Two recent cases deserve special attention for their use of alternative tests to determine whether trade dress consisting of packaging for simple consumer products was functional. In Aromatique Inc. v. Gold Seal Inc., 31 USPQ2d 1481 (8th Cir. 1994), decided July, 1994, the U.S. Court of Appeals for the Eighth Circuit denied protection and registration of trade dress for packages containing potpourri. On the other hand, in Ziegenfelder Co. v. Dunkirk Ice Cream Co., 30 USPQ2d 1604 (N.D.W.V. 1993), the U.S. District Court for the Northern District of West Virginia granted preliminary protection for trade dress consisting of packaging for popsicles.
Determining whether trade dress is functional is one of two key criteria in evaluating whether it will be protected against infringement. (The other criteria is whether the trade dress must be distinctive.) Protecting the design of a functional package impedes competition by preventing the public from copying a useful article that it has a right to copy. As a result, trademark law will only protect nonfunctional trade dress.
In Aromatique, the packaging included pillow-shaped double cellophane bags closed at the top by gathering excess cellophane and tying the cellophane closed with a cord tied in a square-knot bow. Although other marks appeared on the packaging, the claimed trade dress included no words or marks that identified the products as those of Aromatique, except for the shape and configuration of the packaging itself.
The PTO granted two trademark registrations covering Aromatique's trade dress. However, the Eighth Circuit held that the trade dress was not inherently distinctive as a matter of law because the registrations had been granted on the basis that the trade dress had allegedly acquired "secondary meaning" i.e., become distinctive through use in commerce. 15 USC § 1052(f). The court also held that Aromatique's trade dress had not become associated with Aromatique in the mind of consumers because the evidence did not support such a holding.
In addressing functionality, the court noted that trade dress may be considered nonfunctional "if it is an arbitrary embellishment primarily adopted for purposes of identification and individuality." Id. at 1488. On the other hand, "if the trade dress is an important ingredient in the commercial success of the product, it is functional." Id.
The court held that Aromatique's trade dress was functional. In support of its holding, the court noted that Aromatique's witnesses testified that the appeal of its potpourri is both aesthetic and olfactory. In view of this testimony, the court noted that the clear cellophane packaging and the way it is wrapped allows customers both to see and smell the potpourri before they purchase it. They noted that double-bagging increases the shelf life of the product and that the shape of the bag is a consequence of using cellophane bags. They also noted that preventing others in the industry from using these elements would unduly impair competition. Accordingly, the court stated that "there can be no doubt that the cellophane bag is functional and lacks arbitrary embellishment." Id.
One judge dissented from the court's opinion, noting that the majority ignored evidence of nonfunctionality of the trade dress. This evidence included testimony that the trade dress was nonfunctional because there were numerous other ways to package potpourri. Id. at 1498.
In Ziegenfelder, the trade dress consisted of six different flavors of twin pops wrapped in clear film in a clear bag with sticks facing each other and the twin pops facing outward toward the edges of the bag. The bag contained two rows of nine twin pops each and was referred to as the "Rainbow Array". Id. at 1605. The court held that the trade dress appeared to be distinctive because the colors of the twin pops were designed to suggest their flavors and catch the eye of the consumer. Id. at 1610.
The court also noted that trade dress "is functional if it is essential to the use or purpose of the article or if it affects the cost or quality of the article." Id. at 1611. Under this test, the defendant argued that the trade dress was functional because it was used to indicate the flavor of the food product. The court rejected this argument and noted that the focus is "upon whether the trade dress somehow impacts upon the function of the product itself." Id. The court ultimately held that there was insufficient evidence that the trade dress had any impact upon the function of the twin pops.
We note that each court employed a different test for assessing the functionality of trade dress. The Eighth Circuit applied a commercial success standard--"if the trade dress is an important ingredient in the commercial success of the product, it is clearly functional." 31 USPQ2d at 1488. The court gave no indication as to the meaning of "commercial success" in terms of trade dress or how "commercial success" should be measured. On the other hand, the West Virginia court focused on the relationship between the product and the trade dress in terms of use, purpose, cost, and quality. 30 USPQ2d at 1611.
These different tests may have led to the different results in each case. For example, the Eighth Circuit test seems overly broad and capable of rendering any trade dress functional. Under this test, trade dress which is simply recognizable to the public may be held functional because it increases brand loyalty and contributes to the commercial success of the product. On the other hand, the West Virginia test seems to allow for a correct analysis of functionality because it focuses on the relationship between the product and the trade dress. Under this test, it can be determined whether the trade dress is separable from the product and what aspects of the trade dress are protectable.
We further observe that neither of these opinions addressed the issue of de jure and de facto functionality. The U.S. Court of Appeals for the Federal Circuit uses this distinction for assessing whether trade dress is entitled to protection. See, e.g., In re Smith Inc., 222 USPQ 1 (Fed. Cir. 1984) (de facto functional trade dress entitled to registration). See also In re Morton-Norwich Products, Inc. 213 USPQ 9, 13 (C.C.P.A. 1982) (functionality issue applicable to both registration and protection). Under this test, if a given trade dress simply happens to have a function, it is de facto functional and may be registered and protected. On the other hand, if the design feature is one of the few superior designs available, then it is de jure functional, and not entitled to protection.
In conclusion, it seems that the parameters of trade dress protection are evolving and may differ, depending on the jurisdiction in which a party finds itself. Companies seeking to protect product configurations, packaging, and other forms of trade dress need to be cognizant of these varying standards.
U.S. Customs Service Considers Detention of Infringing Articles
In recognition of the increased importance and availability of trade dress protection in the United States, even for trade dress which is not the subject of a trademark or copyright registration, the United States Customs Service is currently considering new regulations (as yet unpublished) which would permit the temporary detention of articles bearing or consisting of infringing trade dress. Currently, Customs can only act if the trade dress is the subject of a trademark or copyright registration, or pursuant to a court order. The new regulations may be part of a package to be published in connection with new U.S. obligations under the North American Free Trade Agreement and in anticipation of U.S. implementation of the Uruguay Round GATT Agreement.