On October 16, 2019 the Advocate General (AG) of the European Court of Justice rendered an opinion in Sky Plc & Ors v. Sky Kick UK Ltd. & Anr. (“the Sky case”) in a reference by Justice Arnold of the England and Wales High Court (Chancery Division). The AG’s opinion caught my attention because the opinion as well as the facts of the case resonated the 1996 order of the Indian Supreme Court in Vishnu Das Trading v. Vazir Sultan Tobacco Ltd., famously known to IP lawyers as “the Charminar case”. While AG’s opinions are only advisory in nature, statistics indicate that courts largely follow the same in arriving at a final judgement.
Let’s examine what makes these two cases similar.
Sky v. Sky Kick
The brief facts of the Sky case are that Sky PLC (“Sky”), who owned several SKY trademarks in the EU in various classes including 9 and 38, sued Sky Kick UK Ltd (“Sky Kick”), a cloud migration information technology service start-up, for trademark infringement. While Sky has used the mark SKY in connection with a range of goods and services and, in particular, goods and services relating to its core business areas of television broadcasting, telephony and broadband provision, it did not offer any email migration or cloud backup goods or services. Nor was there any evidence that it planned to do so in the immediate future. Sky Kick, therefore, denied infringement and, in counter claim, sought invalidity of Sky’s marks as these lacked clarity and precision and were made in bad faith. All the five questions by the referring court to the AG centred around the role and function of ‘specification of goods or services’.
For the purposes of the discussion here, I am limiting myself to the first two questions referred to the AG for opinion, which I summarise as follows:
- Can a trademark be declared wholly or partially invalid because the terms in the specification of goods and services lack sufficient clarity and precision?
- If yes, is the term “computer software” sufficiently clear to enable determination of the extent of protection conferred by the trademark in question?
The AG answered the first question in the negative because any lack of clarity and precision in the specification of goods could always be remedied before or after registration of the mark.
As regards the second question, the AG agreed with the referring court that the registration of a trademark for “computer software” was unjustified and contrary to the public interest because it conferred on the proprietor a monopoly of immense breadth which cannot be justified by any legitimate commercial interest of the proprietor. In support of his opinion, the AG quoted from the 1995 case, Mercury v. Mercury, where Justice Laddie made the following observations regarding the specification “computer software”:
‘the defendant argues that ………… the plaintiff’s registration creates a monopoly in the mark ….. when used on an enormous and enormously diffuse range of products, including products in which the plaintiff can have no legitimate interest. ……. The registration of a mark for “computer software” would cover ………..not just the plaintiff’s type of products but games software, accounting software, software for designing genealogical tables, software used in the medical diagnostic field, software used for controlling the computers in satellites and the software used in the computers running the London Underground system. …. In the end he accepted that some of these were so far removed from what his client marketed …………..in my view there is a strong argument that a registration of a mark simply for “computer software” will normally be too wide… …….. In my view it is thoroughly undesirable that a trader who is interested in one limited area of computer software should, by registration, obtain a statutory monopoly of indefinite duration covering all types of software, including those which are far removed from his own area of trading interest.’
Charminar v. Charminar
Charminar is a 15th century monument and mosque in the city of Hyderabad. Briefly, the facts are that the respondent Vazir Sultan & Co (“VSC”) manufactured cigarettes under the mark CHARMINAR and owned a registration for the same for “manufactured tobacco” in class 34. The appellant, Vishnu Das Trading (“VDT”), subsequently commenced manufacturing ‘quiwam and zarda’ (chewing tobacco products) under the device mark CHARMINAR. The respective marks used different images of Charminar. However, VSC objected to the trademark application of VDT. VDT in turn filed for rectification of VSC’s mark on ground of non-use in respect of chewing tobacco, which was allowed by the Registrar of Trademarks. VSC’s appeal before the Single Judge of the High Court of Madras was allowed on the ground that the sub-classification of “manufactured tobacco” applied by the Registrar of Trademarks was not permitted. VDT appealed before the Division Bench of the Court which upheld the Single Judge’s order holding that there could be no separate registration for cigarettes in class 34 as it spoke only of “manufactured tobacco” and hence VSC’s mark could not be removed on ground of non-use in respect of chewing tobacco, even if these had never been manufactured or intended to be manufactured by VSC. This led to the final appeal before the Supreme Court by VDT.
The Supreme Court allowed VDT’s appeal. Noting that the object of the Trade Marks Act was “to enlarge the field of registrability”, the Court held as follows:
In our view, if a trader or manufacturer actually trades in or manufactures only one or some of the articles coming under a broad classification and such trader or manufacturer has no bonafide intention to trade in or manufacture other goods or articles which also fall under the said broad classification, such trader or manufacturer should not be permitted to enjoy monopoly in respect of all the articles which may come under such broad classification and by that process preclude the other traders or manufacturers to get registration of separate and distinct goods which may also be grouped under the broad classification.
The Supreme Court also made a cautionary note that the order only dealt with the issue of validity of the order of rectification and not on issues of infringement or passing off, thereby leaving the legal recourse of a passing-off action to the registered proprietor.
Thanks for writing about this. The parallel between these cases, as you rightly mention, is a clear one on subject matter. I read Vishnudas, however, as covering ground slightly beyond SkyKick-style cases.
The broad purpose of rejecting overbroad claims is, of course, to preserve freedom of trade within the same class of products. This is the objective the Vishnudas Supreme Court refers to as ‘enlarging the field of registrability’.
Within this purpose, though, lie two connected but completely separable rationales. The first is the elimination of squatting. This is the dominant sense in which Vishnudas is correctly understood, and it is here that the parallel to the old common law position is most direct. (In England, as I understand it, the complication is felt further downstream from the registration. This dates back to the original framing of their 1938 Act, which locked out proprietors from bringing infringement claims if the Defendant’s use fell outside the claimed class. It is a problem that, thanks to a stubborn history of applying similarity tests in an indisciplined manner, hasn’t impeded Indian infringement courts nearly as much.)
There is, however, a second rationale. It has to do with what Vishnudas identified to be a mismatch between the framing of the classes of trade mark registration and the manner in which specific products are identified or associated with in common parlance. To put it a different way, the classes for trade mark registration are a poor proxy for how product segregation works in real world markets.
Therefore, where a restriction (or, by parity of reasoning, even an expansion) of trade mark specifications is necessary to preserve freedom of trade, it is a modification that the law should endorse. In fact, on a re-read of Vishnudas, this is the rationale that comes through more powerfully on the facts of that case. It is also, to the best of my knowledge, not a rationale that draws from English law at all.
The two purposes are, therefore, definitely related, in the sense that they feed the same broad purpose of permitting traders to use similar trade marks while co-existing in formal proximity. Equally, they are separable in the sense that one set of reasons can definitely exist without the other.
My nomination for the best statement on the subject is 2002’s Laboratoire de la Mer (referred to by AG Tanchev in a different context in SkyKick). It described such overbroad claims as “abandoned vessels in the shipping lanes of trade”. For an avenue of trade mark law that’s isn’t especially friendly to aesthetic sense, that’s a pretty enduring articulation.
Dear Eashan – thank you for your comment. I agree that Vishnudas covers more ground than Sky. Though Sky is much better expressed than Vishnudas and easier to read….
Eashan – the previous comment was by me, the author of the blog… 🙂
Apologies it showed up as from “anonymous”!