In Société des Produits Nestlé SA v Cadbury Holdings Ltd (Case R 513/2011-2), the Second Board of Appeal of the Office for Harmonisation in the Internal Market has overturned a decision of the Cancellation Division and found that the three-dimensional (3D) shape of Nestlé's Kit Kat bar has acquired distinctiveness through use throughout the European Union.
The dispute related to Nestlé's Community trademark registration for the 3D shape of its four-fingered Kit Kat biscuit bar.
It is the latest in a history of trademark feuds between the confectionery giants and follows the decision of the English High Court in late 2012 which upheld the validity of Cadbury's registration for the colour purple.
Following Cadbury's cancellation proceedings which were initiated in 2007, the Cancellation Division found that Nestlé's 3D mark, consisting of four trapezoidal bars aligned on a rectangular base registered in Class 30 of the Nice Classification for "sweets; bakery products, pastries, biscuits; cakes, waffles", was devoid of distinctive character and had therefore been invalidly registered contrary to Article 7(1)(b) of the Community Trademark Regulation (207/2009). Nestlé appealed this decision and the Second Board of Appeal issued its finding on December 11 2012.
The Board of Appeal had to consider three key issues:
- Inherent distinctiveness - is the 3D mark devoid of distinctive character? The principal function of a trademark is to distinguish the origin of a product. The Cancellation Division noted that average consumers do not generally make assumptions about the origin of products based on their shape and that it was therefore more difficult to establish distinctiveness in relation to a 3D mark than in relation to a word or a figurative mark. The board found that the 3D mark failed to depart from the normal shape of biscuit bars and further commented that, as the products were low priced for everyday consumption, consumers' attention levels would not be high. Following this consideration, the Board of Appeal held that the Cancellation Division had correctly determined that the geometrical trapezoid shape was not inherently distinctive.
- Acquired distinctiveness - the board then considered whether the mark had acquired distinctiveness through use. Article 52(2) of the regulation provides that, where a mark has been registered in breach of Article 7(1)(b), if the mark has acquired distinctive character through use in the relevant part of the European Union, it may not be declared invalid. This exception requires that at least a significant proportion of the relevant public of the relevant territories are able to identify the goods as originating from a particular undertaking because of the use of the mark. The mark in question is a non-word mark and the board stated that, in the case of non-word marks, it is in the European Union as a whole that the mark must have become distinctive through use. It further stated that the relevant public is made up only of member states of the European Union during the period between the date of registration and the issuing of cancellation proceedings.
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In order to prove that its mark had acquired distinctiveness, Nestlé submitted survey evidence which showed that almost 50% of the general public of the combined relevant member states of the European Union associated the shape of the Kit Kat biscuit bar with Nestlé. This evidence was accepted by the board, which held that the trademark was not invalid as it had become distinctive through use in the relevant parts of the EU territory.
- Technical function of shape marks - Article 7(1)(e) provides
that a mark cannot be registered, even if it has acquired
distinctiveness through use, if it consists exclusively of shapes
necessary to obtain a technical result. The board found that,
although the shape of the bars contributed to making portioning
easier, the shape did not perform a technical function or meet a
technical need.
As the technical exception did not apply in this case, the board held that the 3D shape mark had acquired distinctiveness through use and overturned the decision of the Cancellation Division.
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