KitKat shape mark - Advocate General opines for a strict interpretation of trademark law in Nestlé v Cadbury

7 minute read
15 June 2015


Advocate General Wathelet's Opinion, of 11 June 2015, indicates that Nestlé's unbranded KitKat finger shape will not be registrable as a trademark in the UK.

What does the above shape mean to you?

Perhaps -

  • chocolate, chocolate confectionary, biscuits having chocolate coating or something along those lines, or
  • it is the shape of (or like) a KitKat, or
  • it is a KitKat, and only a KitKat ?

Acquired distinctive character

Société des Produits Nestlé SA (Nestlé) sought to register the above shape for goods in class 30: chocolate; chocolate confectionery; chocolate products; confectionery; chocolate-based preparations; bakery goods; pastries; biscuits; biscuits having a chocolate coating; chocolate coated wafer biscuits; cakes; cookies; wafers.

In the English High Court, Mr Justice Arnold ruled in January 2014 that Nestlé's shape was devoid of inherent distinctive character in respect of all the goods covered by its application.

However, a finding that a mark is devoid of inherent distinctive character does not prevent registration if it is demonstrated that the mark has acquired a distinctive character. But what needs to be demonstrated in this context? That the average consumer recognises the shape and associates it with Nestlé/a KitKat? Or that the shape actually is that of the Nestlé KitKat product? Note that there is no KitKat branding on the shape itself.

AG Wathelet opined that it is not sufficient for these purposes that the average consumer recognises the mark and associates it with Nestlé's KitKat. In order for the mark to have an acquired distinctive character for the purposes of the Trade Marks Directive 2008/95/EC (and section 3(1) of the UK Trade Marks Act 1994), the evidence must demonstrate that the average consumer recognises, without any possibility of confusion, the exclusive origin of the goods concerned (i.e. that the shape depicted is that of a KitKat, and only a KitKat).

In the English proceedings there was a factual finding that consumers associate the shape with KIT KAT (and therefore with Néstle), but that they rely on the word mark KIT KAT and other marks used in relation to the goods to identify the trade origin of the products. If the Court of Justice of the European Union (CJEU) follows AG Wathelet's opinion on this point, the case on acquired distinctiveness would appear to be a challenging one for Nestlé.

However, in view of the AG's findings on the law regarding shape exclusions in this case, the acquired distinctiveness dispute may prove moot.

Shape exclusions

Article 3 of the Trade Marks Directive prohibits registration of signs which consist exclusively of i) the shape which results from the nature of the goods themselves, ii) the shape of goods which is necessary to obtain a technical result, iii) the shape which gives substantial value to goods. The UK Trade Marks Act contains a similar provision.

In the English proceedings, the three essential features of Nestlé's shape were each found to fall within a prohibition of Article 3(1)(e) (see the summary table below). But none of the essential features fell within all of the Article 3(1)(e) restrictions. Does this prevent the shape exclusion of Article 3(1)(e) from biting?

Essential feature of the mark Applicable provision of Article 3(1)(e)
x) The rectangular 'slab' shape of the mark as it appears on the form of application including the relative proportions of length, width and depth 3(1)(e)(i): the feature results from the nature of the goods themselves
y) The presence, position and depth of the breaking grooves arranged along the length of the bar, which effectively divide the bar into detachable 'fingers' 3(1)(e)(ii): the position (i.e. the angle) of the grooves was necessary to obtain a technical result
z) The number of such grooves, which together with the width of the bar determine the number of 'fingers' 3(1)(e)(ii): it was necessary for there to be three grooves in order for there to be four fingers, each of which was of the desired portion size

In AG Wathelet's opinion, it does not.

Noting that trademark law constitutes an essential element in the system of competition in the EU, AG Wathelet explained that the intent behind Article 3(1)(e) is, in accordance with the CJEU's decision in Hauck (C-205/13), "to prevent the exclusive and permanent right which a trademark confers from serving to extend indefinitely the life of other rights which the EU legislature has sought to make subject to limited periods".

In AG Wathelet's opinion, it must follow from this that if any one (or more) of the criteria listed in Article 3(1)(e) is satisfied, in respect of one (or more) of the essential features of the shape, Article 3(1)(e) precludes registration.

Comment

It remains to be seen whether the CJEU will follow the Advocate General's opinion in the Nestlé v Cadbury case. If it chooses to do so, it would be adopting a narrow interpretation of the legislation and setting tough challenges for parties seeking to register shape marks:

  • First, there would be a fairly high evidential burden on applicants asserting acquired distinctiveness. Recognition and association would not be enough; applicants would have to demonstrate that in the eyes of the average consumer the guarantee of origin was met in the absence of any other trademark which is usually used in conjunction with the shape mark.
  • Second, if any single essential feature of a mark fell within any of the exclusions of Article 3(1)(e), the mark would not be registrable. This would be a clear signal that the courts will strictly limit anyone using trademark law to try and extend unlimited protection to product shapes.

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