Part IV: Trade Mark Concepts #Shapes #Hauck

In this piece we will be dealing with some of the questions that came up in the Hauck case.

The facts, once again, are pretty straightforward.

Hauck wanted to register the following shape as a trade mark.

Stokke opposed it on grounds of the shape being invalid.

Went through a series of courts before reaching the Court of Justice.

Note that the majority of the analysis comes from the opinion of the Advocate General (AG). The court constantly keeps referring to the AG’s opinion and seldom comes up with anything of its own.

Out of the three questions put before the court, we will be dealing with two here.

  1. (a)      Does the ground for refusal or invalidity in [the first indent of] Article 3(1)(e) of [the trade marks directive], namely that [three-dimensional] trade marks may not consist exclusively of a shape which results from the nature of the goods themselves, refer to a shape which is indispensable to the function of the goods, or can it also refer to the presence of one or more substantial functional characteristics of goods which consumers may possibly looks for in the goods of competitors?

(b)      If neither of those alternatives is correct, how should the provision then be interpreted?

  1. (a)      Does the ground for refusal or invalidity in [the third indent of] Article 3(1)(e) [of the trade marks directive], namely, that [three-dimensional] trade marks may not consist exclusively of a shape which gives substantial value to the goods, refer to the motive (or motives) underlying the relevant public’s decision to purchase?

(b)      Does a “shape which gives substantial value to the goods” within the meaning of the aforementioned provision exist only if that shape must be considered to constitute the main or predominant value in comparison with other values (such as, in the case of high chairs for children, safety, comfort and reliability) or can it also exist if, in addition to that value, other values of the goods exist which are also to be considered substantial?

(c)      For the purpose of answering Questions 2(a) and 2(b), is the opinion of the majority of the relevant public decisive, or may the court rule that the opinion of a portion of the public is sufficient in order to take the view that the value concerned is “substantial” within the meaning of the aforementioned provision?

(d)      If the latter option provides the answer to Question 2(c), what requirement should be imposed as to the size of the relevant portion of the public?”


The Relevant Statute

First Council Directive 89/104/EEC of 21 December 1988 (European Statute)


Article 2

A trade mark may consist of any sign capable of being represented graphically, particularly words, including personal names, designs, letters, numerals, the shape of goods or of their packaging, provided that such signs are capable of distinguishing the goods or services of one undertaking from those of other undertakings.

Article 3

  1. The following shall not be registered or if registered shall be liable to be declared invalid:

(a)    signs which cannot constitute a trade mark;

(b)    trade marks which are devoid of any distinctive character;

(c)    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, or the time of production of the goods or of rendering of the service, or other characteristics of the goods or service;

(d)    trade marks which consist exclusively of signs or indications which have become customary in the current language or in the bona fide and established practices of the trade;

(e)    signs which consist exclusively of:

                                     –    the shape which results from the nature of the goods themselves, or

                                     –    the shape of goods which is necessary to obtain a technical result, or

                                     –    the shape which gives substantial value to the goods;

  1. A trade mark shall not be refused registration or be declared invalid in accordance with paragraph 1(b), (c) or (d) if, before the date of application for registration and following the use which has been made of it, it has acquired a distinctive character. Any Member State may in addition provide that this provision shall also apply where the distinctive character was acquired after the date of application for registration or after the date of registration.



Question 1 Deconstruction

I intend to postpone writing on this till a follow up post.

I am yet to fully comprehend what their lordships wish to convey.

Question 2 Deconstruction

This question is concerned with interpreting the third indent of the relevant provision:

“–        the shape which gives substantial value to the goods.”

Prior to trudging into the messy conflict that this case deals with, let us first acquire a basic understanding of the general functioning and rationale behind this specific aspect of the provision.

We have already seen the problems with trade mark law encroaching into the field of patent law. Similarly, it is problematic when trade mark law encroaches into the field of copyright or design law. The above provision tries to prevent undertakings from indirectly protecting marks for eternity, which would otherwise have only been protected for a limited period of time under design law.

Now, let us look at the variations in interpretations of the provision under discussion.

There are two prevailing interpretations in European Courts over this provision.

Interpretation #1 (German Courts):

This interpretation draws a distinction between two types of goods:

  1. Goods that serve a purely aesthetic function. (e.g. Jewellery)
  2. Goods that serve a functional purpose, but might nonetheless contain aesthetic elements. (e.g. a speaker with a fancy shape).

According to this interpretation only the first type of goods (1) are hit by the prohibition.

Interpretation #2 (OHIM):

According to this interpretation, no distinction is made between the two categories of products. Irrespective of whether the product serves a solely aesthetic function, the fact that consumers look for the shape in a product of that nature is seen as enough reason to prohibit it from being registered.

In the current case, the court adopted Interpretation #2 and in my opinion, rightly so.

One only needs to look at the rise of Apple to realize that consumers care a lot about aesthetics, even when the primary function of the product is not ornamental. Consumers may be buying Apple computers for their incredible speed and what not, but it is difficult to argue that their sleek design doesn’t play on the minds of consumers.

Hence, by registering as a trade mark, what should have ideally only been copyrighted, Apple would have gained an unfair advantage over its competitors. Realizing such an eventuality, the court rightly chose the second interpretation.

Now, let us move onto the second aspect of Question 2.

Is public perception decisive in determining “substantial value”?

We need to note that the relation between public perception and “substantial value” is very distinct from the relation between public perception and “technical result“(already discussed).

Why so?

Basically, marks with “substantial value” are prohibited from being protected because consumers look for such marks in competitor’s products. Therefore, whether a mark is of “substantial value” or not is deeply linked with consumer perception. The AG too acknowledged the strong relation.

But strangely, the court held that consumer perception could at best be one of the various factors, but could not be a decisive factor.

It goes on to lay down other factors that are relevant for determining “substantial value“:

Nature of the goods under question

Artistic value of the shape

Dissimilarity with the regular shapes in the market

Promotion strategy


I found this decision slightly unsettling.

Similar to the caveat while dealing with “acquired distinctiveness”, we need to be clear about our indicative and decisive factors even in the context of analysing “substantial value”.

As long as the final result of consumers including the shape in their decision making is caused, the shape mark should be prohibited from ownership. When the primary condition has been clearly fulfilled, why does one need to go into the indicative factors, which at best, merely indicative towards the conclusion?

Whenever this question arises in Indian courts, I hope thoroughly reconsider this line of reasoning.

Coming up

The Kit-Kat case. Click here.

Chief References

The Judgment, The Advocate General’s Opinion.

Image from here.


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