Protecting Trade Dress in Once-Patented Subject Matter

The recent decision, Fuji Kogyo Co. v. Pacific Bay Int'l, Inc., 461 F.3d 675 (6th Cir. 2006), confronts the question deliberately left unresolved in TrafFix Devices, Inc. v. Marketing Displays, Inc., 532 U.S. 23 (2001), of whether a product design claimed in a prior utility patent can ever be protectable trade dress under the Lanham Act. Although setting a high bar to protectability, indeed a 'presumption' and 'heavy burden' that material claimed in a utility patent is functional and hence unprotectable once the patent term ends, the Supreme Court, of course, expressly elected not to foreclose such protection entirely. Thus, it refused the invitation of defendant TrafFix, and 'some of its amici,' to rule that 'the Patent Clause of the Constitution, Art. I '8, cl. 8, of its own force, prohibits the holder of an expired utility patent from claiming trade dress protection.' 532 U.S. at 35. Without itself addressing the constitutional question of how narrowly 'limited times' means 'limited times,' Fuji Kogyo does nothing to ease the burden in establishing trade dress protection for once-patented subject matter; it offers as well a new (if, perhaps, less than fully developed) analytical approach for applying the TrafFix presumption, asking whether the claimed trade dress would have infringed the expired patents.

A fishing line guide is one of a series of eyelets mounted along the length of a rod, through which the fishing line is threaded. Asked to tackle the question of whether Fuji Kogyo's previously patented fishing line guides could be protected as trademarks, the Sixth Circuit did not spare the rod in holding that because the designs were within the scope of Fuji Kogyo's expired patents, which to the court meant that Fuji Kogyo's own designs would have infringed its patents, either literally or under the doctrine of equivalents, judgment had been properly granted after trial dismissing its infringement claims and canceling the trademark registrations it had secured for the designs.

A potentially barbed issue in the waters left deliberately uncharted in TrafFix was that Fuji Kogyo's line guides were the subject not only of prior patent claims (and hence presumptively functional under TrafFix), but also ' on the other side of the ledger ' protected by three subsisting federal trademark registrations (which arguably should have overcome the presumption of functionality under 15 U.S.C. '1125(a)(3) and conferred a statutory presumption of validity under 15 U.S.C. '1115(a)), and had been the subject of seven design patents, which, although expired, likewise presumptively established the ornamental, non-functional nature of the designs under 35 U.S.C. '171. Although Fuji Kogyo might thus have entailed a knotty challenge of unsnarling a tangled line of evidentiary presumptions, the court cast aside any latent legal conflicts among the Lanham Act and the two patent presumptions, saying simply that there were present factual issues that could only be resolved at trial, 461 F.3d at 684, and that, in this instance, the evidence of functionality overcame the statutory presumptions of non-functionality under trademark and design patent law.

That there is a factual component to assessing the different evidentiary presumptions and weighing them against one another hardly explains the legal interplay among them. Nor does it aid in resolving such legal issues subsumed in the ultimate finding of functionality. Most obviously, in a hypothetical set of jury instructions, some explicit guidance would have to be given to the fact-finders on how to weigh the different presumptions against one another. Although the familiar empyrean decree may be that our intellectual property laws represent a 'carefully crafted bargain,' Bonito Boats, Inc. v. Thunder Craft Boats, Inc., 489 U.S. 141, 150-51 (1989), such that the several grounds to establish rights under patent, trademark, and/or copyright (and the metes and bounds of such rights) theoretically need never be in conflict, to lesser mortals the reality suggested by the unresolved legal conflict in Fuji Kogyo (not to mention the constitutional question left unanswered in TrafFix) is that room for further bargaining surely exists.

One wonders whether Fuji Kogyo might not have taken a different approach entirely ' that is, identifying what distinguished the designs literally claimed by the utility patents from those registered as trademarks and those once subject to design patent protection ' focusing, that is, on the distinctions among the plaintiff's own designs rather than what they had in common. Based on other evidence presented, including Fuji Kogyo's own advertising touting the utilitarian advantages of its line guides, the guides might nonetheless still have been deemed functional. However, arguably all of the presumptions could have been accommodated by granting some limited (perhaps very limited) protection to the registered trademarks, provided that doing so would not entail protecting the precise subject matter previously patented. However, the decision does not disclose if this was even argued by Fuji Kogyo much less considered by the court. Instead, giving apparent analytical priority to the utility patents and the evidentiary presumptions that, under TrafFix, largely barred the way to protectability, the Sixth Circuit devoted arguably the most noteworthy part of its decision to a test to establish the scope of the evidentiary presumption in the wake of the expired utility patents. Whatever weight the court gave to the other statutory presumptions is not readily gauged.

Given the many slight differences between the actual commercial designs Fuji Kogyo asserted had become trademarks and the designs disclosed in its expired utility patents, the test the court adopted in holding all of the designs functional, irrespective of these differences, entailed analyzing whether Fuji Kogyo's claimed trademarks would, hypothetically, have infringed its own patents, either literally or under the doctrine of equivalents. Each did, primarily under the doctrine of equivalents. 461 F.3d at 689. Similarly, in TrafFix, where the issue was whether a dual spring design for temporary road signs (to keep them upright in windy conditions) was functional, the Supreme Court held that the plaintiff's prior patents rendered the claimed designs unprotectable as trade dress notwithstanding that its patent disclosed the springs spaced apart, not positioned together as in the commercial embodiment. The Court ruled against the patentee because, in an earlier infringement case, it had argued that a competitor's dual-spring design infringed the patents notwithstanding that the springs were positioned together. 532 U.S. at 31.

Even while adopting an infringement analysis as the measure of the presumption against trademark protection, the Sixth Circuit also held, over Fuji Kogyo's objections, that in determining the scope of the patent claims, it was not necessary first to construe those claims, thus refusing to take Fuji Kogyo's bait that a formal Markman-like claim construction analysis was needed. The court, after all, was not actually determining infringement, but assessing functionality. 461 F.3d at 690. Had Fuji Kogyo also argued that the scope of the patents should have been limited as a result of its own prosecution history estoppel or other more rigorously applied tools of claim construction, one wonders whether, consistent with its overall analysis, the Sixth Circuit might have deemed such review either unnecessary or an appropriate further means to delineate the TrafFix presumption of functionality.

Although barely addressed in Fuji Kogyo, perhaps the greatest source of lingering uncertainty as to how to apply the TrafFix presumption (given that the Supreme Court declined to erect a complete bar) is the question of what is the proper test of functionality. TrafFix reaffirmed the 'traditional rule' of Inwood Labs v. Ives Labs, 456 U.S. 844 (1982), quoted also in Qualitex Co. v. Jacobson Products Co., 514 U.S. 159 (1995), that: ' a product feature 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.' 532 U.S. at 32. The Court also added that '[w]here the design is functional under the Inwood formulation there is no need to proceed further to consider if there is competitive necessity for the feature,' and 'no need, furthermore, to engage ' in speculation about other design possibilities, such as using three or four springs which might serve the same purpose.' Id. at 33-34. However, this language has been interpreted by some courts as allowing consideration of alternative designs and competitive necessity before first determining a design is functional under the Inwood test. See, e.g., Valu Engineering Inc. v. Rexnord Corp., 278 F. 3d 1268, 61 U.S.P.Q2d 1422, 1426 (Fed. Cir. 2002) ('Nothing in TrafFix suggests that consideration of alternative designs is not properly part of the overall mix, and we do not read the Court's observations in TrafFix as rendering the availability of alternative designs irrelevant.') Compare Antioch Co. v. Western Trimming Corp., 347 F.3d 150, 157 (6th Cir. 2003) ('the Supreme Court 'rejected' the competitive-necessity test as the main test and reinstated the Inwood formulation as the primary method for evaluating functionality.'); Eppendorf-Netheler-Hinz GMBH v. Ritter GMBH, 289 F.3d 351, 357 (5th Cir. 2002).

To the extent that Fuji Kogyo reflects some of this analytical uncertainty it is that the court cited favorably to In re Morton-Norwich Prods., Inc., 671 F.2d 1332 (C.C.P.A. 1982), the primary precedential source of the 'competitive necessity' test of functionality prior to TrafFix. Fuji Kogyo is not alone among post-TrafFix cases in continuing to cite the old standard. However, Morton-Norwich, in identifying as one of the key elements of functionality the availability of alternative designs, fishes in different waters from those trolled by TrafFix, where the focus was more on inherent or absolute criteria of functionality, based simply on the actual usefulness of the product. By turning the focus to the anticompetitive effects of allowing monopolies in utilitarian designs, Morton-Norwich is a more relativistic measure, under which trademark protection in theory may be allowed if alternative designs exist and there is no competitive necessity to use the design in issue.

In refusing to foreclose entirely trademark protection in previously patented subject matter, the Supreme Court did not give any guidance when this might occur (except to note broadly that 'arbitrary, incidental, or ornamental aspects of features of a product found in the patent claims, such as arbitrary curves in the legs or an ornamental pattern painted on the springs' might 'not serve a purpose within the terms of the utility patent.' TrafFix, 532 U.S. at 34). The existence of presumptively valid registered trademarks, as in Fuji Kogyo, might be one such circumstance, yet the decision gave the fisheye to that theory. Another might be the existence of a truly widely known form of trade dress, endowed with great secondary meaning. The Lego case, recently decided in Canada, comes readily to mind. Kirkbi AG v. Ritvik Holdings, Inc., (2005) 433 C.P.R. (4th) 385 (S.C.C.). See also Tyco Indus., Inc. v. Lego Systems, Inc., 5 U.S.P.Q.2d 1023 (D.N.J. 1987), aff'd, 853 F.2d 921 (3d Cir.), cert. den., 488 U.S. 955 (1988) (holding the Lego building block design functional without any mention of the expired utility patents). How-ever, because of the precision with which Lego's patents claimed the relevant design, even its familiar building block might be a poor example of a design that could survive expiration of applicable utility patents. For instance, its 1961 U.S. Patent No 3,005,282 ('Toy Building Brick') claimed: 'In a toy building set, a hollow building block or rectangular parallelepiped shaped comprising a bottom and four side walls at least four cylindrical projections extending normally outwardly from said bottom ' and a tubular projection extending normally from the inner face of said bottom ' ' Had the patent less specifically claimed the now-familiar 'tubular' projections (and assuming no duty to have claimed the tubular designs as best mode), conceivably one might have argued (under Morton-Norwich) that any number of other (less familiar) interlocking shapes were equally available. Other recent cases in which once-patented designs have been deemed at least potentially worthy of trademark protection do not involve similarly well-known designs and may even make Fuji Kogyo's fishing line guides seem all-but famous. See, e.g., Midwest Indus., Inc. v. Karavan Trailers, Inc., 175 F.3d 1356 (Fed. Cir. 1999) (refusing to foreclose trade dress protection for previously patented curved winch post for hitching boats to trailers).

Following Fuji Kogyo, the question thus remains when, or if, the scales might tip in favor of trade dress protection for once-patented designs. The Internet dictionary slangsite.com defines a 'fish test' as a means of distinguishing types of surrealism. For now, still casting about for that elusive case in which a once-patented design might actually merit trade dress protection (not just simply survive summary judgment), the question remains what facts or legal consideration might overcome the TrafFix presumption or whether, as evidenced by Fuji Kogyo, it remains little more than a fish test, effectively barring protection without so-holding. Most likely, unless the Supreme Court revisits the issue and transforms the presumption into a complete bar, absent greater uniformity in applying the test of functionality and sorting through the evidentiary presumptions only touched on in Fuji Kogyo, those angling for a definitive answer will have to remain somewhat at sea.

Jonathan Moskin is a partner in the New York office of White & Case LLP. He may be contacted at [email protected].

The recent decision, Fuji Kogyo Co. v. Pacific Bay Int'l, Inc ., 461 F.3d 675 (6th Cir. 2006), confronts the question deliberately left unresolved in TrafFix Devices, Inc. v. Marketing Displays, Inc ., 532 U.S. 23 (2001), of whether a product design claimed in a prior utility patent can ever be protectable trade dress under the Lanham Act. Although setting a high bar to protectability, indeed a 'presumption' and 'heavy burden' that material claimed in a utility patent is functional and hence unprotectable once the patent term ends, the Supreme Court, of course, expressly elected not to foreclose such protection entirely. Thus, it refused the invitation of defendant TrafFix, and 'some of its amici,' to rule that 'the Patent Clause of the Constitution, Art. I '8, cl. 8, of its own force, prohibits the holder of an expired utility patent from claiming trade dress protection.' 532 U.S. at 35. Without itself addressing the constitutional question of how narrowly 'limited times' means 'limited times,' Fuji Kogyo does nothing to ease the burden in establishing trade dress protection for once-patented subject matter; it offers as well a new (if, perhaps, less than fully developed) analytical approach for applying the TrafFix presumption, asking whether the claimed trade dress would have infringed the expired patents.

A fishing line guide is one of a series of eyelets mounted along the length of a rod, through which the fishing line is threaded. Asked to tackle the question of whether Fuji Kogyo's previously patented fishing line guides could be protected as trademarks, the Sixth Circuit did not spare the rod in holding that because the designs were within the scope of Fuji Kogyo's expired patents, which to the court meant that Fuji Kogyo's own designs would have infringed its patents, either literally or under the doctrine of equivalents, judgment had been properly granted after trial dismissing its infringement claims and canceling the trademark registrations it had secured for the designs.

A potentially barbed issue in the waters left deliberately uncharted in TrafFix was that Fuji Kogyo's line guides were the subject not only of prior patent claims (and hence presumptively functional under TrafFix), but also ' on the other side of the ledger ' protected by three subsisting federal trademark registrations (which arguably should have overcome the presumption of functionality under 15 U.S.C. '1125(a)(3) and conferred a statutory presumption of validity under 15 U.S.C. '1115(a)), and had been the subject of seven design patents, which, although expired, likewise presumptively established the ornamental, non-functional nature of the designs under 35 U.S.C. '171. Although Fuji Kogyo might thus have entailed a knotty challenge of unsnarling a tangled line of evidentiary presumptions, the court cast aside any latent legal conflicts among the Lanham Act and the two patent presumptions, saying simply that there were present factual issues that could only be resolved at trial, 461 F.3d at 684, and that, in this instance, the evidence of functionality overcame the statutory presumptions of non-functionality under trademark and design patent law.

That there is a factual component to assessing the different evidentiary presumptions and weighing them against one another hardly explains the legal interplay among them. Nor does it aid in resolving such legal issues subsumed in the ultimate finding of functionality. Most obviously, in a hypothetical set of jury instructions, some explicit guidance would have to be given to the fact-finders on how to weigh the different presumptions against one another. Although the familiar empyrean decree may be that our intellectual property laws represent a 'carefully crafted bargain,' Bonito Boats, Inc. v. Thunder Craft Boats, Inc ., 489 U.S. 141, 150-51 (1989), such that the several grounds to establish rights under patent, trademark, and/or copyright (and the metes and bounds of such rights) theoretically need never be in conflict, to lesser mortals the reality suggested by the unresolved legal conflict in Fuji Kogyo (not to mention the constitutional question left unanswered in TrafFix ) is that room for further bargaining surely exists.

One wonders whether Fuji Kogyo might not have taken a different approach entirely ' that is, identifying what distinguished the designs literally claimed by the utility patents from those registered as trademarks and those once subject to design patent protection ' focusing, that is, on the distinctions among the plaintiff's own designs rather than what they had in common. Based on other evidence presented, including Fuji Kogyo's own advertising touting the utilitarian advantages of its line guides, the guides might nonetheless still have been deemed functional. However, arguably all of the presumptions could have been accommodated by granting some limited (perhaps very limited) protection to the registered trademarks, provided that doing so would not entail protecting the precise subject matter previously patented. However, the decision does not disclose if this was even argued by Fuji Kogyo much less considered by the court. Instead, giving apparent analytical priority to the utility patents and the evidentiary presumptions that, under TrafFix, largely barred the way to protectability, the Sixth Circuit devoted arguably the most noteworthy part of its decision to a test to establish the scope of the evidentiary presumption in the wake of the expired utility patents. Whatever weight the court gave to the other statutory presumptions is not readily gauged.

Given the many slight differences between the actual commercial designs Fuji Kogyo asserted had become trademarks and the designs disclosed in its expired utility patents, the test the court adopted in holding all of the designs functional, irrespective of these differences, entailed analyzing whether Fuji Kogyo's claimed trademarks would, hypothetically, have infringed its own patents, either literally or under the doctrine of equivalents. Each did, primarily under the doctrine of equivalents. 461 F.3d at 689. Similarly, in TrafFix, where the issue was whether a dual spring design for temporary road signs (to keep them upright in windy conditions) was functional, the Supreme Court held that the plaintiff's prior patents rendered the claimed designs unprotectable as trade dress notwithstanding that its patent disclosed the springs spaced apart, not positioned together as in the commercial embodiment. The Court ruled against the patentee because, in an earlier infringement case, it had argued that a competitor's dual-spring design infringed the patents notwithstanding that the springs were positioned together. 532 U.S. at 31.

Even while adopting an infringement analysis as the measure of the presumption against trademark protection, the Sixth Circuit also held, over Fuji Kogyo's objections, that in determining the scope of the patent claims, it was not necessary first to construe those claims, thus refusing to take Fuji Kogyo's bait that a formal Markman-like claim construction analysis was needed. The court, after all, was not actually determining infringement, but assessing functionality. 461 F.3d at 690. Had Fuji Kogyo also argued that the scope of the patents should have been limited as a result of its own prosecution history estoppel or other more rigorously applied tools of claim construction, one wonders whether, consistent with its overall analysis, the Sixth Circuit might have deemed such review either unnecessary or an appropriate further means to delineate the TrafFix presumption of functionality.

Although barely addressed in Fuji Kogyo, perhaps the greatest source of lingering uncertainty as to how to apply the TrafFix presumption (given that the Supreme Court declined to erect a complete bar) is the question of what is the proper test of functionality. TrafFix reaffirmed the 'traditional rule' of Inwood Labs v. Ives Labs , 456 U.S. 844 (1982), quoted also in Qualitex Co. v. Jacobson Products Co. , 514 U.S. 159 (1995), that: ' a product feature 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.' 532 U.S. at 32. The Court also added that '[w]here the design is functional under the Inwood formulation there is no need to proceed further to consider if there is competitive necessity for the feature,' and 'no need, furthermore, to engage ' in speculation about other design possibilities, such as using three or four springs which might serve the same purpose.' Id. at 33-34. However, this language has been interpreted by some courts as allowing consideration of alternative designs and competitive necessity before first determining a design is functional under the Inwood test. See, e.g ., Valu Engineering Inc. v. Rexnord Corp. , 278 F. 3d 1268, 61 U.S.P.Q2d 1422, 1426 (Fed. Cir. 2002) ('Nothing in TrafFix suggests that consideration of alternative designs is not properly part of the overall mix, and we do not read the Court's observations in TrafFix as rendering the availability of alternative designs irrelevant.') Compare Antioch Co. v. Western Trimming Corp ., 347 F.3d 150, 157 (6th Cir. 2003) ('the Supreme Court 'rejected' the competitive-necessity test as the main test and reinstated the Inwood formulation as the primary method for evaluating functionality.'); Eppendorf-Netheler-Hinz GMBH v. Ritter GMBH , 289 F.3d 351, 357 (5th Cir. 2002).

To the extent that Fuji Kogyo reflects some of this analytical uncertainty it is that the court cited favorably to In re Morton-Norwich Prods., Inc., 671 F.2d 1332 (C.C.P.A. 1982), the primary precedential source of the 'competitive necessity' test of functionality prior to TrafFix. Fuji Kogyo is not alone among post-TrafFix cases in continuing to cite the old standard. However, Morton-Norwich, in identifying as one of the key elements of functionality the availability of alternative designs, fishes in different waters from those trolled by TrafFix, where the focus was more on inherent or absolute criteria of functionality, based simply on the actual usefulness of the product. By turning the focus to the anticompetitive effects of allowing monopolies in utilitarian designs, Morton-Norwich is a more relativistic measure, under which trademark protection in theory may be allowed if alternative designs exist and there is no competitive necessity to use the design in issue.

In refusing to foreclose entirely trademark protection in previously patented subject matter, the Supreme Court did not give any guidance when this might occur (except to note broadly that 'arbitrary, incidental, or ornamental aspects of features of a product found in the patent claims, such as arbitrary curves in the legs or an ornamental pattern painted on the springs' might 'not serve a purpose within the terms of the utility patent.' TrafFix, 532 U.S. at 34). The existence of presumptively valid registered trademarks, as in Fuji Kogyo, might be one such circumstance, yet the decision gave the fisheye to that theory. Another might be the existence of a truly widely known form of trade dress, endowed with great secondary meaning. The Lego case, recently decided in Canada, comes readily to mind. Kirkbi AG v. Ritvik Holdings, Inc., (2005) 433 C.P.R. (4th) 385 (S.C.C.). See also Tyco Indus., Inc. v. Lego Systems, Inc ., 5 U.S.P.Q.2d 1023 (D.N.J. 1987), aff'd , 853 F.2d 921 (3d Cir.), cert. den ., 488 U.S. 955 (1988) (holding the Lego building block design functional without any mention of the expired utility patents). How-ever, because of the precision with which Lego's patents claimed the relevant design, even its familiar building block might be a poor example of a design that could survive expiration of applicable utility patents. For instance, its 1961 U.S. Patent No 3,005,282 ('Toy Building Brick') claimed: 'In a toy building set, a hollow building block or rectangular parallelepiped shaped comprising a bottom and four side walls at least four cylindrical projections extending normally outwardly from said bottom ' and a tubular projection extending normally from the inner face of said bottom ' ' Had the patent less specifically claimed the now-familiar 'tubular' projections (and assuming no duty to have claimed the tubular designs as best mode), conceivably one might have argued (under Morton-Norwich) that any number of other (less familiar) interlocking shapes were equally available. Other recent cases in which once-patented designs have been deemed at least potentially worthy of trademark protection do not involve similarly well-known designs and may even make Fuji Kogyo's fishing line guides seem all-but famous. See, e.g., Midwest Indus., Inc. v. Karavan Trailers, Inc ., 175 F.3d 1356 (Fed. Cir. 1999) (refusing to foreclose trade dress protection for previously patented curved winch post for hitching boats to trailers).

Following Fuji Kogyo, the question thus remains when, or if, the scales might tip in favor of trade dress protection for once-patented designs. The Internet dictionary slangsite.com defines a 'fish test' as a means of distinguishing types of surrealism. For now, still casting about for that elusive case in which a once-patented design might actually merit trade dress protection (not just simply survive summary judgment), the question remains what facts or legal consideration might overcome the TrafFix presumption or whether, as evidenced by Fuji Kogyo, it remains little more than a fish test, effectively barring protection without so-holding. Most likely, unless the Supreme Court revisits the issue and transforms the presumption into a complete bar, absent greater uniformity in applying the test of functionality and sorting through the evidentiary presumptions only touched on in Fuji Kogyo, those angling for a definitive answer will have to remain somewhat at sea.

Jonathan Moskin is a partner in the New York office of White & Case LLP. He may be contacted at [email protected].