SkyDrive Set for a Skydive? – Cloud computing service faces dispute over similar trademark

A recent decision of the High Court provides a useful illustration of the breadth of the rights granted by trademark registration. In that ruling the use of SKYDRIVE by Microsoft for its cloud storage solutions, was found to infringe the trade mark SKY, used in connection with, among other things, broadband internet. For context it is worthwhile getting a better picture of the rights you receive in exchange for successfully registering a trademark.

When you register a brand name as a trademark, you might assume that the law will simply prevent others from using that name in their business. However, the position is somewhat more complex, and the protection you receive is in a sense both broader and narrower than that.

Regular readers of our blog are likely already aware that when registering a trademark, that registration is restricted to certain specified goods and services. For example, you might register YOURBRAND for use with clothing and accessories. While this limits the exclusivity of your rights to a certain extent, such that another business might be entitled to sell cars, or make a TV show called YOURBRAND, you may still be able to take action if another business uses the same brand with goods or services which are similar to your own. But what if the name they use isn’t exactly the same, just similar?

In fact, there are a number of situations when you might be able to take action upon discovering your registered trademark, or a similar trademark, being used without your permission. This is because the law looks in detail at whether the marks are in fact identical, or just similar, and whether they are intended to be used in connection with identical or similar goods or services.

Even if someone uses just a similar brand, with similar goods or services, you can nonetheless take action if you can show that the public is likely to be confused. If your trademark has a reputation and a similar or identical mark has been used without permission in a way which takes unfair advantage of, or is detrimental to, the reputation or distinctive character of your mark, that may also constitute infringement.

So, the strongest case arises when an identical trademark is used for identical goods or services, but neither of these elements are essential.

Returning to the recent dispute over use of SKYDRIVE on the basis of the registered trademark SKY, the court found that although the two trademarks were not identical, there was sufficient similarity between the two marks, and between the goods and services for which they were used, that a claim for infringement should succeed.

The court also found that there was infringement on the basis that Sky’s reputation in the UK is strong, that use of SKYDRIVE would reduce the distinctiveness of the SKY brand, and that Microsoft was not compelled, or otherwise had due cause to use that particular wording.

There are a vast range of factors which influence such a decision, for example in this case the fact that the word “Drive” is arguably descriptive of the service Microsoft provides, that the core goods and services provided by each business were complementary, and that third parties have created apps based on SkyDrive, such as SkyWallet, all supported the court’s judgment.

Serious repercussions can arise from unjustified claims so, given the wide range of factors that are relevant when assessing whether trademark infringement has taken place, it is important to seek specialist advice before taking action yourself.

Microsoft have said that they will appeal the decision, so the dispute is far from over, and it will be interesting to see if the company chooses to continue using the brand name despite this ruling, in the hope that they are ultimately successful.