Trademark

Choco Wars: The Trademark Menace- Part I


In this two part blog post Prateek Surisetti, our Spicy IP Fellowship applicant, discusses whether  companies can trademark colours.

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In this two part post, I will discuss the problems with allowing companies to trademark colours with very wide limits of usage through an analysis of one of the legal battles fought between the two chocolate heavy weights: Nestle and Cadbury.

Essentially, Cadbury wished to register a trademark for the colour Pantone2685C (Dairy Milk’s Purple), but Nestle opposed it. Finally in 2013, after 10 years of litigation, the Court of Appeals held in favour of Nestle and barred Cadbury from registering the mentioned shade of purple. But it is to be noted that the court did not invalidate registration of colour trademarks per se, but dismissed Cadbury’s claim on grounds of attempting to register multiple formulations.  I will be using the case as a base for entering into broader discussions surrounding thresholds of precision and objectivity required of trademark applications.

Facts

Cadbury’s application for registering Pantone2685C consisted of two significant descriptive elements. It contained:

  • the colour code (Pantone2685C) and
  • the verbal description: “applied to the whole visible surface, or being the predominant colour applied to the whole visible surface”.

It is the verbal description that is of significance to our discussion. But first, prior to discussing the nitty gritties of the case, let me acquaint you with the case law.

Case Review

Primarily, four cases were analyzed. Brief summaries of the two significant ones are below:

The Libertel Case (C-104/01 [2003] ECR 1-3793)

A telecommunications company wished to register “orange” as a trademark. The court held that “orange” was too vague and that the requirement of a graphical representation (reliable representation on paper) was not met. The legal consequences of the decision was that pure colours could be registered if the colour mark applied for (a) is “a sign”, (b) is capable of graphical representation and (c) is capable of distinguishing goods of one undertaking from the other. In the current case, the judges held that condition (a) was not fulfilled. I shall discuss this in detail. 

The Sieckmann case (C-273/00 [2002] ECR 1-11754)

Here, the attempt was to register a particular scent as a trademark. The Court finally held that scents could not be registered due to failure of intelligible form of representation. But more importantly, the Court devised the Sieckmann Criteria, which is a set of conditions that a mark must satisfy. For registration, the representation of the mark must be clear, precise, objective, durable, self-contained, easily accessible and intelligible. In the current case, the level of clarity, precision, objectivity and self-containment of the representation was held to be inadequate.

Two other cases were discussed, but I shall weave them into the subsequent discussion as they merely serve to illustrate the principles explicated in Libertel and Sieckmann, rather than establish any new principles.

What the Judges had to say

Before moving any further, let me establish that the primary concern in this case was not whether the public used Pantone 2685C to distinguish between products, but whether the fundamental requirements of a trademark were met by Cadbury’s application. It was only if these requirements were fulfilled, did the court have to look into the mark’s distinctiveness (ability to help public distinguish).

The usage of the word “predominant” (verbal description) in Cadbury’s application was what cost them the trade mark. One of the conditions laid down in Libertel was that the mark should be “asign. Only one single mark could be registered. This was also upheld in the Bundespatentgericht case (C-49/02 [2004] ECR 1-6129), where the application was for registration of a combination of two colours in the abstract (no restriction on manner of usage; infinite formulations). In that case, the court held that the required level of “precision and uniformity” was not achieved. Similarly, in the current case, the court set aside the application because the verbal description encompassed a multitude of possible representations.

Further, predominance could be based on (i) surface area, (ii) positioning of colour on the package and (iii) the extent of mixing with other colours. Therefore, the multiplicity of factors resulted in ambiguity that made the court come to the conclusion that the required level of clarity, precision and uniformity was not achieved by the application.

Please note that I have made two distinct points over here. The first problem is that the verbal description encapsulates too many formulations and is therefore, not “asign. Secondly, the verbal description is unclear as to what it constitutes. Both these problems can exist independent of each other and I shall show how this could happen when I get to the 50% analysis a little later further down.

Lastly, I shall discuss one of Cadbury’s arguments which I feel is a rather fruitful area for analysis. In the Bundespatentgericht case, the court held that a combination of colours in the abstract was not registrable. This implies that spatial delimitation is a requirement for the ensuring precision and uniformity. Cadbury tried to evade this line of reasoning by stating that the word “predominant” qualifies the extent of usage and additionally argued that such levels of ambiguity were inherent and unsurmountable in the cases of such trademarks. Basically, Cadbury was trying to say that no single colour trademark would ever be registrable if such level of ambiguity was unacceptable, as such levels of ambiguity were inherent to applications for such trademarks. Let us examine this claim.

If Cadbury had said that they would apply the colour to the whole of the packaging, then the issue of clarity does not arise. So Cadbury’s claim can be set aside at this stage itself. It is possible to acquire trade marks for colours with zero ambiguity. But let us go a little deeper. Is it possible to get a trade mark for a single colour without spatially restricting the coverage?

On this, Sir Timothy Lloyd (one of the judges) made an interesting statement. He said that if Cadbury had asked for registration for application to the whole or more than 50% of the package, the application might have achieved the required level of clarity. But this is problematic too as even with north of 50% coverage, there are a multitude of formulations available and the requirement of absolute precision and uniformity would not be achieved. Nevertheless, his statement indicates that absolute level of precision might not be necessary. This begs the question: What is the ideal threshold? In order to locate the ideal threshold we need to look at why the Sieckmann Criteria were constituted in the first place.

The basis of the Sieckmann Criteria and the Ideal Threshold

In order to locate the ideal threshold it is necessary to understand the underlying reasons for requiring applicants to represent marks (in their applications) in a clear, specific, intelligible, precise, accessible, uniform, self-contained and objective manner.

The obvious issue with ambiguity is that registration authorities and competitors will not be able to objectively determine the scope and extent of an ambiguous mark. In Sieckmann, the court held that registration authorities should be able to determine the scope of the mark from a look at the register itself for ensuring smooth running of the trademark regime.

Apart from authorities, if competitors are unable to determine the scope, they will be hesitant to use the colour in an acceptable manner as well. Companies will become weary of using a particular colour for aesthetics or other functions, leading to anti-competitive practices. In the final paragraph of this piece, I shall argue that apart from concerns of clarity, the court should also consider whether registering a particular mark would lead to too much of a constraint on the competitor’s general right on using a colour.

In the current case, if Cadbury had applied for registration of every mark that involves upwards of 50% coverage, then concerns of clarity would be addressed. But in my opinion, that should not be the only concern. Giving a monopoly on formulations containing more than 50% coverage constrains competitors to a very large extent. Therefore, a trademark at the ideal threshold should not only be clear enough for authorities and competitors to understand scope, but must also not abuse the ability of competitors to use the colour. To conclude, single colour trademarks should be registered (among other things) only when the application is either strictly spatially delimited (one formulation) or is for a very limited number of formulations.

The Indian Angle

The latest draft of the Trademark rules seem to account for this analysis. Though it is not explicitly evident, if you read any of the statutes the assumption seems to be that you can trademark a “combination of colour” only as a mark and not in the abstract. As yet, there have been no caseswhich have considered the multi-formulation question specifically.

Coming up in Part II

In Part II, I will attempt to raise the argument that there are serious issues even with colour trade marks in general.

Chief References:

Primary Judgment, Overruled Judgment

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