Trademark should be choosen on good faith

Section 3(6) of the Trade Mark Act 1994 provides:
“A trade mark shall not be registered if or to the extent that the application is made in bad faith.”
This provision implements Article 3(2)(d) of Directive 2008/95/EC of 22 October 2008 (First Council Directive 89/10 4/EC of 21 December 1988) to approximate the laws of the Member States relating to trade marks.

The Section 3(6) the Trade Mark Act 1994 dealt with by the courts in the cases of Gromax Plasticulture Ltd v Don and Low Nonwovens Ltd [1999] RPC 367, Harrison v Teton Valley Trading Co [2004] EWCA Civ 1028, [2005] FSR 10, Ajit Weekly Trade Mark [2006] RPC 25, Royal Enfield Trade Marks, Hotpicks Trade Mark [2004] RPC 42 and Nonogram Trade Mark [2001] RPC 21, together with relevant principles derived from Barlow Clowes International Ltd v Eurotrust International Ltd [2005] UKPC 37, [2006] 1 WLR 1476 and Re H (minors) [1996] AC 563, in paragraph 117 of his decision as follows:
“Bad faith includes dishonesty and ‘some dealings which fall short of the standards of acceptable commercial behaviour observed by reasonable and experienced men in the particular field being examined’. Certain behaviour might have become prevalent but this does not mean that it can be deemed to be acceptable. It is necessary to apply what is referred to as the ‘combined test’. This requires me to decide what Mr Maslyukov knew at the time of making the application and then, in the light of that knowledge, whether his behaviour fell short of acceptable commercial behaviour. Bad faith impugns the character of an individual or collective character of a business, as such it is a serious allegation. The more serious the allegation the more cogent must be the evidence to support it. However, the matter still has to be decided upon the balance of probabilities. The issue has to be considered as at the date of application for registration. An act of bad faith cannot be cured by an action after the date of application.”
In Gromax Plasticulture Ltd v Don & Low Nonwovens Ltd, [1999] R.P.C. 367 Lindsay, J. of Chancery Division held, dismissing the passing off claim, finding respondent's registration valid and infringed by petitioner , and ordering revocation of petitioner’s registration, that (1) respondent's application had not been made in bad faith. Bad faith included dishonesty and some dealings which fell short of the standards of acceptable commercial behaviour. It was, however, to be decided by reference to the Trade Marks Act 1994 and with regard to all the material circumstances. The exclusive distributorship agreement with petitioner’s only covered the UK, mainland Europe and the Middle East, and was limited in time, so respondent retained the right to appoint other distributors. The fact that plaintiff would be recognised by its customers as the guarantor of the quality of the products, and not respondent, and that complaints would be directed to petitioners and not respondent was usual in any such agreement; (2) respondent's registration did not mislead the public pursuant to s.46(1)(d) of Trade Marks Act 1994. It was not a requirement that a mark must denote the manufacturer nor was there a rule that the relationship between the owner of the mark and the goods should not change. At no stage did the mark cease to fulfil its purpose of signifying goods with which respondent had a substantial connection. Nor could it be argued that the mark had come to signify goods sold by petitioner to the extent that the public would be misled if they were sold by someone else; s.46(1)(d) did not have that effect, which would apply to many exclusive distributorships, at least where the owner of the mark had, as here, retained a significant role as manufacturer and regulator of quality; (3) respondet's mark would not be revoked under s.46(1) for non use on the basis that its mark should have been registered in Class 17 and not Class 24 since there had been use within Class 24. Even if there had not been, there would still have been a powerful argument that the discretion to revoke should not have been exercised, or there may have been a proper reason for non use; (4) petitioner had infringed respondent's mark; (5) since respondent's registration predated petitioner's application, and as there was a likelihood of confusion, the discretion available under s.47(2) would be exercised by declaring petitioner's mark invalid, and (6) with respect to passing off, the goodwill in the name GRO-SHIELD was vested in respondent and petitioner jointly and therefore as petitioner had failed to show it had a monopoly and sole right to use the mark, there was no passing off.

In Maslyukov v Diageo Distilling Ltd[2010] EWHC 443 (Ch); [2010] E.T.M.R. 37 the court found that the above said preposition of law to be accurate. The court upheld the hearing officer decision who cited the judgment of the Court of Justice of the European Communities (as it then was) in Case C-529/07 Chocoladefabriken Lindt & Sprüngli AG v Franz Hauswirth GmbH [2009] ECR I-0000 at [40]-[51].
As held by the ECJ, the fact person who applies for the trademark knew of the use of the name for similar or identical products and applied for those names is not an act of bad faith per se. It will depend on the circumstances of the case. … especially taking into account the traditions of the trade, is still involved in the trade by reference to this sign.
The court in Maslyukov v Diageo Distilling Ltd[2010] EWHC 443 (Ch); [2010] E.T.M.R. 37 held that the petitioner is using the trade mark applications to appropriate the reputation of the earlier reputed names; something very useful to a new business which has no history in the trade, especially when tradition and heritage are key parts of the trade. There is no doubt that reasonable and experienced men in the trade would consider that filing the applications falls short of the standards of acceptable commercial behaviour. (There are experts in the trade who say as much.)
The limitation of the rights in the applications was after the date of application, and the question of bad faith has to be considered at the date of application. Even if I take into account the limitations I do not consider that this affects my deliberations as to the views of reasonable and experienced men in the Scotch whisky trade to the applications.
The issues must be judged on whether the general categories of goods encompass goods for which there can be objection as per the judgment of the CFI in Duro Sweden AB v Office for Harmonization in the Internal Market (Trade Marks and Designs) (OHIM) Case T- 346/07 …
The court upheld that the hearing officer was entitled to conclude that petitioner had acted in a manner which fell short of the standards of acceptable commercial behaviour.