Nestle didn’t get a break

31st Jul 2018

It’s been widely reported in the media that after a long-running legal battle between global chocolate giants over the shape of KitKat finger wafers, the case has been sent back to the EU’s trademark office after judges dismissed appeals by both companies.

The ruling by the European Court of Justice means the EU Intellectual Property Office (EUIPO) must review a 2012 decision to uphold Swiss-based Nestlé’s (NESN.S) trademark on the shape of the four-finger chocolate-covered wafer biscuit over objections raised by Cadbury-owned Mondelez (MDLZ.O) of the United States.

The court found that Nestle had failed to show that consumers in enough EU countries recognized the shape as distinctive, but also dismissed an appeal by Mondelez against some of the grounds for a lower EU court ruling in 2016 that had found the EUIPO was wrong to reject the U.S. firm’s complaint.

The outcome leaves the possibility that the trademark agency could, whilst respecting the judges’ ruling, take note of other evidence — such as new proof the shape is distinctive to people in more countries — and might preserve protection for KitKat’s shape. The brand name “KitKat” and the embossment on the chocolate bar are not at issue in the case.

Proceedings have been followed closely by trademark lawyers, who see implications for brands operating across the EU single market, where there are varying histories in national markets. This was not the first time that the two companies have clashed in court; in 2010 Nestle successfully blocked Cadbury’s attempt to trademark the shade of purple used for its signature chocolate wrappers.

The case demonstrates just how protective companies are about their intellectual property rights. Even though the two products in question have been sold side by side in Europe since the 1930’s, multinational companies bought out the original producers and marketed them globally, coming into contact with very similar products thus causing the conflict. Nestle has already intimated that this will not be the end of the battle, showing just how important it is to them to protect the shape of the well-known teatime treat.

Our commercial litigation and dispute resolution team have wide ranging experience in dealing with copyright infringement cases and have successfully secured settlements, judgments and injunctions to protect our clients’ business and Intellectual Property Rights.

We have also acted in connection with defamation and malicious falsehood or trade libel issues – again frequently in the context of wider business disputes where one party is said to be undermining the other’s brand, products or services.

Business Rates - Rating your chances?

It is well-known practice amongst property owners to perform rating mitigation exercises to obtain relief from business rates whilst their properties stand empty. There is, of course, nothing wrong with using a loophole in legislation which enables them to avoid the financial burden of paying rates on an empty property which is not generating any income. However, certain purveyors of “schemes” offered to landlords to “assist” them in avoiding rates have exploited the system for less than altruistic purposes, leaving unsuspecting landlords on the receiving end of proceedings brought by local authorities for liability orders for unpaid rates.

Certain classes of non-domestic property that are empty for a continuous period of 3 or 6 months (depending on the type of property) are exempt from rates over that period. Occupation of the property for less than 6 weeks during that time will be ignored, but if the premises are occupied for 6 weeks or more, the rates exemption will end at the beginning of the occupation but then a new exemption period will begin to run afresh once the property is empty again.

It is therefore common practice to lease an otherwise empty property to another party for a period of 6 weeks, during which time the leaseholder becomes liable for the rates. Once the 6 weeks have expired, the tenant then vacates and the property is then returned to the landlord, who then claims a further statutory 3 or 6 month exemption from rates, and the cycle the continues.

This is beneficial not only to landlords but also for tenants looking for short-term storage and companies who trade in performing the operational logistics by moving items between the various properties.

However, numerous landlords have fallen victim to those who try to exploit this system for financial gain. Companies have sprung up offering to provide landlords with short-term tenants to enable them to take advantage of the rates exemption regime, but there have been numerous instances of the “tenants” not occupying the properties sufficiently to fulfil the requirement of “actual occupation”. This has resulted in local authorities across the country taking action to recover rates on the basis that the tenancies were “shams”. These companies have also taken matters a step further, by seeking to gain not only the 3 or 6-month exemption period for the landlord, but also to avoid liability for the 6-week letting periods. To do so they have attempted to rely upon various other classes of exemption, including a discretionary relief for use of premises for charitable purposes and an exemption for use of premises for fish farming. The latter has resulted in “tenants” placing boxes in premises and claiming that they are being used for snail farming (the definition of fish farming includes shellfish, which in turn includes “molluscs”).

There are several cases like this where Magistrates’ Courts have sided with the local authorities, leaving landlords liable to pay non-domestic rates when they had been under the impression that they had been provided with legitimate tenants and that they had therefore successfully avoided liability. We have acted for landlords in cases where they have fallen victim to these scams and have been able to extricate them from such proceedings before reaching court. If you have recently had proceedings brought against you for rates that you do not think you are liable for, or think you may have unwittingly become involved in one of these “scams”, please contact us.

Owens v Owens

When Mr & Mrs Owens said I do little did Mrs Owens know if she wanted to divorce it would break her emotionally and financially. Even with financial assistance from Resolution (the organisation who quality assure family lawyers) and a visit to the Supreme Court she cannot escape the previous Judgment handed down that she simply does not satisfy the grounds for divorce based on Mr Owens ‘unreasonable behaviour’.

It seems unconscionable that in the 21st century the law still prevents an amicable divorce by mutual consent or at the will of one party to the marriage who no longer wishes to be party to it. Family lawyers agree that it should not be for any husband or wife to prove blame which results in conflict and acrimony. Especially in marriages involving children.

Since we last attempted a change in divorce law through the Family Law Act 1996 1,720,000 people cited adultery or unreasonable behaviour as grounds for divorce in their petition.

Mrs Owens is now aged 68, she has given her marriage 40 years but simply because her husband refuses to divorce she will have to wait until 2020 (5 years separation) to divorce him without his consent. Mr Owens says the only reason she wants to divorce him is through boredom or because she has had an affair. Mr Owens does not believe he should be criticised for trying to save his marriage. It is clear in this marriage listening was not one of Mr Owen’s strong points if he believes that his marriage is reconcilable.

In answer to this Dame Butler-Sloss, the first female Lord Justice of Appeal (Appeal Court Judge) as tabled a private members bill to change the law to ‘no fault’ as in the US, Australia and Scotland (yes Scotland has different laws!) However, it continues to be very difficult to convince parliament to have any enthusiasm for this subject.

With divorce soon to go on line and more people self representing it is concerning that many may fall prey to this recent case law with spouses who do not wish to divorce choosing to defend the divorce proceedings. If you need help or advice with your divorce contact me on 01603 675666 or email kr@rogers-norton.co.uk.

Rogers and Norton: About Us