IP in the candy industry

candy

It might seem unusual to think of intellectual property in the framework of something as colourful as candy. But believe it or not, it is no less problematic. 

Trade marks play an important role in the candy industry and have been at the heart of numerous disputes, from the Toblerone trade mark protecting the shape of its chocolate bar being challenged in the EU to KitKat’s trade mark application for its break-apart bar shape being denied in the UK.

A trademark can be a word, a logo, a combination of both, shape, colour… And it is used to identify the source of a product and distinguish it from competitors’ products.

Trade marks represent the reputation and quality of a product and its source. A trade mark grants its owner the right to prevent others from using the same or a similar trade mark on the same or similar products in a way that is likely to cause confusion as to the source, origin or sponsorship of the products.

What we will present today are a few examples of trade mark infringement cases in the candy industry (be it chocolate or candy properly speaking).

Lindt vs Haribo

Swiss chocolatier, Lindt & Sprüngli AG and Haribo GmbH & Co. were involved in a 3-year long dispute regarding trade mark infringement by three-dimensional chocolate bears. Haribo considered that Lindt's bear-shaped chocolates were infringing Haribo’s trade mark “Goldbären” (Gold Bear). Haribo, which invented gummy bears in the 1920s, stated that consumers are likely to get confused between the two, even if Lindt’s products are made of chocolate while Haribo’s gummy bears are a jelly sweet.

Haribo argued that “gold bears” and “golden bears” are well-known marks in Germany since the Haribo packaging depicts the classic Haribo golden bear with a red ribbon around its neck. On the other hand, we have Lindt chocolate bears wrapped in gold foil with a red ribbon, inspired by Lindt’s Easter best-seller: their golden chocolate bunny.

At regional level, the court decided in favour of Haribo and prohibited sales of Lindt’s bear-shaped chocolates. On appeal, the court’s decision was overruled and and the ruling granted in favour of Lindt, stating that the two products bore no similarity. It was held that chocolate teddies cannot be confused with Haribo’s jelly sweets.

The dispute went all the way up to the Federal Court of Justice, which confirmed the decision of the court of appeal, stating that Lindt’s gold foil-wrapped chocolate bears, which it sells as Lindt chocolate teddies, did not infringe Haribo’s marks for “golden bears” and “gold bears,” which is used for its line of gummy bears in gold packaging.

The court established that different terms could be used to refer to Lindt’s chocolate bears, such as “teddy”, “chocolate bear” or “chocolate teddy” and even “gold bear”. Referring to these chocolates as “gold bears” is neither a violation of Haribo’s trade mark or an imitation of its jelly sweets. The court also pointed that Lindt’s name and logo were prominently placed on the company’s chocolate bears, and that consumers were more likely to connect the bears to Lindt’s own well-established chocolate lines, like its foiled-wrapped Easter bunnies. In these conditions, the court considered that granting protection to Haribo could open the door to monopolisation of three-dimensional product forms, something that is not in accordance with the goals pursued with trade mark protection.

Haribo vs. Ositos&Co

Ositos&Co is a Spanish company that has been selling a more adult version of the usual gummy bears. The founders of this company had the brilliant idea to combine alcohol and gummy bears. The company had been selling their alcoholic bears online and in bars for 3 months when they received a cease and desist letter from Haribo. Haribo considered that these adult gummies were so similar to its gummy bears that they infringed its trade mark. Hence, Haribo required Ositos&Co to stop manufacturing and selling its booz-bears and transfer the management and ownership of its domain name, ositosconalcohol.com, to Haribo. Haribo also considered that by using the shape of a bear on their packaging, the startup was taking unfair advantage of Haribo’s reputation. By the way, for our English readers, “Osito” means “little bear” in Spanish.

The business, founded by 3 recently graduated university students, was starting to take off as customers grew fond of these adult gummy bears and their range of flavours: gin and strawberry, whisky and cola, rum and pineapple, and tequila and lemon. Each bear contains 19% alcohol: 17 are equivalent to a glass of alcohol.

The founders of Ositos&Co consider that the risk of confusion is slim. Indeed, Ositos&Co’s bears are bigger and have a different shape; and they are only sold online or in places where alcohol is served, being clearly marked as products for 18+.  

Ositos&Co is still deciding what the next course of action is going to be for them, but in the meantime, they plan to carry on selling their products in Spain and to their customers in France and the UK.

Poundland vs Toblerone

Poundland is a UK discount chain that saw a business opportunity when Toblerone decided to change the shape of its bar, selling less chocolate at a higher price. So Poundland prepared the launch of its own chocolate bar on the market without anticipating the opposition from Toblerone.

Originally, both chocolate bars had peaks and troughs and were wrapped in a golden package with red letters. But while the classic Toblerone bars had become lighter in weight, Poundland’s bar would be chunkier and cheaper.

Toblerone claimed trademark infringement, alleging that the Twin Peaks bar was “deceptively and confusingly similar” to its well-known Toblerone bar, and asked the court to order Poundland to refrain from selling the lookalike bar.

Poundland responded that the shape of the bar was actually inspired by two hills in the English county of Shropshire near the border with Wales (Ercall and Wrekin). Inspiration that also gave name to the chocolate bar “Twin Peaks”. Poundland also tried to argue that Toblerone had lost exclusivity over the shape since it had ceased to be distinctive enough in light of the recent redesign the chocolate bar experienced.

Regarding the likelihood of confusion by consumers as to the source of the chocolate bars and the fact that consumers might be led to think that the Twin Peaks bar is connected to and/or endorsed by Toblerone, Poundland claimed that the packaging, name, taste and shape of its Twin Peaks bar is different to the point that “no member of the relevant public would mistake one for the other”. In addition, the shape of the Twin Peaks bar was new and created a different overall impression upon the informed user.

Instead of pursuing further legal actions, Toblerone’s owners decided to settle the case. As part of the settlement agreement, Poundland could sell 500,000 Twin Peaks bars without fear of future litigation from Mondelēz (the bars that were already pre-produced and ready to be launched) but, after that, it would have to change the design of the bar, and also redesign its packaging.

These are only but a few examples of the legal disputes that have arisen in the candy industry. As you can see, trade marks play an essential role in this industry, especially the non-traditional ones. This is all for our monthly blog post. We hope you enjoyed this sweet break and see you next month!