Case Details
- Citation: [2016] SGCA 64
- Court: Court of Appeal of the Republic of Singapore
- Date of Decision: 24 November 2016
- Procedural Dates: 31 July 2015; 10 February 2016 (hearing dates); Judgment reserved
- Civil Appeal No: 200 of 2014
- Related Suit: Suit No 1081 of 2012
- Judges: Sundaresh Menon CJ, Chao Hick Tin JA, Andrew Phang Boon Leong JA, Tay Yong Kwang JA and George Wei J
- Appellants/Plaintiffs: Societe des Produits Nestlé SA; Nestlé Singapore (Pte) Ltd
- Respondents/Defendants: Petra Foods Limited; Delfi Singapore Pte Ltd
- Legal Areas: Trade marks; trade mark infringement; invalidation/revocation; shape marks; well-known trade marks; groundless threats; copyright (at first instance)
- Statutes Referenced: Trade Marks Act (Cap 332, 2005 Rev Ed) (“TMA”) (notably ss 7, 22, 35)
- Key Prior Decision: [2014] SGHC 252
- Cases Cited (as provided): [2014] SGHC 252; [2016] SGCA 64
- Judgment Length: 89 pages; 27,939 words
- Trade Marks in Issue: Registered three-dimensional shape marks for chocolate wafer bars sold under the KIT KAT branding, specifically the “Two-Finger Shape” and “Four-Finger Shape” (the “Registered Shapes”)
Summary
This appeal concerned the registrability and enforceability of two three-dimensional “shape marks” used in connection with chocolate wafer bars marketed under the KIT KAT brand. The appellants, Societe des Produits Nestlé SA and Nestlé Singapore (Pte) Ltd, held Singapore registrations for the “Two-Finger Shape” and “Four-Finger Shape”. The respondents, Petra Foods Limited and Delfi Singapore Pte Ltd, imported and distributed similar chocolate wafer products marketed under the TAKE-IT and DELFI TAKE-IT trade marks. Nestlé sued for trade mark infringement (including claims involving well-known and registered marks) and also pursued copyright infringement relating to packaging.
The High Court dismissed Nestlé’s infringement claims and allowed the respondents’ counterclaims to invalidate and/or revoke the registrations for the Registered Shapes, as well as to address groundless threats. On appeal, the Court of Appeal upheld the High Court’s approach, focusing on whether the Registered Shapes were capable of functioning as trade marks and whether they fell within statutory exclusions applicable to shape marks. The Court’s reasoning reflects a policy concern: trade mark protection should not be used to confer a perpetual monopoly over product shapes that are essentially functional, customary, or otherwise insufficiently distinctive.
What Were the Facts of This Case?
The appellants belong to the Nestlé group. Their chocolate-covered wafer products are distributed in Singapore under the KIT KAT trade mark. The first appellant, Societe des Produits Nestlé SA, is a public company incorporated in Switzerland, while the second appellant, Nestlé Singapore (Pte) Ltd, is incorporated in Singapore. The respondents belong to the Petra Foods group. Petra Foods Limited is the parent company of Delfi Singapore Pte Ltd, which acts as importer and distributor of chocolate products sold under the TAKE-IT and DELFI TAKE-IT trade marks.
The trade marks at the centre of the dispute were two registered three-dimensional shape marks in Singapore. These were described in the registration certificates as the three-dimensional shape of the goods, namely “two or four bars attached to one another by a thin base as shown in the representation on the application form”. Both registrations were for goods in Class 30 of the Nice Classification: “chocolate confectionery being chocolate coated confectionery blocks or bars and chocolate wafer biscuits”. The appellants referred to these as the “Two-Finger Mark” and the “Four-Finger Mark”, collectively the “Registered Shapes”.
In terms of commercial history, the appellants’ products bearing the Registered Shapes had been sold in Singapore since the 1950s. The four-finger KIT KAT product was launched as Rowntrees Chocolate Crisp in 1935 and rebranded as KIT KAT in 1937. The two-finger KIT KAT product was launched in 1963. The judgment notes that the popularity of these products is reflected in estimated sales volumes in Singapore between 2003 and 2010 of more than 2.4 million kilograms.
The respondents also had a long history in moulded chocolate wafer products. According to the respondents, one of their subsidiaries, PT Ceres, manufactured a moulded chocolate wafer comprising a single chocolate-coated wafer under the trade mark PATSY in Indonesia in 1951. Around 1986 to 1987, PT Ceres manufactured and sold moulded chocolate wafers comprising two or three sticks joined at the base by chocolate, sold in Indonesia, Singapore and Dubai under the WINDMOLEN mark. The respondents later developed a product line consisting of two-finger and four-finger TAKE-IT products, which are also moulded chocolate wafer bars.
What Were the Key Legal Issues?
The appeal raised several interlocking issues, but the Court of Appeal’s focus was narrower than the full dispute at first instance. The central questions were whether the Registered Shapes were valid trade marks under the Trade Marks Act, and therefore whether Nestlé could rely on them for infringement. In particular, the respondents had counterclaimed for invalidation and/or revocation on multiple grounds, including that the shapes were not capable of distinguishing the goods, were devoid of distinctive character, and fell within statutory prohibitions relating to shapes that result from the nature of the goods, are necessary to obtain a technical result, or give substantial value to the goods.
At first instance, the High Court allowed the counterclaim primarily on two grounds: (i) lack of inherent distinctiveness under s 7(1)(b) of the TMA, and (ii) the “technical result” prohibition under s 7(3)(b) of the TMA. The Court of Appeal therefore had to consider whether the High Court was correct in its legal tests and its application of those tests to the evidence. A further issue, connected to the validity analysis, was whether the Registered Shapes had acquired distinctiveness through use under s 7(2) of the TMA.
Finally, although the appeal’s scope was described as limited, the Court of Appeal also had to consider the consequences of invalidity for Nestlé’s infringement claims and the related relief sought, including the respondents’ counterclaim for groundless threats of trade mark infringement. Where a registration is invalid, the proprietor’s ability to threaten or sue on the basis of that registration is legally constrained.
How Did the Court Analyse the Issues?
The Court of Appeal began by situating the case within the broader legal treatment of shape marks. The judgment notes that the law has historically viewed attempts to obtain protection for three-dimensional marks with suspicion, reflecting the concern that product shapes should not be monopolised indefinitely through trade mark law. This policy concern is traced to older authorities, including the proposition that a trade mark must be distinct from the product to which it is applied, and the warning that registering the shape of a container risks converting protective intellectual property law into a source of monopoly. The Court acknowledged that modern law is more receptive to unconventional marks, but emphasised that courts still grapple with when a trader is entitled to a perpetual monopoly over a shape used in connection with trade.
Against that background, the Court of Appeal examined the statutory requirements for trade mark registration and the exclusions applicable to shapes. Under s 7(1)(b), a sign must not be devoid of distinctive character. The High Court had found that the Registered Shapes were not inherently distinctive because the average consumer of chocolate products would not pay particular attention to the shape as an indicator of origin, given that the shapes did not depart significantly from norms and customs in the chocolate confectionery sector. The Court of Appeal accepted that the inquiry must be anchored in how the average consumer perceives the sign in the context of the goods, rather than in the proprietor’s subjective intent or the commercial success of the product.
The Court of Appeal also addressed the concept of acquired distinctiveness under s 7(2). The High Court had applied an approach drawn from English jurisprudence, particularly the test articulated in Nestlé (EWHC), where the proprietor must have used the sign in such a way that consumers have in fact come to rely on it as indicating origin. The Court of Appeal’s analysis reflects that acquired distinctiveness is not established merely by showing that the product is popular or that consumers are familiar with the shape. Instead, the evidence must demonstrate that the relevant public has learned to treat the shape itself as a badge of origin.
On the “technical result” prohibition under s 7(3)(b), the Court of Appeal considered whether the Registered Shapes consisted exclusively of a shape necessary to obtain a technical result. This is a critical statutory category, because it aims to prevent trade mark law from protecting functional or engineering-driven aspects of product design. The Court’s reasoning, as reflected in the High Court’s findings, indicates that where the shape is dictated by the need to achieve a technical outcome—such as structural or manufacturing requirements—registration is barred even if the shape is aesthetically appealing or commercially successful. The Court of Appeal’s approach underscores that the “exclusively” requirement is important: if the shape is not solely dictated by technical necessity, the analysis may differ; however, where the evidence supports that the shape is necessary for technical reasons, the statutory exclusion applies.
Although the provided extract is truncated, the overall structure of the Court of Appeal’s reasoning can be understood from the issues that were decided below and the policy framing adopted at the outset. The Court’s analysis therefore combined (i) a consumer-perception inquiry for inherent distinctiveness and acquired distinctiveness, and (ii) a functional/technical inquiry for the statutory exclusions. These inquiries operate independently but converge in the practical effect that, if the shape is not a valid trade mark, infringement claims based on it cannot succeed.
What Was the Outcome?
The Court of Appeal dismissed the appeal and upheld the High Court’s decision invalidating and/or revoking the registrations for the Registered Shapes. As a result, Nestlé’s trade mark infringement claims relying on those shape registrations could not be sustained. The practical effect is that the respondents were not liable for infringement on the basis of the invalidated shape marks.
The decision also preserved the High Court’s handling of the respondents’ counterclaims, including those relating to groundless threats. Where a registration is invalid, the legal foundation for threatening infringement proceedings is undermined, and the court’s orders reflect the balance between protecting legitimate trade mark rights and preventing misuse of trade mark registrations to exert improper commercial pressure.
Why Does This Case Matter?
This case is significant for practitioners because it clarifies how Singapore courts will approach the validity of shape marks for consumer goods—particularly where the shape resembles common product design features in the relevant market. The Court of Appeal’s emphasis on consumer perception for inherent distinctiveness and on evidence-based proof for acquired distinctiveness reinforces that proprietors must marshal cogent material demonstrating that consumers rely on the shape as an origin indicator, not merely that the product sells well or is widely known.
Equally important is the Court’s treatment of the statutory exclusions for shapes that are necessary to obtain a technical result. The decision illustrates that even long-standing commercial use and strong brand recognition may not overcome statutory barriers where the shape is functional or technically necessary. This is a key point for brand owners seeking to register product shapes: they must consider not only whether the shape is distinctive, but also whether it falls within the “nature of goods”, “technical result”, or “substantial value” prohibitions.
From a litigation strategy perspective, the case also demonstrates the risk of relying on shape registrations as the primary enforcement tool. If a registration is vulnerable to invalidation, infringement proceedings may fail at the threshold. For defendants, the case supports the use of counterclaims for revocation/invalidation as a means to neutralise enforcement leverage, including in disputes involving well-known marks and packaging-related claims.
Legislation Referenced
- Trade Marks Act (Cap 332, 2005 Rev Ed) (“TMA”): s 2(1) (definition of “trade mark”); s 7(1)(a) (not a trade mark / incapable of distinguishing); s 7(1)(b) (devoid of distinctive character); s 7(2) (acquired distinctiveness); s 7(3)(a) (shape resulting from the nature of the goods themselves); s 7(3)(b) (technical result prohibition); s 7(3)(c) (substantial value prohibition); s 22(1)(a) and s 22(1)(b) (revocation for non-use/suspension); s 35(2) (groundless threats). [CDN] [SSO]
Cases Cited
- [2014] SGHC 252 (High Court decision in Societe des Produits Nestlé SA v Petra Foods Limited and another)
- [2016] SGCA 64 (Court of Appeal decision in Societe des Produits Nestlé SA v Petra Foods Limited and another)
- Re James Trade Mark, James v Soulby (1886) 33 Ch D 392
- Re Coca-Cola Co’s Application [1986] 2 All ER 274
- Bongrain SA’s Trade Mark Application [2005] RPC 14
- Société des Produits Nestlé SA v Cadbury UK Ltd [2014] ETMR 17
Source Documents
This article analyses [2016] SGCA 64 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the full judgment for the Court's complete reasoning.