“CRYPTOBACK”: strike first by registering descriptive brand names

CRYPTOBACK is a neologism, or new word, for ‘cryptocurrency cashback’.

Some neologisms can be difficult to police through the common law of passing off that protects unregistered trade marks and trade names, because the public understands the neologism as describing the product itself, rather than indicating the manufacturer or supplier of that product: like the one-time new word ‘linoleum’.

Wirex Ltd v. Cryptocarbon Global Ltd

This was the issue in Wirex Ltd v. Cryptocarbon Global Ltd, litigation fought earlier this year in the English Intellectual Property Enterprise Court.

Wirex launched a credit and debit card rewards scheme with cashbacks in Bitcoin under the name CRYPTOBACK.

Prior to the launch, Wirex prudently obtained a registered trade mark for CRYPTOBACK covering amongst other things financial and software services.

Cryptocarbon Global (‘Global’) also offered a cryptocurrency cashback system and in the marketing made reference to the word ‘cryptoback’.

Predictably, Wirex sued Global for registered trade mark infringement; there is not much point in owning a trade mark registration if you are not going to try to enforce it.

Global sought to argue in its defence that, since Global had been the first in time to use ‘cryptoback’, Wirex’s CRYPTOBACK trade mark was invalid because under the law of passing off its use in the UK at the application date could be halted.

Judgment on the facts in favour of Wirex

But this defence that Global advanced failed.

The judge found that, as a result of the way in which Global had used ‘cryptoback’, the public would have perceived the word merely as describing a cashback service – not designating a specific cashback service provided only by Global, and by no other company.  Global had therefore failed to establish the necessary trading goodwill (an essential condition for success in a passing off claim) in the word ‘cryptoback’ at the relevant time.

So: Wirex’s CRYPTOBACK trade mark registration was found to be valid, and infringed by Global’s use of it in trade.

Lessons for those launching new products or services

The case highlights two sides of the same coin:

If you are intending to launch a new product or service, whatever the nature of your chosen brand – neologism, word, logo, shape or other non-traditional sign, or any combination of these – then it always prudent pre-launch to secure trade mark registration of that brand in those markets where you expect to trade.

First, you can use a trade mark registration to prevent competitors trespassing on your brand even before the launch.

Second, given appropriate searches, you will avoid wasting time/money on launching a new service or product under a brand name that already belongs to someone else in the territories where you are aiming to use it, and then having to change it, attracting potential damages, legal costs and adverse publicity.

For advice and assistance on the pre-launch availability and protection of intended brands worldwide, please contact Robert Humphreys and Tristan Morse.

All the thoughts and commentary that HLaw publishes on this website, including those set out above, are subject to the terms and conditions of use of this website.  None of the above constitutes legal advice.  Much of the above will no doubt fall out of date and conflict with future law and practice one day.  None of the above should be relied upon.  Always seek your own independent professional advice.

Humphreys Law