19 April 2018Trademarks

EUIPO must re-examine KitKat shape, says AG

An advocate-general (AG) at the Court of Justice of the European Union (CJEU) has said that the European Union Intellectual Property Office (EUIPO) must re-examine whether Nestlé’s four-finger KitKat shape may be maintained as an EU trademark.

Today, April 19, AG Melchior Wathelet proposed that appeals brought by Nestlé, the EUIPO and Mondelēz International should be dismissed.

Nestlé applied to the EUIPO to register the 3D shape of the four-finger KitKat in 2002. Four years later, the EUIPO agreed to register the mark for sweets, bakery products, pastries, biscuits, cakes, and waffles.

But, in 2007, Cadbury (now Mondelēz) applied to the EUIPO for a declaration of invalidity. This application was dismissed in 2012 as the EUIPO considered that Nestlé’s mark had acquired distinctive character through use in the EU.

Mondelēz appealed against the decision, disputing the conclusion that the trademark had acquired distinctive character throughout the entire EU.

Fast-forward to December 2016, and the European General Court annulled the EUIPO’s decision and ordered the EUIPO to reconsider the registration.

Although the trademark had acquired distinctive character through use in ten countries, the court said that the EUIPO “could not validly conclude its examination” without coming to a conclusion “regarding the perception of the mark” in four other countries (Belgium, Ireland, Greece and Portugal) and “without analysing the evidence adduced in respect of those member states”.

Mondelēz, Nestlé and the EUIPO each brought an appeal against the decision before the CJEU.

Mondelēz disputed the General Court’s conclusion that the mark had acquired distinctive character in ten member states and the finding that a chocolate bar consisting of “four trapezoid-shaped fingers” could be classified as a sweet or biscuit.

Wathelet considered Mondelez’s appeal to be “manifestly inadmissible” and said it must be dismissed.

He pointed out that the statute of the CJEU provides that an appeal may be brought by “any party which has been unsuccessful, in whole or in part, in its submissions”.

According to case law, a party which has asked the General Court to annul an EU act is “not considered to have been unsuccessful, even partially, in its submissions where the General Court granted the relief sought”.

The General Court had annulled the EUIPO’s decision and, in the absence of an appeal, the EUIPO would have been obliged to declare the trademark invalid.

Nestlé and the EUIPO argued that the General Court erred in finding it necessary to establish that distinctive character was acquired through use in all of the member states concerned.

Wathelet explained that under case law it would be unreasonable to require proof of distinctive character in each member state, but that this doesn’t mean that the party applying for the trademark can leave out entire regions and markets.

“Account must be taken of the geographical size and the distribution of the regions in which acquired distinctive character has been positively established, in order to ensure that the evidence from which an extrapolation is made for the whole of the EU relates to a quantitatively and geographically representative sample,” said a press release from the CJEU.

He added that the information provided for the four states was not sufficient to establish that the public identified Nestlé as the commercial origin of the product.

Nestlé also failed to provide market research for Luxembourg.

At the hearing in February, Nestlé did not include evidence seeking to establish that the market research provided for the other member states also applied to the five mentioned above or could act as a basis for extrapolating the acquisition of distinctive character through use in the five countries.

“In the absence of such evidence, the AG concludes that the General Court had to annul EUIPO’s decision, as it in fact did,” said the press release.

The AG’s opinion has not yet been issued, but a press release was sent by the court.

A spokesperson for Mondelēz said: “We note the opinion of the AG, but look forward to the decision of the CJEU. However, as we have previously stated, our contention is that the shape of the KitKat bar should not be protected as a trademark throughout the EU as its shape is not distinctive enough.”

According to a Nestlé spokesperson, the AG’s opinion is fully in line with Nestlé’s arguments.

However they added: “Regrettably, we believe his final conclusion is based on incorrect factual findings. Nestlé did submit sufficient evidence to prove acquired distinctiveness of its iconic KitKat four fingers shape to meet the AG’s proposed threshold (‘comparability’), including in the few countries where evidence was challenged.”

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More on this story

18 May 2017   Nestlé lost its appeal yesterday against the trademark rejection of the 3D shape of its four-finger KitKat chocolate bar, potentially marking the beginning of a divergence between EU and UK law.
24 July 2018   Tomorrow, the Court of Justice of the European Union will issue a trademark ruling on the KitKat chocolate bar, while an advocate-general will opine on Dutch cheese.
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