The shape of things to come: CJEU decides on the KitKat trade mark case

Back in 2002, Nestlé filed an application to register the three-dimensional sign of the ‘four finger KitKat bar’ as an EUTM. However, registration of the mark in 2006 was swiftly followed a year later by an application filed by Cadbury’s (now Mondelez) seeking a declaration that the mark was invalid on the grounds that it was devoid of distinctive character.

An 11-year war of the chocolate giants followed, leading to a decision of the Court of Justice of the European Union (CJEU), which is also summarised in this press release, published by the court. In short, the CJEU has sent the case back to the EUIPO asking them to reconsider the evidence, but all is not lost for Nestlé and the battle is set to continue.

The key issue before the CJEU was whether the shape of the KitKat had acquired distinctive character through the use that has been made of it in the EU as it did not have inherent distinctive character. In particular, what was needed in order to show such acquired distinctive character – was it necessary to demonstrate use in each individual Member State, or only in a substantial part of the EU, or is there some other criteria? This was relevant because the EUIPO Board of Appeal, in accepting Nestlé’s evidence of acquired distinctiveness, did not rule on the public perception of the mark in Belgium, Ireland, Greece, Luxembourg and Portugal – five of the then 15 Member States of the EU (its evidence covered Denmark, Germany, Spain, France, Italy, The Netherlands, Austria, Finland, Sweden and the UK markets).

What is the shape of things according to the CJEU for those seeking to register EU trade marks on the basis of acquired distinctiveness?

The Court confirmed that evidence submitted must be capable of demonstrating acquired distinctiveness throughout the EU.  It cannot only be in respect of a substantial part of the EU. However, trade mark applicants will not in all cases have to submit evidence of acquired distinctiveness in each Member State of the EU. For example, it is possible that evidence will be relevant to several Member States (or even the whole EU).  The CJEU gives the example of a business which may group several Member States together in the same distribution network and treat those Member States as ‘one and the same’ for marketing strategy purposes.  Also, as a result of geographic, cultural or linguistic proximity between two Member States, the relevant public of one Member State will have a sufficient knowledge of products and services present on the market of the other Member State.

Therefore, if brand owners are preparing evidence of distinctiveness throughout the EU, they need to consider every Member State and provide a clear rationale as to why evidence submitted for one Member State may apply to another.  In the meantime, ‘sweet victory’ in this case is on hold until after the EUIPO has re-examined the mark.