UNITED KINGDOM

Legal updates: case law analysis and intelligence

• UK-based AI software developer opposed the use of “App BUILDER”, “Chatbot BUILDER” and “Website BUILDER”, claiming its Builder brand and sub-brands are known in the industry
• The IPEC decided that BUILDER is a descriptive term widely used in the software industry 
• Especially in connection with new technologies and business fields, the question of the sufficient distinctiveness of the registered signs should be thoroughly examined, also regarding future developments in the industry

On 19 June 2024 the UK High Court issued its decision in Case No [2024] EWHC 1430 (IPEC) relating to Engineer.ai Global Limited’s BUILDER trademarks and a claimed infringement by Appy Pie Ltd and Appy Pie LLP. The court dismissed the claims and held that the claimant’s trademarks lack distinctiveness.

Background

The case concerned a judgment in a trademark dispute between claimant Engineer.ai Global Limited, a UK-based software developer in the field of AI, and its competitors, the two associated companies Appy Pie Ltd and Appy Pie LLP.

The claimant was the owner of seven UK registered trademarks, all of which included the term “Builder”, and which were registered for software-related goods and services in Classes 9 and 42. The dispute concerned the defendants' use of the word “Builder” in connection with the trade of app development products and services.

The claimant maintained that its umbrella brand Builder and associated sub-brands using the element “Builder” were recognised and known in the industry and to its customer base in the United Kingdom as “Builder”.

Claims

The claimant claimed infringement by the defendants of its BUILDER trademarks, particularly their use of the word “Builder” on the Appy Pie website within the terms “App UILDER”, “Chatbot BUILDER” and “Website BUILDER”, among others.

The claimant submitted that the defendants’ use of the word “Builder” in conjunction with one or more descriptive words in the field of computer technology would be perceived by the relevant public as one of the family of marks owned by the claimant and would thus associate the defendants' use with the claimant, giving rise to a likelihood of confusion and taking unfair advantage of the claimant's marks. 

Defence and counterclaim 

The defendants submitted that they offered their software development and support services under the brand name Appy Pie and used the term “Builder” only in a generic or descriptive way, but not as a trademark. They further denied that the public was likely to recognise BUILDER as a trademark because it is so generic and descriptive. 

The defendants also counterclaimed that each of the trademarks were invalid in respect of the goods and services for which they were registered as they lacked inherent distinctiveness. 

Decision

The court decided that BUILDER, whether or not accompanied by a further descriptive term such as “.ai” or “CLOUD”, is a descriptive term widely and interchangeably used in the software industry as a tool for creating or developing software. Therefore, the average consumer would immediately perceive the BUILDER mark as descriptive and, as such, inherently incapable of identifying the goods and services for which the BUILDER trademarks were registered. 

The court therefore concluded that none of the BUILDER marks had acquired distinctive character. The effect of this finding is that all the marks are invalid for lack of distinctiveness. Furthermore, the court did not find that any of the marks: 

• had a reputation with a significant part of the public in the United Kingdom; or 
• had a highly distinctive character capable of distinguishing them from others. 

In conclusion, all alleged infringement claims failed and were dismissed. On the other hand, the defendants succeeded on the counterclaim and all the marks were deemed invalid for lack of distinctiveness (to the extent pursued by the defendants). 

Comment

The decision illustrates that when registering trademarks, especially in connection with new technologies and business fields, the question of the sufficient distinctiveness of the registered signs should be thoroughly examined, also regarding future developments in the respective industry. 

This question should be asked even more before basing trademark infringement claims on these trademarks. Not only with respect to the validity of the trademarks but also considering that in the case of quite generic trademarks, not every use of these signs in trade constitutes trademark use. 

This article first appeared in WTR Daily, part of World Trademark Review, in August 2024. For further information, please go to www.worldtrademarkreview.com