The High Court has recently handed down a judgment in the case of Charles Claire LLP and Lynx Golf Limited v Kevin Harold Woolgar [2025] EWHC 1802 (Ch) (22 July 2025) (Charles Claire LLP v Woolgar). The case looked at, in part, whether the filing of a UK trade mark by a deceitful consultant was filed in bad faith.
Bad faith remains a hot topic in intellectual property (IP) following the landmark judgment in the Supreme Court case of SkyKick UK Ltd and another (Appellants) v Sky Ltd and others (Respondents) [2024] UKSC 36 (SkyKick). SkyKick considered the issue of bad faith in detail, and the judgment included a list of key principles to consider when assessing whether a finding of bad faith can be made out. Whilst SkyKick remains the leading case on the current parameters for succeeding in a claim of bad faith in the context of unduly broad terms, Charles Claire LLP v Woolgar emphasises the fundamental importance of considering the applicant’s frame of mind at the point of filing.
What is bad faith?
Bad faith in UK trade mark cases is broadly understood to be a finding that an applicant has departed from accepted principles of ethical behaviour or honest commercial practices.
The facts of the case
The Defendant, Mr Woolgar, supplied a range of golf products for Charles Claire LLP and Lynx Golf Limited (Claimants) in China. Mr Woolgar acted independently of the Claimants with his role defined in a consultancy agreement (Agreement) between Charles Claire LLP (First Claimant) and Atop Pro Golf Inc Limited (Mr Woolgar’s business). Mr Woolgar worked on different projects with the Claimants relating to its “Lynx” brand including the design and development of golf products. During the course of Mr Woolgar’s relationship with the Claimants, he also proposed a new range of junior golf clubs under the proposed brand of “Ai”.
The claims against Mr Woolgar were two-fold. It was alleged that:
- Mr Woolgar was taking a secret commission on the goods he supplied, and
- Mr Woolgar had no right to file for a UK trade mark for the “Ai” brand.
Secret commission
The secret commission provides a useful backdrop to the bad faith claim. After the disclosure of a series of emails between Mr Woolgar and his business associate in China, and a revealing cross-examination of Mr Woolgar, the judge was “quite prepared to hold that Mr Woolgar did benefit from amounts, of which the Claimants were unaware…”. This resulted in a finding of deceit, breach of trust, and breach of an implied contract, as well as a finding that Mr Woolgar breached the duty of care he owned to the Claimants. Against this backdrop, the Court turned to the UK trade mark registration Mr Woolgar obtained for Ai.
Trade mark ownership and application
In around 2019, Mr Woolgar had pitched his idea for an “Ai” range of junior golf clubs to the Claimants. At the time, the Claimants were not prepared to fund the venture. Mr Woolgar went on to develop the Ai brand and secured a trade mark registration for the Ai logo. It was his position that this brand was separate to the work he did for the Claimants and that the Claimants should have fully recognised this. The Claimants ran two arguments. First, the Claimants argued that Mr Woolgar had no right to register this trade mark. As the Agreement included an IP assignment clause, it was the Claimants’ position that the trade mark rightfully belonged to them. The judge considered that the trade mark and its registration fell outside the services Mr Woolgar provided under the Agreement, principally as the Ai brand was not something the First Claimant wanted to pursue, and it was only due to Mr Woolgar’s financing that there was an Ai range. The assignment clause therefore did not bite in these circumstances.
Second, the Claimants argued that the trade mark was filed in bad faith as Mr Woolgar acted with dishonest intent. At this point, the judge carefully considered the principles set out in SkyKick. With these in mind, the events leading up to the filing of the application in question were in the judge’s view “a perfectly orthodox commercial arrangement” and held that “there was nothing dishonest in Mr Woolgar’s state of mind”. This may come as a surprise given that Mr Woolgar was found to be taking a secret commission in relation to the work he undertook for the Claimants. The Claimants did invite the judge to take into account Mr Woolgar’s deceitful behaviour. The judge made it clear that he must consider the facts as they pertained to Mr Woolgar’s intention at the time of filing that specific trade mark. The key consideration was whether Mr Woolgar’s intention when obtaining the trade mark were dishonest. He saw Mr Woolgar’s deceitful behaviour in relation to the secret commissions as separate from his conduct in relation to the filing of the trade mark registration and found no credible basis for a finding that he had acted in bad faith.
Judgment takeaways
This case highlights the vital importance of carefully considering your contractual terms with third parties including consultants and the need to ensure that these terms are considered and reviewed as the relationship develops. Whilst you may not wish to pursue certain business opportunities, you may well wish to consider the effects and ownership of those opportunities before it creates an expensive headache further down the line.
If you have questions or concerns about filing a trade mark, or any other issues raised in this Keynote, please contact Will Sander and Jennifer Stratfold.