Are your trade marks safe? Lessons from the Sky/SkyKick case for small and medium sized businesses

The UK Supreme Court has issued important guidance in the long-running dispute between Sky and Skykick. While the parties ultimately settled and requested that the judgment not be issued, the Supreme Court took the unusual step of finalising and publishing their decision.

What was the dispute?

Many big brands take a broad approach in terms of registering IP protections and tend to register beyond the scope of the products and services they offer to secure protection for their brand. This is a defensive strategy that has become quite common place and helps stop other businesses from using these trade marks. The reason for this is that trade marks have huge value and are a key way that customers know what brand the products and services they purchase or use are associated with.

Skykick, a US based company, offering email migration and cloud storage services, expanded into the UK and offered its customers email migration and cloud storage services. When Sky discovered this it claimed that the use of Skykick (the important part being the use of Sky) was an infringement of its trade mark because of the visual and phonetic similarities to its registered trade mark Sky. Sky stated that consumers would be confused about the goods and services and may believe they were being provided by Sky.

Skykick defended this claim and challenged the validity of Sky’s trade mark registrations and argued they had been obtained in ‘bad faith’.

What is the basis of Skykick’s defence?

Skykick challenged Sky’s trade mark due to bad faith. Skykick’s main argument was that if a trademark is obtained in bad faith it will fail or, if already registered, will be invalidated. Essentially, the argument was that Sky had no intention of providing services or selling products in many of the classes they’d registered Sky in (classes are here if you’re interested) and were only ever going to sell goods and services that fell within classes relating to telecommunications and email service provision and had therefore registered in the other classes in bad faith.

What did the Supreme Court decide?

The Supreme Court decided that:

1.     Sky’s registrations in classes covering goods and services they never intended to sell were applied for in bad faith and were therefore invalid. Therefore, the parts of the registration covering goods and services Sky actually intended to sell were valid but in respect of the other classes the registrations were invalid. Practically, this meant that the trade mark registrations previously granted were modified accordingly.

2.     Despite this partial invalidity, while SkyKick’s use of Sky in cloud backup products did infringe the parts of Sky’s registrations that remained valid, those relating to the cloud migration services Skykick were selling did not.

3.     Pre-existing cases involving EU trade marks would still be governed by the EU trade mark regulation if filed before the transition period ended, i.e. if cases were filed in the UK before 31 December 2020, EU trade mark laws still applied to these disputes.

What are the key learnings for small businesses?

For SMEs, the SkyKick ruling is a reminder to keep trade marks specific, genuine, and aligned with actual business activity. Here are a few practical steps to consider:

• Review your portfolio: Assess whether existing marks reflect your primary goods and services. If you find you have overly broad registrations, consider replacing them with trade mark registrations that are more narrowly focused and relevant.

• Focus on core offerings: Avoid the temptation to register for broad categories without clear intent. Concentrating on specific categories that directly relate to your business can provide more reliable protection, i.e. making sure you are registering the marks in classes where you have a clear intention to sell products and services that fall within that class.

• Be strategic with new applications: When filing new trade mark applications, think long-term and focus on areas where you see the most value and growth potential. This will help build a strong, defendable trade mark portfolio without risking unnecessary challenges. Anticipate growth areas when filing registrations but avoid purely speculative or defensive registrations that could lead to challenges.

• Protect your core brand assets: Ensure that your trade marks are well-maintained in the areas most critical to your business. Strong, targeted registrations provide the best protection against infringement and unauthorised use.

This case serves as a landmark decision on the limits of trade mark registrations and the dangers of registering in classes where you have no intention of selling products or services that fall within that class. For small and medium sized businesses, it highlights the importance of having a clear trade mark strategy which aligns with your actual and foreseeable business activities. By taking a measured and thoughtful approach to registration, businesses can build strong, enforceable trade mark portfolios while minimising the risk of invalidation.

This ruling shows a shift towards more accountable trade mark practices and encourages businesses to register marks genuinely linked to their operations rather than engaging in overly broad defensive, speculative trade mark applications.

About Adaptable Legal Counsel

Adaptable Legal Counsel specialises in offering fractional legal support to businesses, ensuring that you have access to professional advice without the need for a full-time legal team.

Our legal counsel as a service model provides businesses with access to expert advice when they need it most, whether for trade mark strategy, contract negotiation, or general compliance. By offering flexible legal support, we help businesses navigate complex legal landscapes while staying focused on growth and innovation.

About Amy

Amy is a commercial solicitor with experience in intellectual property protection. She now offers flexible legal services through Adaptable Legal Counsel, supporting SMEs with tailored solutions to meet their unique needs.

During her time at Panasonic and Reed Exhibitions (RX Global), part of the RELX Group, Amy gained expertise in advising on the protection of intellectual property from both a registration and contractual perspective. She provides now fractional legal support so she can help enable businesses to navigate complex legal landscapes with confidence and efficiency.

For more information, please visit our website to discuss how our flexible legal services can help your business succeed in partnerships with larger clients.

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Disclaimer: This blog is for informational purposes only and should not be considered legal advice. The content provided here is intended to offer general insights into data protection and contractual considerations for businesses. For specific legal advice tailored to your individual circumstances, please consult a qualified legal professional. Adaptable Legal Counsel disclaims any liability for actions taken or not taken based on the information in this blog.