Clifford Chance

Introduction

The Spanish Supreme Court, by means of judgment 1190/2023 of 19 July ("Judgment 1190/2023"), has declared valid a three-dimensional trademark consisting of the historic 'iron mould' bottle: an unlabeled, dark green glass bottle that was designed in 1880 to hold the natural apple cider produced in Asturias (Spain).

The judgment analyses the grounds for invalidity of three-dimensional trademarks and, in particular, interprets Article 5(1)(e) of the Spanish Trademark Act ("STA"), which corresponds to Article 7(1)(e)(ii) of EU Trademark Regulation 2017/2001².

Background to the case

The Asturian Cider Association ("ACA"), an association of cider producers in the Principality of Asturias, is the holder of Spanish trademark number 2948349, consisting of a three-dimensional trademark protecting the historic 'iron mould' bottle. This bottle has been used by the Asturian cider producers since the 19th century.
ACA filed a trademark infringement action before Santander Commercial Court No. 1 against Sidra Somarroza, a cider producer based in Cantabria (an autonomous community neighboring Asturias) for marketing its natural cider using the registered green glass bottle. Unfair competition actions were also brought against Sidra Somarroza.

Sidra Somarroza replied to the complaint opposing the invalidity of trademark 2948349. Among other grounds for invalidity, it argued that the three-dimensional trademark was subject to the following two grounds for absolute invalidity: (i) the trademark consisted exclusively of technical elements intended to promote the preservation and pouring of cider (Article 5(1)(e) STA) and (ii) it was devoid of distinctive character (Article 5(1)(b) STA).

Santander Commercial Court No. 1 dismissed the complaint concluding, inter alia, that the trademark lacked distinctiveness and that the essential characteristics of the bottle met exclusively technical requirements for the fulfilment of its function. The unfair competition actions were also dismissed.

ACA appealed the first instance judgment to the Cantabria Provincial Court, which dismissed the appeal. The Provincial Court confirmed the invalidity of the three-dimensional trademark, as its essential characteristics consisted exclusively of the shape of the product necessary to obtain the technical result. The second instance court did not rule on distinctiveness.

ACA appealed the second instance judgment to the Supreme Court. The Supreme Court, in Judgment 1190/2023, upheld the appeal and recognized the validity of the aforementioned three-dimensional trademark as not falling under the absolute prohibitions of Articles 5(1)(b) and 5(1)(e) STA. Consequently, it concluded that Sidra Somarroza had committed acts of trademark infringement by marketing its cider produced in Cantabria with the registered bottle. The unfair competition actions, however, were dismissed.

Case comment

In Judgment 1190/2023, the Supreme Court analyses the validity of three-dimensional trademarks in light of the doctrine of the Court of Justice of the European Union ("CJEU") and sets out the criteria to be followed in interpreting Article 5(1)(e) STA.

To begin with, the Supreme Court reminds us that a three-dimensional shape can be registered as a trademark, as it cannot be denied distinctiveness in the abstract. The average consumer's perception, however, is not necessarily the same in the case of a three-dimensional trademark as in the case of a word or figurative trademark, since consumers are not used to the origin of goods based on their shape. Therefore, a three-dimensional trademark can only be distinctive when the shape of the product differs from the norm or customs of the sector.

Likewise, a three-dimensional trademark cannot be valid when consisting exclusively of the shape, or another characteristic, of goods that is necessary to obtain a technical result. This ground for invalidity is set forth in Article 5(1)(e) STA, which corresponds to Article 7(1)(e) (ii) of EU Trademark Regulation 2017/2001.

The examination by the Supreme Court of the application of Article 5(1)(e) STA draws heavily on the case law established by the CJEU . The Supreme Court expounds that, to apply this prohibition, the CJEU requires that (i) the essential characteristics of the three-dimensional trademark be identified and (ii) it be verified that all essential characteristics correspond to the technical function of the product.

Applying the abovementioned case law, it then concludes that even though the essential characteristics of the 'iron mould' bottle (a thickened, truncated mouthpiece; a neck in the shape of a lady's leg; and a shoulder in the shape of a quarter of a horn) have a technical function (i.e., contain the cider and facilitate its pouring), said technical functions are not the reason it was looked for either by the trademark owner when creating the trademark nor the one sought by consumers when purchasing the bottle. In fact, Judgment 1190/2023 states that those essential characteristics instead serve to identify the origin of this product.

For the Supreme Court, the set of all the essential characteristics that make up the trademark cannot be attributed solely or mainly to a technical result, but rather they seek to inform the consumer that the bottle of Asturian cider comes from an Asturian cider maker.

According to the Supreme Court, it is the impression of all the characteristics which give the Asturian cider bottle a totally unique appearance which prevails, and not so much the technical function which each of the characteristic elements of the 'iron mould' bottle may fulfil.

Consequently, the three-dimensional trademark protecting the 'iron mould' bottle is not in response, "exclusively and necessarily, to a technical solution whose use by other entrepreneurs is hindered by the registration of the trademark", as is shown by the wide variety of bottle shapes used to contain natural cider. The Supreme Court clarifies that the existence of alternative shapes does not undermine the ground for invalidity of Article 5(1)(e) STA, but ends by noting that "the wide availability of alternatives and the fact that the registered bottle shape does not express a technical function leads us to consider that its protection as a trademark does not distort effective competition by hindering competitors in the availability of functional or usability features that allow the bottle to contain cider and facilitate the pouring of cider".

The Supreme Court finalizes indicating that the 'iron mould' bottle does not fall within the grounds for invalidity of article 5(1)(e) STA, since neither the consumer nor the entrepreneur looks for this bottle for the technical function of its characteristics, but rather for its appearance and uniqueness, which allow it to be associated with natural Asturian cider.

Although the Supreme Court considered CJEU case law to reach the conclusion stated in Judgment 1190/2023, there is no reference in said judgment to the reasonings contained in the General Court's decision of 5 July 2023 (T-10/22) handed down just a few days before and which also deals with Article 7(1)(e)(ii) of Regulation No 207/2009. In said decision, the General Court concluded that "the fact that an essential element of the mark applied for, which is necessary to obtain a technical result, also has an aesthetic value or an unusual character does not preclude the application of Article 7(1)(e)(ii) of Regulation No 207/2009". Furthermore, it also concluded, referring to previous judgments from the same court, that the fact that the sum of the functional elements contributes to create an ornamental image of the trademark does not affect the application of Article 7(1)(e)(ii) of Regulation No 207/2009.

Conclusion

The Supreme Court has found valid a three-dimensional trademark consisting of the historic 'iron mould' bottle and has delineated the guidelines for interpreting Article 5(1)(e) of the STA. We do not know whether Judgment 1190/2023 considered the reasoning contained in case T-10/22 when reaching its conclusion. We will have to keep an eye on the forthcoming Supreme Court case law interpreting Article 5(1)(e) of the STA.