This decision clarifies that the presumption of “acquired secondary meaning” associated with registration does not apply retroactively in product design trade dress cases. The presumption is effective only as of the registration date.
On October 30, the Federal Circuit Court of Appeals reversed a decision from the International Trade Court invalidating the Chuck Taylor Converse sneaker design trade dress. Converse Inc. v. ITC, No. 2016-2497, 2018 WL 5536405 (Fed. Cir. Oct. 30, 2018). At first glance, this appeared to be great news for Converse. However, the decision highlights multiple obstacles that Converse, and other brand owners, will continue to face as they seek to enforce product design trade dress in the US.
The Chuck Taylor decision arose out of Converse’s 2014 ITC complaint seeking an exclusion order against designs that allegedly infringed its classic sneaker’s trade dress. The ITC ultimately rejected the complaint because, among other reasons, it found the asserted Chuck Taylor trade dress invalid on distinctiveness grounds. Converse appealed to the Federal Circuit. The Federal Circuit reversed and remanded the decision because it believed that the ITC’s analysis was flawed. In doing so, the Federal Circuit attempted to clarify several issues relating to trade dress law in the circuit, namely: (1) presumptions of validity; (2) proof of acquired distinctiveness; and (3) likelihood of confusion.
A brand owner attempting to protect its product design (or “product configuration”) trade dress must specifically define it at the outset. The elements must be distinctive and non-functional. Converse defined the Chuck Taylor sneaker’s trade dress as consisting of essentially three elements: the stripes on the midsoles; the toe cap; and the bumper. To be valid and protectable, the claimant must prove that the trade dress has acquired distinctiveness as a mark, or, as the Federal Circuit described it, “acquired secondary meaning.” In Converse, the ITC held that Converse failed to do so. The Federal Circuit reversed and remanded the decision, but Converse is not out of the woods.
Converse attempted to argue that its 2013 U.S.P.T.O. registration covering the Chuck Taylor trade dress provided it with a statutory presumption of validity with respect to all infringers. The Federal Circuit disagreed because the remaining intervenors, including Skechers, began using their accused designs prior to issuance of the registration. Therefore, the presumption of validity provided by the registration was inapplicable. In other words, the Federal Circuit held that Converse’s 2013 federal registration could not be enforced against Skechers because Skechers began using its accused design prior to 2013.
This is the crux of the Converse holding. This decision clarifies that the presumption of “acquired secondary meaning” associated with registration does not apply retroactively in product design trade dress cases. The presumption is effective only as of the registration date.
Here, it is important to distinguish product design trade dress from other forms of marks, such as word marks, logos, or product packaging. Those forms of marks may be deemed “inherently distinctive,” and therefore registrable and protectable upon first use. In contrast, product design trade dress (and other “non-traditional” marks, such as color marks and scent marks) can never be deemed inherently distinctive. Those marks require “acquired secondary meaning” before they can be registrable and protectable. Nothing in Converse suggests that an inherently distinctive mark’s presumption of validity does not apply prior to its date of registration.
There is one final noteworthy point regarding Converse’s federal registration. On remand, the ITC must decide whether it was proper to invalidate the Chuck Taylor trade dress registration in light of the Federal Circuit’s holding that it was inapplicable to early users such as Skechers. The dissenting opinion argued that the registration was not at issue and, as a result, should not have been invalidated.
On remand, Converse will be left with only its common law rights. However, those rights were also considerably constrained by the Federal Circuit’s ruling. The court held that the only applicable common law rights are those which existed at the time Skechers launched its accused shoes. Therefore, Converse must prove that its Chuck Taylor trade dress acquired secondary meaning prior to Skechers’ first use of the accused design. To do so, it must essentially go back in time. A present-day consumer survey and proofs will be ineffective. The Federal Circuit noted that the “most relevant” proofs would be evidence of acquired secondary meaning existing during the five-year period immediately preceding the first infringing use.
As to acquired distinctiveness, the Federal Circuit held that six factors must be assessed: “(1) association of the trade dress with a particular source by actual purchasers (typically measured by customer surveys); (2) length, degree, and exclusivity of use; (3) amount and manner of advertising; (4) amount of sale and number of customers; (5) intentional copying; and (6) unsolicited media coverage of the product embodying the mark.”
Finally, as to likelihood of confusion, the Federal Circuit held that “accused products that are not substantially similar cannot infringe.” The phrase “substantially similar” is not typically associated with trademark law. However, the court drew a comparison between product design trade dress law and design patent law, which requires “an ordinary observer [to] perceive that the ‘two designs are substantially the same.’”
While the Converse decision clarified certain issues pertaining to trade dress law in the Federal Circuit, it is important to note that the decision will not be binding in the other federal circuits. Unlike patent law, each regional circuit has its own governing precedent in Lanham Act cases. The Federal Circuit is not the primary reviewing court for trade dress infringement cases filed in the federal district courts. Appeals in those cases are adjudicated in the regional circuit court of appeals. (For example, a trade dress infringement lawsuit filed in the Northern District of Illinois would be appealed to the Seventh Circuit Court of Appeals.) That said, the Federal Circuit is the primary reviewing court for ITC cases (like Converse), as well as opposition and cancellation actions commenced in the Trademark Trial and Appeal Board. Consequently, it is an important decision.