On 18th August 2009 the Federal Court of Australia rejected an appeal by well-known Belgian chocolatier Guylian from a decision of the Australian Trademarks Office refusing registration of Guylian’s chocolate "seahorse" shape.

The court held that the seahorse shape was incapable of distinguishing Guylian’s chocolate products, notwithstanding survey evidence that the court stated “plainly shows an association between the seahorse shape and Guylian”.

The decision provides important clarification as to when a shape trademark will be registrable for chocolate and confectionery products, particularly in light of an earlier Federal Court decision (Kenman Kandy) which held that a concocted “bug shape” for confectionery was inherently capable of distinguishing and thus registrable.

This article discusses the background to the Guylian decision and the key lessons that emerge from the decision for companies seeking to protect their shape marks in Australia.

Test for registrability of shape marks
The test for whether a shape mark is registrable in Australia is the same as for any other mark – the key elements being that the mark must be “capable of distinguishing” and not confusingly similar to any prior marks. The controversial issue as far as shape marks is concerned generally concerns whether the shape is “capable of distinguishing”.

The test for whether a mark is “capable of distinguishing” involves three basic steps: 

  • Is the relevant mark “inherently adapted” to a sufficient degree to distinguish the relevant goods? If yes, the mark is capable of distinguishing. The inherent capacity of a mark to distinguish depends on the nature of the mark and the extent to which other traders would naturally and without improper motive wish to use the mark in connection with their similar goods. Examples of marks that are inherently adapted to distinguish include invented words and terms that have no descriptive or other meaning in the context of the relevant goods. 
  • Is the mark only “to some extent” inherently adapted to distinguish? If yes, the mark may be capable of distinguishing having regard to the extent to which the mark has been used, or other circumstances. 
  • If the mark is not to any extent adapted to distinguish, the mark may be capable of distinguishing if, because of the extent to which it has been used, it is distinctive as at the filing date of the relevant application. In other words, a mark that lacks any inherent capacity to distinguish may be registrable if it has become factually distinctive through use.

How these tests should be applied in the context of shape marks has been the subject of a number of Australian cases.

Kenman Kandy
In the 2002 Kenman Kandy Case the Federal Court of Australia held that a three-dimensional “bug shape” as depicted below was inherently adapted to distinguish in respect of confectionery.

Please see original document to view image.

The registrar initially objected to registration of the mark on the ground that confectionery is frequently manufactured in the form of novelty shapes such as animals, and that the mark therefore was not inherently adapted to distinguish. However, the court considered that the shape did not reflect any recognisable insect or bug, but was a “concocted” shape that other traders would not naturally think of or wish to use, and therefore the shape was inherently adapted to distinguish.

Guylian – inherent adaptation to distinguish
In Guylian the registrar argued that the relevant shape mark was clearly reminiscent of a seahorse, and that other chocolate manufacturers might naturally wish to produce chocolates in the shape of a seahorse. However, the court accepted that a shape which is reminiscent of a real animal or creature should not, for that reason alone, be considered inherently unadapted to distinguish.

There was no evidence that any company other than Guylian had sold chocolates in the shape of seahorses before the priority date of Guylian’s application (2002). However, the court (in the absence of any actual evidence on the point) accepted that, as at that date, other companies might have wished to make seahorse-shaped chocolates. The court was influenced by evidence of chocolates being sold before the priority date in the shape of seashells and other marine animals. For this reason, the shape mark was not inherently adapted to distinguish Guylian’s choclates.

The court was also influenced by the fact that if the mark were to be registered, Guylian would potentially have a broad monopoly over seahorse-shaped chocolates. The court had no difficulty with the fact that the mark comprised the entire shape of the relevant goods, despite the suggestion in some earlier cases that a mark must be something separate from or added to the goods in respect of which it is used.

Evidence of use
Having decided that the shape was not inherently adapted to distinguish, the court considered the second limb of the test set out above – namely, whether the mark had acquired a capacity to distinguish by virtue of Guylian’s use of the mark.

Guylian’s evidence showed that Guylian had first sold seahorse-shaped chocolates in 1980. Guylian’s sales and advertising figures were impressive, and it relied on survey evidence showing a strong association between the seahorse shape and Guylian.

However, the court was not convinced that Guylian’s evidence showed use of the seahorse shape “as a trade mark”. Images of the shape on the packaging of Guylian’s products were “not used in any sense to identify Guylian but to illustrate some examples of the elegance of the chocolates and the content of the box more generally”. It was, in the court’s view, unlikely that consumers would view those images as a trademark.

The court also held that the presence of the Guylian brand on Guylian’s packaging diluted any trademark significance that might otherwise attach to the seahorse shape. The presence of other branding made it difficult for Guylian to establish that the seahorse shape by itself had acquired the necessary capacity to distinguish.

In relation to the survey evidence, the court considered that the association between the shape and Guylian was attributable to Guylian’s sale of the seahorse-shaped chocolates over a long period of time, rather than the shape itself being used as a trademark. Significantly, the court noted that “evidence of association on its own does not prove distinctiveness; the evidence must establish that the public has been educated to understand the sign as an identifier of the origin of the goods”.

Key lessons
At first glance the decision might seem to represent a harsh outcome for Guylian – it was clearly the pioneer of seahorse-shaped chocolates and was denied registration despite strong evidence of association with the shape, in circumstances where an earlier application for an unused “bug shape” was considered inherently registrable.

However, the outcome may have been different had Guylian’s packaging, advertising and promotion clearly involved use of the seahorse shape as a mark, so as to educate consumers as to the significance of the shape as a badge of origin. Guylian’s position was also compromised by its failure over many years to prevent imitators, although Guylian was presumably in a difficult position as it may not have had clear grounds to take action against copy products in the absence of an appropriate trademark registration. The decision illustrates that appropriate trademark usage and prompt action against copy products are particularly important in the context of protecting shape marks.

This article first appeared in IAM magazine. For further information please visit www.iam-magazine.com.