The CJEU has annulled the EUIPO’s decision that Nestlé’s 3D KitKat mark had acquired distinctiveness across the EU and provided guidance on the evidence required to prove acquired distinctiveness.
There has been a long running dispute between Nestlé and Cadbury in relation to the validity of Nestlé’s 3D marks for its four-finger KitKat chocolate bar (the "KitKat Mark"). We reported on the UK side of this trade mark dispute back in June 2017.
The CJEU judgment and preceding litigation related to whether the KitKat Mark should be revoked for a lack of distinctiveness. Nestlé was required to prove that the shape had acquired distinctiveness across the EU through use. In 2012, the EUIPO Board of Appeal found that the mark had acquired distinctiveness through use and was registrable. Cadbury subsequently challenged the decision and the General Court agreed, annulling it in 2016. In turn, Nestlé (amongst others) appealed. The CJEU has now upheld the General Court’s decision and annulment, rejecting all points of appeal by Nestlé and opining on the evidence required to prove acquired distinctiveness.
Prior to the CJEU judgment, it was understood that providing evidence of acquired distinctiveness across a substantial part of the EU was sufficient. It was on this basis, among others, that Nestlé appealed. The CJEU judgment has now clarified that acquired distinctiveness must be proven throughout the EU i.e. in relation to every member state where the mark lacks distinctiveness. As the EUIPO had not considered acquired distinctiveness in Greece, Portugal, Ireland and Belgium, it had not applied the correct legal test for acquired distinctiveness.
Although acquired distinctiveness must now be proven for each member state, the CJEU highlighted that separate evidence is not necessarily required for each member state; there is a difference between what must be proven and how it must be proven. Where, for example, the trade mark owner has grouped member states together and treated them as one for business purposes (for example, combined distribution or sales networks), it may be able to adduce evidence that deals with those member states as a collective.
What does this mean for brand owners?
While the CJEU has provided clarity, this decision will increase the evidential burden for brand owners. The fact that evidence may be adduced in relation to collective member states is helpful. However, if the courts take a hesitant approach to this, gaps in evidence could be fatal. Our previous article in relation to KitKat contains practical advice for brand owners seeking to protect or enforce their shape trade marks.
What next for KitKat?
The question of acquired distinctness will be reconsidered by the EUIPO Board of Appeal in light of this judgment. The English court has already found that the KitKat shape mark lacks distinctiveness; after the CJEU judgment, a similar finding by EUIPO would not be surprising.