The Survey Says! EU General Court decides on requirements for evidence on distinctive character
A recent decision by the European General Court (GC) highlights the requirement for comprehensive evidence when seeking to prove acquired distinctiveness in relation to 3D marks.
Regulation No 207/2009 (CTM Regulation) sets out the basic requirements for registering a trade mark in the EU and contesting applications or registrations of marks.
Article 7(1)(b), (c) and (d) of the CTM Regulation contain absolute grounds for refusal for registration of a mark (the Absolute Grounds) - in summary: if the mark is devoid of distinctive character (7(1)(b)), descriptive (7(1)(c)) or has become exclusively customary in the language/trade (7(1)(d)).
Article 7(3) states that the Absolute Grounds are not a bar to registration of a trade mark if that mark has acquired distinctiveness through use in relation to the goods or services for which registration is applied for.
Similarly, Article 52(2) provides (amongst other things) that, where an EU trade mark has been registered in breach of Article 7(1)(b), it may not be declared invalid if, following use after registration, it has acquired distinctive character in relation to the goods or services for which it is registered.
The case considered the validity of a registered EUTM (no. 2632529), owned by Nestle, comprising of a 4-finger Kit Kat chocolate bar without any other markings (the Mark).
The Mark was registered on 7 August 2006. On 23 March 2007 Cadbury (now Mondelez) filed an application for a declaration of invalidity on the basis of (amongst other things) the Absolute Grounds. On 11 January 2011, the Cancellation Division of the EUIPO gave its decision declaring the mark invalid. Nestle appealed the decision on 9 March 2011 and on 11 December 2012, the Second Board of Appeal of the EUIPO upheld Nestle's appeal, annulling the Cancellation Division's decision. Mondelez subsequently appealed the Board of Appeal's decision to the GC.
The GC's decision clarified two key points in EU trade mark law.
The first was that protection under Article 7(3) and Article 52(2) is only available for those categories of goods in which the rights holder could establish genuine use. In this case the Mark was registered for "Sweets; bakery products, pastries, biscuits; cakes, waffles" in class 30. The evidence produced by Nestle only showed genuine use with respect of sweets and biscuits, and therefore the GC determined that no protection would be offered under Article 7(3) and 52(2) for the remaining goods.
The second point dealt with evidence of acquired distinctive character. Nestle relied upon evidential data from 10 of the 15 Member States of the EU (at the time), which it extrapolated to indicate what proportion of the total EU population (i.e. across all Member States) would immediately recognise Nestle as the commercial origin of the product having the shape of the Mark. Although the Board of Appeal agreed with this approach, the GC disagreed and determined that "in the case of a mark which, like the contested trade mark, 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" (emphasis added).
This case demonstrates the need for robust and accurate evidence of acquired distinctiveness and use in relation to all registered goods, for all Member States potentially even at the application stage (if an application seeks to rely upon Article 7(3)). Brand owners and potential applicants should keep this in mind when compiling and submitting evidence in any EUIPO prosecution or third party opposition proceedings. Currently with 28 Member States to cover, the collection and compilation of this evidence can be hugely costly, and places rights holders in a challenging position.Given this cost, gathering 'pre-emptive' evidence of acquired distinctive character (in anticipation of a prosecution or third party action) is likely to be prohibitively expensive, for all but the most valuable brands. In our view, the more cost effective and pragmatic approach would be to hold fire until the evidence is required for reliance on Article 7(3) or Article 52(2) – in either case, if more time were required to gather such evidence at that stage, an extension could be sought.