The Sky's the limit for Skyscape

UK broadcaster Sky plc has been flexing its legal muscles again recently. The broadcasting group, formerly BSkyB, takes an aggressive stance to protect its brand internationally. The latest episode is a tussle with Skyscape Cloud Services, and a victory for Sky.

Sky has engaged in high profile disputes in recent years with VoIP service Skype. This led to a ruling in May 2015 by the European courts that Skype could not register its name and bubble logo as EU trade marks because of potential for confusion with the SKY brand.  (This dispute has since settled.)

And Sky forced Microsoft to change the name of its cloud storage service from “SkyDrive” to “OneDrive” after a trade mark infringement claim.

Now the UK courts have issued a decision in Sky's favour against Skyscape Cloud Services. Skyscape offers a range of cloud services to the UK public sector, including IaaS, PaaS and SaaS, through the G-Cloud framework.

What is unusual about this dispute is that Sky did not actually start the fight, at least not formally. Sky's lawyers started writing to Skyscape in 2014, alleging trade mark infringement in relation to a series of UK and European marks, referring to its success in the dispute with Microsoft and demanding undertakings from Skyscape. No deal was reached, but Sky did not sue.

Skyscape then started court proceedings itself, on the understandable basis that it wanted commercial certainty over use of its brand. While this is common in the patent arena it is less common with trade marks. UK patent law expressly provides for businesses to apply for declarations of non-infringement. There is no such express right in UK trade marks legislation so Skyscape had to ask the court to use its discretion to grant the declaration. In order to do this, it had to persuade the judge that the negative declaration would help to ensure that the aims of justice were achieved and the underlying issue was sufficiently clearly defined. The case failed on this last point – the draft orders proposed were not clear enough for the judge to make a clear ruling.

During the trial, Skyscape put forward tables showing how Skyscape's activities mapped onto Sky's broadly drafted trade marks. But the judge said that this did not really clarify things and in any event, was too late to be given proper examination.

He went on to analyse the trade mark infringement case that Sky could put forward. The registered marks were very broad in scope covering a wide range of goods and service. And buyers of Skyscape's services could include relatively inexperienced organisations accessing them through G-Cloud. Sky's brand was well-known within the UK. Overall, Skyscape had not shown that an infringement case would fail.

Lessons to learn?

• When selecting your brand, make sure that you have conducted proper clearance searches. This includes checking to see if anyone else has registered the same or a similar trade mark, particularly where this is a big or aggressive players. You can save trouble and expense down the line by avoiding possible brand clashes from the outset. Skyscape had done some searches in 2012, after starting operations. This may have influenced the way it used its brand, but clearly it did not decide at that stage to change its name.
• If you are threatened with trade mark infringement action, it is clear that an application for non-infringement is an available tool. But before starting an action of this type, you will need to identify very clearly the order you want the court to make, and bear in mind that you will have the burden of proof and will have to produce convincing evidence that trade mark infringement has not occurred.

The wider question about whether Sky should be allowed to dominate an everyday word so comprehensively remains unanswered.