HomepageCommercial LawPrivate LawPublic Law & Human RightsCriminal LawEU & International LawCareers

Accessibility

Have Irlen Syndrome, or need different contrast? Click the button below for options.

Background Colours

Subscribe

Enter you email address below to subscribe to free customisable article notifications.

Alternatively, click the button below for our various RSS Feeds (available journal wide, or per section).

Problems with Trade Marks for Shapes

Article Cover Image

About The Author

Connor Griffith (Consulting Editor)

Connor is a law graduate from the University of Nottingham with a particular interest in intellectual property and corporate law. He is currently a trainee solicitor at a large national firm, sitting in the Real Estate department. Outside the law, he enjoys stand-up comedy and moaning about Brexit.

[Read More]

Ideas shape the course of history.

John Maynard Keynes

Many consumers make their purchasing decisions by considering the reputation of the company behind the product. Comical images like lines of eager customers queueing overnight outside Apple stores in anticipation of every new iPhone demonstrates how, in the modern market, successful branding – leading to mass brand-loyalty – has become just as valuable a commodity as the customers themselves.

However, this faith placed in companies has resulted in rivals developing inferior unoriginal products to try and infiltrate the market. The law thus employs trade marks to prevent this parasitic practice; they verify the origin of a product and reward the creativity of creators where they have provided a product or service that consumers want. Through this, imitators are prevented from riding on the coattails of the successful.

However, the application of this protection has been difficult in relation to products that attain value and distinction through their particular shapes: a recent rejection by the Court of Appeal of an attempt to apply a trade mark to the shape of London Taxis in The London Taxi Corporation v Frazer-Nash Research [2017] – alongside a similar rejection by the German Federal Patent Court concerning the shape of Nespresso coffee capsules – demonstrate that this struggle to secure ‘shape marks’ is far from over. Indeed, this article will discuss the many restrictions on registering shape marks, questioning whether such a strict approach is truly necessary.

The Current Shape of the Law

Trade marks are defined in Section 1(1) of the Trade Mark Act 1994 (TMA 1994) as ‘any sign capable of being represented graphically which is capable of distinguishing goods or services of one undertaking from those of another’. There are thus three main elements to a trade mark.

A Sign

While ‘sign’ has not been statutorily defined, the courts have adopted a very wide approach to defining it. Jacob J in Philips Electronics NV v Remington Consumer Products (No. 1) [1998] RPC 283, for example, interpreted the term to simply include ‘anything which can convey information’.

Indeed, the only limitation placed on the term is that the sign must take a specific format. This resulted in an attempt to place a trademark on the idea of having a transparent collection bin on a vacuum cleaner being rejected by the European Court of Justice (ECJ) in Dyson Ltd v Registrar of Trade Marks [2007] as the concept was ‘a mere property of the product’.

Capable of Graphic Representation

The requirement for the sign to be capable of graphic representation was interpreted in Swizzles Matlow Application [1998] RPC 244 as stipulating that the product must be understandable without reference to samples of the goods themselves.

The ECJ in Ralf Sieckmann v Deutsches Patent-und Markenamt [2002] elaborated further upon this by finding that a graphic representation ‘utilizes images, lines, or characters’ and is ‘clear, precise, self-contained, easily accessible, intelligible, durable, and objective’. These collective characteristics have since been termed the ‘Sieckmann criteria’.

Distinctiveness in Trade

The sign must be capable of distinguishing the goods or services of one undertaking from those of other undertakings. Whether this is the case is judged from the perspective of the hypothetical ‘reasonably well-informed and circumspect consumer’.

This requires that the mark is not too general. Slogans, for example, must be particularly unique and indicative of origin. In Audi v OHIM [2010], the ECJ held that Audi’s slogan of ‘Advance or Advantage through Technology’ was permitted as the public would see it as distinctive for goods coming from Audi. However, the ECJ also rejected ‘Real People, Real Solutions’ as insufficiently distinctive, on the grounds that it was a promotional message that in no way indicated that the product in question originated from Audi.

Shape Marks

However, simply satisfying the description of a mark under Section 1(1) of the TMA 1994 does not guarantee trade mark protection. Section 3 of the TMA 1994 provides a variety of absolute grounds for refusal of registration, of which Section 3 (2) of the TMA 1994 is of the most interest for present purposes: it contains a ‘preliminary obstacle’ specifically to shape marks by providing:

A sign shall not be registered as a trade mark if it consists exclusively of-

(a) the shape which results from the nature of the goods themselves, or

(b) the shape of goods which is necessary to obtain a technical result, or

(c) the shape which gives substantial value to the goods.

It should be noted that ‘consists exclusively’ was interpreted by the ECJ in Lego Juris v OHIM [2010] to mean only the ‘essential characteristics’ of the mark need fall under an exclusion for the application to fail. Therefore, even if the entirety of the shape is not excluded, the application will still fail if the elements outside the scope of Section 3(2) of the TMA 1994 are ‘trivial’ at most.

Though further general challenges to registration exist under Section 3 and Section 5 of the TMA 1994, the final key obstacle for shape marks exists by way of Section 3(1)(b) of the TMA 1994: the shape itself cannot be devoid of any ‘distinctive character’.

Resulting from the Nature of the Goods

Where there is simply just one shape available for a product due to the nature of that product (for example, a banana can only be one shape), that shape will not be protectable under trade mark law.

The reasoning is clear: the shape of the product could not possibly be anything else. Any trader of such products, argue Lionel Bently and Brad Sherman, would therefore ‘necessarily have to use the same shape’, meaning an unreasonable monopoly would be granted to the first applicant for that good if the exclusion did not exist.

Necessary to Obtain a Technical Result

The second exclusion prevents protection where the sign consists exclusively of a shape that is necessary to obtain a technical result.

This exclusion seems to have been interpreted rather widely: as Lionel Bently and Brad Sherman observe, it covers not only where the shape of the good was chosen in order to achieve a ‘technical solution’ – as the ECJ held in Philips Electronics v Remington Consumer Products [1999] – but also to cover designs chosen for 'convenience features' such as the storage or transporting of the good.

The shape of the good need not be the sole method of achieving a technical result for the exclusion to apply: all that matters is the decision to use that particular shape was motivated by function. Indeed, the ECJ in Philips Electronics v Remington Consumer Products [1999] held that the requirement for the shape to be ‘necessary’ to obtain a technical result connoted only a causal relationship between the outcome and shape, as opposed to a ‘mandatory relationship between technical result and shape’ whereby the ‘shape is the only one that could perform the function’.

Gives Substantial Value to the Goods

Thirdly, the statute prevents protection of a sign where it consists exclusively of a shape that gives substantial value to the goods.

The leading case is Bang & Olufsen v OHIM [2011], in which the particular design of a loudspeaker was rejected by the ECJ. The applicant’s arguments that the target public would purchase the speaker due to its sound quality – and not necessarily its design – were deemed irrelevant as there was ‘no obligation to consider the views of the target public’ as this had little impact on the ‘substantial value’ of the goods.

Instead, the ECJ focused on the applicant’s ‘own marketing and other literature produced by distributors [which] emphasized the aesthetic characteristics of the shape as a selling point’, with the speaker having been described by the applicants as a ‘pure, slender, timeless sculpture for music reproduction’. It was clear that the shape and design were important to the applicant in driving up the value of the goods, and thus protection was rejected.

Distinctive Character

Finally, shape marks – like all trade marks – will be refused registration where they are devoid of any ‘distinctive character’. This requirement aligns with the fact that a primary role of trade marks is to distinguish the goods of one undertaking from those of another.

The ECJ made it clear in Linde AG [2003] that once a shape satisfies the requirements in Section 3(2) of the TMA 1994, it faces no stricter a test of distinction than any other type of mark. However, as pointed out in Henkel v OHIM [2007], ‘average consumers are not in the habit of making assumptions about the origin of products on the basis of their shape’, causing the ‘vast majority’ of shape mark applications to fail under Section 3(1)(b) of the TMA 1994.

Indeed, the ECJ in Henkel v OHIM [2007] subsequently required the shape chosen to have ‘significantly depart[ed] from the norm or customs of the sector and thereby fulfil[led] its essential original function’. This necessitates a two-step test:

  1. There must be something unusual or idiosyncratic about the shape such that the relevant consumer would notice it and remember it; and
  2. The relevant consumer must think of this shape as indicative of source, rather than being merely functional or decorative.

Though the strict test for distinctive character has resulted in many applicants claiming they have ‘acquired distinctive character as a result of the use made of [the sign]’, permitted by Section 3(1) of the TMA 1994, this is also a strict test. For example, a key factor which the court considers is the proportion of the relevant class of persons who identify the goods as originating from a particular undertaking as a result of the use of the mark. This is held to a very high standard: in British Sugar Plc v James Robertson & Sons Ltd [1996] RPC 281, 60% of the relevant class recognised ‘Treat’ as a mark, yet this was still held to be an insufficient amount.

Culmination of the Current Law

It is therefore clear that there are a wide variety of restrictive tests to be applied when considering whether the shape of a good can be protected by trade mark law. In addition, shape marks must also satisfy the standard requirements that all marks must adhere to. This prevents applications where the mark is, amongst other things-

  • Descriptive: in Wrigley’s v OHIM [2003], ‘Doublemint’ was rejected because it could either be an indication of the strength or quantity of chewing gum;
  • Deceptive: ‘Orwoola’ was rejected by the Hong Kong Intellectual Property Department, because as it wrongly suggested the products were made entirely of wool; or
  • Made in Bad Faith: the ECJ in Lindt v OHIM [2012] rejected Lindt Golden Bunnies, as the application was made solely to prevent competing products.

Fulfilling all of these requirement is a tall order, resulting in very few applications for shape marks becoming successful. A rare example of success occurred before the Canadian Federal Court in Kraft v Euro Excellence [2004], where Kraft succeeded in gaining protection over Toblerone chocolate bars, which are known for their triangular prism shape. Notably, however, this was subsequently overturned by the Canadian Supreme Court in Euro Excellence v Kraft [2007], in a neat parallel with the ECJ’s decision to deny protection to the four-bar design of KitKat chocolate bars in Mondelez UK Holdings v EUIPO [2016].

Permitting the Popular

There is a clear need to re-evaluate the restrictions to registration of shape marks. Indeed, it is submitted the exclusion under Section 3(2)(c) of the TMA 1994 is highly questionable; it is not clear why shapes that give substantial value to the goods should be rejected.

An Overlooked Distinction

A justification for the substantial value exclusion was given by a Dutch court in Burberry I [1989] BenGH 14-04-1989, which argued that the law should:

[P]rotect the freedom of competitors to give the same shape to their products in order to increase the value of those products.

However, this rationale – which aligns with the justifications for the other two exclusions in Section 3(2) of the TMA 1994 – overlooks an important distinction between the substantial value exclusion in Section 3(2)(c) of the TMA 1994 and those contained in Section 3(2)(a)(b) of the TMA 1994 . Whether a shape originates from its function is undeniable, but whether the value of a product increases exclusively because of its shape is debatable; there are a large number of commercial factors affecting pricing. By adopting a blanket justification, courts are confusing opinion for fact.

Caroline Wüeggertz writes that case law, in following this justification, has overwhelmingly resulted in ‘good’ designs (those that deviate from the general norm in an aesthetically pleasing way) being punished whereas ‘poor’ designs (those that are less aesthetically pleasing) are granted trade mark protection, despite the fact that both types are ‘perceived by the average consumer as an indicator of commercial origin’.

Additionally, Charles Giegen makes the point that the substantial value exclusion has become competitively redundant: by definition, a ‘good’ design deviates from the norm and so cannot prevent general competition as it is distinct. Even if the shape was not distinct, the mark would instead fail under the requirement in Section 3(1)(b) of the TMA 1994 for distinct character, removing any need for the substantial value exclusion.

Cutting Corners of Copyright and Designs

A more compelling justification for the substantial value exclusion was provided by the ECJ in Bang & Olufsen v OHIM [2011]: it prevents design and copyright protection, which are alternate methods of protecting the shapes of products but are ‘rights limited in time’, from being ‘bypassed’ by potentially perpetual trade marks.

Again, this justification is similar to those made under the other exclusions in Section 3(2) of the TMA 1994; indeed, as Caroline Wüeggertz observes, the technical function exclusion under Section 3(2)(a)(b) of the TMA 1994 operates in such a way that means that technical functions should instead be ‘subjected to a patent protection limited in time’. Patents act as a temporary reward for ingenuity in industry, but, like design and copyright protection, do not permanently prevent competition.

Nonetheless, Wüeggertz argues that while:

[A] design or copyright should not be able to be made perpetual through trade mark law … the interpretation in case law of the exclusion … might go too far when excluding shapes that de facto are perceived by consumers as a designation of origin, but which happen to have a design that is appreciated.

Therefore, while the substantial value exclusion perhaps need not be completely repealed – as to do so would be to grant perpetual rights to shapes, rendering design rights and copyright obsolete – a compromise must be found through re-evaluation of how courts determine whether a shape grants the product substantial value.

Conclusion – Advocating a Compromise

The recent opinion of Advocate General Szpunar in Louboutin v Van Haren [2017] considered this issue. Specifically, AG Szpunar made clear that the substantial value exclusion should consider only the ‘intrinsic value of the shape, and must take no account of attractiveness of goods flowing from the reputation of the mark or its proprietor’. This aligns with the approach of Aldous LJ in Philips v Remington [1999] EWCA Civ 1340, who held ‘what has to be considered is the shape as a shape’, with any ‘reputation built up by advertising and reliability’ being deemed ‘not relevant’.

This approach acknowledges that the reality of current markets is that branding – including the aesthetics of products – plays a vital part of many companies’ operations. Successful branding increases the amount consumers are willing to pay for a product, allowing the company to value their goods higher. This is basic capitalism; to punish such valuations discourages successful competition.

The approach of AG Szpunar laudably finds a midpoint between achieving the objective of the substantial value exclusion and ensuring market competition: brands would not be punished for successful marketing, but valid cases of where the market is hurt by the use of certain aesthetics would be prevented and alternate methods of intellectual property protection would not be made obsolete.

The case of Louboutin v Van Haren [2017] is currently yet to be decided; arguments are ongoing. Hopefully, the ECJ will adopt the proposal of AG Szpunar and undertake a new and more commercially-minded approach to applications for shape marks.

For the latest articles straight to your inbox, you can subscribe for free. Alternatively, follow @KeepCalmTalkLaw on Twitter or Like us on Facebook.

Tagged: Commercial Law, European Union, IP, Intellectual Property, Technology

Comment / Show Comments (0)

You May Also Be Interested In...

The Death of Copyright Law's Idea/Expression Dichotomy

2nd Feb 2018 by Ted Cook (Guest Author)

The Biggest Challenges Facing the Legal Profession in 2018

2nd Jan 2018 by Keir Baker

Copyright Protection for TV Shows: Pointless or Going for Gold?

19th Dec 2017 by Connor Griffith

Fair Use on YouTube: The H3H3Productions Copyright Case

19th Sep 2017 by Connor Griffith

Facebook Consumes WhatsApp

16th Oct 2014 by Jade Rigby

Competition v Intellectual Property - Clarity but little substantive change

27th Mar 2014 by Chris Bridges

Section Pick May

Taming the Retail Giants: The Impact of Mergers & Acquisitions on Competition

Editors' Pick Image

View More

KCTL News

Keep Calm Talk Law: Moving Forward

3rd Sep 2019

Changing of the Guard: Moving Keep Calm Talk Law Forward

12th Aug 2018

An Anniversary or Two: Four Years of Keep Calm Talk Law

11th Nov 2017

Rising from the Ashes: The Return of Keep Calm Talk Law

18th Nov 2016

Two Years On, Keep Calm Talk Law’s Legacy is Expanding

11th Nov 2015

Twitter

Javascript must be enabled for the Twitter plugin to function. Click below to visit us on Twitter.

Free Email Subscription

Subscribe to Keep Calm Talk Law for email updates, and/or weekly roundups. You can tailor your subscription on activation. Both fields are required.

Your occupation / Career stage is used to tailor your subscription and for readership monitoring.

Uncheck this box if you do not want to receive our monthly newsletter.

By clicking the Subscribe button, you agree to our privacy policy and terms of service. Please ensure you read these in full.

Free Subscription