Computer software: ECJ supports trademark applicants with general generic term

Lack of clarity and unambiguity of the generic term computer software is not a reason for the invalidity of a Community trademark, the ECJ ruled today in the internationally highly regarded case Sky vs. SkyKick. The ruling supports trademark applicants who wish to secure a large scope of protection for their trademark by using as general a term as possible.

The case Sky vs. SkyKick (EU:C:2020:45), which was decided today by the European Court of Justice (ECJ), was referred to the Court for a preliminary ruling by the High Court of Justice (UK). The main question was whether the generic term computer software claimed by Sky for its trademarks was sufficiently clear and precise to grant trademark protection.

The marks in question were registered for Nice Class 9, for all types of computer software which were to be included in Class 9, notwithstanding the fact that Sky did not provide all types of software and could never provide all types of software.

Trade mark applicants often use as general terms as possible and also many terms to designate their goods and services. This opens up the possibility of extending the range of goods and services offered under the protected sign and – at least as importantly – to secure an exclusive right in fields claimed by the trademark application.

The IP-Translator judgment of June 2012 (ECJ, C-307/10) is also important in this context. The ECJ had ruled that a generic term covers only those goods or services which are covered by its literal sense, and not the entire alphabetical list which belongs to the Nice class for the respective generic term.

In the present case, however, the focus was on the need for clarity and unambiguity. According to the case-law, the applicant for a trade mark must indicate the goods and services for which trade mark protection is sought so clearly and unequivocally that it is possible for the competent authorities and third parties to determine the extent of the protection afforded by the mark (ECJ judgment of 2012, C-307/10).

Clarity and unambiguity required for generic term?

SkyKick had argued that the requirement of clarity and unambiguity of the goods and services for which a trademark was registered could be linked to the requirement of graphic representability.
The ECJ rejected this objection. This only applies to signs capable of constituting a trade mark and not to terms such as those used in the present case, such as the designation of the goods and services computer software, the Court explained. It is true that the lack of clarity and precision in the representation of the sign may be a ground for invalidity (Article 3(1)(a) of Directive 89/104 (and Directive 2008/95)). But this is not the case where the specification of goods and services is concerned.

Breach of public order?

SkyKick also raised the objection that a trademark that does not meet the requirement of clarity and accuracy is contrary to public policy. The ECJ rejected it today. The term “public policy” (as referred to in Article 7(1)(f) of Regulation No 40/94 and Article 3(1)(f) of First Directive 89/104) cannot be understood as referring to the characteristics of the trade mark application, the ECJ held – by the way, in contrast to the Advocate General’s opinion in the present case – and therefore also not to the clarity and precision of the terms of a trade mark application.

ECJ supports trademark applicants with a general generic term

Neither Article 3 of First Directive 89/104 nor the abovementioned provisions of Regulation No 40/94 contain, among the absolute grounds for invalidity listed therein in relation to a Community trade mark, the lack of clarity and precision of the terms.
It follows from the foregoing considerations that the lack of clarity and unambiguousness of generic terms cannot be regarded as a ground for invalidity or for declaring the national or Community trade mark concerned invalid within the meaning of Article 3 of First Directive 89/104 or Articles 7 and 51 of Regulation No 40/94, the ECJ held.

The Court added that such a designation, which lacks clarity and precision, is protectable only for the goods and services for which it has been put to genuine use. In this context, the Court referred to the obligation to use a trademark, according to which a trademark is revoked if it has not been used for 5 years. Moreover, the genuine use of the mark during the last 5 years must be made in such a way as to be consistent with the essential function of the mark.

Furthermore, the ECJ added that Article 51(3) of Regulation No 40/94 and Article 13 of the First Directive 89/104 must be interpreted as meaning that, where the ground for invalidity relates only to some of the goods or services specified in the application for registration, the trade mark must be declared invalid or unregistered in respect of those goods or services only.

Bad faith by unused goods and services?

The aspect of bad faith was also discussed in this case. Because the generic term computer software also applied to types of software, Sky could not provide any software, did Sky even intend to use the trademark for this purpose?

Nevertheless, the ECJ did not recognise bad faith in the trademark application under the generic term computer software. Bad faith could not be assumed on the basis of a mere finding that the applicant did not have, at the time of filing, a business division corresponding to the goods and services covered by the application, the court explained.

However, the ECJ held that registration of a trade mark without the applicant intending to use it for the goods and services covered by the registration could constitute bad faith if the applicant intended either to cause damage to third parties’ interests or to acquire an exclusive right for purposes other than those inherent in the function of a trade mark (where the application for the trade mark is not justified in the light of the objectives of Regulation No 40/94 and First Directive 89/104).

Case computer software internationally observed

This computer software case was also followed with great interest in the EU Member States. The Hungarian, French, Polish and Slovak Governments argued that the term “software” was not too general and did not designate goods which were too different to identify the goods and services covered by the registration.

The Governments of the UK, France, Hungary, Poland, Slovakia and Finland also pointed out that nowhere in the legislation is there an explicit requirement that the specification of goods and services must be clear and precise.

Today’s judgment confirms this view. The EU Member States are free to apply their own provisions of national law, for example to require a declaration by a trade mark applicant that the goods and services covered by the application are used or that he has a genuine intention to use them.