Court of Appeal of the Hague

[IN THE NAME OF THE KING]

JUDGMENT

COURT OF APPEAL OF THE HAGUE

Civil-law division

Case No. : 200.133.706/01 Case/Cause-list No. : C/09/446226/KG ZA 13-777

Judgment of 15 July 2014 in the matter of

1. KETTLE FOODS, INC., a company incorporated under foreign law with its registered office in Salem, Oregon (United States of America), 2. KETTLE FOODS LTD., a company incorporated under foreign law with its registered office in Bowthorpe, Norwich (the United Kingdom), the Appellants, hereinafter referred to as "Kettle Foods Inc" and "Kettle Foods Ltd" and jointly as "Kettle Foods" (in the singular), lawyer: A.M.E. Verschuur, practising in Amsterdam, against

1. INTERSNACK NEDERLAND B.V., with its registered office in Doetichem (the Netherlands), hereinafter referred to as "Intersnack Netherlands", 2. INTERSNACK GROUP GmbH & Co. KG, a company incorporated under foreign law with its registered office in Düsseldorf (Germany), hereinafter referred to as "Intersnack Group", 3. INTERSNACK KNABBER-GEBÄCK GmbH & Co. KG, a company incorporated under foreign law with its registered office in Cologne (Germany), hereinafter referred to as "Intersnack Knabber", the Respondents, hereinafter also jointly referred to as "Intersnack" (in the singular), lawyer: M.W. Rijsdijk, practising in Amsterdam.

The course of the proceedings

By way of a Notice of Appeal ("NoA") of 26 August 2013, Kettle Foods lodged an appeal against the judgment that the preliminary relief judge of the District Court of The Hague had issued between the parties on 30 July 2013. The NoA included three grounds for appeal against that judgment which were contested by Intersnack in its Defence on Appeal also containing a Statement in the Cross- Appeal ("DoA/SCA"). Kettle Foods contested the two grounds for appeal in the cross-appeal in a Defence in the Cross-Appeal also containing exhibits ("DCA").

The parties had their cases pleaded at the hearing of this Court of 27 March 2014, Kettle Foods by its lawyer and his colleague, T.H.B. Iserief, Intersnack by its lawyer and P.J.M. Steinhauser, lawyer practising in Bloemendaal (the Netherlands). The lawyers had written pleadings at their disposal ("WPA" = Written Pleadings on Appeal). With a view to the pleadings, the parties submitted some more exhibits to this Court and to the other party, namely: - received by this Court on 6 March 2014: Kettle Foods' exhibits 54-58; - received by this Court on 6 March 2014: Intersnack's document submitting exhibits also containing a change to the cross-appeal, with exhibits 105-116; - received by this Court on 12 March 2014: Kettle Foods' exhibits 59-71; - received by this Court on 17 March 2014: Intersnack's exhibits 117-120; - received by this Court on 26 March 2014: the updated lists of costs from Kettle Foods and Intersnack. Kettle Foods raised an objection against Intersnack's exhibits 117-120 arguing that they had been filed too late. By word of the presiding judge, the parties were told at the pleadings that this Court would grant the objection as these documents were not received by this Court and Kettle Foods until after the time limit of twee weeks prior to the day of the hearing as stipulated in Article 2.17 of the National Rules of Procedure for civil summons proceedings before courts of appeal had lapsed.

The assessment of the appeal

Body of facts

1. The appeal proceedings proceed from the following facts. a. Kettle Foods is an American company that has been developing, producing and selling potato chips since 1982. In 1988 an English entity of Kettle Foods was incorporated and since then the company has extended its operations to the European market. In the Netherlands the Kettle Foods products have been available since 2006. b. In the United States (US) the production process applied by Kettle Foods for the production of its chips is generally referred to as 'kettle cooked'. This process is also referred to as 'hand cooked' or 'batch cooked'. On 3 January 2007, the US District Court of California ruled that 'kettle cooked' is a descriptive designation. Kettle Foods subsequently cancelled its trade mark registrations in the US. c. Kettle Foods Inc owns the following trade marks: - the Benelux word mark KETTLE, registered on 1 October 1989 for goods in class 29, including snacks; - the Community word mark KETTLE, registered on 2 February 1999 for goods in classes 29, 30 and 42, including potato chips. Kettle Foods Ltd has a licence for these trade marks and according to the licence may act against third parties in connection with trade mark infringement. d. In the Netherlands Kettle Foods’ chips are marketed in packages stating 'KETTLE chips'. e. In Germany Intersnack Knabber produces 'hand cooked' / 'batch cooked' chips under the CHIO trade mark. Intersnack Netherlands purchases these chips from Intersnack Knabber and has recently started selling them in the Netherlands. The packaging for these chips states - underneath the CHIO trade mark and the word chips - the words 'Kettle Cooked' (hereinafter also "KC"). One of these bags looks is shown below: In what follows the aforesaid Intersnack chips and the packaging of them will also be referred to as 'CHIO chips' and the (Dutch) 'CHIO KC packaging'.

Kettle Foods' claims and the judgment of the preliminary relief judge

2.1 Kettle Foods applied for a prohibition against trade mark infringement for the EU, or at least for the Benelux, and an injunction against the tortious acts, with ancillary claims. The trade mark infringement injunction is based on the position that by selling chips in the CHIO packaging, and especially in view of the word 'Kettle' affixed thereto, Intersnack is acting in violation of Article 2.20(1) (a) to (d) of the Benelux Convention on Intellectual Property (Trademarks and Designs) ("BCIP") and Article 9(1) (a) to (c) of Council Regulation (EC) No 207/2009 of 26 February 2009 on the Community Trade Mark ("CTMR"). The injunction against the tortious acts is based on the position that by using the word 'Kettle' on the CHIO packaging Intersnack: (i) needlessly causes confusion; (ii) makes a misleading statement within the meaning of Article 6:194 of the Dutch Civil Code ("DCC") a) by suggesting a commercial connection with Kettle Foods and b) about the manner in which it prepares its chips; (iii) conducts dishonest commercial practices within the meaning of Article 6:193b DCC because it a) wrongly uses the trade mark of Kettle Foods and b) significantly restricts the ability of consumers to make a well-informed decision; (iv) is guilty of misleading commercial practices within the meaning of Article 6:196c DCC because a) it induces a consumer to take a purchasing decision it would not otherwise take, b) a commercial connection with Kettle Foods is suggested and c) confusion is caused.

2.2 In the judgment of 30 July 2013 (hereinafter "the Judgment") the preliminary relief judge - after rejecting Intersnack's defence that he lacked cross-border jurisdiction with regard to the two German Intersnack companies - dismissed Kettle Foods' claims. In the Judgment the judge found as follows, put briefly: A. It is unlikely that 'KETTLE' is a well-known trade mark in the Benelux or the other countries of Europe, which means that Article 2.20(1)(c) BCIP and Article 9(1)(c) CTMR are not applicable; B. Article 2.20(1)(a) and (b) BCIP and Article 9(1)(a) and (b) CTMR cannot benefit Kettle Foods either as in the preliminary opinion of the preliminary relief judge the situation is as described in Article 2.23(1)(b) BCIP and Article 12(b) CTMR: Intersnack is using the sign 'Kettle Cooked' to communicate a certain preparation method, a feature of the good it markets and it moreover does so in accordance with honest practices in industrial and commercial matters; C. in view of the above the reliance on Article 2.20(1)(d) does not succeed either; D. Kettle Foods' reliance on tort must also fail.

The appeal

3.1 Kettle Foods lodged an appeal against the Judgment in good time. Its first three grounds for appeal in the main appeal take issue with decisions stated at [2.2] under A, B and D of the preliminary relief judge's Judgment. Intersnack's cross-appeal takes issue, inter alia, with the cross-border jurisdiction.

Intersnack's cross-appeal

4.1 The Court of Appeal sees cause to begin with Intersnack's cross-appeal. In view of the judgment of the Dutch Supreme Court ("DSC") of 10 October 1980 (NJ 1981, 3) the fact that Intersnack's cross-appeal was issued conditionally in its motion of 6 March 2014 in the sense that that motion stated that the cross-appeal would only become relevant if the court were to rule in the main appeal that the use of the designation 'Chips Kettle Cooked' is tortious, does not stand in the way of this. Added to that, the Court of Appeal must ex officio examine the jurisdiction issue raised in the cross-appeal, even outside the scope of the area reopened by the grounds for appeal, see, inter alia, DSC 18 February 2011, LJN: BO7116, and specifically at [17] of the Advocate General's opinion.

4.2 The first ground for cross-appeal takes issue with some findings of fact in the Judgment, more specifically the finding of the actions that the three Intersnack companies carry out and their mutual relationship. In the explanation of this ground for cross-appeal, Intersnack submitted the following (put briefly) (see nos. 109-116 DoA/SCA): a) Intersnack Group owns the shares of Intersnack companies in various European countries. It takes the initiative for new products, but it is not engaged with their sales, either directly or indirectly. Under the auspices of Intersnack Group, the look of the packaging for the 'kettle cooked' chips was developed in collaboration with the Intersnack companies that were interested in including this product in their range of products; b) In the various European countries 'kettle cooked' chips are sold by the local Intersnack companies in different packaging. In Germany they have opted for a packaging under the FUNNY FRISCH brand and with 'Kessel Chips' as the product designation, in France they use the VICO brand and the 'Brut de Chips' product designation, whilst in the Netherlands they use the CHIO brand and the 'Kettle Cooked' product designation; c) Intersnack Knabber produces the chips. The local Intersnack companies order the desired quantity from Intersnack Knabber which supplies it from its warehouse in Germany to the haulage company enlisted by the local company concerned, which collects it from the warehouse. The CHIO 'kettle cooked' chips that are sold by Intersnack in the Netherlands were ordered at and supplied in this manner by Intersnack Knabber. The packaging too is produced by Intersnack Knabber by order of Intersnack Netherlands (no. 136 DoA/SCA); d) The three defendant Intersnack companies do not sell the CHIO packaging with the 'Kettle Cooked' designation outside the Netherlands nor is there any serious threat that they will do so (nos. 114-116 DoA/SCA); No. 6 NoA shows that Kettle Foods affirms that Intersnack Group is responsible for the development of the CHIO chips, that Intersnack Knabber is responsible for the production of and supply to customers and that Intersnack Netherlands is responsible for the sale to customers in the Netherlands.

4.3 The second ground for cross-appeal submits that the preliminary relief judge should have declined jurisdiction in as far as the claims were cross-border claims. This Court will first assess this ground for cross-appeal.

Second ground for cross-appeal: (cross-border) jurisdiction

5.1 In the first instance the District Court's jurisdiction to hear the claims, including the cross- border claims, against Intersnack Netherlands was not contested. This jurisdiction thus already exists on the grounds of Article 24 of Council Regulation (EC) No 44/2001 (hereinafter the "Brussels I Regulation"). Perhaps superfluously, the following is noted in that regard. The Dutch court has jurisdiction on the grounds of Article 2 of the Brussels I Regulation to hear the claims based on infringement of the Benelux trade mark and separate torts against Intersnack Netherlands, see, as regards the claim based on the Benelux trade mark, at [28] to [34] of the judgment of the Court of Appeal of The Hague of 26 November 2013 in the matter of 'H&M v G-Star', ECLI:NL:GHDHA:2013:4466. This entails cross-border jurisdiction. The Dutch court (for the Community mark, the court of The Hague) has jurisdiction on the grounds of Article 97(1) (in conjunction with Articles 95(1) and 96(a)) and/or Article 103(1) CTMR to hear the claim based on infringement of the Community mark against Intersnack Netherlands. This entails cross-border jurisdiction under Article 98(1) or Article 103(2) CTMR. It follows from all this that Intersnack's second ground for cross-appeal is not applicable to Intersnack Netherlands.

5.2 Regarding the defendants established in Germany, i.e. Intersnack Group and Intersnack Knabber, the Dutch court can only base its jurisdiction on Article 6(1) of the Brussels I Regulation. This ground requires a connection between on the one hand the claims against Intersnack Netherlands - regarding which the jurisdiction of the Dutch court has just been established - and on the other hand the claims against Intersnack Group and Intersnack Knabber. More specifically, the connection between these claims must be so close that the proper administration of justice requires that they must be heard and determined together in order to avoid irreconcilable judgments if they are heard and determined separately. Decisions are irreconcilable in that sense if divergence occurs in relation to the same situation, both in fact and in law, see, inter alia, para. 79 of the judgment of the Court of Justice of the European Union (ECJ) of 1 December 2011 in case C-145/10 ('Painer'). Article 6(1) of the Brussels I Regulation is applicable in addition to the jurisdiction of the CTMR, see at [4] of the judgment of the Court of Appeal of The Hague of 13 August 2013 in the 'Bang & Olufsen v Loewe' case, ECLI:NL:GHDHA:2013:3356.

5.3 Within the scope of its second ground for cross-appeal, Intersnack disputed that this situation is the same in fact and in law (see, inter alia, no. 133 DoA/SCA).

5.4 As the legal ground for the claims issued against all the defendants is the same, i.e. infringement of a Benelux trade mark and a Community mark as well as the torts referred to at [2.1] above, the requirement that these claims were issued in the context of 'the same legal situation' is satisfied.

5.5 The three defendant Intersnack companies are part of the same group. As the findings at [4.2] above show: - Intersnack Knabber affixes the words 'Kettle Cooked' to the CHIO packaging; - Intersnack Knabber subsequently supplies such packaging to Intersnack Netherlands; - Intersnack Group too has a role in affixing the 'Kettle Cooked' sign to the CHIO packaging. Accordingly, Intersnack Knabber and Intersnack Group have each carried out one or more acts regarding the same allegedly infringing sign, to which the acts that Intersnack Netherlands is being accused of relate. This therefore also involves 'the same factual situation'. This is not altered by the fact that the three aforementioned Intersnack companies each carry out different acts in relation to the same sign.

5.6 If the case against Intersnack Netherlands and the cases against Intersnack Group and Intersnack Knabber were heard and determined separately, there would, in view of the findings at [5.4] and [5.5] above, be a risk of irreconcilable judgments. Contrary to Intersnack's submissions, there is no reason to assume that Kettle Foods is solely intent on removing the German Intersnack companies from the jurisdiction of the German court. The fact that the German court has already issued a ruling against Kettle Foods in connection with the 'Kessel Chips' packaging used in Germany by Intersnack does not suffice to assume so. Accordingly, Article 6(1) of the Brussels I Regulation means that the Dutch court also has jurisdiction to hear the claims issued against Intersnack Group and Intersnack Knabber. This article in principle confers, also in relation to preliminary relief, territorially unlimited jurisdiction (see the judgment referred to at [5.2] above of the Court of Appeal of The Hague in the 'Bang & Olufsen v Loewe' case).

5.7 The above means that Intersnack's second ground for cross-appeal must fail.

First ground for cross-appeal: is the CHIO packaging marketed outside the Netherlands?

6.1 The submissions made by Intersnack within the scope of its first ground for cross-appeal do not amount to grounds for appeal in the sense that they are aimed at setting aside the judgment, they serve to supplement or substantiate the defences raised against Kettle Foods' claims. 6.2 This Court will first discuss Intersnack's defence referred to at [4.2] under (d) above, i.e. that the defendant Intersnack companies do not market the CHIO packaging with the 'Kettle Cooked' designation outside the Netherlands and that there is no serious threat of them doing so.

6.3 Kettle Foods claims that the 'infringing CHIO product' is in fact sold outside the Netherlands by one or more of the defendant Intersnack companies and that there is in any event a threat of them doing so (nos. 5, 15, 27, 30 and 32-36 DCA).

6.4 In assessing this submission by Kettle Foods, it must first of all be specified that 'infringing CHIO product' must solely be taken to mean: the CHIO packaging KC with the words 'Kettle Cooked' on it and the statements relating to this packaging such as they can, for example, be seen on the CHIO websites depicted in Exhibit 32 to the NoA (hereinafter jointly referred to as the "CHIO packaging KC"). It must also be noted that in view of the principal rule of Article 150 of the Dutch Code of Civil Procedure ("DCCP") it is for Kettle Foods to state specifically and make it plausible that the CHIO packaging KC is also sold outside the Netherlands or that there is a threat of it being sold outside the Netherlands.

6.5 In support of the submission referred to at [6.3] above, Kettle Foods has first of all referred (see no. 33 DCA) to the websites with information about CHIO products it filed as Exhibit 14 in the first instance. Given that the word 'kettle' is not mentioned on these websites, Kettle Foods cannot however derive an argument from this.

6.6 Secondly, in support of the aforesaid submission, Kettle Foods has pointed out (see no. 34 DCA) that a product description on the CHIO packaging, as shown by Exhibit 52 and the CHIO chips bag filed at the pleadings, is printed in nine languages (including English, French and German). In view of the submission made by Intersnack (see at [4.2] under (b) above) which is not contested by Kettle Foods (see no. 36 DCA) that packaging other than the CHIO packaging is available in markets in countries other than the Netherlands, including France, and in view of the fact that according to the 2nd and 3rd pages of the aforesaid exhibit 52 and the bag of CHIO chips filed at the pleadings a step-by-step outline is only stated in Dutch and German ('Stap/Schrit' 1-4), and it is therefore essentially only bilingual packaging, it cannot however be concluded that the fact that the (Dutch) CHIO packaging also has a product description in (inter alia) the French and English language, means that this packaging is also marketed in France, the United Kingdom ("UK") or Ireland or that there is a threat of it being marketed there. The fact is that different packaging has been developed for different countries.

6.7 The fact that it had been noted on Intersnack's behalf at the hearing in the first instance, as submitted by Kettle Foods in no. 35 DCA, that it would like to use one kind of packaging in the different European countries, does not imply that Intersnack will opt for the (Dutch) CHIO packaging KC.

6.8 It follows from the findings at [6.4] to [6.7] above that it has not been made (sufficiently) plausible that Intersnack sells or threatens to sell the (Dutch) CHIO packaging KC in, for example, France, the UK or Ireland - and more in general: in countries other than the Netherlands or Germany. Intersnack's defence as entailed in the second ground for cross- appeal is rightly raised to that extent.

Kettle Foods' main appeal: the trade mark infringement claims 7.1 Before discussing Kettle Foods' two grounds for appeal in the main appeal (1 and 2), this Court must first discuss Intersnack's defence - briefly referred to in no. 4.9 of the preliminary relief judge's Judgment and otherwise only mentioned in passing - that it does not use the word 'Kettle' on its packaging as a trade mark. According to Intersnack in no. 25 of its pleading notes in the first instance, no. 76 DoA/SCA and nos. 26 and 27 WPA, the relevant public in the Benelux will interpret 'Kettle Cooked' as a reference to a preparation method or as a quality designation.

7.2 This Court finds first and foremost that the ordinary, average consumer is the reference person for a general consumer item such as chips and that the relevant public is the ordinary general public.

7.3 At the top of the packaging of Intersnack's CHIO chips is the word 'CHIO', which the public will perceive as the trade mark, as Kettle Foods affirms in no. 21 NoA (cf. no. 29 2nd bullet point of Intersnack's WPA). Therefore, as the public has already seen a trade mark on the packaging, it will be less likely to interpret the words 'Kettle Cooked' on the packaging as a trade mark as well. The English of the average consumer in the Benelux is such that he will interpret the words 'Kettle Cooked' as a preparation method, even though he may not always know exactly what that preparation method is. The average Benelux consumer will read these words as meaning 'cooked in a kettle' or 'prepared in a kettle'. This is all the more cogent, as noted at [4.10] of the Judgment (without being contested on appeal, see no. 59 NoA), because that consumer is used to packaging of snack products making statements in English about the preparation method and other features. In this Court's preliminary opinion, consumers in the Benelux who are unfamiliar with the KETTLE trade mark of Kettle Foods will therefore regard the words 'Kettle Cooked' on the CHIO packaging KC as the description of the preparation method of the chips rather than as a designation of the origins of that good. Thus they will not read those words as a trade mark. It is only Benelux consumers who are familiar with the KETTLE trade mark of Kettle Foods who may recognise in 'Kettle Cooked' a trade mark, i.e. Kettle Foods' trade mark. In addition, in the EU Member States in which the average consumer has insufficient knowledge of the English language to interpret the words 'Kettle Cooked' as a preparation method (hereinafter the "X Member States") the word 'kettle' may be perceived as a trade mark, even if people are unfamiliar with the KETTLE trade mark.

7.4 In the UK and Ireland the Community mark KETTLE must be regarded as a well-known trade mark. The fact is that Intersnack has acknowledged (in nos. 18 and 73 DoA/SCA, see also no. 28 WPA) Kettle Foods' submission (nos. 43 and 44 NoA) in that regard. Kettle Foods has not, however, specified that Intersnack sells or threatens to sell the packaging with the 'Kettle' designation in the UK, Ireland or the X Member States, whilst this Court found at [6.8] above that it cannot be deemed plausible that Intersnack sells or threatens to sell the CHIO packaging KC in Member States other than the Netherlands or Germany. In view of this, it must be concluded that the Community mark KETTLE is therefore not being infringed (or at risk of being infringed) in the non-continental part of the EU and the X Member States.

7.5 Given the findings at [7.3] it must now be examined whether the general public or a significant part thereof in the continental part of the EU without the X Member States knows the KETTLE trade mark. Intersnack claims that it does not, see no. 73 DoA/SCA and no. 19 WPA.

7.6 As Exhibit 55 Kettle Foods has filed a report of an online survey into 'awareness Kettle chips' of September 2013 that was carried out among 2000 Dutch consumers aged between 18 and 75 years (hereinafter the "Awareness Report"). It was reported that assisted awareness of the KETTLE trade mark was 30%. Further to Intersnack's submission that assisted awareness does not really mean much (nos. 14-16 WPA), this Court notes that in the context outlined at [7.3] above determining assisted awareness is in fact the most appropriate research method. The fact is that in that context, as with determining assisted awareness, recognition of the trade mark by the public is of decisive importance.

7.7 In nos. 14 and 15 WPA, Intersnack rightly noted that the Awareness Report did not include the research question. As noted in § 4.1 of 'Market research in the court room ; the role of market research in trade mark disputes' [in Dutch] by Harry van den Berg (Amsterdam, 2007) - which book Kettle Foods also refers to in no. 44 WPA - contains a good questionnaire 'the heart (or perhaps better: the Achilles heel) of legal market research' [in Dutch]. The absence of the research question in the Awareness Report means that an essential part of the study cannot be reviewed. The doubts this raises give cause to regard the percentage mentioned in the report as slightly too high.

7.8 Kettle Foods also tried to demonstrate the well-known nature (i.e. awareness) of the KETTLE trade marks by filing turnover figures, sales figures, market shares, advertising efforts and such like (nos. 12-42 NoA and nos. 21-25 WPA). For now, this Court finds that these submissions do not suffice to assume that awareness of the KETTLE trade mark is higher than shown by the Awareness Report, at least for the territory of the Netherlands to which the report relates. It is important in this regard that the relevant question at issue here is not whether KETTLE is such a well-known trade mark that it is entitled to the additional protection offered by Article 9(1)(c) CTMR and Article 2.20(1)(c) BCIP.

7.9 Taking all this into account, this Court finds that Kettle Foods has been unable to make it plausible that its KETTLE trade marks are known among more than approximately 25% of Dutch consumers. In other words: approximately 75% of Dutch consumers are not aware of the KETTLE trade mark as referring to snacks/chips. This is such a high percentage that against the background of the reference person referred to at [7.3] above, it cannot be concluded that a significant part of the Dutch public will interpret the word 'Kettle' in 'Kettle Cooked' on the CHIO packaging KC as a trade mark.

7.10 Kettle Foods has not submitted that the KETTLE trade mark is better known in the other countries of the continental part of the EU, including the other Benelux countries, than in the Netherlands. For example, the submission made by Kettle Foods in no. 15 NoA in fact suggests that the trade mark is better known in the Netherlands and in Belgium than in the rest of continental Europe, but it was not indicated that it is better known in Belgium than in the Netherlands. Kettle Foods' argument developed in nos. 18-20 WPA that as a result of the judgment of the ECJ in case C-301/07 ('Pago'), the awareness of KETTLE in the UK and Ireland is sufficient to classify that trade mark as a well-known trade mark within the meaning of Article 9(1)(c) CTMR cannot benefit Kettle Foods because this matter does not turn on the well-known nature of KETTLE in that sense (see also at [7.8] above in fine) but only on the well-known nature of the trade mark in relation to the question of whether the allegedly infringing sign in the countries in which it is used will or will not be perceived as a trade mark. The 'Pago' doctrine does not apply to this question.

7.11 In view of the findings at [7.9] and [7.10] above, it must be assumed that the public in the entire continental part of the EU, except for the X Member States, will not interpret the word 'Kettle' in 'Kettle Cooked' on the CHIO packaging KC as a trade mark. In this territory the requirement of Article 9(1) (a) to (c) CTMR and Article 2.20(1) (a) to (c) BCIP that the challenged sign is at risk of being used 'in relation to goods or services' is therefore not satisfied.

7.12 If the use by Intersnack of the 'Kettle' sign in the continental part of the EU, without the X countries, should be classified as use 'in relation to goods or services', this could not benefit Kettle Foods either. In (inter alia) nos. 18 et seq. of its written pleadings in the first instance, Intersnack successfully relied on Article 2.23(1) BCIP and Article 12 CTMR. In that regard it is noted first and foremost that in (advertising) statements third parties and Kettle Foods itself use the words kettle-cooked, kettle style, 'ketelgebakken' [kettle-cooked] and 'in ketels bakken/frituren' [cooking/deep-frying in kettles] to describe the ('hand-cooked') preparation method of the specific chips in question. The 'Kettle Cooked' designation may therefore be regarded as a designation of a feature of the good. In view of this, Kettle Foods can only prevent the use by Intersnack of that designation if that use is contrary to honest practices in industrial or commercial matters. In the assessment of this requirement account must be taken of the extent to which the use of the designation concerned will be interpreted by the relevant public or at least a significant part of that public as an indication of the existence of a link between the goods of the third party and the trade mark proprietor (see para. 83 of the judgment of the ECJ of 16 November 2004 in case C-245/02 ('Anheuser v Busch')) and with all the other relevant circumstances of the case, such as the packaging (cf. paras. 25 and 26 of the judgment of the ECJ of 7 January 2004 in case C-100/02 ('Gerri v Kerry')). According to the above it must be concluded that a significant part of the relevant public will not interpret the 'Kettle Cooked' designation on the CHIO packaging KC as an indication of the existence of a link between the chips of Intersnack and Kettle Foods or an economically affiliated company thereof. In addition, the CHIO packaging KC prominently shows the CHIO trade mark plus an elaborate explanation of the 'kettle cooked' process. The fact that Intersnack does not use the 'Kettle Cooked' term in Germany and France but instead 'Kessel Chips' and 'Brut de Chips' (see also at [4.2] under (b) above) is an indication that Intersnack is not seeking to derive an advantage from the 'KETTLE' trade mark. Given all this, it must be assumed that its use by Intersnack on the CHIO packaging KC is in accordance with honest practices in industrial and commercial matters, meaning that Intersnack may successfully rely on the exception of Article 2.23(1) BCIP and Article 12 CTMR and that Kettle Foods' second ground for appeal must fail.

7.13 In summary: Intersnack does not infringe nor threaten to infringe the KETTLE Community mark anywhere in the EU. It doesn't in the UK, Ireland and the X Member States because it has not been made plausible that Intersnack sells or threatens to sell the CHIO packaging KC or other packaging with the word 'Kettle' there. Nor in the other EU Member States because, in as far as it uses the 'Kettle' designation there, Intersnack does not use the word 'Kettle' as a trade mark or it may at least rely on the exception of Article 12 CTMR in that regard. Nor has it been made plausible that Intersnack sells or threatens to sell CHIO packaging KC outside the Netherlands and Germany. Kettle Foods' claims on the grounds of the Community mark must therefore be dismissed.

7.14 The above also means that Kettle Foods cannot successfully rely on Article 2.20(1)(a) to (c) BCIP with regard to the Benelux. Given furthermore that the provisions under (d) of Article 2.20(1) BCIP are no longer at issue on appeal because Kettle Foods has not (or at least not sufficiently clearly and with reasons given) filed an appeal against the finding at [2.2] under (C) of the preliminary relief judge's Judgment, Kettle Foods' claims on the grounds of the Benelux trade mark must also be dismissed. 7.15 Given that Kettle Foods' trade mark infringement claims must be denied in view of Intersnack's defences as referred to at [6.2], [7.1] or at least at [7.12] and [7.5], its first two principal grounds for appeal need not be discussed.

Kettle Foods' main appeal: tort

8.1 In its NoA Kettle Foods has not (or not sufficiently clearly) appealed against the rejection of the tort claims where they were based on the ground stated at [2.1] under (ii)a) and (iv)b), i.e. that Intersnack's use of the word 'Kettle' suggests a commercial link with Kettle Foods. This is therefore no longer at issue on appeal. Nor can this ground be regarded as a factually accurate ground in light of the aforementioned finding that in countries where the CHIO packaging is sold, the average consumer will perceive the 'Kettle Cooked' sign affixed to that packaging as a designation of a preparation method and therefore as a reference term. This finding removes the basic assumption of the grounds stated at [2.1] under (i), (iii)a) and (iv)c) for the tort claimed by Kettle Foods, which according to nos. 70-73 and 76 NoA and nos. 50- 52 WPA are all based on the submission that Intersnack's use of the word 'Kettle' causes confusion with Kettle Foods' KETTLE trade mark. Accordingly, this Court concurs with Intersnack's defence (see no. 98 DoA/SCA) that this is a variant of the likelihood of confusion under trade mark law that cannot lead to a result other than the finding under trade mark law.

8.2 This leaves the grounds stated at [2.1] under (ii)b), (iii)b) and (iv)a) amounting to the argument that Intersnack is misleading the public by suggesting with the words 'Kettle Cooked' on its CHIO packaging that the CHIO chips are cooked in a kettle - according to the picture: a traditional ('Panoramix') kettle - whereas they are in fact prepared in an industrial deep fat fryer.

8.3 The question of whether or not a statement is misleading must be answered in view of the likely expectation of the average, well-informed, careful and alert consumer to whom the statement is addressed or that reaches it, i.e. the 'reference person' (DSC 30 May 2008, LJN: BD2820 'TMF'). A statement will, in particular, be misleading if it is inaccurate or incomplete. The factual establishment of a statement being inaccurate or incomplete does not however mean that it is also misleading. It is necessary that the statement misleads or can mislead the reference person and due to its misleading character can influence the reference person's economic actions. A statement may therefore only be classified as misleading if it is reasonably plausible that the inaccuracy or incomplete nature of the statement is of material importance to the decision by the reference person to perform the legal act concerned, in this case the purchase of a bag of CHIO chips, cf. DSC 27 November 2009, LJN: BH2162 'VEB v WOL et al.'. Intersnack disputes, inter alia, that this requirement has been satisfied.

8.4 Although Kettle Foods rightly noted in no. 74 NoA and no. 55 WPA that under Article 6:195(1) DCC the onus to prove the accuracy and complete nature of the facts comprising the statement or suggested by that statement and on which the allegedly misleading character of the statement is based lies with Intersnack, it is for Kettle Foods to make it plausible, when this has been contested with reasons given, that the inaccuracy or incomplete nature it alleges is of sufficient material importance to influence the purchasing decision of the average consumer.

8.5 It must be assumed that the average consumer will not assume that chips are (still) prepared in a 'Panoramix' kettle and that he 'could not care less' (in Intersnack's words in no. 90 DoA/SCA) whether the chips are prepared in an industrial kettle or in an industrial deep fat fryer. It is therefore unlikely that the inaccuracy or incomplete nature of the statement alleged by Kettle Foods is of material importance to that consumer's purchasing decision, so that nobody is being misled. The grounds stated at [8.2] are therefore also unable to support Kettle Foods' claim in tort.

8.6 It follows from the foregoing that Kettle Foods' third ground for appeal must fail in its entirety.

Remaining issues of the main appeal

9.1 This Court will disregard the offer made by Kettle Foods in no. 78 NoA to furnish evidence as preliminary relief proceedings do not allow for it. What is more, the only evidence issues specifically referred to by Kettle Foods, i.e. the existence of a certain market, the well-known nature of its trade mark and the meaning of 'kettle' are unsuited to evidence by witnesses. Kettle Foods could have filed the written documents it lists of its own accord.

Conclusion and costs of the proceedings

10.1 It must be concluded that none of the grounds for appeal in the main appeal and in the cross-appeal can set aside the contested judgment. That judgment must therefore be upheld. Accordingly, there is no ground for Kettle Foods' claim in no. 79 NoA for the reimbursement of the costs it paid to Intersnack in the first instance.

10.2 As the party ruled against in the main appeal, Kettle Foods will be ordered to pay the costs of the appeal proceedings. Article 1019h of the Dutch Code of Civil Procedure ("DCCP") applies in this matter to the extent that it relates to the trade mark law grounds. Intersnack filed the itemised lists of costs required in connection with this article as Exhibit 120, which was however not admitted due to having been filed out of time (see under the heading 'course of the proceedings'). This means that an itemised list is deemed to be lacking for the period up to 2 weeks prior to the date of the hearing (i.e. the period up to and including 13 March 2014). Accordingly, the costs for that period will be estimated based on the court- approved scale of costs. In the main appeal 1 point may be granted for the DoA, based on tariff rate II. That results in EUR 894.

10.3 Intersnack did provide an adequate itemised list in the form of an updated breakdown of costs for the period after 13 March 2014. This lists the following items: - 1.90 hours at EUR 250 x 1.05 for the activities carried out by M.W. Wiegerinck on 14 and 15 March 2014 (i.e. EUR 498.75); - EUR 24,875.55 for 'ongoing work of 15/3'; - EUR 8,106.00 for 'estimated time up to and including the pleadings', thus totalling EUR 33,480.30, this is approximately 1/4th of the EUR 138,692.27 claimed by Intersnack for the entire appeal.

10.4 Kettle Foods disputes the reasonableness and fairness of the costs claimed by Intersnack. In no. 59 WPA Kettle Foods argues that at most the same amount of EUR 72,000.00, which it claims for the entire appeal, should be allowable. The parties agree that 80% of the costs incurred on appeal must be allocated to the main appeal. In line with Kettle Foods, this Court will set the part of the appeal based on tort (not covered by Article 1019h DCCP) at 20%, meaning that on balance 60% of the total costs incurred on appeal will be allocated to the '1019h DCCP' part in the main appeal. Added to that, for the reason referred to at [10.3] above in fine, only 1/4th of the total costs on appeal are deemed to have been incurred in the period after 13 March 2014. This Court finds that the EUR 33,480.30 charged by Intersnack for the pleadings and the preceding two weeks is excessive in light of the rather simple/average nature of these proceedings. Kettle Foods' disproportionality defence is therefore well-founded. In view of this, Intersnack's '1019h DCCP' claim will be awarded up to 60% of 1/4th of the EUR 72,000.00 mentioned by Kettle Foods, i.e. up to EUR 10,800.00. For the time that Intersnack spent on the tort ground at the pleadings EUR 375.60 (i.e. 20% x 2 points in tariff rate II) will be granted based on the court-approved scale of costs. Finally, account must be taken of the court fee of EUR 683.00 paid by Intersnack.

10.5 It follows from the findings at [10.2] to [10.4] that the costs payable to Intersnack in the main appeal total (EUR 894.00 + 10,800.00 + 375.60 + 683.00 =) EUR 12,752.60.

10.6 As shown by the findings at [5.7] and [6.8] both parties were partly ruled against in the cross-appeal. The parties will therefore be ordered to bear their own costs of the cross- appeal as to be stated in the operative part. It is hereby noted that according to settled case- law the fact that Intersnack raised a number of defences in the form of a cross-appeal (see at [6.1]) does not mean that it will be ordered to pay the costs of the cross-appeal proceedings (cf. DSC 10 June 1988, NJ 1989, 30 and DSC 25 September 2009, LJN:BJ1248).

Decision

This Court of Appeal:

- upholds the judgment issued between the parties by the preliminary relief judge of the District Court of The Hague of 30 July 2013;

- orders Kettle Foods to pay the costs of the main appeal, estimated to date at EUR 12,752.60 on Intersnack's part;

- orders that each party must bear its own costs of the cross-appeal;

- declares this judgment immediately enforceable as regards the cost order.

This judgment was issued by judges A.D. Kiers-Becking, M.Y. Bonneur and R. Kalden; it was pronounced in open court on 15 July 2014 in the presence of the clerk of the court.

[duly signed and stamped]