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France: Nestlé and Cadbury catty over Kit Kat ruling

Would you recognize the commercial origin of the illustrated chocolate bar? In 2010 Nestlé filed a trade mark application for this 3D sign but only in the United Kingdom. Its protection under trad mark law has been an obstacle course for its manufacturer ever since.

Cadbury filed an opposition against this application, notably on the basis of absence of distinctive character of the sign as filed, and because the shape would result from the nature of the goods and is necessary to obtain a technical result (Article 3 §1 (e) of the EU Directive 2008/95).

In its decision of June 2011, the UK IPO considered that the sign was lacking distinctive character and did not acquire this missing distinctive character through use, whereas this shape has been used by Nestlé and by Rowntree & Co before it, since 1935.

The UK examiner considered that the rectangular shape resulted from the nature of the goods, except for "cakes" and "pastries", and that the grooves (presence, position, number and depth) along the plate, determining the number of bars, were necessary to obtain a technical result.

In 2013, Nestlé appealed this decision before the High Court, which first estimated that the examiner should not have made any distinction for "cakes" and "pastries" and then asked for a preliminary ruling from the Court of Justice of the EU on three questions.

The CJEU analysed these issues in a different order but noted as a first step a basic principle: when a trade mark is rejected under Article 3 §1 (e) of the EU Directive, it can never acquire a distinctive character through use.

Therefore, the question whether or not the applied-for-trade mark falls under the exclusion of Article 3 §1 (e) of the Directive is particularly important for Nestlé.

The CJEU began its analysis from question 2: "Does a shape consisting of three essential features (one from the nature of the good and two others necessary for a technical result) have to be rejected according to the Article 3 §1 of the EU Directive 2008/95?" The Court started by stating that the grounds for refusal (shape consisting of the nature of the goods/shape dictated by a technical result) are strictly independent from each other. One ground of refusal, if applicable, is enough to prevent a trade mark from being registered, no matter if the other ground can be met. However, to be refused, one ground of refusal has to apply in full to the shape in question.

Then the CJEU came to question 3: "Does this technical result need to relate to the way the good works or does it (also) have to apply to the way the good is manufactured when considering the signs exclusively dictated by the shape of the good necessary to obtain a technical result?"On this issue, the Court ruled that the criterion to be taken into account is the way the product operates and not the way it is made.

And finally the CJEU addressed question 1: "For a trade mark having acquired a distinctive character thanks to the use it has been made of, is it enough to demonstrate that, at the time of filing, a significant portion of the interested sphere recognised the trade mark in association with the goods OR does the applicant have to demonstrate that the interested sphere considered that the mark (as applied, independently of any other trade mark) indicated the origin of the goods ?" Related to this issue, the Court provided the following clarification: the acquired distinctive character has to be assessed taking into account the presumed perception of the interested average consumers of this kind of goods. The applicant must show that the applied-for trade mark alone, notwithstanding the presence of another trade mark in the course of the trade, is an indication of the origin of the goods as coming from a specified undertaking.

Based upon these guidelines, the English Court will have to reassess this file on the crucial point of determining whether the Kit Kat bar shape falls within the exclusion of Article 3 §1 (e). Turning to the nature itself of the goods, we may presume that the shape in question is not the result of the nature of the goods themselves. However, the discussion will be more arduous when appreciating whether this shape is fully and entirely dictated by its technical function.

One can only hope that the final decision will be a practical one as refusing the registration of this particular trade mark would deny any indication of origin of the goods in real life. And isn't that the main function of a trade mark?

FranceDec15Jan16

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