The main function of a trademark is to identify the source of goods or services, and it must meet the requirement of "distinctiveness" through either "inherent distinctiveness" or "acquired distinctiveness. In specifying that a trademark shall meet the requirement of "inherent distinctiveness, Item 1, Paragraph 1, Article 29 of Taiwan's Trademark Act (the "Act") states: "A trademark shall not be registered if it is devoid of distinctiveness in any of the following: (Item 1) Consisting exclusively of a description of the quality, intended purpose, material, place of origin, or relevant characteristics of the designated goods or services." Paragraph 2, Article 29 follows up by stating: "Items 1 or 3 of the preceding paragraph shall not apply if the trademark has been used by the applicant and has become, in trade, a sign capable of distinguishing the goods or services of the applicant." That is, even if a trademark fails to meet the requirement of "inherent distinctiveness," it can possess "distinctiveness" by meeting requirement of "acquired distinctiveness" through its repeated use.

 

In response to the international trend of trademarks covering three-dimensional shapes, the Act was amended on April 29, 2003, to include protection of three-dimensional trademarks. However, since three-dimensional trademarks refer to three-dimensional shapes consisting of lengths, widths, and heights, those shapes often make up the appearance of the goods themselves (shapes, colors, etc.). It is difficult to clearly distinguish between the three-dimensional trademarks and the goods themselves. Furthermore, it is difficult to determine whether consumers use the three-dimensional trademarks to distinguish the source of goods or services. Therefore, in practice, what are the requirements for demonstrating the "distinctiveness" of three-dimensional trademarks? This is an important issue in trademark practice. Supreme Administrative Court Judgment No. 112(2023)-SZ-55 (dated April 12, 2024) clearly indicates that the requirements for proof of the distinctiveness of three-dimensional trademarks should be stricter than those for two-dimensional designs.

 

The first-instance trial found the following facts: Company A, the third party, filed an application for a three-dimensional trademark consisting of the three-dimensional shapes of shoes ("Disputed Trademark") and claimed priority as a German trademark. The Taiwan Intellectual Property Office examined and determined that the trademark was not distinctive under Item 1, Paragraph 1, Article 29 of the Act, and the original disposition was issued. After Company A's appeal against the original disposition was dismissed, Company A transferred the trademark rights of the Disputed Trademark rights to the appellant, who filed an administrative lawsuit. Given that the footwear market is highly competitive, the court stated in the first-instance judgment that consumers pay great attention to appearance, comfort, and functionality when making purchasing footwear; the supporting materials submitted by the appellant did not mention the characteristics of the Disputed Trademark and failed to prove that the Disputed Trademark had inherent distinctiveness. In addition, the market research report submitted by the appellant was skewed towards metropolitan Taipei, which affected its reference value, and obviously not enough consumers could correctly identify the source of the goods. This was insufficient to prove that the Disputed Trademark had acquired distinctiveness. Therefore, the original disposition was upheld and the appellant's complaint was dismissed. The appellant then appealed to the Supreme Administrative Court.

 

Supreme Administrative Court Judgment No. 112(2023)-SZ-55 not only found that the first-instance judgment was legally correct but further explained the requirements for proof of the distinctiveness of the three-dimensional trademark. Concerning the registrability of the three-dimensional trademark, the court explained that three-dimensional shapes are often the shapes of the goods themselves or the goods' decorations; that is, the three-dimensional shapes are inseparable from the goods. Consumers usually perceive the three-dimensional shapes as providing the goods' functions or the designs of the goods' decorations rather than marks that distinguish the goods' sources. Therefore, in determining the inherent distinctiveness of three-dimensional shapes, the court stated that requirements for proof of distinctiveness of the three-dimensional trademark in indicating the goods' sources and distinguishing them from other goods should be stricter than that for two-dimensional shapes. Moreover, another factor to consider is the characteristics of the goods. Consumers pay less attention to daily necessities or inexpensive goods. Unless the goods' three-dimensional shapes are unique or leave lasting impressions in consumers' minds that distinguish the sources of the goods, the three-dimensional shapes are not identifiable.