CJEU suggests that the shape of a Kit Kat bar is not a trade mark, but Nestle may still have last laugh
It may be a chocolate bar recognised by ninety percent of the public in the UK, but a decision of the CJEU today, combined with comments in the original High Court case, suggests that the shape of a Kit Kat bar may well ultimately be found not to be a trade mark in an apparent defeat for Nestle, and a victory for Cadbury in the continuing battle of the chocolate bars. This dispute centres of Nestlé's attempt to monopolise the shape of a four fingered chocolate bar and Cadbury's attempts to stop that.
The CJEU effectively found that mere recognition of a sign, is not enough to enable the registration of a shape as a trade mark. The CJEU found that the shape must act as a badge of trade origin in its own right. Based on the original UKIPO Hearing Officer’s assessment of the evidence submitted by Nestlé in support of their application, some initial comments by the High Court judge on this case, existing UK case law and indeed the confirmation of the CJEU of the legal principles applying to the case today, might well suggest that the High Court will find against Nestle on this question, based on the facts.
Lee Curtis, trade mark attorney and partner at HGF: "This is a dispute about one company, Nestle, trying to monopolise the shape of a product, a Kit Kat chocolate bar, and in time stopping others using that shape, most notably in this case Cadbury. Taken with the original comments from the High Court judge, the CJEU decision would imply that a ninety percent consumer recognition of the shape of the bar by the British public is not enough to give Nestle that monopoly right. The question is have Nestle shown the shape acts as a trade mark alone?"
“Nestle may still be able to argue at the High Court that such recognition levels are enough to show the shape acts as a trade mark in its own right. I do have my doubts that the High Court judge will accept that argument based on his initial comments in the case. However, Nestle may be able to apply the evidence already submitted in the case to answers given by the CJEU in its decision today.”
The CJEU today confirmed (Case C-215/14) an earlier finding of the Advocate General (see our Background story here) that the shape of a Kit Kat bar is unlikely to be protectable as a trade mark. The CJEU concluded that, for the purposes of the registration of a mark itself, the trade mark applicant must prove that that mark alone (as opposed to any other trade mark which may also be present) identifies the particular origin of the goods; in this case, the four fingered bar alone, would not be enough to do so.
It is interesting to note that the CJEU differed from the AG Opinion, in that signs consisting exclusively of the shape of goods which are necessary to obtain a technical result (grooves which gives the product the shape, but also enable consumers easily to separate the wafer ‘fingers’), must be interpreted as referring only to the manner in which the goods at issue function and does not apply to the manner in which the goods are manufactured; whereas the AG thought both should apply. Further, confirming the AG Opinion, the CJEU confirmed that for the technical exclusions to registration of a shape trade mark to apply, notably where a shape is derived from the product itself or was needed to achieve a technical result, those individual exclusions had to apply to the whole product. It seems unlikely that anyone of the three ‘key’ elements of the shape of the Kit Kat bar would be found to apply to the whole product, an apparent victory for Nestle.
“The CJEU did find in favour of Nestle on a number of points relating the shape resulting from the product itself and where it was necessary to achieve a technical result, but the key question is does the shape of the Kit Kat bar act as a trade mark in its right. Based on the decision today, and the original comments of the High Court judge, I suspect the High Court will ultimately find against Nestle on this point.”
“It should also be remembered that the High Court proceedings are an appeal from an UKIPO decision, and in most cases a judge cannot deviate from that decision unless the Hearing Officer had made an error in applying a principle of the law. The Judge’s room for manoeuvre is thus very constrained. The CJEU in many ways confirmed the original Hearing Officer’s decision as to the law. So I believe that it is likely that Justice Arnold will reject Nestlé’s attempt to register the shape of the Kit Kat chocolate bar.”
"Some may find this decision hard to understand given the consumer recognition of the shape is so high. However, Kit Kats are not sold by shape alone in transparent packaging. The word mark Kit Kat dominates together with its distinctive packaging. If you go into a store, do you buy the bar by shape alone? "
Although this is not the end of the dispute and ultimately it will be for the UK High Court to make a decision on the registration, the verdict of the CJEU today suggests that Nestle will be unsuccessful in monopolising a the shape of a four fingered chocolate bar and this decision is a victory for Cadbury. However, the tables may be turned, and Nestle may ultimately have the last laugh.