Opinion of the advocate general
On December 23 2011 the Dutch Supreme Court, in Trianon v Revillon,(1) referred questions to the European Court of Justice (ECJ) for a preliminary ruling on the interpretation of the absolute grounds for refusal of trademark protection for signs which consist exclusively of "the shape which gives substantial value to the goods" under Article 3(1)(e)(iii) of the EU Trademark Directive.(2)
Revillon's Benelux trademark is a three-dimensional mark (BX 0744485) for chocolate products, consisting of the shape of the chocolate product which resembles a vine.
The Den Bosch Court of Appeals dismissed the application of Article 3(1)(e)(iii) of the directive on the grounds that, in principle, a potentially attractive shape of a chocolate product has no essential influence on the intrinsic value of the product. The essential value of chocolate rather lies, according to the court, in the taste and substance. This appeal decision is consistent with Benelux legislative history and the case law of the Benelux Court of Justice. In Burberrys, for instance, the Benelux Court of Justice held that:
"a distinctive shape of the goods may only be refused as a trade mark because of its influence on the essential value of the goods, when the nature of the goods is such that its appearance and shape determine its market value to an important extent because of their beauty and original character."(3)
In addition, the explanatory memorandum to the former Benelux Trademark Act specifically states:
"In the comestible goods industry, however, goods, such as chocolate, may be sold in an attractive shape, although that does not have essential influence on the intrinsic value of the delicacy."(4)
Opinion of the advocate general
The advocate general pointed out that Article 3(1)(e)(iii) of the directive differs from the former Benelux provision in that it excludes shapes that give "substantial value" rather than "essential" value to the goods. The attorney general further observed that the case law of the Benelux Court of Justice has been superseded by the General Court's October 6 2010 decision in Bang & Olufsen v OHIM. The General Court confirmed the Office for Harmonisation in the Internal Market's application of Article 7(1)(e)(iii) of the regulation in respect of the three-dimensional shape of a loudspeaker. The General Court held that the design may be an element which is very important to the consumer's choice, even if the consumer also takes other characteristics of the goods at issue into account. The General Court added that the fact that the shape is considered to give substantial value to the goods does not preclude other characteristics of the goods (eg, technical qualities) from also conferring considerable value on the goods. Therefore, the attorney general concluded that the Benelux case law which considered only the one and foremost substantial value was irrelevant.
Contrary to the binary 'either/or' Benelux tradition, the attorney general argued that the wording of the directive allows for a sophisticated approach based on the appreciation of the shape as having a substantial value according to a substantial part of the relevant public (regardless of other characteristics), similar to the approach adopted by the General Court. Nevertheless, the attorney general advised that questions be referred to the ECJ.
The Supreme Court concluded that the issue concerned the interpretation of Article 3(1)(e)(iii) of the directive, and had not yet been resolved by the ECJ. Therefore, the Supreme Court formulated the following questions similar to those suggested by the attorney general:
"1. Do the grounds for refusal or invalidity of 3(1)(e)(iii) of Directive 89/104/EEC, as codified in Directive 2008/95, that three dimensional trade marks cannot exclusively consist of the shape which gives substantial value to the goods, concern the incentive (or incentives) for the purchase decision of the relevant public?
2. Does 'the shape which gives substantial value to the goods' in the meaning of aforementioned provision
(a) only apply if that shape should be considered the foremost or dominating value in comparison to other values (as in the case of comestible goods with taste and substance), or
(b) can such also be the case, if besides that foremost or dominating value, there are other values of the good that can also be considered substantial?
3. Is the perception of the majority of the relevant public decisive for the answering of question 2, or may the judge find that the perception of a part of the public suffices to consider the relevant value as 'substantial' in the meaning of aforementioned provision?
4. In case question 3 is answered in the latter, which standard should then be set for the magnitude of the relevant part of the public?"(5)
The judgment in Bang & Olufsen v OHIM may raise doubts as to whether it is necessary to refer these questions to the ECJ. However, it is still uncertain whether the ECJ will agree with the approach taken by the General Court in that case.
The approach suggested by the attorney general is in accordance with the wording of the directive and fits within the framework of the ECJ's case law. If it had been the intention to make the directive identical to former Benelux law on such an important issue – defining absolute exclusion of trademark protection of certain shapes – it would have explicitly stated so. In the absence of such clear and unambiguous wording, the approach adopted by the Benelux Court of Justice cannot be followed without confirmation from the European courts.(6)
The sophisticated approach elaborated by the attorney general fits well within the framework of ECJ case law, because the ECJ allowed for an interpretation of the exclusions under Article 7(1)(e)(iii) of the regulation on the basis of the appreciation of the relevant public in Lego:
"The perception of the average consumer … may be a relevant criterion of assessment for the competent authority when it identifies the essential characteristics of the sign."(7)
A parallel may further be made with the ECJ's interpretation of the exclusion of shapes which are necessary to obtain a technical result pursuant to Article 3(1)(e)(ii) of the directive. The ECJ disregards the existence of technical solutions by alternative shapes.(8) Although substantial value may not necessarily follow from the availability of other shapes, alternative characteristics of the goods at issue which also give substantial value may be disregarded by the same token.
The question is whether the shape gives substantial value to the goods at issue for the relevant public. Whether there are other features of the goods that also give substantial value to the goods is irrelevant in this approach.
This may thus imply that a three-dimensional mark that comprises the shape of the product itself is excluded from trademark protection if that specific shape departs significantly from the appearance of the same products of other market operators. After all, because of its distinctiveness, such shape gives substantial value.
Consequently, ornamental marks that comprise the shape of the goods themselves are excluded from trademark protection by Article 3(1)(e)(iii) of the directive, as technically dictated shapes of goods and shapes that are dictated by the nature of the goods are respectively excluded by Articles 3(1)(e)(ii) and 3(1)(e)(i) of the directive.
As such an approach does not imply that marks that do not comprise the shape of the product itself are excluded from trademark protection, it allows for a fair balance between trademark protection and the public interest underlying Article 3(1)(e) of the directive – that is, that certain shapes should remain free for all competitors to use.(9) Therefore, in such a competitive playing field, rights holders should adopt equally sophisticated strategies to exercise and maintain their IP rights.
For further information on this topic please contact Gerben Hartman or Kurt Stöpetie at Brinkhof by telephone (+31 20 30 53 200), fax (+31 20 30 53 201) or email ([email protected] or [email protected]).
(1) DSC December 23 2011, NJ 2012, 23.
(2) 89/104/EEC, as codified in Directive 2008/95.
(3) BCJ April 14 1989, Burberrys, NJ 1989, 834, para 16.
(4) III C Uniform Benelux Trademark Code, 2. Comments by article, Article 1 sub 2), March 19 1962, p 11; unofficial translation by the authors. The Dutch text can be found on the website of the Benelux Trademark Office.
(5) Unofficial translation by the authors.
(6) Cf. High Court E&W (Laddie J.), Wagamama, 1 August 1 1995, BIE 1996, 71.
(7) ECJ September 14 2010, Lego, C-48/09, para 76.
(8) ECJ June 18 2002, Philips v Remington, C-299/99, NJ 2003, 481, par 83; Lego, para 53-57.