Lindt hopping mad with ECJ decision in chocolate rabbit case

European Union

In Chocoladefabriken Lindt & Sprüngli AG v Office for Harmonisation in the Internal Market (OHIM) (Case C-98/11 P, May 24 2012), the Court of Justice of the European Union (ECJ) has put an end to Chocoladefabriken Lindt & Sprüngli AG's hopes of securing EU-wide rights for its chocolate rabbit.

Eight years ago Lindt filed a Community trademark (CTM) application for a three-dimensional mark, namely a gold foil-wrapped chocolate rabbit wearing a red ribbon and bell:

In October 2005 OHIM rejected Lindt's application on the basis of Article 7(1)(b) of the Community Trademark Regulation (40/94), stating that none of the elements constituting the shape of the chocolate product (sitting rabbit), the gold foil wrapping or the ribbon and bell - whether taken separately or together - were sufficiently distinctive. It was, the OHIM said, quite normal for companies to manufacture chocolate in the shape of a sitting rabbit, wrap their products in gold foil and/or decorate animals with ribbons and bells. In addition, the evidence of acquired distinctiveness relied upon did not overcome the objection because it related to Germany only (and the objection applied equally across the entire European Union, hence proving distinctiveness in one member state was not sufficient).

This decision was upheld by the Fourth Board of Appeal in June 2008 and then again by the General Court.

Lindt was not satisfied that the right decision had been taken in relation to either the inherent distinctiveness assessment or the evidence of acquired distinctiveness. The two pleas in law alleged that the General Court was wrong:

  1. to find that the shape of a sitting or crouching rabbit together with the use of gold foil for chocolate bunnies and the ribbon and bell around the neck did not depart significantly from the customs of the industry in order to have the requisite distinctive character (following Henkel v OHIM (Joined Cases C-456/01 P and C-457/01 P)); and
  2. to find that the mark needed to have acquired distinctiveness through use in all member states in order to satisfy Article 7(3). That ruling, Lindt said, was incorrect for two reasons:

2.1. The mark was inherently distinctive in 15 of 27 member states so that there was no requirement that it prove acquired distinctiveness for those, only the remainder. Impressive evidence of acquired distinctiveness was proved in three other member states - thus 18 were ticked off. Lindt argued that the mark was therefore either inherently distinctive or had acquired distinctive character in most of the European Union. Lindt's explanation was that over 350 million of the 465 million people in the European Union would perceive the mark as distinctive whether because of the inherently distinctive nature of the mark or as a result of the use made. That translated as over 75% of the EU population.

2.2. It was wrong to base the assessment on registrability - and, specifically, distinctive character - on individual national markets. The question of acquisition of distinctive character should be based on the entire overall population without distinction as to national market so that if a mark of distinctive character is a significant part of the total population of the European Union that should be sufficient to give them protection EU-wide.

The ECJ held that Lindt had failed to establish that the mark had inherent distinctive character in 15 member states so as to prove that distinctiveness needed to be acquired only in relation to the remainder. Distinctiveness through use had therefore to be proved for all of the member states in order to satisfy the test that distinctiveness was acquired through use throughout the European Union, and Lindt had failed to do so.

It would have been surprising - and thrown into question fundamental questions about the unitary nature of the CTM - if the ECJ had not dismissed the appeal.

Whereas it may seem a tough test for a mark to be distinctive in all 27 member states - and this is always very difficult to prove for a mark such as this - this must be the right approach. Why should someone be prevented from using a mark that is entirely descriptive in one member state just because it is not entirely descriptive in the other 26 member states?

It is true that the same distinctiveness test should apply to all types of trademarks. However, this case shows that, when filing for a non-traditional mark, securing a Community-wide right may be difficult because, in practice, it will not be seen as distinctive in any of the member states. This means that the applicant faces a very heavy evidential burden in proving that consumers do in fact perceive such a mark as distinctive in every member state, which is of course a very expensive exercise.

All this means is that the owners of shape or non-traditional marks may choose national registrations over a CTM registration, whether at the point of filing or, in the alternative, by falling back on the conversion procedure if they at least think that they have a fighting chance of securing a CTM registration at the outset.

Harriet Seymour and Mark Holah, Field Fisher Waterhouse, London

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