Nestlé's KIT KAT doesn't get a break

In an ideal world, many businesses would like a law passed so that none of their competitors can ever make something that looks or operates the same as (or in a similar manner to) their products. Unfortunately, the law is not so generous!

However businesses are able to obtain such protection, to a certain extent, through intellectual property rights. Most of those rights, though, have a finite life.  For example, a patent will only last for 20 years and a registered design for a maximum of 25 years. The exception to this is a registered trade mark. Provided the trade mark is used in trade and all renewal fees are paid when due, it can last for ever.

Unsurprisingly, a number of traders have tried over the years to secure perpetual monopolies in the shape and appearance of their products, by trying to register them as trade marks. In principle, European trade mark law allows the shapes of products to be registered as trade marks. That said, the bar set against registration is quite high.

To register the three dimensional shape of a product as a trade mark, various hurdles have to be overcome. First, it is likely that such a mark will be held to be inherently non-distinctive. In other words, consumers will not, on seeing the shape, automatically assume that it is a trade mark, indicating from whom the goods originate. They need to be "educated" to see it as a trade mark. Second, if the shape of the goods results from the nature of the goods themselves, or is necessary to obtain a technical result, then it is not possible to register the shape as a trade mark.

A recent case involving Nestlé and Cadbury highlighted this in practice. Nestlé applied to register the three dimensional shape of its four fingered Kit Kat chocolate bar as a UK trade mark. Cadbury opposed the application on various grounds. Initially, the opposition proved largely successful and, as a result, Nestlé appealed the first instance decision. 

Nestlé did not challenge the Hearing Officer's conclusion that the three dimensional shape of a four-fingered Kit Kat chocolate bar is devoid of inherent distinctive character.  However, they claimed that evidence showed that the shape had acquired distinctive character and had thus become a "trade mark". The public saw the shape "as a trade mark", indicating the trade source of the chocolate bar. 

The Judge hearing the appeal held that whilst Nestlé might be able to show that consumers had come to recognise the shape, and associated it with Nestlé's Kit Kat bar (through trade), that did not necessarily mean that consumers had come to rely on the shape "as a trade mark"  (i.e. to indicate from whom the goods came from). 

As the Judge and the Hearing Officer held, there was no evidence, and they both thought it inherently unlikely, that consumers of four fingered Kit Kats would rely upon the shape of the product to confirm the authenticity of the goods. What they would rely upon was the name embossed on the chocolate bar, or its packaging, the word mark "Kit Kat". 

The case itself has raised some difficult points of law. As a consequence, the Judge has referred certain questions to the European Court of Justice for them to answer. The answers they give will decide whether the Hearing Officer and the Judge are correct in their approach. 

Ultimately, what the Kit Kat case proves is that while businessman would like to be granted monopolies to prevent others producing products that look the same as theirs, at present the English judiciary will not allow such monopolies to exist through the registration of trade marks, except in a few, very exceptional, cases.


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