Wirex’s trade mark battle over cryptocurrency rewards scheme
Cryptocurrency payment platform, Wirex, has recently won its trade mark battle involving an allegation that a rival had infringed the name of its cryptocurrency rewards scheme in the Intellectual Property Enterprise Court (“IPEC”). Senior Associate, Jamie McConnell, specialises in Intellectual Property and Technology Disputes and summaries the facts of the case below.
London-based Wirex, specialises in cryptocurrency payment and was one of the first to offer a cryptocurrency rewards scheme, which they called “CRYPTOBACK”. The scheme gives up to 1.5% of the transaction value back to customers in Bitcoin who used their Wirex card for in-store purchases. Wirex successfully applied to register CRYPTOBACK in July 2018 as a trade mark for financial and software services.
The infringement claim and defence
Wirex brought a claim against Cryptocarbon Global (Global), Cryptocarbon UK and Bee-One alleging they had infringed its CRYPTOBACK trade mark in September 2019. The defendants defended this allegation arguing that they had been using the CRYPTOBACK scheme four years prior in ‘good faith’. The defendants also sought to counter-claim arguments of ‘bad faith’ on the basis:
— The defendants acquired the goodwill associated with the CRYPTOBACK mark and the right to invalidate Wirex’s trade mark.
— Bee-One had launched a similar scheme based on cashback loyalty in 2015 which evolved to similar plans relating to cryptocurrency rewards in 2016, which was then launched in 2017.
— There had been many other uses of CRYPTOBACK in the UK before Wirex registered the trade mark in 2018.
The IPEC’s decision
Judge Hacon disagreed with the defendants’ arguments and found that Wirex’s CRYPTOMARK trade mark was valid and had been infringed by the defendants in breach of section 5(4)(a) of the Trades Mark Act 1994.
Judge Hacon also dismissed the defendants’ counter-claim seeking to invalidate Wirex’s trademark. This decision was based on (amongst other things): (i) unreliable evidence – the defendants’ witness evidence was not supported by the record of transactions for UK holders selecting CRYPTOBACK at that point, (ii) insufficient evidence – to prove that the word CRYPTOBACK was presented to the public in the UK, and (iii) a lack of evidence to show the defendants’ establishment of goodwill associated with the mark.
This case is an important reminder of the need for developing fin-tech businesses, particularly using new cryptocurrency schemes, ideas and products, to protect and enforce their IP as soon as they can. It doesn’t stop there either, there is an on-going onus on trade mark holders to put their mark to genuine use to avoid losing the right. You can read our previous update on the ‘use it or lose it’ argument here.
If you need help protecting or enforcing a trade mark, please get in touch with our highly experienced Disputes team.
This update is for general purposes and guidance only and does not constitute legal or professional advice. You should seek legal advice before relying on its content. This update relates to the prevailing circumstances at the date of its original publication and may not have been updated to reflect subsequent developments. If you have general queries about our updates, please email: email@example.com