Société des Produits Nestlé SA v Cadbury UK Ltd

A product shape is not inherently distinctive merely because it is unusual for the goods concerned. The relevant question is whether the average consumer would perceive it as indicating trade origin.

For acquired distinctive character, recognition of a shape and association with the applicant’s goods may be insufficient where consumers do not rely on the shape itself, rather than other marks, to identify origin. The interaction between the exclusions for shapes resulting from the nature of goods and shapes necessary to obtain a technical result may require separate consideration. The latter exclusion may also extend to technical features dictated by manufacture, but the position required clarification from the CJEU.

Nestlé appealed against, and Cadbury cross-appealed from, the hearing officer’s decision on Nestlé’s application to register the three-dimensional shape of the four-finger Kit Kat product for goods in class 30. The hearing officer found the shape inherently non-distinctive for most goods, but inherently distinctive for cakes and pastries. He also found that registration was excluded by the provisions concerning shapes resulting from the nature of the goods and shapes necessary to obtain a technical result, except for cakes and pastries.

The appeals concerned the proper approach to inherent and acquired distinctiveness, and the interpretation of the relevant exclusions in Directive 2008/95/EC. The central issue was whether the shape could proceed to registration despite the findings concerning consumer recognition, product functionality and manufacture.

1. Appeal standard. In the absence of any challenge to the hearing officer’s factual findings, the appellate court should show real reluctance to interfere unless there is a distinct and material error of principle. The approach in REEF Trade Mark [2002] EWCA Civ 763, [2003] RPC 5 was applied.
2. Inherent distinctiveness. The hearing officer erred in treating the shape as inherently distinctive for cakes and pastries. A shape does not acquire distinctive character merely because it is outside the norms and customs of the relevant sector. The average consumer’s perception remains decisive. The reasoning in Bongrain SA’s Trade Mark Application [2004] EWCA Civ 1690, [2005] RPC 14 was applied.
3. Acquired distinctiveness. The hearing officer was entitled to conclude that recognition of the shape and association with Nestlé’s products did not establish reliance on the shape itself as indicating origin. The existing English approach, reflected in Vibe Technologies Ltd’s Application [2009] ETMR 12 and the authorities discussed there, required consumers to rely on the mark as a trade mark. However, the meaning of use of a mark as a trade mark under article 3(3) remained unclear. A reference to the CJEU was therefore necessary.
4. Shape exclusions. The court was unable finally to determine whether a shape with one essential feature resulting from the nature of the goods and two essential features necessary to obtain a technical result was excluded under article 3(1)(e)(i), article 3(1)(e)(ii), or both. It was also unclear whether the technical-result exclusion covered features necessary for the manner of manufacture, as opposed to the manner in which the goods functioned. The reasoning in Koninklijke Philips Electronics NV v Remington Consumer Products Ltd [2002] ECR I-5475 and Lego Juris A/S v Office for Harmonisation in the Internal Market [2010] ECR I-8403 was considered.
5. The indicated questions were referred to the CJEU for a preliminary ruling. The court reserved the precise wording and was to hear counsel on that wording.

• High Court (Chancery Division): appeals from the hearing officer’s decision of 20 June 2013 were not finally determined. Questions concerning acquired distinctiveness and the shape exclusions were referred to the CJEU.