United States: Republished From 2015: Some Thoughts On De Facto And De Jure Functionality

Last Updated: August 16 2017
Article by John L. Welch

Section 2(e)(5) of the Lanham Act bars registration of a proposed mark that "comprises any matter that, as a whole, is functional." The shape of a product or a feature of a product may have a function – i.e., it may have utility – but still be registrable as a trademark. In other words, the product or feature may be de facto (in fact) functional but not de jure (in law) functional.

Confusion over these concepts sometime arises when, in considering the registrability of a product shape, the TTAB or a court encounters design patents or utility patents that are related to the product. Utility patents, as the name indicates, concern things that have utility: "any new and useful process, machine, manufacture, or composition of matter." Design patents concern the ornamental features of useful objects: the way things look rather than the way they work. Thus both utility and design patents are directed to things that are useful (or de facto functional).

A particular device may be the subject of a both a utility patent, because it incorporates a useful invention – say, a corkscrew that operates in a new way – as well as a design patent, because the device has a novel and nonobvious shape – suppose the corkscrew is shaped like a kangaroo.

In the trademark realm under Section 2(e)(5), when one considers whether a product configuration or feature may be registrable as a trademark, one must first determine whether it has utility – i.e., whether it is de facto functional. A purely ornamental feature (i.e., purely non-functional) – such as the decorations on a monster truck (for entertainment services) – by definition has no utility and is therefore eligible for registration as a trademark.

What about a shape or feature that does have utility? For example, in our corkscrew, the tail of the kangaroo, which functions as the handle or lever that operates the corkscrew? It has utility, it performs a function, and therefore it is de facto functional in a trademark sense. But is it de jure functional and therefor unregistrable? That's where the Inwood and Morton-Norwich decisions come in play.

One approach to assessing the registrability of product shape or feature is to ask the following questions:

1. Does the configuration or feature have utility? If yes, proceed to the next question. If no, the feature is ornamental and may be registrable. A showing of acquired distinctiveness is required, says Wal-Mart, unless the feature may be considered product packaging (or, as in the recent monster truck case, trade dress for services). Product packaging and other trade dress may be inherently distinctive, but first it must pass the Seabrook test.

2. If the configuration or feature has utility (for example, the kangaroo tail), is the shape the only one that will work? No it is not, for the kangaroo tail. The handle of the corkscrew, and the corkscrew itself, could take on many shapes. What, then, is an example of a design that can be useful in only one shape? Patent attorneys point to a case involving the blade or shank (the business end) of a key, which had to be in the particular shape in order to operate the corresponding lock. So that design patent was held to be invalid because the shape was "functional" in a design patent sense, not ornamental. If question 2 is answered yes, then the configuration or feature is not eligible for a design patent (or a trademark registration).

3. If the answer to question 2 is no, then a design patent is available. An invention is functional in the design patent sense only if the design is the only one that will work: think key blade. But functionality for trademarks requires a different standard. Even if there are alternative designs that will work, a product configuration or feature may be unregistrable as a trademark – i.e., de jure functional – if the design meets the Inwood test: if it is "essential to the use or purpose of the device or ... affects the cost or quality of the device." The CCPA's Morton-Norwich factors are meant to assist in the determination of trademark functionality. In the recent "bladeless" fan decision, the Board found that the shape of the product met the Inwood test.

The Board and the courts sometimes go astray when utility patents are involved. It is tempting to conclude that any feature discussed in a utility patent must ipso facto be de jure functional and therefore unregistrable as a trademark. But the Supreme Court in TrafFix was careful to limit the effect of utility patents as follows: it said that if a feature is claimed in a patent (not merely discussed in the specification), that is strong evidence that the feature is de jure functional. Not conclusive evidence, but strong. That is because even if a feature is claimed in a patent (for example, the lever on the cork screw), it still may be possible to design that element in a number of shapes that work equally well (the kangaroo tail being one).

Some of these principles were discussed in two recent TTAB decisions: the monster truck case, in which the Board found the decorations on a monster truck to be ornamental trade dress that was inherently distinctive under Seabrook, and the "bladeless" fan case, in which the Board applied Inwood and Morton-Norwich in affirming a Section 2(e)(5) functionality refusal of the shape of the fan elements.

The next time you read a decision in a product configuration case or trade dress case, look closely to see how the court or the Board applies these principles and makes these distinctions. Of course, if you don't agree with my understanding, let me know.

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