Is the layout and design of a shop capable of being registered as a trade mark in Europe?
On 10 July 2014, the Court of Justice of the European Union (CJEU) handed down its judgment in the dispute between Apple Inc v Deutches Patent - und Markenamp (German Patent and Trade Mark Office) (C-421/13) that Apple’s retail store layouts, such as the one depicted below, may be able to be registered as a trade mark in the European Union.
Apple applied for a US trade mark on its retail store design in 2010. The US trade mark was registered for “retail store services featuring computers, computer software, computer peripherals, mobile phones, consumer electronics and related accessories and demonstrations of products relating thereto”. The trade mark was granted in January 2013 and Apple then sought to extend the trade mark internationally under the Madrid Agreement. On 24 January 2013, the German Trade Marks Office refused the extension of the three-dimensional international trade mark:
On the grounds that the depiction of the space devoted to the sale of the undertaking’s products was nothing other than the representation of an essential aspect of Apple’s business. The DPMA considered that while it is true that consumers may perceive the layout of such a retail space as an indication of the quality and price bracket of the products, they would not see it as an indication of their commercial origin. Besides, it considered that the retail store depicted in the case before it was not sufficiently distinguishable from the stores of other providers of electronic products1
Apple appealed to the Federal Patent Court of Germany, which held that the design of the store was distinctive from the usual layout of retail stores in the electronic sector but, referred the following questions to the CJEU:
Judgment of the CJEU
The CJEU examined the first three questions together by evaluating whether a design of a retail layout fulfilled the requirements of Articles 2 and 3(1) of the Directive of European Union law.
The CJEU held that it was clear from the wording of Article 2 that designs are capable of graphic representation. The key issue was whether a pictorial representation was capable of constituting a sign as defined in Article 2 of the Directive.
Article 2 covers: “Signs of which a trade mark may consist”. The Article provides:
A trade mark may consist of any signs 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.
On the one hand the Article made no mention of the packaging of a service. However, the German judges realised that there were some instances in case law in which the CJEU had brought some “unconventional” signs within the scope of Article 2 of the Directive. Therefore, the judges felt that the packaging of the service was comparable to those of goods and was within the scope of Article 2 of the Directive.
Notably, the CJEU held that a representation that depicts the layout of a retail store by means of an integral collection of lines, curves and shapes, may constitute a trade mark provided that the representation is capable of distinguishing the goods or services of one undertaking from those of other undertakings.
The CJEU held that a design of the layout of a retail store is capable of distinguishing the products or services of one undertaking from those of another. In this context it was relevant whether the depicted layout departed significantly from the norm or customs of the economic sector concerned.
The next question for the CJEU was whether Apple’s application for extending the protection of the contested trade mark contrary to the grounds for refusing trade mark protection expressed in Article 3?
In particular, Article 3 stops marks being registered (or allows them to be declared invalid) for:
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 services;
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:
(i) the shape which results from the nature of the goods themselves;
(ii) the shape of goods which is necessary to obtain a technical result;
(iii) the shape which gives substantial value to the goods.3
In essence, whether a design representing the layout of a retail store was distinctive enough to be registrable had to be assessed by reference to the goods or services in question and with regard to the perception of the relevant public. As the legislation does not distinguish between types of marks, the Court found that the normal assessment criteria should be applied.
The CJEU also held that Apple could apply to register store layouts not only for goods themselves, but also for services, so long as these services do not form an integral part of the offer for sale of those goods.
Certain services, such as those referred to in Apple’s application and clarified by Apple during the hearing, which consist of carrying out, in such stores, demonstrations by means of seminars of the products that are displayed there, can themselves constitute remunerated services falling within the concept of "service".4
This decision is a significant development for businesses in the EU which rely on novel visual aspects of their store layouts to imprint brand awareness and brand loyalty in the minds of their customers. It remains to be seen how this guidance is interpreted by the German Trade Marks Office and in other countries. The judgment highlighted the need for the layout of a store to depart significantly from normal layouts in order to qualify as distinctive.
The definition of what constitutes a trade mark under relevant European directive is a little different to the definition here in Australia because it includes design and shape of goods and of their packaging. Since under Australian law trade mark and designs are separate branches of intellectual property law, it may be more difficult to follow a similar argument. However, the concept of a trade mark continues to evolve in Australia, for example: “Eagle Boys Pizza” has registered the pink glow associated with its neon signage.
This shows that the perception of what constitutes a trade mark is clearly expanding to include those signs that encompass the brand’s look and feel.
However, there is still some way to go for trade mark owners in Australia who wish to acquire rights in trade marks that fall outside the scope of a standard word or device trade mark. Colours, like sounds and smells, are particularly hard to trade mark, because a company needs to prove the shade sufficiently distinguishes its brand from others.
Monopolies in colour have not faired so well in Australia to date. For example, BP, has lost its 12-year battle to trade mark the colour green which dominates its sunburst logo. BP’s attempt to monopolise green, also known as Pantone shade 348C, was knocked back by IP Australia after a long-running battle with Woolworths, which considers the green shade in its apple logo too similar. While the petroleum giant has struggled to trade mark the colour in Australia, it has succeeded in Britain and Europe.5
Furthermore, there are numerous cases in the UK and US in which companies have secured trade mark protection in respect of a particular colour. For example, Christian Louboutin has secured the trade mark for the distinctive red used on the soles of shoes he designs and the retailer Harrods has a trade mark over the shade of green synonymous with its brand. Now confectionery giant Cadbury has won a lengthy court battle giving it the right to the trade mark for the distinctive colour of purple it uses for the packaging of its milk chocolate6.
These cases, no doubt, will act as good precedents for companies in Australia wishing to acquire trade mark rights in respect of your not so typical trade marks. They indicate that there is scope for novel applications for trade mark protection.