The functionality doctrine in U.S. trademark law states that a functional mark is not registrable. The doctrine prevents the use of trademarks for impeding legitimate competition by ensuring that companies seek protection for utilitarian features through patents having limited terms, and not with trademarks which are renewable indefinitely. When a patent term expires, competitors are free to use the functional product features disclosed in the expired patent.
The U.S. Court of Appeals for the Federal Circuit (CAFC or Federal Circuit) recently had occasion to apply the functionality doctrine in CeramTec GmbH v. CoorsTek Bioceramics LLC.1 In that case, CeramTec appealed the cancellation of its trademarks for the color pink on ceramic hip components.
CeramTec produces hip components made from zirconia-toughened alumina ("ZTA") ceramic, which contains chromium oxide (chromia). Additionally, CeramTec patented a particular chemical composition of the ZTA ceramic including the addition of chromia in a U.S. patent that expired in January 2013. The expired patent claimed a range of ratios of zirconia-to-chromia that had the effect of producing various colors in the ZTA ceramic, including the color pink, which CeramTec marketed under the term "Biolox Delta." The patent specification and prosecution history disclosed that the effect of adding chromia to the ZTA ceramic was to enable the composition to obtain "unprecedented levels of hardness," which in turn enabled the ZTA hip component to maintain its shape. About a year before the expiration of its patent, CeramTec applied for and obtained trademark registrations for the color pink in ceramic hip components.
CoorsTek, a competitor of CeramTec, produces two ZTA ceramic materials for hip implants named CeraSurf-P containing the ratio of chromia making it pink and CeraSurf-w containing no chromia, thus making it white. CoorsTek filed a cancellation petition in the Trademark Trials and Appeals Board (TTAB) to cancel CeramTec's trademarks for the color pink, arguing that the color was functional. The TTAB analyzed the functionality issue under the Morton-Norwich Products2framework and found the color pink rendered by the addition of chromia to ZTA ceramics for hip implants to be functional, in favor of CoorsTek.
Analysis of functionality of a trademark under Morton-Norwich Products requires a court to consider: (1) the existence of a utility patent disclosing the utilitarian advantages of the design; (2) advertising materials in which the originator of the design touts the design's utilitarian advantages; (3) the availability to competitors of functionally equivalent designs; and (4) facts indicating that the design results in a comparatively simple or cheap method of manufacturing the product.
Under factor (1), the TTAB analyzed the claims, specification and prosecution history of CeramTec's expired patent and found the color pink rendered by the addition of chromia to ZTA ceramic to provide toughness, hardness, stability and suppression of brittleness of the ZTA ceramic. In addition to the expired patent, the TTAB also considered other patents and applications in the CeramTec portfolio, concessions by CeramTec that the addition of chromia rendered the ZTA ceramic pink, and finally that the expired patent included at least one claim that covered the Biolox Delta product.
CeramTec argued that the TTAB incorrectly attributed certain functional benefits other than hardness to the addition of chromia in its expired patent and that the TTAB improperly applied the U.S. Supreme Court's TrafFix3 decision. The Federal Circuit noted that CeramTec had already conceded the feature of hardness to be attributed to chromia addition. With respect to TrafFix, which held that utility patents are "strong evidence" of functionality, CeramTec argued for a narrower interpretation of the case. CeramTec interpreted TrafFix to require that (i) the utility patent explicitly claim the trademarked design feature and that (ii) the trademarked goods are the "central advance" of the patent. CeramTec argued that neither requirement is met because the patents neither (i) discussed the benefits of pink ZTA ceramics nor (ii) discussed hip components. The Federal Circuit rejected such a narrow view of TrafFix.
Instead, the Federal Circuit interpreted TrafFix more broadly, simply requiring the trademarked feature to be shown as being functional in the specification and prosecution history, rather than being explicitly disclosed as functional. The Federal Circuit also disagreed with the narrow interpretation of the "central advance" language as urged by CeramTec, explaining that the Supreme Court merely used that language to describe the strength of the functionality evidence in that particular case rather than stating a general rule applicable in every case. Considering the expired patent and its associated prosecution history and other patents in the CeramTec portfolio that disclosed chromia addition led to ZTA ceramic hardness, the Federal Circuit found that evidence to weigh in favor of functionality under Morton-Norwich factor (1).
Under factor (2), which requires consideration of advertising materials by CeramTec touting the utilitarian advantages of the color mark, the TTAB found such advertising materials along with FDA submissions disclosing the addition of chromia as functionally beneficial to ZTA ceramics. CeramTec did not challenge this finding on appeal.
Under factor (3), which requires functionally equivalent designs to be available to competitors to support a finding of functionality, the TTAB found this factor neutral and the Federal Circuit agreed. CeramTec used statements by CoorsTek to argue that their CeraSurf-w material was functionally superior to the Biolox Delta material – an argument the Federal Circuit cast as a mischaracterization of CoorsTek's statements. However, CoorsTek stated that CeraSurf-w (CoorsTek white ceramic) "is not as hard" as CeraSurf-p (CoorsTek pink ceramic) and concluded oppositely that CeraSurf-w was not functionally better than Biolox Delta. CeramTec also argued that the expired patent disclosed ZTA ceramics leading to a variety of colors other than pink.
However, the Federal Circuit understood the TTAB to discount potential alternative designs due to the scarcity of producers in the market. Thus, CeramTec merely disagreed with the TTAB's assignment of weight to the evidence of functionally equivalent designs available to competitors, and assignment of weight of evidence was within the discretion of the Board.
Under Morton-Norwich factor (4), which requires consideration of facts showing that the mark results in a simpler or cheaper method of manufacturing the product, the Federal Circuit found the factor neutral. CeramTec argued the TTAB overlooked evidence that Biolox Delta was more expensive to manufacture. Again, the Federal Circuit found CeramTec to mischaracterize the evidence. The evidence CeramTec used to argue that Biolox Delta was more expensive included statements by CoorsTek that the costs of manufacturing CeraSurf-p were higher than those of CeraSurf-w.
Because the Biolox Delta material is within the scope of at least one claim of CeramTec's expired patent and was marketed as being pink, it was difficult to refute the connection between the color pink and the claimed chromia addition. In the absence of Biolox Delta to logically connect the expired patent to the color pink, factors (1) and (2) would likely have been viewed as being more favorable to CeramTec. Additionally, the expired patent could have been drafted to more aggressively disclose the irrelevance of any resulting color due to the ratio of chromia added to ZTA ceramic, which could possibly have neutralized the effects of the Biolox Delta advertising and marketing materials.
Footnotes
1 ___ F.4th ___, 2025 WL 29252 (Fed. Cir. Jan. 3, 2025).
2 In re Morton-Norwich Products, Inc., 671 F.2d 1332, 1340-41 (Ct. Cust. Pat. App. 1982).
3 TrafFix Devices, Inc. v. Mktg. Displays, Inc., 532 U.S. 23 (2001).
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