United States: Federal Circuit: Color Marks Can Be Inherently Distinctive When Used On Product Packaging

On April 8, 2020, the United States Court of Appeals for the Federal Circuit issued a precedential ruling, holding that color marks can be inherently distinctive when composed of a unique design or a particular combination of colors and used on product packaging.

Background

Forney Industries, Inc., a tool and accessory products company, applied to register a mark described as "a solid black stripe at the top [and] [b]elow the solid black stripe is the color yellow which fades into the color red" for use in connection with packaging for various welding and machining goods. Forney sought to register the mark without showing acquired distinctiveness.

The United States Patent and Trademark Office ("USPTO") issued an office action and refused registration under Sections 1, 2 and 45 of the Lanham Act because the mark "is not inherently distinctive." After Forney's attempt to overcome the refusal was unsuccessful, and the application was again refused because the mark was not registrable without proof of acquired distinctiveness, Forney appealed the decision to the Trademark Trial and Appeal Board ("TTAB"). The appeal argued that the proposed mark is "product packaging trade dress that may be inherently distinctive and, therefore, registrable without proof of acquired distinctiveness." The TTAB affirmed the refusal to register, finding (1) a particular color on a product or its packaging can never be inherently distinctive and may only be registered on a showing of acquired distinctiveness and (2) a color mark consisting of color applied to product packaging cannot be inherently distinctive in the absence of an association with a well-defined peripheral shape or border.

Decision

The Federal Circuit held that the TTAB erred in concluding that (1) a color-based trade dress mark can never be inherently distinctive without differentiating between product design and product packaging marks and (2) product packaging marks that employ color cannot be inherently distinctive in the absence of an association with a well-defined peripheral shape or border.

The Federal Circuit applied the Supreme Court's decisions in Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763 (1992), Qualitex Co. v. Jacobson Prod. Co., 514 U.S. 159 (1995), and Wal-Mart Stores, Inc. v. Samara Bros., 529 U.S. 205 (2000) as guideposts. It explained that the TTAB erred in finding a proposed product packaging mark consisting of multiple colors is not capable of being inherently distinctive and that Forney's mark falls firmly within the category of marks the Supreme Court described as potential source identifiers. Forney's proposed mark can be perceived by consumers to suggest the source of the goods in that type of packaging, and the TTAB should have considered whether Forney's mark satisfies the criteria for inherent distinctiveness.

The Federal Circuit then turned to the TTAB's alternative conclusion that a color may only be inherently distinctive when used in conjunction with a distinctive peripheral shape or border. The Federal Circuit held that nothing in the case law mandates such a rule. Forney's proposed mark was a "symbol" and not just a "color mark." The court explained that because Forney was not attempting to preempt the use of the colors red, yellow, and black but instead sought to protect only the particular combination of those colors, arranged in a specific design, the TTAB should have assessed the question of inherent distinctiveness based on the overall impression created by both the colors employed and the pattern created by those colors.

Implications

The Federal Circuit's decision establishes that color mark consisting of color applied to product packaging can be inherently distinctive, and the USPTO must look to four factors established in Seabrook Foods. These factors are whether the trade dress is (1) a "common" basic shape or design; (2) unique or unusual in the particular field; (3) a mere refinement of a commonly adopted and well-known form of ornamentation for a particular class of goods viewed by the public as a dress or ornamentation for the goods; or, if applicable, (4) capable of creating a commercial impression distinct from the accompanying words. Seabrook Foods, Inc. v. Bar-Well Foods Ltd., 568 F.2d 1342, 1344 (C.C.P.A. 1977).

Brand owners seeking to secure registered rights in color marks should, in light of the Federal Circuit's decision, consider the following:

• Applying for a color mark that is composed of a unique pattern or combination of colors;
• Approaching the color mark as a "symbol" of the brand; and
• Including the color mark on product labels and packaging.

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