Across Europe since the implementation of the harmonising Trade Marks Directive No. 89/104 (“the Directive”), three dimensional marks have not been precluded from registration as a trade mark provided that they satisfy the criteria for registrability and/or are not excluded on other grounds. However, 3D/shape marks face inherent difficulties in satisfying such criteria and/or in avoiding not falling foul of the other statutory exclusions. These difficulties for 3D/shape marks have been recently highlighted in an opinion by the Advocate General submitted in the latest round of various trade mark disputes between Nestlé and Cadbury.

Background

Nestlé had applied to the UK Intellectual Property Office, (“the UKIPO”) to register in the UK as a trade mark the three dimensional shape of the well-known four-finger chocolate bar (pictured below without KIT KAT embossed into the product) covering various chocolate and confectionary goods in class 30.

Click here to view the image.

The UKIPO accepted and published the application on the basis that, even though the mark lacked inherent distinctiveness, Nestlé had shown that the trade mark had acquired distinctive character through prior use. 

Cadbury opposed the application on the following absolute grounds:

  • the trade mark is devoid of distinctive character (section 3(1)(b) Trade Marks Act 1994);
  • the trade mark is a shape which results from the nature of the goods themselves (section 3(2)(a) Trade Marks Act 1994); and
  • the shape is necessary to obtain a technical result (section 3(2)(b) Trade Marks Act 1994)

The application was then referred to a hearing officer at the UKIPO.  Nestlé aimed to rely on the proviso that a trade mark will not be refused if it has acquired distinctive character from use before the date of filing. To substantiate this claim Nestlé provided survey evidence where over 90% of people mentioned “Kit Kat” in their response to seeing the shape. In spite of this the Hearing Officer found that the mark had not acquired distinctive character in relation to the goods, except for “cakes” and “pastries”.

The Hearing Officer distinguished between mere recognition that the mark is associated with Nestlé and the essential function of a mark in acting as a badge of origin. The mark was always used with the word mark KIT KAT, embossed on the fingers and on the packaging of the goods. The consumers would view KIT KAT as the trade mark, rather than the shape of the product itself.

With regard to the shape of the product, the Hearing Officer found that the trade mark consisted exclusively of the shape which is necessary to obtain a technical function and also was a shape that resulted from the nature of the product itself. The three features of the trade mark considered were:

  1. the basic rectangular shape;
  2. the presence, position and depth of the grooves running along the length of the bar; and 
  3. the number of grooves, which, together with the width of the bar, determine the number of fingers. 

The first feature was found to result from the nature of the goods themselves and the other two features were necessary to obtain a technical function. In relation to “cakes” and “pastries” the Hearing Officer held that the trade mark was inherently distinctive and could therefore be registered for those goods.

The Hearing Officer therefore rejected the application, except in relation to “cakes” and “pastries”.

Both parties appealed the hearing Officer’s decision to the High Court.

On its cross-appeal, Cadbury challenged the decision insofar as the trade mark had inherent distinctiveness in respect of “cakes” and “pastries”, arguing that just because the shape was outside the norms of the sector, this does not give it distinctive character. The High Court agreed with Cadbury on this point.

On its appeal, Nestlé argued that the trade mark had acquired distinctiveness for all goods stated in the application, not just for “cakes” and “pastries”.  With regard to the shape of the goods, Nestlé argued that the three elements listed by the Hearing Officer did not fall within one of the exclusions, which was a pre-requisite for rejection.

The Court was of the view that the examiner should not have made the distinction between “cakes” and “pastries” and all the other goods in class 30, either in relation to the proof of acquired distinctive character or the applicability of the shape exclusions in section 3(2). Also, given the unclear position of the law in this area, the High Court referred the following questions to the European Court for a ruling on the law:

  1. In order to establish that a trade mark has acquired a distinctive character following the use that had been made of it within the meaning of Article 3(3) of Directive 2008/95/EC, is it sufficient for the applicant for registration to prove that at the relevant date a significant proportion of the relevant class of persons recognise the mark and associate it with the applicant's goods in the sense that, if they were to be asked who marketed goods bearing that mark, they would identify the applicant; or must the applicant prove that a significant proportion of the relevant class of persons rely upon the mark (as opposed to any other trade marks which may also be present) as indicating the origin of the goods?
  2. Where a shape consists of three essential features, one of which results from the nature of the goods themselves and two of which are necessary to obtain a technical result, is registration of that shape as a trade mark precluded by Article 3(1)(e)(i) (section 3(2)(a)) and/or (ii)(section 3(2)(b))  of Directive 2008/95/EC?
  3. Should Article 3(1)(e)(ii) (section 3(2)(b)) of Directive 2008/95/EC be interpreted as precluding registration of shapes which are necessary to obtain a technical result with regard to the manner in which the goods are manufactured as opposed to the manner in which the goods function?

The Opinion

The decision of the European Court is awaited but the Advocate General Wathelet has just provided the following opinion (Case C-215/14 Société des Produits Nestlé SA v Cadbury UK Ltd on the 11 June 2015) on the questions that have been submitted by the UK’s High Court:

  1. it is not sufficient for the applicant for registration to prove that the relevant class of persons recognises the trade mark in respect of which registration is sought and associates it with the applicant’s goods or services. It must prove that only the trade mark in respect of which registration is sought, as opposed to any other trade marks which may also be present, indicates, without any possibility of confusion, the exclusive origin of the goods or services concerned.
  2. Article 3(1)(e) (section 3(2)) of the Trade Marks Directive must be interpreted as precluding registration of a shape as a trade mark where that shape has three essential features, one of which results from the nature of the goods themselves and the other two of which are necessary to obtain a technical result, provided that at least one of those grounds fully applies to that shape.
  3. Article 3(1)(e)(ii) (section 3(2)(b)) of the Trade Marks Directive must be interpreted as precluding registration as a trade mark of a shape which is necessary to obtain a technical result not only with regard to the manner in which the goods function, but also with regard to the manner in which they are manufactured.

The Nestlé case will now proceed to final judgment by the CJEU and although the Court is not bound by the opinion, in most cases the Advocate General’s opinion is followed. Once the judgement has been given by the CJEU, the UK High Court will then make a decision on the trade mark application.

Nestlé had also applied to register the shape as a Community Trade Mark and was successful on appeal. There is a further appeal by Cadbury in relation to this CTM registration.  It is to be hoped that we do not end up with two conflicting decisions.

Comments

The problem facing Nestlé with regard to the UK application was that there is embossed on the chocolate fingers, the KIT KAT logo. Also, the chocolate bar is rarely sold unwrapped or advertised without the red packaging marked with the KIT KAT logo. The Advocate General made it clear that Nestlé would have to prove reputation in relation to the shape trade mark and not any other mark. This point seems difficult to argue with, as the applicant should prove acquired distinctiveness for the applied for mark, rather than any other mark it is commonly used with. 

However, the Advocate General in the opinion sets the bar high in relation to proving this distinctiveness. If the opinion is followed,  Nestlé would have to show more than mere recognition of the trade mark; it would had to prove that the public identifies the shape of the trade mark with Kit Kat, without the possibility of confusion. The shape mark would have to act independently as a trade mark and indicate origin. The survey evidence submitted by Nestlé indicating that 90% of people shown a picture of the chocolate bar, without any other marks, mentioned Kit Kat in their comments was rejected, stating that recognition and distinctiveness are two separate things.

With regard to the shape of the mark, it appears as though registration is precluded if any of the grounds fully apply to the shape as a whole. The Opinion indicates that the manner in which the shape is manufactured is considered when analysing whether the shape is necessary to obtain a technical result.

As an aside, please recent invalidity trade mark cases (Case T 395/14 and Case T-396/14 Best-Lock (Europe) Ltd v OHIM on the 16 June 2015) involving the registration of the well-known Lego figurines (pictured below) contrasts this outcome to date of the Nestlé/Cadbury dispute.

Click here to view the image.

In the Lego case, the CJEU held that the shape marks did not fall foul of the exclusions for protection, finding that the result of the marks were to confer human traits on the figures, and the fact that children can use these in a play context was not “technical”. Even though the applicant, Best-Lock, did not submit the strongest case for invalidity, it does indicate that it is possible to register and maintain shape marks. It should however be noted that this was a decision at European level, rather than at UK level.