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 Pfizer’s trademarks?

7. More Questions • 1) The Order of Job’s 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-Wear’s proprosed sales of “Body Gear” clothing

14. Agenda for Next Class • Infringement