Acquired distinctive character in trade marks must be evidenced in every EU country, rules court

The EU's General Court set out its view in a dispute involving confectionary giants Nestlé and Mondelez UK Holdings & Services, the owner of the Cadbury brand.

The Court was assessing whether the Board of Appeal at the EU Intellectual Property Office (EUIPO) had been right to rule that the shape of Nestlé's 'four-finger' Kit Kat chocolate bar was eligible for EU trade mark protection. Mondelez had appealed against the Board of Appeal's ruling.

Central to the Board of Appeal's ruling had been its finding that Nestlé's shape mark had acquired distinctive character through its use in the EU.

Marks which are devoid of distinctive character cannot be registered as trade marks under EU law. However, where marks that are not inherently distinctive have been wrongly registered as trade marks, trade mark owners can nevertheless avoid those marks being revoked if it has "acquired a distinctive character in relation to the goods or services for which it is registered"  through its use post-registration.

According to the General Court's ruling, it had been shown before the Board of Appeal that Nestlé's shape mark had acquired distinctive character through use in 10 EU countries, including the UK, France and Germany, despite the fact the population of those 10 countries make up approximately 90% of the total population of the EU.

However, that Board of Appeal "erred in law" by not "analysing the evidence" about the extent to which distinctive character had been acquired in the other EU member states, the Court ruled. As a result it annulled the Board of Appeal's decision.

In its ruling, the General Court said that "for the registration of a trade mark to be accepted under [EU trade mark law], the distinctive character acquired through use of that trade mark must be demonstrated in the part of the European Union where it was devoid of such character".

"In the case of a mark which … does not have inherent distinctive character throughout the European Union, the distinctive character acquired through use of that mark must be shown throughout the territory of the European Union, that is, in all the member states concerned," the Court said.

The High Court in London earlier this year rejected Nestlé's bid to obtain UK trade mark protection for the shape of its Kit Kat bars.

In a statement provided to Out-Law.com, Nestlé said: "We are pleased that the Court acknowledges that the four finger-shape trademark has acquired distinctiveness in 10 member states of the EU, namely the UK, Germany, Austria, France, Italy, Spain, Denmark, Sweden, Finland and Netherlands. The four finger-shape has been used throughout the EU by Nestlé for decades and is known by consumers as being KIT KAT."

"At the same time, the judgement sets a high threshold for trade mark applicants to register shapes as EU trade marks by requiring evidence of acquired distinctive character in all EU member states. We continue to review the findings and consider our position," it said.