Shape marks: Is it another scenario for IP battles? The Kit kat case

Diciembre de 2013

“(…) ideas should freely spread from one to another over the globe, for the moral and mutual instruction of man, and improvement of his condition, seems to have been peculiarly and benevolently designed by nature, when she made them, like fire, expansible over all space, without lessening their density in any point, and like the air in which we breathe, move, and have our physical being, incapable of confinement or exclusive appropriation. Inventions then cannot, in nature, be a subject of property” . Letter to Isaac McPherson Monticello, August 13, 1813, The Letters of Thomas Jefferson 1743-1826. 

Palabras clave: marcas tridimensionales, signos no tradicionales, prácticas restrictivas de la competencia, derecho de la competencia, OAMI

En esta ocasión, la discusión gira entorno a los criterios requeridos para el registro de marcas tridimensionales, los cuales han sido debatidos a raíz de las múltiples controversias entre dos grandes multinacionales de chocolates, Nestlé y Cadbury. Los recientes pronunciamientos de la Oficina de Armonización del Mercado Interior (OAMI) acerca del registro de la forma de la barra de chocolate comercializada bajo la marca ¨kit kat¨ han generado dudas acerca de los criterios que han de ser tenidos en cuenta por las oficinas de registro. En efecto, a diferencia de lo sostenido por las autoridades Europeas y Sur Africanas, la OAMI ha admitido el registro de formas que aunque no cuentan con inherente distintividad, su fuerte reconocimiento en el mercado permitiría su registro marcario. Tal como se ha expuesto en anteriores reseñas en este Boletín, los efectos generados de la exclusión de un agente del mercado mediante derechos de propiedad intelectual debe ser analizado y tenido en cuenta al momento de estudiar la concesión de dichos derechos, y de ahí la importancia del estudio de la relación entre propiedad intelectual y derecho de la competencia. Esta reseña pretende analizar la situación actual de la jurisprudencia internacional sobre el tema en cuestión.

Keywords: shape marks, acquired distinctiveness, unfair competition, OHIM

In December 2012, the Second Appeal Board of the Office for Harmonization in the Internal Market (OHIM) found that the Kit Kat shape (four-fingered chocolate bar owned by Nestlé) had acquired distinctiveness in the market due to its strong presence and distribution among consumers. Although Cadbury appealed against the registration arguing that the chocolate bar shape of Kit Kat was functional rather than distinctive, the Board stated that regardless of the lack of inherent distinctiveness, the recognition by consumers among EU members was enough to consider the four – fingered as a badge of origin.

As stated by Emma Roe, partner and head of commercial IP at Cobbetts LLP in Leeds, England, this case gives brand owners lessons on the use of the ´acquired distinctiveness argument´ to protect non-traditional trademarks[1].

However, on June 2013 the Intellectual Property Office of the United Kingdom refused registration of the four – fingered shape for the Kit Kat chocolate bar produced by Nestlé. In fact, the UK IPO found that the shape was a functional design more than an aesthetical one. Therefore, consumers would only identify the function of the shape that allows easier and faster consumption. Despite the strong presence of the chocolate bar in the market, the IPO stated that the shape did not acquire distinctiveness because consumers did not link the product to the shape but to the word mark ¨kit kat¨. In fact, according to the IPO, the shape of the mark only allowed consumers to break and eat the ¨desired portion sized¨[2].

 Likewise, a South African Court rejected arguments of infringement given by Nestlé against Tiffany Break chocolate bar produced by the Company Lffco. This Court ruled that Nestlé did not give evidence of confusion among consumers[3].

Consequently, doubts remain about the criterion required when considering shape marks´ protection. The OHIM has considered that acquired distinctiveness is the most important factor to decide whether a shape mark could be protected, whereas, the UK IPO and South African Courts have required inherent distinctiveness and aesthetic functionality. Hence, it is intended to analyse the current position of the European Court of Justice (ECJ) and American Courts in order to establish which is the criterion used on this subject[4].

Even though the European Trade Marks Directive enshrined the protection of fanciful shape marks and those shapes of goods that have acquired distinctiveness, the article 3 (1) (e) of the same Directive and the article 3 (2) of the UK Trade Marks Act have forbidden the registration of functional shapes[5]. The rationale of these articles is based on competition law considerations.

 In consequence, the exclusion of functional shape marks from protection intends to avoid exaggerations from IP owners seeking to exclude others from using functional shapes that offer technical solutions to consumers. Besides, the technical applications of a certain product could be protected under patent law which confers exclusivity for a period of time but would not be subjected to renovations as applies for trade marks, in order to keep protection.

 Following Dyson v. Registrar of Trade Marks[6], the ECJ has been clear by stating that it is important to distinguish a mere property of the product from signs capable of distinguishing goods and services. In consequence, it is not possible to register an abstract concept or an idea of a product because by doing so, others competitors are excluded from the exploitation of such concept. 

Thus, when an applicant seeks to register shapes as trademarks, those shapes must satisfy the general test of distinctiveness, by assessing the evidence that the sign accomplishes its function as an indication of origin.  Following Koninklijke Philips Electronics v. Remington Consumer Products Ltd[7], the criteria used to identify the distinctive character of three dimensional trademarks is not different from those to be applied to other categories of trademarks but it is required that the sign is capable of distinguishing. Besides, in this case the ECJ stated: ¨where the functional characteristics of the shape of a product are attributable solely to the technical result, article 3(1) (e), second indend, precludes registration of a sign consisting of that shape, even if that technical result can be achieved by other shapes¨. The ECJ has also maintained that a shape does not have to be exclusively functional to be excluded from registration. In fact, if one shape has functional and aesthetic features, it could not be registered because of its technical applications.

Furthermore, the ECJ in the Mag case[8] stated that the distinctive character has to be assessed accordingly to the impression of the average consumer, perceiving the mark as a whole. In this case the ECJ recognised the difficulty to assess the distinctive character in shapes because of the perception of the consumer who is not used to identify the origin of products by seeing their shape. Effectively, consumers distinguish the source of goods through words or graphic features. Therefore, it is important that the shape can be distinguished from those normal and common figures used in the relevant sector, allowing the average consumer (reasonably well informed, observant and circumspect) to distinguish from those products of other undertakings, without paying special attention to details.

In Linde, Winward Industries, and Rado Uhren[9], the ECJ stated that shapes could fall within the definition of descriptive marks. Consequently, this Court held that those shapes that are common in the relevant sector and that are typically found for the relevant goods, are devoid of distinctive character (Stork KG v Office for Harmonisation in the Internal Market (T396/02) (2004) E.C.R II-3821, CFI).

In the United States, Subsection (e) (5) of the Lanham Act provides that a mark cannot be registered when it comprises any matter that as a whole is functional. Therefore, as stated by the relevant case law, those simple shapes like circles or squares are only registered when they have acquired secondary meaning (Mishawaka Rubber and Woolen Mfg Co v SS Kresge Co). And only those inherently distinctive are protectable without proof of secondary meaning (Two Pesos Inc v Taco Caban, Inc).

In order to decide cases where the registration of shapes is sought, the Supreme Court has stated that when the shape only performs some function or utility, it cannot be registered, but when a shape is sufficiently distinctive, the existence of alternative designs that would perform the same function is irrelevant (Traffix Devices, Inc v. Marketing Displays, Inc). In Qualitex Co v Jacobson Products Co (1995), quoting Inwood Laboratories, Inc v Ives Laboratories, Inc, the Court stated that it can not be registered as a trademark when by doing so, it will put a competitor at a significant disadvantage because the feature is essential to the use or purpose of the product.

To conclude, as the US Supreme Court, the ECJ has justified protection over shape marks by giving competition considerations. Both jurisdictions have considered the effects that could be generated by excluding other competitors from the use of common shapes in the relevant sector or technical features needed to allow consumers make use of the product. However, the U.S Courts have developed the criterion of secondary meaning. In other words, when certain shapes represent more than its function and general appearance and can generate further impressions and ideas in the consumer mind, it is possible to consider its registration.

Conversely, positions assumed by the OHIM generate doubts about future interpretations and analysis of shape marks´ registration. In consequence, it is of great importance to consider the effect of future battles originated from the registration of shapes as it has happened between Nestlé and Catbury over the Kit Kat shape.

Above all, it is important to raise the following questions: Is inherent distinctiveness required in order to protect shape marks or acquired distinctiveness could be enough? If the registration of a shape puts a competitor in a situation of disadvantage, would be enough to reject registration even though the shape has inherent or acquired distinctiveness?

As it has been reiterated in other reviews written for this IP Bulletin, given the nature of IP rights (ius excludendi alios), the interface between competition and intellectual property law has to be analysed when considering the scope of protection. Balanced interaction is needed in order to incentivise further innovation and ensure a fairer diffusion/redistribution of new inventions[10]. As economists have maintained, “innovation drives competition and competition is in turn driven by innovation”[11].




[1] World Intellectual Property Review, Nestlé wins trade mark battle over Kit Kat shape (4th January, 2012)
[2] The Brand Protection Blog, UK IPO rejects Nestlé’s application to register KitKat shape mark,
[3] World Intellectual Property Review, Nestlé Defeated in South African Trademark Row, (5th of December, 2013)
[4] In Colombia, the Registrarion Office (Superintendencia de Industria y Comercio – SIC) has required inherent distinctiveness and has rejected the registration of shapes that are common in the relevant sector, such as the shape of cookies (Glacitas Case – Resolución 48627 de 26 de noviembre de 2008). 
[5] Aplin Tanya, Davis Jennifer, Intellectual Property Law, Text Cases and Materials, (Oxford, 2009), 263
[6] Case C- 321/03 (2007) ECR I-687
[7] C-299/99 (2002) ECR I-5475
[8] Mag Instrument Inc v OHIM (C-136/02)
[9] Linde AG (C-53/01), Winward Industries Inc (C-54/01) and Rado Uhren AG (C-55/01) (2003) E.C.R. I -3161.
[10] Tü Thanh Nguyen, Competition Law, Technology Transfer and the TRIPS implications for developing countries, (Edward Elgar Publishing, 2010)
[11] G.A. Manne and J.D. Wright, Competition Policy and Patent Law Under Uncertainty: Regulating Innovation, (Cambridge University Press; 1 edition, 2011) 206