By Ross Pratt-O’Brien BL
CASE C-237/19 GÖMBÖC— CJEU delivers IP judgment regarding shapes necessary to give a technical result under the Trade Mark Directive
In April 2020, the Court of Justice of the European Union (CJEU) issued its ruling in Case C-237/19, Gömböc, ECLI:EU:C:2020:296, on the interpretation of Article 3(1)(e)(ii) and (iii) of the Trade Mark Directive, 2008/95, now Article 4(1)(e)(ii) and (iii) of Directive 2015/2436.
This was a preliminary ruling in proceedings between the Hungarian Intellectual Property Office (HIPO) and Gömböc Ktf regarding the rejection by the HIPO of the application for registration of a three-dimensional mark as a national mark.
The interpretation by the CJEU of the grounds for refusal, concerning the prohibition of registration of signs consisting exclusively of the shape of goods, which is necessary to obtain a technical result and which gives substantial value to the goods, has been problematic in intellectual property law.
What is a Gömböc?
A gömböc is the name of a Hungarian food similar to Scottish haggis, made of pork and cheese. In a Hungarian folk tale, the Gömböc devours the members of a family one after the other, until the youngest son slits it open from the inside with a penknife.
For the purposes of the court proceedings and the trademark, it is a convex three-dimensional homogenous body that when resting on a flat surface has just one stable and one unstable point of equilibrium. The Russian mathematician Vladimir Igorevich Arnold wondered whether three-dimensional objects with only two equilibrium points exist. In the mathematical field it was believed that the minimum number was four. However, Hungarian engineers proved this wrong by creating the gömböc, with only two equilibrium points which always returns to its initial position on a horizontal surface. Essentially, a self-righting object similar to a roly-poly, though unlike a roly-poly, the object lacks counterweight.
Gömböc Kft applied for a Hungarian national trademark for the shape of the Gömböc for Class 14 of the Nice Agreement concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks of 15 June, 1957, as well as ‘decorative crystal ware and chinaware’ and ‘toys’ in Classes 21 and 28. This application was rejected by the HIPO on the basis that the shape gave substantial value to the decorative items in Classes 14 and 21 and that it was necessary to achieve a technical function for toys, for which the self-righting function was relevant. This decision was appealed to the Metropolitan Court and a request was made for a referral to the CJEU which was refused on the ground that there was sufficient case law available. This decision was affirmed on a further appeal to the Court of Appeal, in which it was determined that the shape has aesthetic value and did not agree that substantial value can be based on scientific significance.
On further appeal, the Supreme Court of Hungary decided to refer questions to the CJEU for a preliminary ruling asking:
1) Is Article 3(1)(e)(ii) of Directive 2008/95/EC of 22 October 2008 to approximate the laws of the Member States relating to trade marks to be interpreted as meaning that, for signs which consist exclusively of the shape of goods,
(a) it can only be examined if the shape is necessary to obtain the technical result sought on the basis of the graphic representation contained in the register, or
(b) can the perception of the relevant public also be taken into account? In other words, can it be taken into account that the relevant public is aware that the shape for which registration is sought is necessary in order to obtain the technical result sought?
2) Is Article 3(1)(e)(iii) of Directive 2008/95/EC of 22 October 2008 to approximate the laws of the Member States relating to trade marks to be interpreted as meaning that the ground for refusal is applicable to those signs which consist exclusively of the shape of goods and in respect of which it can be determined whether the shape gives substantial value to the goods, bearing in mind the perception or knowledge that the buyer has of the goods represented graphically?
3) Is Article 3(1)(e)(iii) of Directive 2008/95/EC of 22 October 2008 to approximate the laws of the Member States relating to trade marks to be interpreted as meaning that the ground for refusal is applicable to signs which consist exclusively of a shape
(a) that, by virtue of its individual character, already enjoys the protection conferred on designs, or
(b) whose aesthetic appearance alone gives the goods any kind of value?
The CJEU confirmed that the competent authority must carry out a two-step inquiry for the correct application of the ground for refusal established in Article 3(1)(e)(ii).
The first step refers to the proper identification of the essential characteristics of the three-dimensional sign at issue. The identification of the essential characteristics begins with the assessment of the graphic representation; however, the competent authority may also take into account other information “such as surveys or expert opinions, or data relating to intellectual property rights conferred previously in respect of the goods concerned.”
The second step considers whether the characteristics identified perform a technical function. Even though all the essential characteristics required to obtain a technical result are not shown in the representation, the ground for refusal established under Article 3(1)(e)(ii) may apply “provided that at least one of the essential characteristics required to obtain that technical result is visible in the graphic representation of the shape of that product”. This step need to take into consideration, where appropriate, the additional features relating to the function of the goods in question. This information must be objective and reliable and can include “surveys or expert opinions on the function of the product, any relevant documentation such as scientific publications, catalogues and websites, which describe the technical features of the product”.
As a result, the perception of the public may be a relevant criterion only for the identification of the essential characteristics but not for assessing whether the characteristics perform a technical function. The CJEU opined that the public may not have the expertise to accurately determine the technical features of the product and to what extent the shape of the product contributes to the technical result. Only objective and reliable information may be taken into consideration.
The CJEU held that the “perception or knowledge of the relevant public” is not a decisive element when applying the ground for refusal set out in Article 3(1)(e)(iii) but, may only be used for identification of the essential characteristics. In the proceedings, the knowledge of the relevant public related to the fact that the product depicted had become “the tangible symbol of a mathematical discovery”. Article 3(1)(e)(iii() may also apply if it is shown through objective and reliable evidence that the consumer’s decision to purchase the product is to “a very great extent, determined by one or more features of the shape which alone forms the sign”. Characteristics of the product not related to its shape are irrelevant to the assessment.
The Court clarified that the ground for refusal established in Article 3(1)(e)(iii) must not be applied “systematically to a sign which consists exclusively of the shape of the product where that sign enjoys protection under the law relating to designs or where the sign consists exclusively of the shape of a decorative item”. Thus, the CJEU confirmed the coexistence of multiple forms of legal protection, noting, that the regimes “are independent, without any hierarchy existing as between.”
The existence of a registered design over the Gömböc does not imply the automatic refusal for trademark registration, providing that that conditions for registration of that sign as a trademark are satisfied. The ground for refusal under Article 3(1)(e)(iii) cannot be applied automatically when the sign at issue consists exclusively of the shape of a decorative item but must be apparent from “objective and reliable evidence that the consumer’s decision to purchase the product in question is based to a very large extent on one or more characteristics of that shape.” The CJEU held that the substantial value of the decorative items may result from factors not related to its shape, such as “the story of its creation, its method of production, whether industrial or artisanal, the materials that it contains, which may be rare or precious, or even the identity of its designer.” For this ground of refusal to apply, it must be apparent from objective and reliable evidence that the consumer’s decision to purchase the product was based to a very large extent on one or more characteristics of the shape, which is a matter for the competent authority.
 This has proved to be an issue in a number of cases; Case C-48/09 Lego Juris v OHIM; Case C-163/16 Christian Louboutin SAS v Van Haren Schoenen BV; Hauck v Stokke Case C-205/13  Case C-237/19 para 28  Ibid para 29  Ibid para 32  Ibid para 34  Ibid para 35. The concern for the Court was the risk that the public may undermine the objective pursued by the ground for refusal of registration provided for in the Directive, namely to prevent trade mark law from granting an undertaking a monopoly on technical solutions or functional features of a product.  Ibid para 43  Ibid para 41  Ibid para 54  Ibid para 60