Ratio decidendi: A non-distinctive character may be granted the status of a Trade Mark if the Applicant is able to prove and establish that the relevant class of people consider the character, in question, as emanating from the undertaking of the Applicant only.

Background

The appeal concerns an application made by Nestlé to register as a UK trade mark the three-dimensional shape in respect of chocolate and various goods in Class 30 of Classifications.

The trade mark corresponds to the shape of the well-known four-finger products sold by Nestlé under the name Kit Kat, except that the shape lacks the logo on each bar which is part of the actual product. However, a pertinent point to note is that as the product is wrapped in a paper sleeve bearing the logo, the product is not visible until the wrapping is removed.

Is the Four-Finger Shape Distinctive?

The hearing officer (first instance) held that the trade mark was devoid of any distinctive character since it could not have been determined until the logo was embossed, for which it was embossed, to determine of what brand the four-finger chocolate products were related since many competitors sold similar shape products.

Key Arguments

Therefore, we will be considering the acquisition of distinctive character by an inherently non-distinctive three-dimensional shape mark.

Lord Justice Kitchin received a preliminary response from the CJEU, after which he opined, rightly, that it is not sufficient for the applicant to show that a significant proportion of the relevant class of persons recognise and associate the mark with the applicant’s goods. Furthermore, the Judge pointed out that for a non-trade mark lawyer the difference between such recognition or association and a perception that the goods designated by the mark originate from a particular undertaking is elusive.

He explains this in great detail to show that a rightful distinction exists. He points out that the Courts are concerned with a mark which in this case was a three-dimensional shape of a chocolate product which has no inherent distinctiveness, such that members of the public are not likely to take it as a badge of origin in the way they would a newly coined word or a fancy name. He states that we should, for our understanding, assume that products in that shape have been sold on a very large scale under and by reference to a brand name which is inherently highly distinctive. Then, we must assume too that the shape has in that way become very well known.

That does not necessarily mean that the public have come to perceive the shape as a badge of origin such that they would rely upon it alone to identify the product as coming from a particular source. The relevant class of people may simply regard the shape as a characteristic of products of that kind, or they might find it brings to mind the product and brand name with which they have become familiar. Lord Justice Kitchin held that these kinds of recognition and association do not amount to distinctiveness for trade mark purposes, as the CJEU confirmed.

Lord Justice Kitchin held that the significance of the distinction lies in the considerable value of the shape to be registered as a trade mark since it confers upon the proprietor an exclusive right to use that shape in relation to the product concerned. If a third party were to use the same shape for the same product, the proprietor would not need to show a likelihood of confusion about the origin of the product for, subject to certain defences, a likelihood of confusion would be presumed.

The Court favours a statement of Jacob J in Nestlé v Unilever at paragraphs (32) and (33):

(32) The manufacturer sells and advertises his product widely and under a well-known trademark. After some while the product appearance becomes well-known. He then says the appearance alone will serve as a trademark, even though he himself never relied on the appearance alone to designate origin and would not dare to do so. He then gets registration of the shape alone. Now he is in a position to stop other parties, using their own word trademarks, from selling the product, even though no-one is deceived or misled. (33) For that reason I think that in the case of marks consisting of product shapes it is not enough to prove the public recognises them as the product of a particular manufacturer. It must be proved that consumers regard the shape alone as a badge of trade origin in the sense that they would rely upon the shape alone as an indication of trade origin, particularly to buy the goods. If that cannot be proved, then the shape is not properly a trademark, it does not have a ‘distinctive character’ for the purposes of trade mark law.

The Court explained that the tribunal must consider whether the applicant has proved that a significant proportion of the relevant class of persons perceive the goods or services designated exclusively by the mark applied for, as opposed to any other mark which might also be present, as originating from a particular undertaking. In short, the mark must be seen as a badge of origin.

In continuation, it is iterated that it is not necessary to show that consumers have in fact relied upon the mark in selecting or purchasing the goods or services, or that they have used the mark at some point after purchase to verify that they have chosen the right goods or services. In other words, it is not necessary to show that the mark has played any part in a consumer’s purchasing or post-transactional behaviour. Nor is it necessary to show that the mark will play a part in consumer purchasing or post-transactional behaviour in the future.

Lord Justice Kitchin was of the opinion that when assessing whether an applicant has proved that a significant proportion of the relevant class of persons perceives the relevant goods or services as originating from a particular undertaking because of the sign in question, one is to consider whether such person would rely upon the sign as denoting the origin of the goods or services if it were used on its own. Further, it could also be enough that the consumers have come to rely upon the mark as an indication of origin.

Considering the case of Windsurfing v Boots (1999), the Court agreed that in assessing the distinctive character of a mark in respect of which registration has been applied for, the following, inter alia, may also be taken into account: the market share held by the mark; how intensive, geographically widespread and longstanding use of the mark has been; the amount invested by the undertaking in promoting the mark; the proportion of the relevant class of persons who, because of the mark, identify goods as originating from a particular undertaking; and statements from chambers of commerce and industry or other trade and professional associations.

As a counter to the points made by Nestlé, the Court submitted that where a mark has been used as part of or in conjunction with a registered trade mark, it must be shown that the relevant class of persons perceive the product, designated exclusively by the mark in issue, as originating from a particular undertaking.

Thus, as Nestlé was not able to satisfy this requirement, the appeal was dismissed.

Lord Justice Floyd

In concurring with the judgement, Justice Floyd added that in essence, what a hearing officer must be able to conclude is that the goods in question are the goods of one undertaking and no other. For there to be acquired distinctiveness, the consumer must perceive these goods as being Kit Kats, or as originating from the people who make Kit Kats, and not from others. A perception that they looked like Kit Kats is not enough. Acquired distinctiveness carries with it an indication of exclusive trade origin.

The Law Lord agreed with the hearing officer’s question of whether consumers had “come to rely” on the shape to identify the origin of the goods. I peruse the issue as follows:

• there was no evidence that the shape had appeared in promotions over many years;
• the product had, almost without exception, been sold in an opaque wrapper; and
• it did not seem likely that consumers used the shape to check what they had purchased was from the intended trade source.

If it is the case that consumers have in fact come to rely on the shape as an indicator of trade origin, that would certainly be sufficient for acquired distinctiveness. The ultimate question is whether the mark, used on its own, has acquired the ability to demonstrate exclusive origin. On this issue, the Lord opted not to list the ways in which this can be demonstrated.

Sir Geoffrey Vos

Sir Geoffrey Vos agreed with both the Justices and stated, while endorsing the hearing officer, that trade marks are intended to permit consumers to make informed choices between the competing goods of different undertakings in the course of trade.

Disclaimer: This summary should not be considered as an authority in any court of law.