Relying on Supreme Court precedent, the Federal Circuit overturned the USPTO’s refusal to register a multi-color trademark for product packaging, holding that color marks can be inherently distinctive depending upon the character of the color design.

IN DEPTH

Reviewing a decision from the United States Patent and Trademark Office (“USPTO”) Trademark Trial and Appeal Board, the Federal Circuit vacated and remanded the Board’s refusal to register a trademark consisting of a gradient of multiple colors applied to product packaging, and relied on Supreme Court precedent in concluding that color marks can be inherently distinctive when used on product packaging “depending upon the character of the color design.” In re Forney Industries, Inc., Case No. 2019-1073 (Fed. Cir. April 8, 2020) (O’Malley, J.)[precedential].

Background

Metalworking company Forney Industries, Inc., appealed a decision of the Trademark Trial and Appeal Board, which affirmed the USPTO Examining Attorney’s refusal to register Forney’s applied-for trademark consisting of a “solid black stripe …[atop]… the color yellow which fades into the color red… located on… packaging and/or labels” for various welding and machining goods. Citing an amalgamation of Supreme Court jurisprudence under Wal-Mart Stores, Inc. v. Samara Bros. and Qualitex Co. v. Jacobson Prod. Co., both of which discuss the inherent distinctiveness of colors or designs applied to a product or product packaging, registration of Forney’s color-combo mark was refused by the Board on grounds that (1) a multi-color mark can never be inherently distinctive and (2) product packaging marks that employ color cannot be inherently distinctive in the absence of a well-defined peripheral shape or border. On Forney’s appeal, the Federal Circuit addressed both of the Board’s grounds for refusal.

Opinion of the Court

The inherent distinctiveness of trade dress (here, the color combination used on Forney’s product packaging) is determined by whether the trade dress “makes such an impression on consumers that they will assume” the trade dress is associated with a particular source.

Tackling the first of the Board’s errors, the Federal Circuit clarified that the Supreme Court has not gone so far – as the Board did in Forney’s case – to hold that color can never be inherently distinctive when used on product packaging. Here, the court pointed to the Supreme Court’s decision in Two Pesos, Inc. v. Taco Cabana, Inc., which holds that inherently distinctive trade dress is entitled to protection without a showing of secondary meaning. Next, the court pointed to Qualitex, where the Supreme Court confirmed that “there is no rule absolutely barring the use of color alone” as a trade dress. The court further clarified that Qualitex does not “expressly” require a showing of acquired distinctiveness before a color mark is protectable (while acknowledging that the Qualitex decision may imply such a holding). With Two Pesos and Qualitex as its “guideposts,” the court confirmed that Forney’s black, red and yellow color gradient mark could very well communicate the source of its welding and machining goods to a consumer, and could therefore satisfy the criteria for inherent distinctiveness.

Turning to the Board’s second error, the court found no appropriate explanation or supporting case law for refusing Forney’s color gradient mark on grounds that it may only be inherently distinctive if used in conjunction with a “distinctive peripheral shape or border.” Instead, the court explained, once again, that the ultimate test is whether Forney’s combination of colors, and the design those colors create, are sufficiently indicative of the source of the goods contained in Forney’s color-marked packaging.

With this framework in mind, the Federal Circuit vacated and remanded for the Board to consider whether Forney’s color gradient mark is inherently distinctive as used in relation to its applied-for goods under the factors outlined in Seabrook Foods, Inc. v. BarWell Foods Ltd., namely: (1) whether the trade dress is a “common” basic shape or design, (2) whether it is unique or unusual in the particular field, (3) whether it is a mere refinement of a commonly adopted and well-known form of ornamentation for a particular class of goods viewed by the public as a dress or ornamentation for the goods or, in applicable cases, (4) whether it is capable of creating a commercial impression distinct from the accompanying words.