Case No. EWHC-3296-(IPEC)

33. Battle’s next attack on the Mercury mark was that it is invalid because it was registered in bad faith, contrary to s.3(6) of the Trade Marks Act 1994. The law in this regard was reviewed in Sky Ltd & Ors v Skykick UK Ltd [2021] EWCA Civ 1121 where, at [67], Floyd LJ made the following comments: “3. The concept of bad faith presupposes the existence of a dishonest state of mind or intention, but dishonesty is to be understood in the context of trade mark law, i.e. the course of trade and having regard to the objectives of the law namely the establishment and functioning of the internal market, contributing to the system of undistorted competition in the Union, in which each undertaking must, in order to attract and retain customers by the quality of its goods or services, be able to have registered as trade marks signs which enable the consumer, without any possibility of confusion, to distinguish those goods or services from others which have a different origin: Lindt at [45]; Koton Magazacilik at [45]. 4. The concept of bad faith, so understood, relates to a subjective motivation on the part of the trade mark applicant, namely a dishonest intention or other sinister motive. It involves conduct which departs from accepted standards of ethical behaviour or honest commercial and business practices: Hasbro at [41]. 5. The date for assessment of bad faith is the time of filing the application: Lindt at [35]. 6. It is for the party alleging bad faith to prove it: good faith is presumed until the contrary is proved: Pelikan at [21] and [40]. … 8. Whether the applicant was acting in bad faith must be the subject of an overall assessment, taking into account all the factors relevant to the particular case: Lindt at [37]. 9. For that purpose it is necessary to examine the applicant's intention at the time the mark was filed, which is a subjective factor which must be determined by reference to the objective circumstances of the particular case: Lindt at [41] – [42]. 10. Even where there exist objective indicia pointing towards bad faith, however, it cannot be excluded that the applicant's objective was in pursuit of a legitimate objective, such as excluding copyists: Lindt at [49]. 11. Bad faith can be established even in cases where no third party is specifically targeted, if the applicant's intention was to obtain the mark for purposes other than those falling within the functions of a trade mark: Koton Magazacilik at [46]. 12. It is relevant to consider the extent of the reputation enjoyed by the sign at the time when the application was filed: the extent of that reputation may justify the applicant's interest in seeking wider legal protection for its sign: Lindt at [51] to [52] 13. Bad faith cannot be established solely on the basis of the size of the list of goods and services in the application for registration: Psytech at [88], Pelikan at [54].” 34. The burden of establishing bad faith is therefore on Battle. In seeking to discharge this burden, Mr Carter pointed to the fact that Equisafety’s application for registration was filed on 7 June 2019, the day after it had written complaining about Battle’s use of the word mercury, and was made to enable it to bring trade mark proceedings against Battle. Whilst Mr Carter accepted that that of itself would not be objectionable, he submitted that it became bad faith here because Equisafety was using the word mercury descriptively and because such use had been “staggeringly inconsistent” and had not given it any unregistered rights in the word. In this regard, he pointed to the fact that Equisafety’s Mercury products had been marketed as part of its “NightRider” range and of its “Charlotte Dujardin Collection” but that there had never been a Mercury range as such. He also argued that the way in which Ms Fletcher had gone about asserting Equisafety’s interests had been overly assertive and misleading. Finally, he pointed to the fact that Equisafety’s application covered a wide range of goods including some in respect of which it had had no intention of using the mark. 35. In my judgment, the matters relied on by Battle (whether taken collectively or individually) do not come close to showing that Equisafety acted in bad faith. 36. As Mr Carter accepts, the mere fact that Equisafety made the application after finding out that Battle was selling goods under the HVSMR label would not of itself support a case of bad faith and the argument that it became bad faith because the mark was descriptive must fail in view of my findings above. Similarly, the argument that Equisafety had acted in bad faith because it had not then acquired any unregistered rights in the mark must also fail in view of my finding (see below) that Equisafety did have goodwill in and therefore unregistered rights in the Mercury mark. Nor do I accept that Ms Fletcher’s assertiveness in seeking to protect Equisafety’s interests, even to the point of making mistaken statements to Battle’s customers in the course of this litigation, shows that the application for registration was made in bad faith. 37. I should say that, even if it were found that the mark was descriptive or that Equisafety had not acquired unregistered rights in it at the time of the application, Equisafety was clearly making some use of the mark at the time. In that sense, its application would appear to be intended to obtain protection for a mark for purposes falling within the functions of a trade mark. Given this, I do not accept that the average consumer would see the application to register the mark as a departure from accepted standards of ethical behaviour or honest commercial and business practices. Further, given the existence of s.3(1)(b) and (c), there is no need to stretch the meaning of bad faith under s.3(6) to cover a situation where a person applies to register a mark that turns out to be descriptive. 38. As regards the bad faith argument based on the range of the goods covered by the registration, Ms Fletcher admitted that the registration under class 9 included some goods (e.g. “helmets for bicycles and “Fences (Electrified)”) in respect of which she had and still has no intention to use the mark. However, it is clear from her evidence, that the registration also included goods under class 9 and class 18 for which Equisafety was using the mark, as well as classes of goods which, as she said in cross examination, it “ may well want to move into ”. This does not support a bad faith claim, particularly in the case of a registration that was made less than five years ago. As Sir Christopher Floyd said in Skykick at [116]: “116. An applicant for a trade mark does not have to formulate a commercial strategy for using the mark in relation to every species of goods or services falling within a general description. Such an applicant is entitled to say "I am using the mark for specific goods falling within description X. I have no idea precisely where my business in goods of that description will develop in the next 5 years, but there will undoubtedly be more such goods than there are now." Such an applicant would always be forced to accept that there was no prospect whatsoever that it would use the mark for every variety of goods within the description. Such an applicant could not, however, be accused of bad faith in the light of its strategy for applying for protection of sufficient width to cover some further, as yet unformulated, goods within the same category. For this reason, I consider that the concession (see [102] above) that an applicant with but one item of computer software can apply in good faith for computer software as a whole to have been correctly made. It follows that the absence of a commercial rationale or strategy, if by that is meant a plan under which the mark is to be used for all goods or services within a category of the registration, is not relevant to the enquiry about bad faith.” 39. Even if the application was made in bad faith in so far as it related to goods such as bicycle helmets and Fences (Electrified), it is clear from Skykick (see for example, at [108]-[109]), that that would not invalidate the application insofar as it related to goods such as the reflective products that Equisafety was selling at the time. As Equisafety’s infringement claim is based on that latter type of goods, the bad faith argument does not assist Battle. 40. I should say that, even as regards goods such as bicycle helmets and Fences (Electrified), it does not seem to me that the evidence is sufficient for me to conclude that the application was made in bad faith. As these goods were outside the scope of Battle’s activities, it does not appear that Equisafety’s motivation was to undermine Battle’s position. So, the allegation becomes simply one of too broad a specification of goods which is not sufficient to found a bad faith claim (see SkyKick at [67(13)] and [77]). 41. For all these reasons I reject Battle’s various claims that the trademark was invalid.