Case No. IP-2015-000146

19.There is an aspect of considering the validity of a trade mark under art.7(1)(c) or, for that matter, under art.7(1)(b) or (d), which is important in this case.20.The date for assessing validity under subparagraphs (1)(b) to (d) of art.7 is the date of filing the application for the Trade Mark, 9 August 2013, see Alcon Inc v OHIM, C-192/03, EU:C:2004:587; [2005] ETMR 69, at [40].21.Art.7(1)(b) to (d) are all subject to art.7(3). The date for assessing acquired distinctiveness under art.7(3) is again the date of filing the application for the trade mark in question, see Imagination Technologies Ltd v OHIM, C-572/07 P, EU:2009:362; [2010] ETMR 19, at [41]-[60] and Oberbank AG v Deutscher Sparkassen- und Giroverband eV, Joined Cases C-217/13 and 218/13, EU:C:2014:2012, at [57].22.I take first art.7(1)(b). The test for inherent distinctiveness under that paragraph and acquired distinctiveness under art.7(3) is the same. The CJEU set out the test under art.7(1)(b) in Freixenet SA v OHIM, Joined Cases C-344/10 P and C-345/10 P, EU:C:2011:680, at [42]:“According to settled case-law, for a trade mark to possess distinctive character for the purposes of Article 7(1)(b) of Regulation No 40/94 it must serve to identify the goods in respect of which registration is sought as originating from a particular undertaking, and thus to distinguish those goods from those of other undertakings (see, in particular, Joined Cases C-456/01 P and C-457/01 P Henkel v OHIM [2004] ECR I-5089, paragraph 34; Case C-136/02 P Mag Instrument v OHIM [2004] ECR I-9165, paragraph 29, and Case C-238/06 P Develey v OHIM [2007] ECR I-9375, paragraph 79).”23.As will be discussed below, the test for acquired distinctiveness is also whether the trade mark serves to identify the goods or services in respect of which registration is sought (or in respect of which it is registered) as originating from a single undertaking.24.Thus, there is only one difference between inherent and acquired distinctiveness: it is that the assessment under art.7(3) permits and requires that the use of the mark in question up to the application date (no further) be taken into account. It follows that use made of the trade mark must be irrelevant to distinctiveness under art.7(1)(b) taken alone.25.This is conceptually easy because art.7(1)(b) is all about whether the trade mark is of itself distinctive. The point is less intuitive in the context of art.7(1)(c) and (d), particularly art.7(1)(d). For instance, it could be said that a trade mark could only ever have become customary in the current language of a trade in consequence of its use, (though not as a trade mark). There is no need for me to pursue this. In my view, at the very least, where it is possible to construe paragraphs (1)(b) to (d) in such a way as to give effect to art.7(3), that is the construction to be preferred. Specifically, if the question whether a trade mark designates a geographical origin were to be assessed by reference to matters which included the effect generated by use of the mark up to the application date, art.7(3) could add nothing. It is therefore solely the inherent character of a mark which can be considered in relation to designation of geographical origin within the meaning of art.7(1)(c).26.An exception to the foregoing principle – that the effect of use of a trade mark must be ignored when assessing the prohibitions to its registration under art.7(1)(b), (c) and (d) – may apply where the use of the trade mark in question has been in relation to goods or services other than those in respect of which the trade mark is registered, or is sought to be registered, see Audi AG v OHIM, C-398/08 P, EU:C:2010:29; [2010] FSR 24. That does not arise on the facts of this case. Acquired distinctive character under art.7(3) 27.Art.7(3) provides:“3. Paragraph 1(b), (c) and (d) shall not apply if the trade mark has become distinctive in relation to the goods or services for which registration is requested in consequence of the use which has been made of it.”28.In Windsurfing (cited above) the ECJ considered whether a trade mark consisting of the name of a lake in Bavaria had acquired distinctiveness:“[47] It follows that a geographical name may be registered as a trade mark if, following the use which has been made of it, it has come to identify the product in respect of which registration is applied for as originating from a particular undertaking and thus to distinguish that product from goods of other undertakings. Where that is the case, the geographical designation has gained a new significance and its connotation, no longer purely descriptive, justifies its registration as a trade mark.[48] Windsurfing Chiemsee and the Commission are therefore right to assert that Article 3(3) does not permit any differentiation as regards distinctiveness by reference to the perceived importance of keeping the geographical name available for use by other undertakings.[49] In determining whether a mark has acquired distinctive character following the use made of it, the competent authority must make an overall assessment of the evidence that the mark has come to identify the product concerned as originating from a particular undertaking, and thus to distinguish that product from goods of other undertakings.[50] In that connection, regard must be had in particular to the specific nature of the geographical name in question. Indeed, where a geographical name is very well known, it can acquire distinctive character under Article 3(3) of the Directive only if there has been long-standing and intensive use of the mark by the undertaking applying for registration. A fortiori, where a name is already familiar as an indication of geographical origin in relation to a certain category of goods, an undertaking applying for registration of the name in respect of goods in that category must show that the use of the mark - both long-standing and intensive - is particularly well established.[51] In assessing the distinctive character of a mark in respect of which registration has been applied for, the following may also be taken into account: the market share held by the mark; how intensive, geographically widespread and long-standing use of the mark has been; the amount invested by the undertaking in promoting the mark; the proportion of the relevant class of persons who, because of the mark, identify goods as originating from a particular undertaking; and statements from chambers of commerce and industry or other trade and professional associations.[52] If, on the basis of those factors, the competent authority finds that the relevant class of persons, or at least a significant proportion thereof, identify goods as originating from a particular undertaking because of the trade mark, it must hold that the requirement for registering the mark laid down in Article 3(3) of the Directive is satisfied. However, the circumstances in which that requirement may be regarded as satisfied cannot be shown to exist solely by reference to general, abstract data such as predetermined percentages.[53] As regards the method to be used to assess the distinctive character of a mark in respect of which registration is applied for, Community law does not preclude the competent authority, where it has particular difficulty in that connection, from having recourse, under the conditions laid down by its own national law, to an opinion poll as guidance for its judgment (see, to that effect, Case C-210/96 Gut Springenheide and Tusky [1998] ECR I-4657, paragraph 37).”29.Broadly, therefore, having made an overall assessment taking into account the matters referred to in paragraphs 50 and 51, the tribunal must assess whether at least a significant proportion of the relevant class of persons identifies goods (or services) as originating from a particular undertaking because of the trade mark. If so, that trade mark will have acquired distinctiveness within the meaning of art.3(3) (or art.7(3) of the Regulation, as the case may be). As a matter of EU law the tribunal may have recourse to a public survey, though only if it has particular difficulty in assessing whether a mark has distinctive character and subject to national law.30.The ECJ returned to art.3(3) in Koninklijke Philips Electronics NV v Remington Consumer Products Ltd, C-299/99, EU:C:2005:432. The Court first reiterated its ruling in Windsurfing. It continued:“[63] Second, the distinctive character of a sign consisting in the shape of a product, even that acquired by the use made of it, must be assessed in the light of the presumed expectations of an average consumer of the category of goods or services in question, who is reasonably well-informed and reasonably observant and circumspect (see, to that effect, the judgment in Case C-210/96 Gut Springenheide and Tusky [1998] ECR I-4657, paragraph 31).[64] Finally, the identification, by the relevant class of persons, of the product as originating from a given undertaking must be as a result of the use of the mark as a trade mark and thus as a result of the nature and effect of it, which make it capable of distinguishing the product concerned from those of other undertakings.”31.Thus, the presumed expectations of the average consumer and the perception of (at least a significant proportion of) the relevant class of persons are two sides of the same coin. They are alternative approaches to the same test for acquired distinctiveness: whether, according to those expectations and that perception, as a result of the use of the trade mark in issue as a trade mark, it is capable of distinguishing relevant products from those of other undertakings. See also Mag Instrument Inc v OHIM, C-136/02 P, EU:C:2004:592; [2005] ETMR 46, at [19].32.The test for acquired distinctiveness set out in Philips was repeated by the Court of Justice of the European Union (“CJEU”) in Société des Produits Nestlé SA v Mars UK Ltd, C-353/03, EU:C:2005:432, at [26]. The CJEU explained what was meant in paragraph 34 of Philips by the requirement that the identification of the product as originating from a particular undertaking must be as a result of the use of the trade mark in question as a trade mark:“[29] The expression ‘use of the mark as a trade mark’ must therefore be understood as referring solely to use of the mark for the purposes of the identification, by the relevant class of persons, of the product or service as originating from a given undertaking.”33.The law on acquired distinctiveness was reviewed recently by the Court of Appeal in Société des Produits Nestlé v Cadbury UK Ltd [2017] EWCA Civ 358. Nestlé had applied to the UK Intellectual Property Office to register the shape of a four-finger chocolate product – the shape of a Kit Kat – as a trade mark. The Hearing Officer held in a decision dated 20 June 2013 that the trade mark was devoid of inherent distinctive character save for cakes and pastries and that it had not acquired distinctive character in relation to any of the other goods in respect of which registration was sought, most relevantly chocolate goods. An appeal was heard by Arnold J ([2014] EWHC 16 (Ch); [2014] FSR 28) who held that the Trade Mark was not inherently distinctive for any of the goods but he sought a preliminary ruling from the CJEU with regard to acquired distinctiveness. The CJEU delivered its judgment on the reference on 16 September 2015 (C-215/14, EU:C:2015:604). The case was then restored before Arnold J who gave a second judgment on 13 January 2016 ([2016] EWHC 50 (Ch); [2016] FSR 19) in which he found that the trade mark had not acquired distinctiveness and so dismissed the appeal from the Hearing Officer. Nestlé appealed further to the Court of Appeal.34.As I have indicated, the appeal raised the question whether a three-dimensional mark consisting of an inherently non-distinctive shape of a Kit Kat had acquired distinctive character. There was a significant complication in that product itself had always been sold in packaging bearing a ‘Kit Kat’ logo, which served as a distinctive badge of origin for the goods. The question was whether the shape of the product, by itself, had also come to serve as a trade mark for the goods and could therefore be registered. The focus of the appeal was thus on matters which do not arise in the present case. However, the Court of Appeal considered more generally what is required to show that a trade mark has acquired distinctiveness through use.35.Before turning to the judgment of the Court of Appeal, I will refer first to certain passages in the judgment of the CJEU. The CJEU confirmed that distinctive character, whether intrinsic or acquired, will be assessed by reference to the perception of the relevant class of persons, which will equate with the view of the average consumer:“[61] That distinctive character must be assessed in relation, on the one hand, to the goods or services covered by that mark and, on the other, to the presumed expectations of the relevant class of persons, that is to say, an average consumer of the category of goods or services in question, who is reasonably well-informed and reasonably observant and circumspect (see, to that effect, judgments in Koninklijke KPN Nederland, C-363/99, EU:C:2004:86, paragraph 34 and the case-law cited therein; Nestlé, C-353/03, EU:C:2005:432, paragraph 25, and Oberbank, C-217/13 and C-218/13, EU:C:2014:2012, paragraph 39).[62] A sign’s distinctive character, which thus constitutes one of the general conditions to be met before that sign can be registered as a trade mark, may be intrinsic, as provided for in Article 3(1)(b) of Directive 2008/95, or may have been acquired by the use made of that sign, as provided for in Article 3(3) of that directive.”36.The CJEU had interpreted (at [58]) the first question referred by Arnold J as asking whether it was sufficient for the applicant for a trade mark to prove that a significant proportion of the relevant class of persons recognise the mark and associate it with the applicant’s goods, or whether the applicant had to go further and prove that the relevant class of persons perceive the goods or services designated exclusively by that mark (i.e. as opposed to any other mark that might be present) as originating from a particular company. The CJEU answered:“[67] Having regard to those considerations, the answer to the first question is that, in order to obtain registration of a trade mark which has acquired a distinctive character following the use which has been made of it within the meaning of Article 3(3) of Directive 2008/95, regardless of whether that use is as part of another registered trade mark or in conjunction with such a mark, the trade mark applicant must prove that the relevant class of persons perceive the goods or services designated exclusively by the mark applied for, as opposed to any other mark which might also be present, as originating from a particular company.”37.If the CJEU’s answer is shorn of the complication of the presence of another trade mark on the goods in question, it was a reiteration of its ruling in Windsurfing and Philips: the relevant class of persons must take the trade mark in suit to mean that the goods or services in respect of which the trade mark is used originate from a single entity. Added, however, was an implied distinction: it is not sufficient if the relevant class of persons recognise the mark and merely associate it with the applicant’s goods.38.In the Court of Appeal Kitchin LJ, Floyd LJ and the Chancellor of the High Court all discussed this distinction, largely in the context of the facts of that case.39.One issue of general application which arose in argument is whether, in order to satisfy the test for distinctiveness set out by the CJEU, it was necessary to show that consumers had relied on the mark in selecting or purchasing the goods or services in question, or that they have used the mark after purchase to verify that they have chosen the right goods or services. In other words, was it necessary to show that the mark had played a part in consumers’ purchasing or alternatively in their post-transactional behaviour? Kitchen LJ (with whom Floyd LJ and the Chancellor agreed) said this (at [84]):“… it is legitimate for a tribunal, when assessing whether the applicant has proved that a significant proportion of the relevant class of persons perceives the relevant goods or services as originating from a particular undertaking because of the sign in question, to consider whether such persons would rely upon the sign as denoting the origin of the goods or services if it were used on its own. Further, if in any case it is shown that consumers have come to rely upon the mark as an indication of origin then this will establish that the mark has acquired distinctiveness.”40.Thus, reliance on a mark as an indication of origin among a significant proportion of the relevant class of persons will establish that the mark has acquired distinctiveness. However, although reliance is relevant, it is not a precondition to establishing distinctiveness:“[98] … I accept that it is not necessary to show the public have relied upon the Trade Mark. Such is clear from the decision of the CJEU. But that does not mean to say that evidence of reliance has no part to play. If an applicant for registration of an inherently non-distinctive mark establishes that, as a result of the use which has been made of it, consumers have come to rely upon it as denoting the origin of the goods to which is has been applied, that will show it has become distinctive.” 41.On the facts the Hearing Officer had been justified in finding that the trade mark had not acquired distinctiveness:“[89] … The high point for Nestlé is his finding that at least half the people surveyed thought that the picture shown to them was a Kit Kat. But in giving their responses they might have had in mind a product coming from the same source as Kit Kat or a product of the Kit Kat type or a product which looked like a Kit Kat. The hearing officer was therefore entitled and indeed bound to consider the results in light of all of the other evidence before him. I am also satisfied he was entitled to conclude as he did that Nestlé had shown recognition and association of the shape with Kit Kat but had failed to prove that the shape (and hence the Trade Mark) had acquired a distinctive character in light of the use which had been made of it.”42.Floyd LJ said this:“[108] If it is the case that consumers have in fact come to rely on the shape as an indicator or trade origin, that would certainly be sufficient for acquired distinctiveness. It is, however, not a necessary precondition that consumers should have in fact so relied, and regarding it as such a precondition could conceivably lead to error. The ultimate question is whether the mark, used on its own, has acquired the ability to demonstrate exclusive origin. It would be unwise to attempt a list of the ways in which this can be demonstrated.”43.The Chancellor agreed with Kitchin and Floyd LJJ, and emphasised that the criterion for establishing the distinctiveness of a trade mark – proving a perception that a trade mark signifies that the goods or services come from a single undertaking – had to be understood in the light of earlier dicta of the CJEU, namely that this perception must arise as a consequence of the use of the mark as a trade mark:“[117] Thus, the perception required by the simple test extracted from paragraph 67 of the CJEU’s decision is a qualified kind of perception. The test in paragraph 67 is that the applicant must prove that the relevant class of persons perceive the goods designated exclusively by the mark applied for as originating from a particular company. The perception that is required is