Nestlé wins fight over tube-shaped marks

Liechtenstein

In Société des Produits Nestlé SA v Masterfoods AG (Case 4 Cg 2001.383), the Supreme Court of Liechtenstein has upheld an action by Nestlé seeking to cancel Masterfoods' registration of a tube shape as a trademark. The High Court had rejected Nestlé's action, stating that Nestlé's own tube-shaped mark was not a valid basis for a cancellation action, on the grounds that the mark (i) lacked distinctiveness, and (ii) had never been used in the precise form registered as it had always been used in conjunction with other elements.

Masterfoods registered a tube shape as a trademark for the packaging of confectionery and chocolate products. Nestlé filed a cancellation suit on the basis of its own registration of a similar shape for the same type of products.

The Liechtenstein High Court dismissed the action. It found that Nestlé's shape mark, which did not bear any ornamentation, should not have been registered as it lacked distinctiveness. In obiter, the court stated that Nestlé's naked tube shape could not have acquired distinctiveness through use since Nestlé did not sell its products in plain tubes, but in tubes bearing ornamentation and at least one figurative word mark.

The same reasoning was used by the Office for Harmonization in the Internal Market in Société des Produits Nestlé v Mars Inc concerning an opposition against Mars's application to register a naked tube shape as a Community trademark:

"The flaw in the opponent's argument is that no evidence has been brought to bear showing that the naked tube shape [...] has ever been used as a trademark on the market."

However, the Liechtenstein Supreme Court overturned the decision on appeal. It followed the Swiss Federal Supreme Court in its narrow interpretation of the grounds of refusal in the Lego decision (see Lego Case remanded to determine nature of blocks' shape). The Liechtenstein Supreme Court reasoned that since the Nestlé Case concerned the shape of the packaging and not of the goods themselves, protection could not be refused on the basis that the shape resulted from the nature of the goods themselves. It also found that refusing protection on the grounds that a shape is "technically essential" is restricted to cases where there is no alternative shape - hereby deviating from the European Court of Justice's Linde decision (see Law on three-dimensional marks knocked into shape by ECJ). Although the Liechtenstein Supreme Court held that the naked tube was not originally distinctive, it found that a market survey proved that the mark had acquired distinctiveness. The fact that Nestlé did not sell its products in plain tubes was not decisive.

For a discussion of other cases involving Nestlé and Masterfoods, see Nestlé is refused exclusive rights in tube shape for confectionery and Nestlé outsmarted in Smarties ruling.

Peter Heinrich, Lenz & Staehelin, Zurich

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