Background to the dispute
On 25 June 2020, BB Services GmbH (invalidity applicant) sought invalidity before the EUIPO of two EUTMs, which had been registered on 18 April 2000 in class 9, 25 and 28 (on the basis of distinctive character acquired through use – filed in 1996). The owner is Lego Juris A/S. The 3D trade marks consist of toy figures, one with a dub on the head (illustrating this post) and one without it. In class 28 the trade mark is registered for ‘Games and playthings’.
The invalidity applicant relied on two grounds: prohibition of registration of signs consisting exclusively of shapes resulting from the nature of the goods (Article 7(1)(e)(i) of the Regulation (EC) No. 40/94, and of shapes of goods necessary to obtain a technical result (Article 7(1)(e)(ii)) of the Regulation (EC) No. 40/94).
In 2021 EUIPO’s Cancellation Division rejected the invalidity application and the Board of Appeal (BoA) dismissed the appeal in its entirety. The BoA also clarified that the Regulation (EC) No. 40/94 applies since the EUTMs were applied for in 1996.
BB Services GmbH appealed both decisions to the General Court.
The first plea – absolute ground for refusal, Article 7(1)(e)(i) of Regulation No. 40/94 not applicable
According to Article 7(e)(i) signs shall not be registered which consist exclusively of the shape which results from the nature of the goods themselves. Article 7(1)(e)(i) does not apply where at least one essential characteristic of the shape does not result from the nature of the goods themselves (such as decorative elements).
According to the applicant, the nature of goods are clearly ‘interlocking building figures’ compatible with LEGO’s modular building system. The BoA did not share this view; the EUTMs’ graphic representation did not clearly reproduce ‘interlocking building figures’.
The General Court agreed with the BoA and declared that the nature of goods was a toy figure. However, the figure is also a ‘interlocking building figure’ compatible with LEGO’s building bricks system referring to the graphic representation and the public’s knowledge of LEGO’s modular building systems. Accordingly, the goods consist of an ‘interlocking toy figure’ with two purposes, namely playing, which is of a non-technical nature, and enabling assembly or combination, which is of a technical nature.
Article 7(e)(i) requires determining the essential characteristics or most important elements of the sign; to be assessed in the light of the nature of the goods in class 28 (‘games and playthings’). The BoA found that the head, body, arms and legs are the essential characteristics of that trade mark – but not the protrusion on its head and the holes under its feet and at the back of its legs. The applicant submits that also these elements are essential characteristics – to be joined with other building bricks of LEGO. None of the essential characteristic has any decorative element.
The General Court agreed to the essential characteristics above; however, it rejected the applicant’s view that ‘no characteristic of the trade mark (…) has any decorative/imaginative element that goes beyond its dual nature. In fact, the toy figure also consists of decorative/imaginative characteristics resulting from the freedom of the designer (such as the cylindrical or ‘barrel’ shape of the head and the short, rectangular shape of the neck). Since there is at least one essential characteristic that results not from the nature of goods, Article 7(e)(i) is not applicable.
The second plea - absolute ground for refusal, Article 7(1)(e)(ii) of Regulation No 40/94 also not applicable
According to Article 7(e)(ii) signs shall not be registered which consist exclusively of the shape of goods which is necessary to obtain a technical result are not to be registered. The purpose of Article 7(1)(e)(ii) is to prevent trade mark law from granting an undertaking a monopoly on technical solutions/functional characteristics of a product.
The BoA rejected the applicant’s view that the protrusion on the head, the hands equipped with hooks and the holes under the feet and at back of the legs, etc. are exclusively intended to enable joining of the figure. The General Court agreed with the BoA’s view that the goods fulfil the purpose of a “toy figure” that can be played with and has human characteristics. However, the goods have a twofold purpose (same conclusion as above) – both that of a ‘toy figure’ and that of an ‘interlocking building figure’ having a technical result of being interlocking and modular with LEGO’s building system.
The BoA found that the essential characteristics of the sign were the head, body (torso), arms and legs. It disregarded the protrusion on its head and the holes under its feet and at the back of its legs. The General Court sided with the BoA; however, it also found that the protrusion on the head, the hooks on its hands and the holes under its feet, etc. are essential characteristics. They contribute to a technical result of a toy figure.
The General Court stated that the cylindrical or ‘barrel’ shape of the head does not stem directly from the technical result of joining an interlocking building figure in LEGO´s modular building system. The same applies to the short and rectangular shape of the neck and the flat and angular trapezoidal shape of the torso, and the specific shapes of arms with hands and legs with feet. These decorative/imaginative characteristics result from the freedom of the designer.
The General Court therefore rejected the applicant’s claim that ‘no characteristic of the contested trade mark has any decorative or imaginative element that goes beyond the functionality described’. Article 7(e)(ii) is not applicable.
To the point
Trade mark law and its unlimited protection (until renewal) are advantageous compared to other rights which are limited in time. Article 7(1)(e) of Regulation No 40/94 aims to prevent abuse of this indefinite protection by requiring that at least one essential characteristic result from the freedom of the designer (‘decorative/imaginative element’). That was the case for both 3D EUTMs so that Article 7(1)(e)(i)(ii) does not apply.
