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Functional color scheme isn’t protected trade dress

August / September 2021 IP Newsletter

A product’s trade dress — the design and shape of the product or its packaging — isn’t subject to trademark protection if it is deemed functional. The word “functional” may conjure visions of parts and components, but courts can find a product’s color functional, too. That’s what happened in a case involving dental products.

Oral arguments

Sulzer Mixpac AG (Mixpac) and A&N Trading Company (A&N) compete in the market for mixing tips that are attached to cartridges filled with materials used by dentists to create impressions of teeth for dental procedures. To accommodate different types of dental procedures, mixing tips vary in their diameters, the lengths of the helixes that mix component materials and cap sizes.

Mixpac owns 12 trademark registrations for particular colors on mixing tips. The registrations show that Mixpac offered its “Candy Colors” on mixing tip caps as early as 1997. Nonetheless, A&N displayed and advertised mixing tips with identical, or nearly identical, colors at a dental convention in 2016.

Mixpac sued A&N for unfair competition, trademark infringement, trademark counterfeiting and false designation of origin. A&N countersued, alleging that Mixpac’s trademark registrations should be canceled because its use of Candy Colors on mixing tips was functional.

The district court found that Mixpac’s use of the colors wasn’t functional, awarded it $2 million in damages and issued a permanent injunction against A&N. A&N appealed.

Another bite at the apple

The trial court concluded that the Candy Colors were nonfunctional because Mixpac’s use of them added to its cost to manufacture the mixing tips. Further, some of its competitors used different colors or no colors for their mixing tips. The U.S. Court of Appeals for the Second Circuit found these findings weren’t clearly erroneous.

It faulted the lower court, though, for failing to apply the appropriate functionality two-part test to Mixpac’s marks. That test first asks whether the design feature is essential to the use or purpose of the product at issue or affects the product’s cost or quality. If so, the feature is functional.

If not, a court must move to a fact-intensive test that determines whether the feature would put competitors at a significant non-reputation-related disadvantage. The feature must not have such an effect on competition to receive trademark protection.

The Second Circuit found that the colors on the mixing tips corresponded to different tip diameters. This allowed users to quickly match the proper mixing tip with the proper cartridge and, therefore, improved the operation of the goods. In other words, the colors affected the quality of the product — a question the district court didn’t examine.

The appeals court ultimately concluded that the colors were functional. As a result, Mixpac’s trade dress was unprotectible. The court reversed the trial court and sent the case back so final judgment could be entered in the defendant’s favor.

Brace yourself

The appellate court’s ruling demonstrates the limits of trademark protection when it comes to trade dress. Trademark holders should tread cautiously when suing over features such as color because they may prove more functional than they seem at first glance.

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