Functionality and Shape Marks: Lessons from an EU Decision

A decision of the EU General Court concerns the registrability of a three-dimensional trademark for packaging where the relevant legal issue was whether the shape consisted exclusively of features necessary to obtain a technical result.  The General Court is the lower of the two Courts that make up the Court of Justice of the European Union.

The Trademark

The Applicant filed a trademark application for following three-dimensional sign:

in association with packaging containers and packaging material made of paper or made of paper coated with plastic material. A registration was obtained but a competitor sought a declaration of invalidity on the basis of a provision in EU regulation which provides that signs which consist exclusively of the shape of goods which is necessary to obtain a technical result are not to be registered.

The Initial Proceedings

The competitor was successful at first instance, but the Applicant appealed. The Board of Appeal upheld the appeal and, consequently, rejected the application for a declaration of invalidity on the ground that the provision did not apply to the contested mark. In essence, the Board of Appeal concluded that the function performed by the shape of the goods did not constitute a technical result within the meaning of the regulation. The Board of Appeal said that the essential characteristics linked to the shape of the product related to the manufacturing process, but did not influence the function performed by that product.

This result was then appealed by the competitor to the General Court.

The Facts 

The Applicant had filed an application under the Patent Cooperation Treaty, (the “PCT application”) relating to the packaging. On the basis, inter alia, of the details set out in the PCT application, the Board of Appeal said that, in relation to traditional parallelepiped shapes, a prismatic shape such as that of the contested mark reduced the quantity of packaging paperboard necessary to hold a given volume of liquid. The Board of Appeal found that that technical result was achieved by means of the first three essential characteristics of the contested mark, which defined the structure and the shape of the container, whereas the fourth essential characteristic, linked to the presence of a sealing fin crossing the upper part of the shape, made it possible to guarantee the hermetic closure of the packaging. The Board of Appeal also found that the shape of the contested mark ensured the stability and handling properties of the packaging.

The improvement in the ratio between the volume of the container and the quantity of material necessary for its manufacture means that, in respect of a given volume, the packaging is lighter than traditionally shaped packaging. The Applicant’s commercial communications highlight such technical benefits. It was apparent from an extract from the Applicant’s website that the Applicant stated, in relation to the shape of the contested mark, that the use of a smaller quantity of packaging material does not compromise the performance of the product. That commercial communication also highlights the product’s lightness as well as its optimal efficiency, linked, inter alia, to its space-saving shape.

The Decision of the General Court Lami packaging (Kunshan) Co. Ltd. V. Tetra Laval Holdings &Finance SA (case T-104/25)

The court noted that provision is intended to prevent the protection afforded by trademark law from being extended, beyond signs which serve to distinguish a product or service from those offered by competitors, so as to form an obstacle preventing competitors from freely offering for sale products incorporating such technical solutions in competition with the proprietor of the trademark. It is necessary, to prevent other exclusive protection rights subject to limited periods (patents, designs) from obtaining protection without limitation in time by relying on trademark law.

The correct application of the provision requires that the court identify, first of all, the essential characteristics of the three-dimensional sign at issue and then ascertains whether those characteristics all perform a technical function of the goods.

In the present case, the competitor was justified in claiming that the Board of Appeal was wrong to conclude that the technical benefits resulting from the shape of the contested mark did not concern the way the product would be used by the end consumers. The PCT application states that, on account of its shape, the packaging is easier to grasp and use for the consumer. Similarly, the extracts from the Applicant’s website refer to the ergonomic nature of the product’s shape. It is stated that the product was designed to adapt perfectly to all hand sizes to offer a more comfortable grip during consumption. The Board of Appeal erred in finding that the technical result obtained by the contested mark concerned only the manufacturing process of the product itself and had no effect on the function performed by that product.

The Canadian Trademarks Act (“Act “)

Under the Act if the trademark consists exclusively or primarily of the three-dimensional shape of any of the goods specified in the application, or of an integral part or the packaging of any of those goods, an applicant must furnish the Registrar with any evidence that the Registrar may require establishing that the trademark is distinctive at the filing date of the application for its registration.

Such a mark is not different in essence from a design mark and must be governed by the same considerations relating to functionality and public policy. It is permissible to allow a trademark owner to distinguish their goods from their competitors by monopolizing the mark used in relation to them but not by monopolizing the goods. To the extent that functionality relates primarily or essentially to the goods themselves, it will invalidate a trademark registration of such a mark. In the past caselaw has established that a trademark incorporating functional features of a product that relate primarily or essentially to the product itself should not be registrable. However, if the functionality is merely secondary or peripheral, like a telephone number with no essential connection to the goods, then it does not act as a bar to registration.

In addition, there are a number of other relevant provisions in the Act. Section 12 provides that “a trademark is not registrable if, in relation to the wares or services in association with which it is used or proposed to be used, its features are dictated primarily by a utilitarian function.” The concept of “utilitarian function” is not defined. Presumably reference will be made to existing case law relating to functionality as a bar to registration.

Section 18.1 provides that the registration of a trademark may be expunged by the Federal Court on the application of any person interested if the Court decides that the registration is likely to unreasonably limit the development of any art or industry.

Section 20 of the Act dealing with infringement provides that “The registration of a trademark does not prevent a person from using any utilitarian feature embodied in the trademark.”

Comment

While the decision arises under EU trademark law, its approach is highly relevant to the Canadian law of functionality. The case serves as a reminder that courts typically look beyond the presentation of the shape of the mark and examine patent filings, technical documentation, and marketing materials to determine whether the claimed features are functional in nature. 

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John McKeown

Loopstra Nixon LLP.  

130 Adelaide St W Suite 2800Toronto, Ontario, M5H 3P5Canada

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This article is of general nature and is not intended to provide specific legal advice as individual situations will differ. Specialist advice should be sought about your specific circumstances. Copyright © John Mckeown, All rights reserved. To unsubscribe to the IP Update please send me an email at jmckeown@Ln.Law

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