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Friday, 13 September 2013

Trade marks and co-branding by Android and Kit Kat

This Kat, a fan of having a break with a Kit Kat bar -- to her knowledge, no endorsement exists with the IPKat -- learned with delight of a certain co-branding deal which found itself at the centre of quite a buzz last week. Apparently, Google has a sweet tooth when it comes to naming its operating systems (OS). Following in the tradition of its “gingerbread”, “ice cream sandwich” and “jelly bean” OSs, it announced that the next Android system will be called KitKat—a word trade mark owned by Nestlé (sadly not accompanied by a coordinated shape mark. See IPKat report here).

Rumour has it that Android Head of Engineering Hiroshi Lockeheimer’s favourite candy bar Kit Kat won out over the name Key Lime Pie – which was widely believed to be the next choice yet ultimately dismissed because many people may not know what it tastes like [is flavour really the factor enticing consumers into buying a non-edible product? And wouldn’t Key Lime be a better – not to mention surprisingly accurate – description of the Android robot colour than the currently used “yucky greeny-yellow”? Merpel sighs]

Official press releases are insistent that there is no financial agreement between Google and Nestlé – Google just decided to do something “fun and unexpected”! (Great!)

Alas, this Kat lives in the real (dog-eat-dog?) world where casual, no-strings-attached co-branding is as rare as a unicorn. In this case, although the companies belong to non-competing sectors, any Kat knows this delicious partnership would end in cease & desist letters and litigation if no agreement existed, no matter how informally it was concluded. 

Here are a few ingredients the legal pastry chefs have to throw into the mix in the trade mark kitchen:

In the EU, Nestlé has KIT KAT Community trade marks registered for the entire Classes 20, 30  and 32 including “confectionery, sweets, candies”. Google Inc. also has several CTM’s registered for ANDROID for  goods and services in Classes 9, 11, 16, 28, 35, 38, 41, 42 including “computer software, computer hardware, mobile phones, mobile peripherals, computers, tablet computers; Telecommunications services, etc.”

Meanwhile in the US, according to Android branding guidelinesthe Android name is property of Google Inc. and the Robot logo is licensed under the terms of the Creative Commons Attribution licence. On the other side, Nestlé owns KIT KAT trade marks registered for “wafer fingers in milk chocolate” first used in 1949. However, Hershey’s retained the licensing rights to the Kit Kat brand in the United States -- obviously a key market sweet spot for Google and Android.

On September 3, 2013, Nestlé applied for trade mark registration for KIT KAT for Services such as “downloadable software via smartphones, mobile phones, mobile terminals or other portable devices and desktop computer applications; Providing Internet platforms; creating and maintaining internet platforms for blogs for third parties; hosting of digital content, including on-line journals and blogs; construction of internet platform for electronic commerce; creation of internet web sites”.

The benefits of such a sugary co-branding strategy work both ways in the short term: Nestlé sells more candy bars as consumers are motivated to buy by the possibility of winning a Google product, and Kit Kat will undoubtedly benefit from higher recognition from the vast growing numbers of Android users. And most importantly, this Kat considers the broader impact of such collaboration – i.e. will Google employees suddenly have an unlimited supply of said candy bars at work?

Brand associations are common in similar commercial sectors (see McDonalds and M&Ms’ candies), but lately we have seen this technique expand as some particularly creative pairings have popped up -- note energy drinks associated with space missions (see Red BullStratos) --  when companies decide to “go combo” in the hopes of linking positive images with their products.

what's cooking in trade marks world?
However, this mere sous-chef humbly cautions about a sugar crash, since “Any sign, or any combination of signs, capable of distinguishing the goods or services of one undertaking from those of other undertakings, shall be capable of constituting a trademark.” (Art 15 TRIPS), and wonders whether this co-branding concoction is the best recipe for trade mark owners in the long-term.

Consumers may become  confused and identify more than a single source of origin, thus leading to trademark dilution for both marks under Art. 15 of the Lanham Act. Particularly vulnerable in this case is the name ‘Kit Kat’, which may lose its exclusive association with the Nestlé candy bar, therefore lessening the strength or value of this mark as an identifier for its goods. Similarly, in the EU, Art. 8(5) of the CTM Regulation recognizes blurring as a form of dilution if it is detrimental to the distinctive character of an earlier trade mark. [though…thinking of fodder for future posts, Merpel  delights in the possibility of scrumptiously fun and unexpected future litigation on this topic!]

For [confusingly] similar  trade marks – KATKIT and KIT T KAT
Give me a break: the Kit Kat parody video here

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