FLIP-TOP not distinctive of Philip Morris, rules Federal Court of Canada

Authors: Emir Crowne and Adrian Werkowski (University of Windsor, Faculty of Law)

Philip Morris Products SA v Imperial Tobacco Canada Ltd, 2014 FC 1237, Federal Court of Canada, 18 December 2014

Journal of Intellectual Property Law & Practice (2015) doi: 10.1093/jiplp/jpv072, first published online: April 18, 2015

The Federal Court of Canada held that the term ‘FLIP-TOP’ was not distinctive of Philip Morris as it described a type of packaging and was not necessarily indicative of source.

Legal context

Section 38 of Canada's Trade-mark Act, R.S.C., 1985, c. T-13 sets out the grounds on which a proposed mark may be opposed. Subsection 38(2)(d) provides that a mark may be opposed where it is ‘not distinctive’.

Facts

Philip Morris applied to register ‘FLIP-TOP’ as a trade mark for tobacco and a variety of tobacco products. This mark had not yet been used and the Trade-marks Opposition Board found that it lacked distinctiveness because it described a type of packaging commonly used for tobacco products.

Philip Morris appealed the decision.

Analysis

A trade mark's lack of distinctiveness is not one of the grounds under which the Registrar may refuse an application (2014 FC 1237 at para 51 (discussing subsection 37(1) of the Act)). It is only after advertisement, and during the opposition stage, that non-distinctiveness may be raised under subsection 38(1)(d).

‘FLIP-TOP’ is a commonly used word in the tobacco industry and ‘is a defined word that refers to a container that has a lid that is easily flipped open’. By definition then, as a proposed mark the term lacked the requisite distinctiveness for the public to necessarily associate it with Philip Morris's products.

Although descriptiveness is related to distinctiveness, the two concepts were explicitly distinguished by the Court. At para 81 Justice Bédard emphasized that her analysis was confined to that of distinctiveness only:

I do not find it necessary to determine whether the term ‘flip-top’ is descriptive of an intrinsic quality of the wares themselves such as a feature, trait or characteristic. In the present context, the key consideration is not whether the mark describes an aspect of the product that is necessarily ‘intrinsic’, but whether the term is capable of identifying the source of the wares in light of the overall product and market.

Practical significance

Source identification is the main purpose of a trade mark. Proposed marks that are themselves a common term will necessarily lack the requisite distinctiveness for registrability. Allowing such marks to acquire distinctiveness, and a secondary meaning, through concerted marketing efforts and actual use, may have been the wiser course of action in this case, instead of having the mark snuffed out at first instance.

No fairy tale ending for Neuschwanstein trade mark

Author: Birgit Clark (Berwin Leighton Paisner LLP)

German Federal Patent Court (Bundespatentgericht), case reference: 25 W (pat) 182/09, 4 February 2011

Journal of Intellectual Property Law & Practice (2011), doi: 10.1093/jiplp/jpr080, first published online: June 1, 2011

The German Federal Patent Court decided that the mark Neuschwanstein clearly and unambiguously referred to the famous castle of the same name and could not therefore be registered as a trade mark due to an inherent lack of distinctiveness regardless of the goods or services for which registration is sought.

Legal context

Like the corresponding provisions of the Community Trade Mark Regulation, §8(2) No. 1 of the German Trade Mark Act (MarkenG) provides that a trade mark which is devoid of any distinctive character shall not be registered. §8(2) No. 2 MarkenG stipulates that trade marks ‘which consist exclusively of signs or indications which may serve, in trade, to designate the kind, quality, quantity, intended purpose, value, geographical origin, the time of production of goods or of rendering of services, or other characteristics of goods or services’ will equally not qualify for registration. §50(1) MarkenG states that the registration of a trade mark may be declared invalid on the ground that the trade mark was registered in breach of §8 MarkenG. §50(2) MarkenG further stipulates that, where a trade mark was registered in breach of §8(2) No. 1 or No. 2 MarkenG, the mark may only be declared invalid provided the ground for refusal still exists at the point of the invalidity decision and provided that the application for invalidity was filed within ten years from the date of registration of the mark.

Facts

The famous German castle Neuschwanstein is one several castles and palaces that were commissioned by the ‘fairy tale king’ King Ludwig II of Bavaria in the mid-nineteenth century. Gracefully situated on a hill near the city of Füssen in Bavaria, neo-gothic Neuschwanstein was intended to be King Ludwig's personal refuge. Sadly, however, the king died under mysterious circumstances not long after the castle was completed. Neuschwanstein has since featured in various films and also famously inspired Disney's Sleeping Beauty Castle. With such a romantic history, it is no surprise that the castle has become a major tourist attraction, with more than 1.3 million people visiting the castle annually.

The Bavarian Castle Department, a division of the Bavarian state government, was concerned about the quality of the souvenir trade connected to the castle and, in an attempt to regulate the souvenir industry in 2005, registered the word mark Neuschwanstein at the German Patent and Trade Mark Office (DPMA) for a broad specification of goods and services in classes 4, 5, 15, 24–27, 29, 30, 32–34, 36, 38, 39, 43 and 44. The German Federal Association Bundesverband Souvenir Geschenke Ehrenpreise e.V. (BSGE), a trade network of souvenir producers, wholesalers, and retailers objected to this registration and filed an invalidity application against the mark at the DPMA, inter alia, arguing that the trade mark was akin to ‘censorship’ of the Neuschwanstein souvenir trade.

Analysis

The DPMA decided in the BSGE's favour and cancelled the mark, holding that the mark Neuschwanstein was a commonly used, non-distinctive term which was incapable of indicating the trade origin of the goods and services marketed under the sign, §8(2) No. 1 German Trade Marks Act (MarkenG). Neuschwanstein was not only a symbol for stylish ambience but was also part of Bavaria's cultural heritage. In view of the DPMA, consumers would therefore regard the mark Neuschwanstein as a mere advertising message and see it as a clear reference to the world famous castle.

Upon appeal by the Bavarian Castle Department, the 25th Senate of the German Federal Patent Court upheld the DPMA's decision, deciding that the term Neuschwanstein clearly and unambiguously referred to the castle of the same name and could consequently not be registered as a trade mark due to a lack of distinctiveness under §8(2) No. 1 MarkenG regardless of the goods or services for which registration was sought. The Court added that the mark was also descriptive of some of the goods and services covered under §8(2) No. 2 MarkenG.

In its decision of 4 February 2011, the Court first assessed descriptiveness of the mark under §8(2) No. 2 MarkenG. With regard to services such as ‘travel services; catering/hospitality services and accommodation services’, the Court found that the average consumer would interpret the mark Neuschwanstein as descriptive of the characteristics of the services rendered, their intended purpose as well as their geographical origin. The Court explained that it was the particular purpose that provision to exclude descriptive signs from trade mark protection since their monopolization was contrary to the justified interest of the general public to be able to use descriptive terms freely. The Court stressed that a potential effect on the freedom to compete was enough in this regard, provided it was reasonable to assume that the mark would be seen as descriptive by the normally informed and attentive consumer in the future. The Court found that the sign Neuschwanstein ‘unambiguously and exclusively’ referred to the castle of the same name. The Court considered that ‘travel services; catering services and accommodation services’ were services that targeted the average consumer, being typically rendered in connection with the visit of a tourist attraction because visitors had to travel to get to the castle and would often eat and/or stay in a nearby hotel. Consequently, the mark Neuschwanstein would be regarded as directly descriptive of such services that were rendered near or in connection with Neuschwanstein castle.

Turning to the question of distinctiveness, the Court held that Neuschwanstein also lacked the necessary distinctiveness under §8(2) No. 1 MarkenG to qualify for trade mark registration. The Court stressed that names of famous tourist attractions, such as Neuschwanstein, were not only non-distinctive for goods and services that are usually offered in the proximity or in the context of a tourist attraction but for all possible goods and services. Moreover, even marks that did not directly refer to the goods and services covered could nonetheless be non-distinctive provided there was a close descriptive connection between the mark and the actual product. Furthermore, the judges explained that commonly used words or idioms of the German language could also be non-distinctive in this sense and so be unsuitable to serve as indication of trade origin, even if they did not directly describe a product, provided that they were usually understood in this way; for example, due to use in the media or in advertisements. Like high-profile events, such as the Football World Cup, the names of famous buildings should equally not be monopolized.

The judges emphasized that Neuschwanstein was not only a major tourist attraction with over 1.3 million visitors per year but also a world famous landmark of particular cultural, political, and historical importance: such cultural sights, being part of the world cultural heritage, were common property belonging to the general public and, like the names of famous historical personalities, should also not be monopolized or commercialized by trade mark laws. Moreover, consumers would not interpret this name as a reference to a particular trade source or a specific undertaking but would always regard it as a reference to the castle. This assessment was not affected by the question of actual ownership of the building.

Applying these guidelines, the Court found Neuschwanstein was non-distinctive not only for goods and services that were typically rendered in close proximity of a tourist attractions (such as souvenirs, clothing, tobacco), products that were often additionally consumed by tourists (such as pharmaceutical goods, coffee, confectionery, and other goods covered by classes 29, 30, 32, and 33), not to mention supplemental services which were often required by tourists (such as financial services, currency exchange, and transport services) but also for those goods and services that that were not usually rendered in close context to a tourist sight (such as carpets, insurance services, real estate services).

All the same, the judges acknowledged that, in order not to overly limit the availability of names of famous buildings as trade marks, this approach had to be applied strictly and must be limited to buildings that were cultural goods of outstanding importance. Whether this was the case had to be specifically determined in each individual case. Comparing Neuschwanstein with other famous sights, such as the Colosseum in Rome, the Taj Mahal, and the Eiffel tower, the Court concluded that Neuschwanstein was not only a globally known symbol of the German age of romanticism and a significant part of Germany's national cultural heritage but also of political and architectural importance so that its name could not be monopolized by one proprietor.

The Court dismissed the Bavarian Castle Department's argument that the sign Neuschwanstein could be used as a trade mark by affixing it to labels or directly on actual products ‘in a self evident way of practical significance’ to render it distinctive in a trade mark sense. Referring to precedents by the German Federal Supreme Court in the DDR-Logo (I ZR 92/08 of 14 January 2010), SWISS ARMY (I ZB 35/98 of 21 September 2000), and TOOOR! (I ZB 115/08 of 24 June 2010) cases, the Court stressed that a mark that inherently lacked distinctiveness could not achieve distinctiveness by simply affixing it to the packaging of goods. Allowing otherwise, the Court explained, would not only bereave Article 8(2) No. 1 and No. 2 MarkenG of all meaning but would also be contrary to European trade mark law. The judges stressed that any assessment of the distinctiveness and/or descriptiveness of a mark always had to be conducted in the abstract, solely with regard to the meaning of a mark in light of the goods and services covered but unrelated to its actual use on the goods.

Finally, the judges made short shrift with the Bavarian Castle Department's contention that comparable trade marks for the castles ‘BURG ELTZ’, ‘NYMPHENBURG’, ‘LINDERHOF’, and ‘SANSSOUCI’, stating that each case had to be judged on its own merits and that earlier registrations were not binding but could only ever have persuasive importance. In particular, the decision as to whether a trade mark was registrable was not open to discretion.

Given that several aspects of this decision were of fundamental importance, the Federal Patent Court permitted a further (partial) appeal to the German Federal Supreme Court (Bundesgerichtshof).

Practical significance

According to German media reports, the Bavarian Castle Department was very disappointed by the cancellation of its Neuschwanstein trade mark, stressing that it was not ‘after the souvenir and snow globe traders’ but merely wanted to protect the Neuschwanstein brand from ‘crude abuse’. In the view of the Bavarian Castle Department certain products, such as schnapps or lingerie, ‘were not reconcilable with the dignity of the castle’. While this view is understandable, the Bavarian Castle Department does have further legal options to prevent abuse of the sign Neuschwanstein under German law. This was also expressly mentioned by the Court which pointed out that alternative routes, such as claims under name right provisions under §12 German Civil Code, under the law of delict under §826 German Civil Code as well as unfair competition law claims under §§1, 3 German Unfair Competition Act were not barred by this judgment.

Following the Federal Patent Court's Neuschwanstein decision, names of culturally important buildings and personalites will be more difficult to protect as German trade marks. It should be emphasized in this context that the Court decided that Neuschwanstein was not distinctive enough for trade mark registration per se unrelated to the goods and services covered. How this decision will affect other existing German trade mark registrations for famous buildings, such as the ones cited by the claimant in the case, is unclear, in particular if the German Federal Supreme Court were to confirm this decision on appeal.

Holy Smokes! British American Tobacco defeats trade mark challenge in the Commonwealth Caribbean

Author: Eddy D. Ventose (Faculty of Law, Cave Hill Campus, University of the West Indies, Barbados)

Philip Morris Products S.A. v British American Tobacco (Brands) Limited, Civil Appeal No. 1 of 2009, In the Matter of the Trade Marks Act, Cap 257 Laws of Belize, Revised Edition 2000

Journal of Intellectual Property Law & Practice (2010), doi: 10.1093/jiplp/jpq185, First published online 16 December 2010

Philip Morris (PM) lost its challenge in the Supreme Court of Belize to the application for registration by British American Tobacco (BAT) in Belize of its cigarette label EMBASSY as a trade mark under the Trade Marks Act, Cap 257, Laws of Belize (BTMA).

Legal context

The first question for the Supreme Court of Belize was whether the MARLBORO trade mark owned by PM was similar to BAT's EMBASSY trade mark, which was being registered for goods identical or similar to those in respect of which MARLBORO was protected, and there existed a likelihood of confusion on the part of the public, which included a likelihood of association with the MARLBORO trade mark, contrary to section 37(2)(b) BTMA (section 5(2) of the UK Trade Marks Act, 1994 (TMA)/Article 4(1)(b) of the Trade Mark Directive 1998. The second question was whether the MARLBORO trademark was a mark with a reputation which, by section 61 BTMA, was protected under Article 6 bis of the Paris Convention for the Protection of Industrial Property. A third question considered was whether MARLBORO was protected under section 37(3) BTMA, which provides that a trade mark which is (a) identical or similar to an earlier trade mark and (b) is to be registered for goods and services which are not similar to those for which the earlier mark is protected, shall not be registered if, or to the extent that, the earlier trade mark has a reputation in Belize and the use of the later mark without due cause would take unfair advantage of, or be detrimental to, the distinctive character or the repute of the earlier mark (see section 5(3) TMA and Article 4(4)(a) Directive).

Facts and analysis

BAT applied to the Belize Intellectual Property Office (BIPO) for registration of its cigarette label EMBASSY as a trade mark. This was opposed by PM, who argued that the EMBASSY trade mark was substantially identical to or deceptively similar to its registered trade mark and the goods in respect of which the BAT application was made were identical or similar to those for which its MARLBORO mark was protected. PM also argued that its mark had acquired a reputation in Belize and that the use of the EMBASSY trade mark was confusingly similar because a similar design to its MARLBORO mark appeared at the bottom of the BAT mark. BAT claimed that its trade mark was not identical with or similar to PM's mark and as such was not likely to deceive or cause confusion in Belize.

Notwithstanding its concession that the MARLBORO mark might have acquired a reputation in Belize, BAT argued that both marks have co-existed peacefully in many markets around the world. The Registrar rejected the opposition on the basis that, while the goods were identical, the marks were not similar and there was thus no likelihood of confusion. PM appealed to the Supreme Court on the basis that, having accepted that PM's mark was a well-known mark under the Paris Convention, the Registrar should have considered the legal implications of that added protection which arose by reason of section 37(3) BTMA and section 61(2) BTMA (which incorporated Paris Convention protection for marks with a reputation).

The decision


Chief Justice Conteh accepted that, given the finding of the Registrar that the goods of the parties, such as cigarettes and cigars, were identical, there might be no need for the Registrar to refer to section 37(3) BTMA which dealt with identical or similar marks on dissimilar goods and services. He pointed out that ‘this was a limited view by the Registrar, given the admitted reputation of Philip Morris's trade mark. He ought to have considered sub-section (3) of the Act’. I am uncertain why this was necessary: a finding that goods are identical precludes examination of section 37(3) BTMA, which refers to dissimilar goods only. Conteh CJ continued that the Registrar should have taken into account the distinctive character of the MARLBORO trade mark and its admitted reputation when determining whether the similarity or identity between PM's goods (cigarettes etc) in respect of its earlier trade mark and those goods covered by BAT's (cigarettes) was sufficient to give rise to a likelihood of confusion. This is startling since the Registrar referred to Case C-251/95 Sabel BV v Puma AG for the view that in assessing the similarity of trade marks, the average consumer usually regarded a trade mark as a whole and does not conduct a detailed analysis of it; in conducting an assessment of the visual, aural and conceptual similarities of the trade marks, reference must be made to the overall impressions created by the trade marks while taking note of their distinctive and dominant components. Admittedly, the Registrar did not make mention of the reputation of the MARLBORO trade mark, but this does not undermine his firm conclusion on the facts that the goods in question were identical.

Conteh CJ claimed that section 37(3) BTMA was aimed at preventing dilution of marks with a reputation even where the goods and services to which the earlier mark and the proposed mark for registration were not similar: it enabled an owner of a trade mark in Belize to raise as a relative ground for refusing the registration of another trade mark that was identical or similar to its trade mark for goods and services that are dissimilar, but only where its registered trade mark had acquired a reputation. Citing the decision of the Court of Justice of the European Union in Case C-292/00 Zino Davidoff v Gofkid, Conteh CJ claimed that the ‘additional’ protection afforded by section 37(3) was against dilution of an earlier trade mark even where the goods and services for which the earlier trade mark and the later trade mark were identical (and, presumably, similar too). Thus, to avail of this ‘additional’ (anti-dilution) protection, the proposed trade mark had to be identical with or similar to the earlier trade mark which had a reputation in Belize.

Conteh CJ also claimed that Article 6 bis of the Paris Convention protected well known trade marks from later trade marks which constituted a reproduction, imitation or translation likely to create confusion with that earlier well known trade mark. In doing so he rejected BAT's contention that the protection afforded by Article 6 bis of the Paris Convention applied only to marks that had not yet been registered under the BTMA but which enjoyed significant reputation outside Belize. That approach was too limited and failed to appreciate the breadth of protection that Article 6 bis of the Paris Convention afforded. He claimed that the owner of a mark with a reputation can gain protection under sections 37(1) and (2) BTMA and even under subsection (3) if its conditions were satisfied: the ‘additional’ protection would also extend to that which obtained under Article 6 bis. Conteh CJ accepted that the rationale for this protective regime under these sections was to protect against confusion in the minds of consumers in relation to goods and services covered by an earlier mark such as to lead them to think that those goods and services were the same as those to which the later mark related or that they had a common design.

Would the use of the EMBASSY trade mark constitute a reduction, an imitation or a translation likely to create confusion with MARLBORO, the well-known trade mark? Conteh CJ accepted the Registrar's finding that the respective goods were identical and, having examined the affidavits submitted by the parties and comparing the two trade marks, held that the two trade marks were neither identical nor similar: the inverted tail-end of the ribbon in the EMBASSY mark, even if it were to be placed to the very top of its mark, would not ‘bear the slightest resemblance, identity or similarity with a roof that is inverted’. This inverted roof was an important feature of the MARLBORO trade mark. A finding that the marks were similar or identical was important because that finding was ‘no doubt central to the protective regime of trade mark law’ under sections 37(2), 37(3) BTMA and under Article 6 bis of the Paris Convention. The Registrar, applying Sabel v Puma correctly, thus reached the correct on similarity.

Conteh CJ held that the dominant and distinctive component of the MARLBORO mark was the roof device, whereas that of the EMBASSY mark was its horizontal ribbon. Not only was there no likelihood of confusion but the use of the EMBASSY trade mark in Belize would not take unfair advantage of or be detrimental to the distinctive character (the roof device) or repute of the MARLBORO trade mark. Further, given the nature of the goods, the average consumer did not engage in any detailed analysis of their marks at the point of purchase but requested the products by name. Since there was surely a phonetic and aural world of difference between the two marks, they could co-exist in Belize. The judge was fortified in his conclusion because decisions in Australia, Korea and Colombia have reached the same conclusion in similar disputes between the parties.

Practical significance

Conteh CJ's analysis of section 37(2)(b) BTMA is sound, focusing on the global assessment of the likelihood of confusion. According to the ECJ in Sabel BV v Puma AG, a global appreciation of the visual, aural or conceptual similarity of the marks in question must be based on the overall impression given by the marks, bearing in mind, in particular, their distinctive and dominant components. That assessment was still necessary as the court then considered section 37(3) BTMA, even if it applied only to dissimilar goods and services.

Conteh CJ assumed that the jurisprudence of the ECJ applied in Belize, although the BTMA was not expressly based on the TM Directive. However, since the BTMA and the TMA are the same in most respects, they have a similar (or perhaps identical) origin. It is an open question now whether the legislative changes made to the TMA as a result of decisions of the ECJ should also be made in Commonwealth Caribbean countries that have modelled their trade mark legislation on the TMA.

The court also considered the applicability of Article 6 bis of the Paris Convention, which did not first require that both trade marks be identical or similar. However, there was still a requirement that the later mark constitute a reproduction, an imitation or translation likely to create confusion in the minds of the public, so the court was not relieved of the obligation to compare the two trade marks.

Japan's IP High Court finds 3D seashell chocolate bar shape inherently distinctive and registrable without secondary meaning evidence

Authors: John A. Tessensohn and Shusaku Yamamoto (Shusaku Yamamoto, Osaka)

Citation: Journal of Intellectual Property Law & Practice 2009 4(7):461-463; doi:10.1093/jiplp/jpp078

Chocolaterie Guylian NV v Commissioner of Japan Patent Office, Case No. H-19 (gyo-ye) No. 10293, 30 June 2008, Intellectual Property High Court of Japan (IPHCJ)

This decision is a significant pro-trade mark development, being the first time that an appellate Japanese court has held that a 3D shape was inherently distinctive and registrable, outlining the distinctiveness criteria which will control future 3D trade mark examinations.

The IPHCJ revoked the Japanese Patent Office (JPO) Board of Appeals' non-distinctiveness decision and held that the 3D shape of a seashell-featured chocolate bar was inherently registrable, the JPO having failed to discharge its evidentiary burden to support its non-distinctiveness rejection.

Facts

Chocolaterie Guylian, the Belgian chocolatier known for its famous Guylian brand, those ubiquitous seashell-shaped chocolates found at duty free shops in most international airports, filed an International Registration 803104 to register an application for a 3D trade mark (consisting of four shell-shaped chocolates, shown below) for ‘chocolate and pralines’ in class 30.

The JPO rejected the application as lacking distinctiveness. Guylian appealed, but the JPO Appeal Board dismissed Guylian's appeal, maintaining that the 3D mark was unregistrable on non-distinctiveness grounds under section 3 of Japan's Trade Mark Law since it consisted ‘solely of a mark indicating, in a common manner, the quality, efficacy, quantity, shape of goods ...’ . The JPO Appeal Board found that it was not inherently distinctive; nor had the 3D mark acquired distinctiveness. Guylian appealed to the IPHCJ, which has exclusive supervisory jurisdiction over all JPO Appeal Board decisions.


Analysis

Section 3(1)(iii)
In accordance with the applicable precedent of Supreme Court decision Otsuka Pharmaceutical v Sankodo, Case No. Showa 53 (gyo-tsu) 129 of 10 April 1979, defining the meaning of section 3(1)(iii) of the Trade Mark Act, the IPHCJ understood the ‘inherently unregistrable trade marks’ provided for in this provision as comprising just two types of unregistrable marks:

Category 1: marks not suitable for monopoly: Marks that are not suitable for a particular party to enjoy an exclusive right to use since any party may feel necessary to use them as appropriate mark in trading; and

Category 2: marks lacking the ability to distinguish: Marks that are generally used and, in most cases, cannot function to identify a source due to their lack of distinctiveness.

In light of the Supreme Court precedent, the IPHCJ felt that the fundamental issue was whether the configuration of the seashell chocolate belonged in either of those disqualifying categories.
The IPHCJ found that the seashell chocolate bar consists of the following three elements in combination:

the rectangular chocolate bar is divided by straight grooves into four consecutive square blocks;

on each block, there is an object representing a prawn, a fan-shaped shell, a sea-horse, or a blue mussel, in this order and

each shellfish is coloured in a marble-like pattern.

The JPO submitted evidence that several other producers had sold the following products: (i) chocolates in the form of a plain bar or rectangular plate with straight grooves dividing the bar to form several consecutive blocks (a common chocolate bar type); (ii) chocolates in the shape of a leaf, nut, prawn, seashell, sea-horse, etc. (a common 3D type); (iii) chocolates composed of circular, oval, or rectangular base with a piece(s) in the shape of a leaf, fruit mounted thereon (a common decorated 3D type), and (iv) chocolates composed of a bar having crossing grooves to form square blocks on its surface with a hat-shaped 3D piece mounted on each block.
Nonetheless, the IPHCJ found that the appellant's 3D configuration was different from these commonplace products:

This three-dimensional shape of chocolate bar is distinct and unique in the sense that no evidence presented by the parties shows the existence of any other similar shapes or configurations in terms of the choice of the four species of shellfish and the three-dimensionally modelled designs thereof, the sequential arrangement thereof, and also the coloured marble-like pattern.

Having held that the Seashell Bar configuration did not fall within scope of the Category 1 unregistrability criteria, the IPHCJ then considered whether the chocolate bar should be regarded as a mark within Category 2. On the basis of the same descriptive analysis, the IPHCJ opined as follows:

The overall impression given by the combined factors (a)–(c) is so distinctive as compared with others that general consumers may use it as an identifier when they make a decision as to which chocolate to buy or not to buy on the next occasion of purchase. The methodological way of arranging shellfish, etc. as used in the plaintiff's chocolate bar would, as the JPO argues, not be original. However, the configuration of the chocolate bar with the actual and material combination of the said elements defined as above is found to be original, novel and distinctive, and it is assumed that this level of distinctiveness would enable the general public, having eaten the Seashell Bar, to distinguish it from others both by the taste they had experienced, and by its novel shape.

The IPHCJ thus held that the present trade mark composed of a Seashell Bar configuration was inherently registrable as a Category 2 mark.

In response to the defendant's argument that only unusual shapes, unrelated to the function or aesthetic features of a product, have inherent distinctiveness, the IPHCJ specifically added: (i) as the inherent value of products indeed resides with their functions and aesthetic features, it is scarcely possible to imagine the actual existence of such a shape or configuration of product that could meet the criteria argued by the JPO and (ii) such an argument is considered to be an excessively abstract position and unreasonably frustrates the rationale for the legislation covering 3D trade mark registration.

The IPHCJ added that, although a manufacturer chooses the shape of a product mainly on the basis of function and visual attractiveness, it is natural that the shape simpliciter plays a role when a consumer is choosing a product and it is a given that the manufacturer has this in mind when creating a product. Thus, it is not appropriate to apply a blanket per se rule that a shape trade mark is always non-distinctive simply because it is a feature of the product, as the JPO had done in this instance.

The IPHCJ rejected the JPO's arguments that a 3D mark consisting solely of the shape of the product will lack distinctiveness, if it is recognized as generally suitable for use as a distinctive shape of the product.

Practical significance

The IPHCJ will register the 3D shape trade mark so long as that mark is taken by consumers to be an indicator of commercial origin and possesses inherent distinctiveness. The IPHCJ Chocolate Seashell decision will make it easier and less expensive to register inherently registrable 3D marks or configurations in Japan.

Under the Trade mark Examination Manual of the JPO, marks ‘consisting exclusively in the shape of goods’ are generally held to be perceived by consumers to be merely ‘within the scope of the shape of the designated goods (including the shape of their packaging), or the shape of an article used in provision of the designated services’ or to be composed exclusively of ‘the common shape of a building, where the designated services concern immovables, e.g., services in the building- or construction industry’.

The JPO declined to register 3D marks even if their ‘shapes of products, which are substantially different from the usual shapes of the kind of goods found on the market and products, which embody decorative elements, as well as products which are new and unusual or characteristic in appearance. Such shapes will be held to be within the range of shapes which might be adopted by competitors in the future’.

The IPHCJ had little sympathy with the JPO's overly restrictive 3D examination policy, which broadly and repeatedly held many 3D shapes to be unregistrable; that exclusionary rule was generously interpreted, resulting in the blanket exclusion of whole categories of 3D marks.

As the JPO did not pursue an appeal of the IPHCJ decision to the Supreme Court of Japan, the IPHCJ decision is now final and conclusive. However, the ruling's long-term impact on the JPO notoriously difficult and rigid 3D trade mark examination guidelines remain to be seen. It is hoped that the Chocolaterie Guylian N.V. v Commissioner of Japan Patent Office 3D trade mark IPHCJ decision will herald a more sympathetic trade mark prosecution environment for brand owners seeking to register their 3D shape marks in the world's second-largest free market economy.