Sky Forces Microsoft Climb-down Over SkyDrive

Microsoft’s tie up with struggling Nokia may be its latest stride to move onwards and upwards but not every cloud has a silver lining for the tech giant. Microsoft has been forced to rebrand its ‘SkyDrive’ cloud storage service following a High Court ruling which it decided not to appeal in a major climb-down.

It follows a claim from BskyB against Microsoft for trademark infringement and passing off. The high profile nature of this decision sends a positive signal to companies keen to protect their intellectual property and serves as a warning to those seeking to exploit the goodwill and reputation of well known brands.

The Battle for Sky

The move from Microsoft to rename its cloud storage service ‘SkyDrive’ came after the High Court ruled in favour of BSkyB. The Judge declared that Microsoft’s use of the mark ‘Sky’ constituted trademark infringement and was also an offence under the tort of passing off. It was stated that the use of ‘SkyDrive’ was likely to confuse consumers who could be misled into thinking that Microsoft’s product was in fact a product of BSkyB.

At the hearing, it transpired that some Microsoft customers had called BSkyB’s helpline believing it was responsible for the service. Furthermore, the Judge opined Microsoft’s ‘SkyDrive’ mark made unfair use of BSkyB’s goodwill and was also detrimental to their registered ‘Sky’ mark which in itself amounted to trademark infringement.

Microsoft Decides Not to Appeal

Microsoft considered appealing the High Court’s decision; however, after what it described as a “transition period”, it agreed to rebrand ‘SkyDrive’.

BSkyB agreed to allow Microsoft to continue using the brand for a “reasonable period of time” to allow transition to a new brand.

Protecting Sky

Only months prior to this case, BSkyB took legal action against another tech company, Liverscribe which, as a result of BSkyB’s challenge, withdrew its ‘Sky’ pen from the UK market. It too, like Microsoft, was forced to rebrand its product.

These cases demonstrate vigilance BSkyB applies to dealing with trade mark infringement. Other companies should take note.

Microsoft’s Previous Form

This was not the first time Microsoft has had trademark trouble. It suffered a similar problem last year when it changed the name of another one of its products after alleged complaints German company, Metro AG.

Comment

BSkyB’s legal challenge against Microsoft highlights the risks of investing in potentially infringing marks. While the two organisations were able to reach a resolution with BSkyB allowing Microsoft a grace period in which to rebrand its product, this was only after a significant legal battle. Concluding these issues in this way can be an expensive exercise for businesses with fewer resources than BSkyB and Microsoft. For more information contact Peter Gourri today by email PGourri@rollingsons.co.uk  or telephone 0207 611 4848.