Scintilla – a flash, a spark, an iota. Shorthand for creativity and an indicator of inventiveness under Australian law.

Wednesday, October 16, 2013

Colour in context: Cadbury's most recent stoush with Nestlé over the colour purple

By Lawyer Tessa Meyrick

Nestlé has successfully challenged Cadbury's attempt in the United Kingdom to register the colour purple as a trade mark in relation to chocolate bars and drinking chocolate.

Having been given its first Royal Warrant in 1854 as the 'manufacturer of cocoa and chocolate to Queen Victoria', Cadbury first introduced its 'Dairy Milk' purple wrapping in 1914 as a tribute to the Monarch herself. The chocolate goodies have been cloaked in a very regal purple ever since, making it surely the longest running cross-marketing campaign in history.

But what Queen Vic giveth, the Lords taketh away.

The UK Court of Appeal has set aside earlier decisions of the Intellectual Property Office (IPO) and the High Court that the trade mark proceed to registration, leaving Cadbury's application to lapse unless it can successfully appeal to the UK Supreme Court (which may well require it to win the heart of the European Court of Justice first).

Cadbury's UK application (filed back in 2004) shows a swatch of the colour – identified as Pantone 2685C – accompanied by a description that the colour is 'applied to whole visible surface, or being the predominant colour applied to the whole visible surface, of the packaging of the goods'.

Under the UK Trade Marks Act 1994, which mirrors the European Trade Marks Directive, a trade mark is only registrable if it is:

(a)    a sign;
(b)    capable of graphic representation; and
(c)    capable of distinguishing the goods or services of one undertaking from another.

After overcoming an early hiccup over the third criterion, the colour mark was registered by the IPO in 2011. That registration was opposed by Nestlé, whose 'Quality Streets' products bear a not dissimilar hue. The IPO made a few minor tweaks to the specification of goods on the registration (narrowing its scope), but left Cadbury's exclusive rights more or less intact.

Nestlé appealed to the High Court, lost, and – perhaps mindful of the influence of colour on appetite – appealed again to the Court of Appeal.

The question in both appeals was not whether Cadbury had established sufficient reputation in Pantone 2685C to meet the 'capable of distinguishing' requirement, but whether the 'mark' as described on Cadbury's application was in fact 'a sign' which was 'capable of being represented graphically' in the first place. For Nestlé, the mark failed to pass the two threshold tests; Cadbury's impressive historic credentials were beside the point.

The European Court has, since its decision in Libertel Grouep BV v Benelux-Merkenbureau in 2003, accepted that a single colour could be registered as a trade mark per se, provided 'it may be represented graphically in a way that is clear, precise, self-contained, easily accessible, intelligible, durable and objective'. Describing the colour by reference to a recognised colour identification code (such as a code in the Pantone Matching System) will go someway to satisfying those requirements, but that's not the end of the story.

And it's here that matters get a bit curly (wurly). Nestlé argued, and the Court of Appeal agreed, that the use of the word 'predominant' in Cadbury's application introduced vagueness and uncertainty, potentially conjuring up any number of signs, not just one. If Pantone 2685C is merely the 'predominant' colour on the packaging, then surely there might be others. The result is not an application to register 'a sign' in the Libertel sense, but to register 'multiple signs with different permutations, presentations and appearances'.

Rest assured, this case does not signal the end of single colour trade marks in the UK or Europe more broadly: the decision ultimately rests on a pernickety point of drafting. It's a win for Nestlé and pedants alike.
So, what does this mean for the future of 'Dairy Milk' purple?

In Australia – not much. After a long battle with competitors Darrell Lea and Nestlé, Cadbury secured several registrations in Australia for Pantone 2685C in 2009, so its position here is as strong as it could ever be.

As for the position in the UK, Cadbury always has the option of re-filing the application with an amended  description. (Incidentally, none of Cadbury's registrations in Australia use the word 'predominantly'.)
In the meantime, Cadbury's statements to the press indicate that it doesn't consider its IP arsenal to have been exhausted by the Court of Appeal's decision:

[the decision] does not affect our long held right to protect our distinctive colour purple from others seeking to pass off their products as Cadbury chocolate. Our colour purple has been linked with Cadbury for a century and the British public has grown up understanding its link with our chocolate.

In other words, Cadbury sees an alternative protection strategy in the common law tort of passing off. That tort prevents a person from falsely holding out that their goods are those of another, or from representing that their goods have some association or connection with the goods of another, when they do not. To be successful, Cadbury would have to establish that its reputation in the distinctive shade of purple was such that its use on a rival chocolate product would lead consumers to mistake the copycat chocolate for the bona fide Cadbury variety.

In Australia, in proceedings against Darrell Lea for misleading and deceptive conduct and passing off, Justice Heerey accepted that 'purple may prompt in the reasonable consumers’ mind a remembrance that purple has been associated with Cadbury chocolate', but concluded that it did not follow that the reasonable consumer would necessarily draw 'the conclusion that the purple packaged product presented for sale to him or her therefore must be Cadbury’s'. At that time, Cadbury had no registered trade marks in Australia for the colour purple (that process having been held up by the opposition filed by Darrel Lea).

If the UK courts follow the same approach as Heerey J, there is a risk of a finding that the use of the colour purple may not be enough in itself to mislead the reasonable chocolate consumer (even those less discerning cocoa consumers amongst us).

In any event, since Cadbury hasn't ruled out an appeal, all bets are on for what it will do next.

And, on the subject of betting, note that Queen Elizabeth defied the top pick for the annual 'what will she wear?' bet at Royal Ascot earlier this year, arriving not in a blue frock but in a shade bearing uncanny resemblance to that used famously by a certain confectionery trader. A sign of continued royal endorsement, perhaps?

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