Friday, 10 November 2017

Afro Leo

The Shape of a Taxi: Who is Driving Miss Daisy?

Afro-IP is delighted to announce that this is the final guest post from Prof Wim Alberts. Wim has formally joined the Afro-IP blogging team and will be contributing as and when his schedule allows. Here is his comparative analysis of the recent Taxi appeal case in the UK. Perhaps you know where South African law is going or rather, who or what is driving it?

Introduction


In an earlier discussion the different aspects of IP protection for vehicle shapes were highlighted (Alberts and Van Dyk 'Taxi! Taxi!' — the protection of car shapes in intellectual property law 2017 SALJ 219).  One of the issues dealt with was the approach of the English courts to the shape of taxis, which did not score high on the distinctiveness graph in the a quo (earlier) judgment of the well-known jurist Judge Arnold in The London Taxi Corporation Limited trading as the London Taxi Company v Frazer-Nash Research Limitedand (2) Ecotive Limited [2016] EWHC 52 (Ch).  This aspect was dealt with again on appeal by the English and Wales Court of Appeal in The London Taxi Corporation Limited trading as The London Taxi Company v (1) Frazer-Nash Research Limitedand (2) Ecotive Limited [2017] EWCA Civ 1729).  

Judgment

The focus of this discussion is the question of the trade marks being invalid because they are each devoid of distinctive character (as envisaged by article 3(1)(b) of the European Parliament and Council Directive 2008/95/EC of 22 October 2008 to approximate the laws of the Member States relating to trade marks (codified version replacing Directive 89/104/EEC).  This leads to the specific defence that the following marks of The London Taxi Company (LTC) have acquired distinctive character.


The 3D Community Trade Mark
The 3D UK Trade Marks





In dealing with this aspect, the court referred to its earlier decision in Société des Produits Nestlé SA v Cadbury UK Ltd [2017] EWCA Civ 358.  More in particular, the following two important quotations (emphasis added):

“77. Before assessing these rival submissions, I think it may be helpful to say a little more about a concept which is woven into the decisions of the CJEU, including the decision of the CJEU in this case, concerning the acquisition of distinctive character by an inherently non-distinctive three-dimensional shape mark such as the Trade Mark. As we have seen, the CJEU has held that it is not sufficient for the applicant to show that a significant proportion of the relevant class of persons recognise and associate the mark with the applicant’s goods. However, to a non-trade mark lawyer, the distinction between, on the one hand, such recognition and association and, on the other hand, a perception that the goods designated by the mark originate from a particular undertaking may be a rather elusive one. Nevertheless, there is a distinction between the two and, as I shall explain in a moment, it is an important one. 

78. The distinction is this. We are concerned here with a mark, the three-dimensional shape of a chocolate product, that has no inherent distinctiveness. A shape of this kind is not inherently such that members of the public are likely to take it as a badge of origin in the way they would a newly coined word or a fancy name. Now assume that products in that shape have been sold on a very large scale under and by reference to a brand name which is inherently highly distinctive. Assume too that the shape has in that way become very well-known. That does not necessarily mean that the public have come to perceive the shape as a badge of origin such that they would rely upon it alone to identify the product as coming from a particular source. They might simply regard the shape as a characteristic of products of that kind or they might find it brings to mind the product and brand name with which they have become familiar. These kinds of recognition and association do not amount to distinctiveness for trade mark purposes, as the CJEU has now confirmed in its decision in this case.”

Returning then to the Taxi ruling, LTC relied on certain practical considerations (paragraph 57).  It was said to be common ground that the LTC marks had, by the relevant date, acquired a secondary meaning.  In other words, to relevant consumers, the shape did signify a licensed London taxi. LTC argued that there was good evidence that the shape had acquired distinctiveness when regard is had to “evidence” that consumers shunned the Mercedes Vito in favour of the traditional design of a taxi.  The court remarked though that if this, and a statement regarding preference for the taxi design, is all that the shape signifies, it is not, applying the test in Nestlé in the Court of Appeal, “sufficient to get him home.” (paragraph 57)

Lastly, LTC relied on what it termed the education of consumers.  These included, amongst others, notices on flip-up seats.  The left-hand advertisement asked "Who's behind this cab?", whilst the right-hand advertisement, said "Manganese Bronze Holdings plc [a predecessor of LTC] is the fast-growing engineering group behind one of the world's most famous symbols – the black cab. Following a tradition that spanned some 110 years, the taxi you are riding in right now sets a new standard in black cab design and comfort".  Later versions included a depiction of the taxi (paragraph 60).

The court dealt (paragraph 66) with this approach in the following terms:

“Firstly, one must remember, as always in the case of a shape mark, that the public are not used to the shape of a product being used as an indication of origin. Secondly, even though I would not, as I have said, necessarily exclude hirers as a class of average consumer, they constitute a class of consumer whose focus will be on the provider of the services being supplied more than on the manufacturer of the vehicle in which they are travelling. It will be hard to interest them, far less educate them, in the topic of whether the shape of the taxi is an indication of a unique trade source. Thirdly, the hirer is aware of the regulation of London taxis and that taxis of the shapes shown in the registrations can be relied on to be licensed London taxis. One must be careful therefore to distinguish this message admittedly conveyed to them by the shape, from that which is necessary to show that the mark has acquired trade mark significance.”

Comments

This case might not resonate with supporters of the decision of the Supreme Court of Appeal in Société des Produits Nestlé SA v International Foodstuffs [2014] ZASCA 187.  The Taxi views can be reconciled though with, for instance, the views of Harms JA in Bergkelder Bpk. v Vredendal Koöp Wynmakery [2006] ZASCA 5 (emphasis added).  There the revered justice stated the following:

“[7] In due course it was generally recognised that not only containers but also shapes of goods may perform a trade mark function.  For example, English law, implementing a European Community Directive, now provides that a trade mark may consist of ‘the shape of goods or their packaging’ and our 1993 Act, similarly, states that shapes and containers for goods may be trade marks. Importantly, from a legal perspective these trade marks do not differ from any other kind of trade mark:

‘the criteria for assessing the distinctive character of three-dimensional shape-of-products marks are no different from those applicable to other categories of trade mark.

However, from a practical point of view they stand on a different footing.

[8] The problem they pose for their promoters is that according to the public perception containers and shapes generally do not, in American parlance, serve as source identifiers. Containers are usually perceived to be functional and, if not run of the mill, to be decorative and not badges of origin.”

It would accordingly appear that whilst the mantra might be that all marks are said to be equal in terms of the distinctiveness criterion, it is just harder for shape marks to comply.  One is reminded here of the comment of the Court of Appeal in the Nestlé case, being that the distinction between, on the one hand, such recognition and association and, on the other hand, a perception that the goods designated by the mark originate from a particular undertaking, may be a rather elusive one.  Nevertheless, there is a distinction between the two.  And that is unlikely to change whilst it is the origin theory that is driving Miss Daisy.  South African trade mark law quo wadis (where are going)?

University of Johannesburg ... and member of the Afro-IP team

Afro Leo

Afro Leo

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