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Trade marks for 'financial services' under the spotlight

Posted on 22 May 2018 by David Rose, Nina O'Sullivan & Eloise Preston

Trade marks for 'financial services' under the spotlight

Following the recent decision in Sky v SkyKick, where Arnold J has referred important questions concerning the proper interpretation of trade mark specifications to the European Court of Justice, his attention has now turned to a mark with a specification covering 'financial services' (Fidelity v Fidelis).  Whilst he decided that the use of FIDELIS did not infringe the FIDELITY marks, largely due to the high degree of knowledge and attention of the average consumer of such services, he did make a number of determinations in relation to the FIDELITY marks which will have potentially wide-ranging implications for those filing and enforcing trade marks in the financial services sector.  Pending the outcome of the referral in SkyKick, this latest decision emphasis how the issues raised in that case are impacting trade mark owners generally.

Background

Investment and asset management provider Fidelity owns a number of trade marks for FIDELITY which are registered for 'financial services', 'insurance services' and 'investment services'. It has been providing financial services in the UK under the brand since 1979.  Following the UK launch of the Fidelis specialty insurance, reinsurance and retrocession underwriting business in July 2015, under the sign FIDELIS, Fidelity brought proceedings for infringement and passing off. Fidelis has a business model which involves allocating its capital between underwriting and investing.  Over the three years between its launch and the trial, there was no evidence of actual confusion, for example, there were limited examples of typographical errors in emails.

 The FIDELITY marks

Arnold J made a number of determinations in relation to the FIDELITY marks and their specifications (some of which were dependent on the outcome of the reference in the SkyKick case):

  • FIDELITY was invalid in respect of 'insurance services' because 'fidelity insurance' is an established and recognised term in the field of insurance. However, this could easily be dealt with by amending the specification to 'insurance services except fidelity insurance'.
  • Whilst the Court accepted that 'financial services' covers 'insurance services', it was arguable that the mark was invalid insofar as it was registered for 'financial services' on the basis it was potentially a term lacking in clarity and precision. This was an issue which would depend upon the outcome in SkyKick. However, the judge said: "I agree that 'financial services' is less objectionable than 'computer software', but I see little difference between 'financial services' and 'telecommunications services".
  • Fidelity had established genuine use of the mark in relation to (1) pensions structured as unit-linked insurance policies (2) reinsurance of unit-linked insurance policies (3) annuities (4) annuity brokerage. However, the extent of this use did not justify the trade mark being registered for 'insurance services'; a fair specification was 'pension-related insurance services'.
  • The question of whether Fidelity had applied to register certain of its marks in bad faith because they did not have any intention to use them in relation to 'insurance services' was again an issue which could not be resolved until the outcome of the referral in SkyKick. However, Arnold J thought that the evidence (which appears to be simply a statement from Fidelity's Head of Pensions that it had considered certain other types of insurance services and that these were under review) demonstrated that Fidelity had a reasonable commercial rationale for seeking registration in relation to a broader class of services than 'pension-related insurance services'.
  • Fidelis also made an argument based on re-filing of applications in order to avoid the consequences of non-use of earlier registrations.  However, the objective evidence pointed in the other direction – the later marks were, for example, for different territories and in relation to different services, and were filed some time after the earlier marks became vulnerable to cancellation.

No infringement and passing off

Whilst there was a high degree of visual similarity and some aural and conceptual similarity between the marks, the services were identical, and the FIDELITY mark had enhanced distinctive character in relation to certain services, the Court concluded there was no trade mark infringement (or passing off).

The key reason for this outcome was the identity, and perception, of the average consumer.  Arnold J agreed with Fidelis that the likely consumers of its services, including those that were encountering it for the first time, would be highly knowledgeable, careful and attentive.  The average consumer was not likely to be confused, a conclusion supported by the lack of evidence of actual confusion over the three years that Fidelis had been trading in the UK.

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