• EUROPEAN PERSPECTIVES

    Giving Nestlé a Break

    ECJ Rules that Use as Part of Another Mark May Count for Acquired Distinctiveness

    In July, the ECJ handed down its long-awaited judgment in Société des Produits Nestlé SA v Mars UK Ltd. (Case C-353/03), settling the hotly disputed question of whether a mark can acquire distinctiveness through use as part of, or in conjunction with, another mark.

    Its judgment is part of a bitter legal wrangle between confectionery giants Nestlé and Mars over the registrability of the words HAVE A BREAK as a trade mark for confectionery. Nestlé had applied to register the mark before the U.K. Patent Office, and Mars had successfully opposed on the ground that the mark was devoid of any distinctive character under Section 3 (1) (b) of the Trade Marks Act 1994. Nestlé’s appeal to the High Court failed, and it further appealed to the Court of Appeal.

    The CA agreed with the lower court’s finding that the mark was devoid of distinctive character, but it considered that Nestlé may have acquired distinctiveness in the mark through use. HAVE A BREAK, however, had typically been used as part of the longer phrase, HAVE A BREAK, HAVE A KIT KAT, and it was unclear whether use as part of another mark, rather than independently, could lead to acquired distinctiveness.

    The CA asked the ECJ to rule on the question of whether a trade mark may acquire distinctiveness under Article 3 (3) of the Trade Marks Directive (the basis for S. 3 (1) (b)) as a consequence of use as part of or in conjunction with another mark.

    The ECJ answered affirmatively. The question of acquired distinctiveness had to be assessed in relation to the goods claimed, from the point of view of the average consumer. The relevant question was whether, taking into account the use of the mark, the average consumer had come to identify the product in question as originating from a given undertaking. Use as a trade mark was required, but there was nothing in the Directive to stipulate that the mark must have been used independently. It followed that if the mark had come through use to denote the goods of a given applicant, then it was immaterial whether the use in question was independent of other trade marks.

    Nestlé’s use of HAVE A BREAK, HAVE A KIT KAT could therefore be considered in an assessment of the acquired distinctiveness of HAVE A BREAK on its own.

     

    Comment

    Although Mars opposed this result and may now lose the case following review of Nestlé’s evidence by the Patent Office, it is hard to believe that it does not on some level welcome this ruling. The decision stands to benefit not only Nestlé, but also Mars and many other consumer products companies.

    It is common practice to employ slogan marks in close conjunction with major brands. Other types of trade marks, such as get-up, typefaces and product and packaging shape are rarely used without other supporting trade mark matter. Major consumer product companies invest substantial sums in developing these marks, and find it hardest to protect those, such as product and packaging shape, which are at the cutting edge. These are the marks in which the greatest investment is often made and evidence of acquired distinctiveness is most often needed.

    If the ECJ had ruled differently and found that only independent use could lead to acquired distinctiveness, the opportunities for protecting such marks based on acquired distinctiveness would have been substantially diminished.

    This practical ruling should be welcomed by businesses and the IP legal world. It will not change the fundamental requirement that a mark which has acquired distinctiveness must be shown to be recognized as a trade mark on its own. However, it will free national courts and registries to apply common sense in the assessment of acquired distinctiveness of marks which have been, or can only practically be, used in conjunction with other marks. It is a welcome break, indeed.