could not have intended to use them all.
The case went to the Court of Appeal, which found in Sky’s favour in 2021. But in an unanimous judgment on Wednesday, the five Supreme Court judges found the “Court of Appeal was wrong to reverse” the initial finding.
The High Court had been “entitled to find that the Sky marks were applied for in bad faith to the extent that it did”, they found.
In an unusual move, the Supreme Court went ahead with its judgment even though Sky and SkyKick settled their dispute — which had been narrowed to a smaller number of goods and services — in September.
SkyKick said it had decided to rebrand following its acquisition by ConnectWise and that both it and Sky “determined that their respective interests would be best served by concluding these long running disputes.”
Sky said in a statement: “Sky, like many other businesses, historically filed a range of trade marks in accordance with relevant guidance available at the time.”
The Supreme Court judgment “concludes a lengthy legal process to clarify the correct application of the law. We acknowledge this clarification and will follow this moving forward.”
Kerry Russell, intellectual property expert at law firm Shakespeare Martineau, said the decision had “sent shockwaves throughout trademark law”.
Companies would need to “give careful consideration” about whether the types of products for which they file trademark applications “are really likely to be used by them” in the near future.