UK: The Shape of Things to Come

The Dutch electronics company Philips began developing electric razors in 1937. Two years later they introduced their first model to the market, a single headed rotary shaver. This was followed by a two headed rotary shaver and, in 1966, by a three headed product in which the heads were arranged in a triangular pattern which projected slightly above a triangular base plate. The three headed model was sold under the trade mark Philishave and soon became highly successful accounting for about 30% of the world’s electric shaver market. In the UK, Philips’ annual sales of Philishave razors had reached about 2 million by 1989 and, although this had fallen significantly (to about 400,000) by 1996, there is no doubt that the Philishave three headed razor was well known as a product made by Philips both prior to and during the 1990s in the UK. The clear association between this form of electric razor and Philips was assisted, in no small measure, by the lack of competing three headed shavers on the UK market during the period 1966 to 1995.

In 1985, in order to reinforce their monopoly, Philips registered a trade mark consisting of a picture of a three headed razor in the UK (registration no. 1254208). In spite of this, Philips’ monopoly was finally challenged in 1995 when Remington introduced their own three headed electric shaver, the DT55, to the UK market. Not surprisingly, Philips sued Remington for trade mark infringement and, in response, Remington sought to invalidate UK1254208 on various absolute grounds.

In 1999, the English Court of Appeal found in favour of Remington and cancelled UK1254208 on the basis of Sections 3(1)(a), 3(1)(b), 3(1)(c) and 3(2)(b) of the 1994 Trade Marks Act, which are derived from Articles 3(1)(a), 3(1)(b), 3(1)(c) and 3(1)(e) of the European Union’s Trade Marks Harmonisation Directive (89/104) (Philips Electronics NV v Remington Consumer Products Ltd). The Court ruled as follows:

• The fact that a trade mark has by use become such as to denote goods of a particular trader did not necessarily mean that it was capable of distinguishing the goods of that trader from those of others.
• A person who had had a monopoly use of a trade mark for many years might be able to establish that it did in fact denote his goods exclusively, but that did not mean that it had a feature which distinguished his goods from those of a rival who subsequently came into the market.
• The shape of an article could not be registered in respect of goods of that shape unless it contained some addition to the shape of the article which had trade mark significance. It was that addition which made the mark capable of distinguishing or which could attain a distinctive character.
• The restriction upon registration imposed by the words "which is necessary to obtain a technical result" was not overcome by establishing that there were other shapes which could obtain the same technical result.
• Having made its ruling, the Court of Appeal recognised the importance of the issues raised by this case and therefore put a number of questions to the European Court of Justice (ECJ) concerning the proper interpretation of the Harmonisation Directive, especially Article 3(1), relevant sections of which are set out at the end of this article. The ECJ has now pronounced on four of the questions put to it by the Court of Appeal. We set out these four questions below, together with the relevant findings of the ECJ in each case.

Is there a category of marks which is not excluded from registration by Article 3(1)(b), (c) and (d) and Article 3(3) of Council Directive 89/104/EEC which is none the less excluded from registration by Article 3(1)(a) of the Directive (as being incapable of distinguishing the goods of the proprietor from those of other undertakings)?

In response to this, the ECJ decided that there was no class of marks having a distinctive character (inherent or acquired by use) which was not capable of distinguishing goods or services within the meaning of the Directive (Article 2). In other words, if a trade mark was distinctive in fact and could therefore be registered in accordance with Articles 3(1)(b), (c) or (d) of the Directive, it could not be refused registration on the basis that it was incapable of distinguishing as a matter of law (Article 3(1)(a)).

Is the shape (or part of the shape) of an article (being the article in respect of which the sign is registered) only capable of distinguishing for the purposes of Article 2 if it contains some capricious addition (being an embellishment which has no functional purpose) to the shape of the article?

Here the Court found that the criteria for assessing the distinctive character of 3-D trade marks were no different from those to be applied to other marks. In order to qualify for registration as a trade mark under the Directive, the shape of an article did not have to include a capricious addition with no functional purpose. The shape simply had to be capable of distinguishing a product having that shape and fulfilling the essential purpose of a trade mark, namely guaranteeing the origin of the product.

Where a trader has been the only supplier of particular goods to the market, is extensive use of a sign, which consists of the shape (or part of the shape) of those goods and which does not include any capricious addition, sufficient to give the sign a distinctive character for the purposes of Article 3(3) in circumstances where as a result of that use a substantial proportion of the relevant trade and public

In answer to this question, the ECJ found that where a trader has been the only supplier of particular goods to the market, extensive use of a sign which consists of the shape of those goods may be sufficient to give the sign a distinctive character for the purposes of Article 3(3) of the Directive in circumstances where, as a result of that use, a substantial proportion of the relevant class of persons associates that shape with that trader and no other undertaking or believes that goods of that shape come from that trader.

It was, however, for the national court to decide whether or not the identification of the shape with the supplier was as a result of use of the shape as a trade mark. (emphasis added).

On this important question, the ECJ ruled as follows:

• The aim of Article 3(1)(e)(ii) was to prevent the registration of shapes whose essential characteristics perform a technical function, with the result that the exclusivity in the trade mark right would limit the possibility of competitors supplying a product incorporating such a function or at least limit their freedom of choice in regard to the technical solution they wish to adopt in order to incorporate such a function in their product.
• Even if other shapes could achieve the same technical result as the shape sought to be protected as a trade mark, this did not overcome an objection raised under Article 3(1)(e)(ii).

This case contains a number of sensible rulings. In relation to the Court’s findings on Article 3(1)(e)(ii), it must be correct that a (trade mark) monopoly should not be granted, potentially in perpetuity, for a trade mark, the essential characteristic of which has a functional purpose. Useful, functional advances should be protected by patent, with its limited term of exclusivity.

The dismissal of Philips’ argument that, since the same technical result could be achieved by razors with different shaped heads, their trade mark registration (for a three headed razor) would not lead to a monopoly in a particular technical result, also makes sense. If Philips’ argument were taken to its logical conclusion, there would be nothing to stop the leading manufacturers of a vast array of products identifying the optimum shape of product to achieve a desired function, protecting that shape by patent and, once the patent is nearing expiry, maintaining their monopoly forever by trade mark registration. Such a situation would be contrary to the public interest.

Further, in the writer’s view, a clear distinction should be made between the grant of trade mark protection for the shape of a product’s packaging and the shape of the product itself. Whilst it is clear that the same criteria for registrability should be applied to both, it is also suggested that the authorities should exercise particular care when considering the registration of product shapes. Whilst it is usually straightforward for a competitor to design around a leading manufacturer’s choice of packaging, it may be much more difficult, if not impossible, to design around the shape of the product itself, particularly if that shape incorporates functional features. It follows that potentially perpetual monopolies in product shapes should not be granted lightly.

The ECJ’s finding on Question 1 should ensure that we do not return to the old, unlamented days of York trailers (York Trailer Holdings v Registrar of Trade Marks, 1984 RPC 231). It will be recalled that, in that York case, the English Court contrived to refuse a trade mark application for York in relation to motor vehicle trailers, even though evidence of acquired distinctiveness had been provided to the Court’s satisfaction. In the Court’s view, a geographical indication such as York could never be distinctive in law even though it was distinctive in fact. Much has changed in trade mark law since that York decision (thank goodness) and it is to be hoped that the ECJ’s ruling that, if a mark is acceptable under Articles 3(1)(b), (c) or (d), it must also be acceptable under Article 3(1)(a), will be followed, without contradiction, by the various UK authorities.

The Court’s answers to Questions 2 and 3 offer at least some hope to the exclusive suppliers of shaped products that, provided the distinctive feature of their 3-D marks does not fall foul of Section 3(2) of the UK Trade Marks Act 1994 (Article 3(1)(e) of the Directive), their marks could be accepted for registration even if they do not contain a capricious addition to the shape and even if they have been sold in a monopoly situation for many years. These rulings ought to benefit designers whose principal concern is the visual impression made by a product. Those whose brief is to optimise the functional benefit offered by the design to the consumer should, quite rightly, still struggle to obtain trade mark protection for their (overwhelmingly functional) 3-D shapes.