19th Class

1
19th Class

• Distribute
• Sign-in sheet
• Slide handouts
• Next assignment
• Voice Recorder on
• Agenda
• Trademark
• Functionality
• Acquisition and Priority

2
Review

• Trademark Theory
• Consumer protection
• Incentives to producers to maintain reputation /
  quality
• NOT incentive to innovate, create new designs
• Most relevant to experience attributes
• Trade dress always requires secondary meaning
• Never inherently distinctive

3
Nonfunctionality

• Functional features are not protected by
  trademark
• Cannot be registered
• Not protected if unregistered
• Even if can show secondary meaning
• Judicially created doctrine
• But recently incorporated into statute.
  2(e)(5),
• 43(a)(3)
• Purpose is to promote competition
• Trademark should be used to prevent confusion and
  protect commercial reputations, NOT protect ideas
  or product design
• 2 kinds of functionality
• Utlitarian functionality
• Aesthetic functionality

4
Utilitarian Functionality

• TrafFix
• Feature is functional if it is essential to use
  or purpose of article or if it affects the cost
  or quality of the article.
• No need to consider other feasible designs
• Klerman. But how determine if feature is
  essential to use or purpose without exploration
  of alternatives?
• Is orange roof essential to Howard Johnson
• If took away roof, hotel would not provide
  shelter
• But orange roof is nonfunctional, because
  alternative roofs (black, brown, etc.) are just
  as good
• Examples
• Square shape of computer monitor
• Shape of airplane exterior
• Arrangement of keys on ergonomic keyboard
• Circle shape of dial
• Orange color for reflective clothing

5
Aesthetic Functionality

• Pagliero (9th Cir. 1952)
• Wallace produced floral design plates
• Pagliero copied design exactly
• Marketed to hotels and restaurants as replacement
  plates
• Wallace sued
• Presented evidence that design had secondary
  meaning
• Pagliero defended by saying no trademark
  protection for plate design
• Design aesthetically functional
• Would trademark protection prevent consumer
  confusion?
• Would trademark protection hinder competition?
• Supreme Court in TrafFix says test for aesthetic
  functionality is whether exclusive use ... would
  put competitors at a significant non-reputational
  disadvantage." (See also Qualitex)

6
Homework Questions

• 1) Merges makes a kit which makes a Chevrolet
  look like a Ferrari. It consists primarily of a
  new exterior autobody, which bolts onto the
  Chevrolet frame. The kit does not include the
  prancing horse hood ornament or the word
  Ferrari. Ferrari sues Merges. Merges argues
  that the shape of the Ferrari is functional. Is
  Merges correct?
• 2) Pfizer holds a patent on Viagra. The pills
  are purple. When the patent expires, AstraZeneca
  introduces a pill, with the same chemical formula
  as Viagra, and call it Biagra. Biagra pills
  are also purple. Has AstraZeneca infringed
  Pfizers trademarks?

7
More Questions

• 1) The Order of Jobs Daughters is a Masonic
  youth group. Their symbol is a registered
  trademark. (See below). The Order licenses
  Company A to make jewelry with its symbol.
  Company B makes jewelry with the symbol without a
  license. Has Company B infringed?

8
Acquisition Priority

• When does company acquire exclusive rights to use
  mark?
• Preliminary assumptions
• No registration, national market
• Basic idea is "first possession" rule
• Registration does not confer rights
• see 1, "owner of trademark ...may apply to
  register
• Priority (w/ exceptions that will discuss later)
  follows first acquisition
• sec 2d. cannot registered if confusingly
  similar to mark already in use
• even if senior mark not registered
• concurrent registration possible
• but rare
• 2 basic alternatives
• 1) when register mark
• 2) when use mark
• Both of these alternatives are or have been used
• Europeans use 1st
• US is/was mostly 2nd
• but recently modified
• Which better?

9
Intent to Use Registration

• New to 1988 revisions
• Applicant files application to register, 1b,
• 6 months later must file affidavit that actually
  in use, 1d
• May file for extensions, up to 3 years
• 6 months automatic, then 2 more years w/ good
  cause
• Registration is issues after affidavit of use
• BUT priority is established by date of filing,
  see 7c
• if registration granted, filing of application to
  register constitutes "constructive use"
• and use is what gives priority
• 7c is key to intent to use, it is what makes
  intent to use registration at all worthwhile
• Hypo
• June1, A files intent to use application for mark
  BRAVO on cheese
• July 1, B starts using BRAVO mark on yogurt
• Nov 1, A starts shipping cheese
• Nov 15, A files affidavit that has used in
  commerce
• Jan 1, PTO registers mark
• Feb 1, A sues B
• A has priority

10
Procedure

• Person wanting to register mark sends in
  application to Patent trademark office
• PTO reviews. awards registration if criteria met
• Part of PTO procedure is publication in Official
  Gazette
• those who think they may be injured to file an
  opposition
• If application denied, then appeal to Trademark
  Trial and Appeals Board
• then appeal on administrative record to US Court
  of Appeals
• or de novo review in district court
• 14. For 5 years after registration
• Opponent or defendant can attempt to get
  cancelled or defend against infringement suit on
  any ground that would have precluded initial
  registration
• 14 -15. After 5 years, can become
  "inconstestable"
• Owner must file affidavit of continuous use
• Opponent or defendant can no longer argue
• descriptive and no secondary meaning
• confusingly similar to another mark in use before
  registration
• BUT can still make other arguments generic,
  scandalous, abandoned

11
Geography

• Common law
• First user, known as senior user owned the mark,
  could prevent others from using it
• BUT subsequent user, known as junior user, had
  defense if had used in good faith in remote area
• Good faith usually meant without notice
• If A had used mark in New York, and B later began
  using mark in California, if B did so w/o notice
  (in good faith), A could not enjoin B.
• if B had notice, then A could get injunction
• In practice, could only prove notice if senior
  user used mark in same area as junior
• So common law only protected TM owner in areas
  where marked actually used
• Zone of natural expansion doctrine
• If A used mark in New York City, and B began
  using mark in northern New Jersey w/o notice, A
  might be able to enjoin B on theory that northern
  NJ was natural zone of expansion
• Federal registration is constructive notice 22
  
• Since common law did not protect remote user who
  had notice, constructive notice gives nationwide
  protection
• Note dependence of statute on common law

12
Question

• 1966. Preco uses term Porcelainate
• Porcelainate is descriptive
• 1977. Ceramco uses Percelainate
• 1979. Ceramco begins advertrising campaing
• established 2ndary meaning
• 1980. Preco began advertising campaign
• established 2ndary meaning
• 1981. Ceramco sues Preco for trademark
  infringement

13
Question

• 11/89. In-Wear files ITU (intent to use
  application) for Body Gear, advertises but does
  not sell
• 12/89. Shalom files ITU for Body Gear
• 2/90. Shalom uses and sells clothing with Body
  Gear logo
• 3/90. Shalom sues In-Wear to enjoin In-Wears
  proprosed sales of Body Gear clothing

14
Agenda for Next Class

• Infringement