The UK Intellectual Property Office (IPO) has rejected an application to register the shape of the Nestlé KIT KAT four-fingered chocolate bar as a three-dimensional trade mark, in opposition proceedings brought by Cadbury. (In the matter of Application 2570766 by Société des Produits Nestlé SA and Opposition 101495 by Cadbury UK Ltd, UK Trade Marks Registry O-237-13 (Allan James), 20 June 2013).
Nestlé had applied to register the shape mark in the UK in Class 30 for various chocolate and chocolate confectionery products, including pastries, biscuits and cakes. The UK IPO upheld the opposition on the following grounds:
- 'Functionality' - the mark consisted exclusively of the shape of the goods which was necessary to obtain a technical result
This exclusion (under section 3(2)(b) of the UK's Trade Marks Act 1994, equivalent to Article 3 (1)(e)(ii) of the Trade Marks Directive) applies where the essential features of a shape are attributable only to a technical result. Other minor arbitrary features which make no real impact on consumers are irrelevant if the essential features of the shape are caught by the exclusion. The essential features were found to be:
- The rectangular 'slab' shape, including the relative proportions of length, width and depth;
- The presence, position and depth of the breaking grooves arranged along the length of the bar, effectively dividing the bar into detachable 'fingers';
- The number of such grooves, which together with the width of the bar determine the number of 'fingers'.
Following cross-examination of witnesses from both parties the evidence showed:
- The basic rectangular shape results from the nature of moulded chocolate bars or biscuits sold in bar form;
- The presence of breaking grooves is a feature which is necessary to achieve a technical result;
- An angle of more than 8-10 degrees for the sides of the product, and for the breaking grooves, results from the nature of moulded chocolate products and the depth of the groove is necessary to achieve a technical result;
- The number of breaking grooves and fingers is determined by the desired portion size.
It followed that the presence and depth of breaking grooves was necessary to achieve a technical result and the other recognisable features of the shape resulted from the very nature of a moulded chocolate bar. None of the essential features of the shape were found to be arbitrary, decorative or imaginative. The argument that the shape was an aesthetic design was rejected. The finding that the shape was functional was consistent with:
- The fact that the goods are usually sold wrapped in such a way that the shape cannot be seen until after purchase;
- The product is designed to be broken up and consumed;
- The emphasis given in the Nestlé's marketing to the breakability of the fingers of the bar.
- No inherent distinctiveness
The IPO also held that the mark was devoid of distinctive character under section 3(1)(b) of the UK's Trade Marks Act 1994. The evidence showed that third party two finger versions of the shape applied for were on the UK market in a significant way prior to the filing date of the application. Other products consisting of a number of joined chocolate fingers separated by breaking grooves, including Terry's 'Waifa' and Cadbury's 'Bar Six', had also been present on the UK market. The IPO found on the evidence that the shape was within the norms and customs of the sector, and was a mere variant on common shapes for chocolate bars and biscuits, i.e. rectangular bars with breaking grooves resulting in individual pieces or 'fingers'. The shape was not such as to permit average consumers to distinguish the product from those of other undertakings. However, in relation to cakes and pastries, the shape was outside the norms and customs of the sector, and so, as a highly unusual shape, it would be capable of distinguishing trade origin in that context.
- No acquired distinctiveness
Nestlé submitted evidence that products corresponding to the marks had been on the UK market for 75 years prior to the filing date of the application; that they had invested substantial sums in promoting the product; and also adduced survey evidence. The Hearing Officer pointed out that trade marks are intended to permit consumers to make informed choices between the competing goods of different undertakings in the course of trade. Therefore survey evidence showing that the public know who usually makes goods of a particular shape, without also showing that such recognition plays some part in the trade of such goods, does not show that the shape has become a trade mark for the goods. The IPO held that Nestlé had shown recognition of the mark amongst a significant proportion of the relevant public for chocolate confectionery, but not that consumers had come to rely on the shape to identify the origin of the goods. This was because:
- There was no evidence that the shape of the product had featured in Nestlé's promotions for the goods for many years prior to the date of application;
- The product was generally sold in an opaque wrapper which did not show the shape of the goods;
- There was no evidence, and it seemed unlikely, that consumers use the shape of the goods post purchase in order to check that they have chosen the product from their intended trade source.
In those circumstances, it was likely that consumers relied only on the word mark KIT KAT and the other word and pictorial marks used in relation to the goods in order to identify the trade origin of the products. Therefore the claim of acquired distinctiveness failed.
Inconsistent decision of OHIM
The IPO also considered the inconsistent decision of OHIM. On 19 December 2012 OHIM's Board of Appeal had reversed an earlier decision to cancel the mark, upholding the registration of the same mark at issue in these proceedings as a Community Trade Mark (CTM). OHIM found that the shape of the KIT KAT bar had acquired a distinctive character due to its long and continued use in the market. OHIM also held the mark was not excluded from registration on the basis of the functionality of its essential characteristics, and, even if certain features did respond to a technical need or perform a technical function, there were other non-technical features of the shape (the trapezoidal shape of the bar, the alignment of four bars, the common joining base and its rectangular shape) which, even if rather banal, were sufficient to make the shape recognisable by the relevant public as a badge of commercial origin.
The IPO disagreed with OHIM's conclusions on distinctiveness and functionality, noting:
- The CTM was not registered for 'chocolate, chocolate products or chocolate confectionery' (which OHIM had objected to on the basis that the sign was devoid of distinctive character in relation to those goods), but instead for 'Sweets; bakery products, pastries, biscuits; cakes, waffles (notably biscuits were still included).
- The Board of Appeal did not have expert evidence as filed in the UK proceedings;
- The Board of Appeal did not have the benefit of hearing cross-examination of experts on their evidence about functionality and manufacturing considerations related to various aspects of the shape.
This case is an interesting example of a national trade mark registry reaching a conclusion diametrically opposed to OHIM's. The decisions are difficult to reconcile although the UK IPO decision unlike OHIM was based on a procedure which allows for the cross-examination of witnesses. The UK IPO expressed concern about implications for infringement if Nestlé were held entitled to an exclusive right in the shape mark, noting that confusion would be presumed in double-identity cases (identical marks/identical goods) but, if consumers place no reliance on the shape of the goods at any stage of the selection process in order to identify trade origin, then no one would actually be confused by a third party's use of the shape.
The dispute between Cadbury and Nestlé is a long-running one and it is possible that Nestlé will appeal the UK decision.