UK: The Chocolate Wars (Part II) And The Taxi Wars

Last Updated: 11 February 2016
Article by Andrew Hawley

The chocolate confectionary market is arguably one of the most competitive within the UK. There are many different types, flavours and shapes of chocolate for us to enjoy, which are sold under numerous well-known household brands. However, although many of these brands are well known, are the chocolate bars themselves? Is it possible for a chocolate bar to be instantly recognisable and distinctive purely thanks to its shape alone, irrespective of any other branding?

The issue regarding whether the actual shape (alone) of a chocolate product is sufficient to identify the product to the relevant consumer was decided in the English High Court in the on-going Nestlé v Cadbury saga (referred back to the English Courts, with questions, by the Court of Justice of the European Union last year). This case specifically dealt with the question over whether Nestlé should be entitled to enjoy exclusive trade mark rights for the shape of its KitKat trade mark in the UK.

In summary, Nestlé sought to register its well known four finger shape, minus the KitKat logo, which is usually embossed on each finger and the packaging, as a trade mark in the UK for various goods in class 30, including chocolate products, chocolate confectionery, pastries, cakes and biscuits.

Rivals Cadbury successfully opposed this application on the basis that the shape of the KitKat mark was a feature of the nature of the goods and that it was necessary to achieve a technical result (to allow the consumer to easily break the bar). In the opposition proceedings, Nestlé filed evidence that the KitKat shape had acquired a distinctive character due to the use made of it in the UK which allowed the consumer to identify the product as a "KitKat" without any additional packaging or branding (which, if successful, would have allowed Nestle to successfully resist the opposition).

Nestlé appealed the decision to the English High Court and Mr Justice Arnold stayed the appeal proceedings pending a ruling from the CJEU on how acquired distinctiveness is to be assessed in relation to trade mark applications for shape marks. The following specific questions were raised:

  1. In order to acquire distinctiveness, is it sufficient that the average consumer recognises the shape and associates it with Nestlé (the applicant), as opposed to any other trade marks which may also be present, as indicating the origin of the goods?
  2. Where a shape consists of a number of essential features, one of which falls within the "nature of the goods" restriction and two of which fall within the "necessary to obtain a technical result" restriction, is registration of that shape as a trade mark precluded even though neither exclusion covers all of the essential features of the product?
  3. Should the prohibition be interpreted as precluding registration of shapes which are necessary to obtain a technical result with regard to the manner in which the goods are manufactured as opposed to the manner in which the goods function?

The judgement of CJEU in relation to the specific questions raised by Mr. Justice Arnold can be summarised as follows:

  1. For the KitKat shape mark to be registrable as a trade mark, Nestle must be able to show that the relevant consumer can easily identify the goods as originating from that specific undertaking (i.e. Nestle) without any additional branding or packaging (either on the product or packaging around the product).
  2. With regards to the specific shape objections, the CJEU opined that it is only necessary for one of these grounds to apply for the trade mark application to be refused.
  3. If the shape of the trade mark is such that it is necessary to achieve a technical result, this should only apply where consumers relate this to the products function and not its manufacture.

The case was returned to the English High Court where Mr. Justice Arnold has now issued his ruling. In essence, Mr Justice Arnold has refused Nestlé's appeal and has ruled that the "KitKat" shape mark is not capable of registration in the UK. In his judgment, Mr Justice Arnold refused the arguments of Nestlé for the following reasons:

  • Nestlé had not promoted the chocolate bar's shape as one of its unique selling points and had distributed it in an opaque wrapping that did not reveal its design;
  • He specifically said "In these circumstances it seems likely that consumers rely only on the word mark KitKat and the other word and the pictorial marks used in relation to the goods in order to identify the trade origin of the products. They associate the shape with KitKat (and therefore with Nestlé), but no more than that";
  • "Therefore, if it is necessary to show that consumers have come to rely on the shape mark in order to distinguish the trade source of the goods at issue, the claim of acquired distinctiveness fails."
  • Therefore, the arguments from Nestlé that association (to the shape mark) is sufficient to demonstrate the acquisition of a distinctive character were deemed incorrect.
  • Despite the decision, Nestlé has indicated that it intends to further appeal this decision as they remain of the opinion that its iconic "four fingered bar" is well known by UK consumers and, as such, deserves to enjoy trade mark protection in the UK.

This decision appears to confirm the feeling that the courts are usually reluctant to allow manufacturers to obtain a monopoly (through a trade mark registration) for shape marks alone. Although the decision reinforces the opinion that consumers tend to be influenced by branding and packaging rather than the shape of the product alone, it must be noted that obtaining trade mark registration in the UK for a shape mark alone is not impossible (as the successful registrations for the Toblerone bar and Nestlé's own Walnut Whip will testify).

When a black cab is not a black cab (or is it?)

The question of whether a shape mark alone is inherently distinctive was also the primary issue in the recent case of London Taxi Company v Frazer-Nash.

In this case, LTC claimed that Frazer-Nash had intentionally copied the shape of its iconic "London black cab" and that the new "Metrocab" of Frazer-Nash was specifically designed to deceive both the London public and existing taxi drivers into thinking that this was and LTC taxi. As a result, LTC launched both trade mark infringement and passing off action in the UK courts based on its registered and unregistered rights in the shape of its "black cab".

Below is an image of the respective taxis in question, with the Frazer-Nash "Metrocab" on the left and the LTC "black cab" on the right:

In this case, Mr. Justice Arnold rejected all of the arguments by LTC and dismissed the infringement claims on a number of grounds, including that the shape marks (of the taxi) adds substantial value to the goods, one of the shape marks had not been put to genuine use in the UK for at least five years and that Frazer-Nash had not taken unfair advantage of LTC's registered trademarks.

Mr Justice Arnold also stated that the shape marks owned by LTC should not have been registered as they lack the required level of distinctiveness (being merely the shape of a taxi) and that they had not acquired a distinctive character through use of the marks. He also applied his reasoning in the recent KitKat case in that consumers did not use or identify the LTC taxi because of its shape, rather due to other branding such as the prominent "LTC" badge. Also, the may associate the shape of the taxi as originating from LTC, but this mere association is not enough as further branding is needed to fully allow the consumer to determine that the taxi originates from LTC and to distinguish their taxi from other such goods.

With regards to the passing off action, Mr Justice Arnold reaffirmed that it is very difficult to establish the necessary goodwill in a shape and that, in this instance, LTC had failed to show that the shape of their taxis had acquired a distinctive character which allowed the public to easily identify the overall shape as being an LTC taxi. As such, no goodwill could possibly accrue in the shape itself.

Mr Justice Arnold also commented that there was also no evidence of misrepresentation as Frazer-Nash had not intended to deceive the relevant consumer into thinking that its "Metrocab" came from the same source as the LTC taxis.

This decision reinforces the opinion that obtaining registered rights in shape marks, and enforcing such rights against third parties, remains highly problematic in the UK unless it can be shown that the shape itself has acquired a substantial level of distinctiveness through use which is not due to an association with any other branding on the goods in question.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions