Sunday, May 23, 2010

Huhtamaki Lifts Cup of Victory Over Dixie Trade Dress Claim

Dixie Consumer Products sued its competitor Huhtamaki Americas in the Northern District of Georgia, claiming a trade dress violation by Huhtamaki over the Dixie Insulair Cup.  Dixie claimed that the bottom white portion of the cup was entitled to trade dress protection.  Judge Timothy Batten disagreed, granting summary judgment to Huhtamaki. The Insulair Cup (pictured, top) has three layers, an inner cup layer which extends to the bottom, a middle insulating layer, and a paper layer outside.  Dixie claimed that the positioning of these layers, creating a white band at the bottom, constituted protectable trade dress.   Dixie started selling the Insulair Cup in 1997.  In 2008, Huhtamaki began selling the competing Comfort Cup.  The Comfort Cup (pictured, bottom) also is comprised of three layers similarly positioned, creating a white band at the bottom. 

Huhtamaki's summary judgment motion raised one major argument, that the element of the cup for which Dixie sought trade dress protection was functional, and under the law there can be no trade dress protection for design elements serving a functional purpose.  As the party seeking protection, Dixie bore the burden of proof because the trade dress at issue was not registered on the principal register.  Dixie pointed out that on February 16, 2010, more than a year after filing, the USPTO approved the mark for publication in the Official Gazette for opposition.  Dixie argued that this was a decision entitled to deference from the court because in reaching that decision the USPTO had rejected Huhtamaki arguments on functionality.  Because no published reasoning from the USPTO was available to support that decision, the court declined to give it any weight, citing a Massachusetts district court opinion, Accord TriMark USA, Inc. v. Performance Food Group Co., 667 F. Supp. 2d 155 (D. Mass. 2009). 

Huhtamaki's claim of functionality relied heavily on the fact that the Dixie Insulair Cup is the subject of several utility patents, especially the Patent No. 6,085,970 (the "'970 patent").  In TrafFix Devices, Inc. v. Mktg. Displays, Inc., 532 U.S. 23, 29, 121 S. Ct. 1255 (2001),  the U.S. Supreme Court held that a  utility patent is "strong evidence" that the features claimed to be trade dress are functional.  Furthermore, the court was not moved by the Dixie argument that the trade dress at issue was ornamental.  The court stated that Dixie's argument came down to the assertion that a functional cup added with a functional insulating sleeve resulted in an ornamental feature.  The court rejected this notion, relying on a Ninth Circuit case which held that, where the whole is simply an assemblage of functional parts, where even the arrangement of parts is designed for superior performance, it is semantic trickery to say that there is still some sort of overall appearance that is nonfunctional.  Leatherman Tool Group, Inc. v. Cooper Indus., Inc., 199 F.3d 1009 (9th Cir. 1999).  Ultimately the court decided that the utility patents covered the feature at issue.  This finding was sufficient for summary judgment in favor of Huhtamaki. 

Notwithstanding the sufficiency of the utility patent issue's sufficiency for summary judgment, the court addressed and rejected Dixie's argument that Huhtamaki could have selected numerous alternative non-infringing cup designs, rendering the feature in question nonfunctional.  Huhtamaki demonstrated to the court's satisfaction that the alternative designs proposed by Dixie would cost more or affect the quality of the Comfort Cup.  The court noted also that there are several other examples in the market of insulated cups with a bottom white band below an insulating sleeve. 

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