No break for KitKat

The Court of Justice of the European Union has said that the European Union Intellectual Property Office (EUIPO) must re-examine whether Nestlé's KitKat shape (the four-fingered one) may remain registered as an EU trademark. We have previously reported on the confectionery issue here.

In a press-release announcing the decision today, advocate-general Wathelet said that the appeals of Nestlé, the EUIPO and Mondelēz International should be dismissed. The full decision will be published soon.

This case has its roots as far back as 2002, when Nestlé applied to the EUIPO (then OHIM) to register the shape of its KitKat as a 3D mark. In 2006, after an inordinate delay and much deliberation, that mark was granted. Only a year later Cadbury (which has since become Mondelēz International), applied for a declaration of invalidity.

That application was subject to even longer delays, and was eventually dismissed in 2012, where it was considered that the shape of the four-fingered KitKat was so well-known that it had acquired distinctiveness.

Mondelēz appealed, and in December 2016 the European General Court annulled the decision to allow registration, and ordered a reconsideration of the registration application. The consequence of that was that in 14 years absolutely nothing had been finally determined.

The basis of that decision was that no regard had been given to Belgium, Greece, Ireland or Portugal in deciding whether Nestlé had acquired distinctiveness in the KitKat's shape. The parties and the EUIPO (as it had by then become) all brought appeals against that decision, and it was passed to the Court of Justice after a much more palatable 18-month delay.

Mondelēz appealed against the finding that the KitKat's shape had acquired distinctiveness. Nestlé and the EUIPO both appealed against the General Court's finding that it was necessary to prove acquired distinctiveness in every relevant member state (it had been found in 10 of the 14).

Wathelet's press release stated that it would be unreasonable to have to prove acquired distinctiveness in every member state, but that does not mean that a party can just leave out entire regions where it may struggle to prove its case. He said that the courts must ensure that "evidence from which an extrapolation is made for the whole of the EU relates to … geographically representative sample".

He also dismissed Mondelēz's appeal on the basis that they had received the relief they wanted (an annulment of the earlier decision) in any event, and therefore could not be deemed an "unsuccessful party": a pre-requisite to appealing to the Court of Justice.

Neither party seems particularly happy with the outcome, with Nestlé suggesting that the conclusion is based on incorrect factual findings, and Mondelēz repeating their contention that the KitKat should not be protected as a trademark as it is not distinctive enough.

The parties can now have a break while they wait for the published decision.

If you have any questions on the above, please do not hesitate to contact the team at McDaniel & Co. on 0191 281 4000 or legal@mcdanielslaw.com.