A recent EU case highlights the importance of trade mark
clearance searches and brand strategy from an early stage. Of
notable interest is the fact that this striking decision involved a
battle between 2 companies with huge global brand presence.
Reaching for the Sky
In 2004 Skype applied to the Office of Harmonisation in the
Internal Market's ('OHIM') for registration of the
SKYPE image (below) as a Community Trade Mark ('CTM') for
the broad specification of 'audiovisual goods, telephony,
photography goods and computer services'.
In 2005 British satellite broadcaster, Sky, opposed the
application pleading the likelihood of confusion with its word mark
'SKY' (below), registered in 2003 for similar goods and
Skype claimed that the 'Skype' mark had acquired a
'secondary meaning' due to its extensive use (including
that the term 'to skype' has been used as a verb to make
video calls). Despite this, the OHIM rejected Skype's claims on
the basis that 'Skype' and 'Sky' were considered
visually, phonetically and conceptually similar.
Skype's the limit
As is often the case with trade mark proceedings, this courtroom
warfare was protracted and spanned a decade, culminating in Skype
taking the fight to the General Court of the European Union. In May
2015, that Court ruled in favour of Sky and denied Skype's
registration on the basis of the similarities between the two
marks. The Court found that it was unlikely that the average
consumer would break down the word SKYPE to distinguish it from
SKY. This was combined with the evidence of Sky's 'wide and
impressive reputation' and that the SKY brand was one of the
most well-known brands in the United Kingdom'.
Not even the cloud shape around the word Skype was enough
– it was considered merely a 'border that closely traces
the contours of the word SKYPE' and a 'merely decorative
function' that should be disregarded when comparing the two
This is a huge blow to Skype which has invested considerable
amounts of money over the years building reputation in the Skype
mark. And even more costly for Microsoft, who paid $8.5billion to
acquire the Skype business and brand in 2011.
It is expected that Skype will appeal to the Court of Justice of
the European Union. Or, it could be tit-for-tat as Sky could even
bring trade mark infringement proceedings against Skype in the
Lessons learnt from this decision
This case highlights that trade mark clearance searches and
brand strategy are crucial from an early stage. Had Skype narrowed
its application to goods and services it actually offered (eg
'internet calls and messaging services') it might have even
avoided the opposition from Sky.
This case also demonstrates the importance of challenging the
use of highly similar trade marks by new market entrants, given
their potential to grow into well-known brands quickly and
potentially impact upon other brands in their core activities.
Keeping a clear eye on competitors' brands as they develop is
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The Ugg boots case revolves around who holds the trade mark rights to the word 'Ugg' in relation to sheepskin boots.
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