CITE:  532 U.S. 23
CMON:  March 2001
PLAIN: Traffix Devices
DEFND: Marketing Displays
COURT: United States Supreme Court
DATE:  March 20, 2001
HISTORY:
On Writ of Certiorari to the United States Court of Appeals for
the Sixth Circuit. 200 F.3d 929, reversed and remanded.
Trade dress protection under Lanham Act (15 USCS 1051 et seq.) for
dual-spring design, on which patents had expired, for mechanism to keep
road signs upright held to be barred, because design was functional.

SUMMARY:
  A utility patent is strong evidence that the features therein claimed
  are functional.  A feature is functional when it is essential to the
  use or purpose of the device or when it affects the cost or quality
  of the device.

JUDGE: Kennedy, Justice
KENNEDY, J., delivered the opinion for a unanimous Court.

DECISION: 

SYLLABUS.

Respondent, Marketing Displays, Inc. (MDI), holds now-expired utility
patents for a "dual-spring design" mechanism that keeps temporary road
and other outdoor signs upright in adverse wind conditions. MDI claims
that its sign stands were recognizable to buyers and users because the
patented design was visible near the sign stand's base. After the patents
expired and petitioner TrafFix Devices, Inc., began marketing sign stands
with a dual-spring mechanism copied from MDI's design, MDI brought suit
under the Trademark Act of 1964 for, inter alia, trade dress infringement.
The District Court granted TrafFix's motion for summary judgment, holding
that no reasonable trier of fact could determine that MDI had established
secondary meaning in its alleged trade dress, i.e., consumers did not
associate the dual-spring design's look with MDI; and, as an independent
reason, that there could be no trade dress protection for the design
because it was functional. The Sixth Circuit reversed. Among other
things, it suggested that the District Court committed legal error by
looking only to the dual-spring design when evaluating MDI's trade dress
because a competitor had to find some way to hide the design or otherwise
set it apart from MDI's; explained, relying on Qualitex Co. v. Jacobson
Products Co., 514 U.S. 159, 165, 131 L. Ed. 2d 248, 115 S. Ct. 1300, that
exclusive use of a feature must put competitors at a significant
non-reputation-related disadvantage before trade dress protection is
denied on functionality grounds; and noted a split among the Circuits
on the issue whether an expired utility patent forecloses the possibility
of trade dress protection in the product's design.

Held: Because MDI's dual-spring design is a functional feature for which
there is no trade dress protection, MDI's claim is barred.  Pp. 4-11.

(a) Trade dress can be protected under federal law, but the person asserting
such protection in an infringement action must prove that the matter sought
to be protected is not functional, 15 U.S.C. Section 1125(a)(3). Trade dress
protection must subsist with the recognition that in many instances there
is no prohibition against copying goods and products. An expired utility
patent has vital significance in resolving a trade dress claim, for a
utility patent is strong evidence that the features therein claimed are
functional. The central advance claimed in the expired utility patents
here is the dual-spring design, which is an essential feature of the
trade dress MDI now seeks to protect. However, MDI did not, and cannot,
carry the burden of overcoming the strong evidentiary inference of
functionality based on the disclosure of the dual-spring design in
the claims of the expired patents. The springs are necessary to the
device's operation, and they would have been covered by the claims of
the expired patents even though they look different from the embodiment
revealed in those patents, see Sarkisian v. Winn-Proof Corp., 697 F.2d
1313. The rationale for the rule that the disclosure of a feature in a
utility patent's claims constitutes strong evidence of functionality is
well illustrated in this case. The design serves the important purpose
of keeping the sign upright in heavy wind conditions, and statements in
the expired patent applications indicate that it does so in a unique
and useful manner and at a cost advantage over alternative designs.
Pp. 4-8.

(b) In reversing the summary judgment against MDI, the Sixth Circuit gave
insufficient weight to the importance of the expired utility patents, and
their evidentiary significance, in establishing the device's functionality.
The error was likely caused by its misinterpretation of trade dress
principles in other respects. "'In general terms a product feature is
functional,' and cannot serve as a trademark, 'if it is essential to the
use or purpose of the article or if it affects the cost or quality of the
article.'" Qualitex, supra, at 165 (quoting Inwood Laboratories, Inc. v.
Ives Laboratories, Inc., 456 U.S. 844, 850, n. 10, 72 L. Ed. 2d 606,
102 S. Ct. 2182). This Court has expanded on that meaning, observing that
a functional feature is one "the exclusive use of [which] would put
competitors at a significant non-reputation-related disadvantage",
Qualitex, supra, at 165, but that language does not mean that competitive
necessity is a necessary test for functionality. Where the design is
functional under the Inwood formulation there is no need to proceed
further to consider competitive necessity. This Court has allowed trade
dress protection to inherently distinctive product features on the
assumption that they were not functional. Two Pesos, Inc. v. Taco
Cabana, Inc., 505 U.S. 763, 774, 120 L. Ed. 2d 615, 112 S. Ct. 2753.
Here, however, beyond serving the purpose of informing consumers that
the sign stands are made by MDI, the design provides a unique and
useful mechanism to resist the wind's force. Functionality having been
established, whether the design has acquired secondary meaning need not
be considered. Nor is it necessary to speculate about other design
possibilities. Finally, this Court need not resolve here the question
whether the Patent Clause of the Constitution, of its own force,
prohibits the holder of an expired utility patent from claiming trade
dress protection. Pp. 8-11.

200 F.3d 929, reversed and remanded.

OPINION

Temporary road signs with warnings like "Road Work Ahead" or "Left Shoulder
Closed" must withstand strong gusts of wind. An inventor named Robert
Sarkisian obtained two utility patents for a mechanism built upon two springs
(the dual-spring design) to keep these and other outdoor signs upright
despite adverse wind conditions. The holder of the now-expired Sarkisian 
patents, respondent Marketing Displays, Inc. (MDI), established a successful
business in the manufacture and sale of sign stands incorporating the
patented feature. MDI's stands for road signs were recognizable to buyers
and users (it says) because the dual-spring design was visible near the
base of the sign.

This litigation followed after the patents expired and a competitor, TrafFix
Devices, Inc., sold sign stands with a visible spring mechanism that looked
like MDI's. MDI and TrafFix products looked alike because they were. When
TrafFix started in business, it sent an MDI product abroad to have it reverse
engineered, that is to say copied. Complicating matters, TrafFix marketed its
sign stands under a name similar to MDI's. MDI used the name "WindMaster",
while TrafFix, its new competitor, used "WindBuster".

MDI brought suit under the Trademark Act of 1964 (Lanham Act), 60 Stat. 427,
as amended, 15 U.S.C. 1051 et seq., against TrafFix for trademark infringement
(based on the similar names), trade dress infringement (based on the copied
dual-spring design) and unfair competition. TrafFix counterclaimed on
antitrust theories. After the United States District Court for the Eastern
District of Michigan considered cross-motions for summary judgment, MDI
prevailed on its trademark claim for the confusing similarity of names
and was held not liable on the antitrust counterclaim; and those two
rulings, affirmed by the Court of Appeals, are not before us.


I


We are concerned with the trade dress question. The District Court ruled
against MDI on its trade dress claim.  971 F. Supp. 262 (ED Mich. 1997).
After determining that the one element of MDI's trade dress at issue was
the dual-spring design, id. at 265, it held that "no reasonable trier of
fact could determine that MDI has established secondary meaning" in its
alleged trade dress, id. at 269. In other words, consumers did not
associate the look of the dual-spring design with MDI. As a second,
independent reason to grant summary judgment in favor of TrafFix, the
District Court determined the dual-spring design was functional. On this
rationale secondary meaning is irrelevant because there can be no trade
dress protection in any event. In ruling on the functional aspect of the
design, the District Court noted that Sixth Circuit precedent indicated
that the burden was on MDI to prove that its trade dress was nonfunctional,
and not on TrafFix to show that it was functional (a rule since adopted
by Congress, see 15 U.S.C. 1125(a)(3) (1994 ed., Supp. V)), and then went
on to consider MDI's arguments that the dual-spring design was subject to
trade dress protection. Finding none of MDI's contentions persuasive, the
District Court concluded MDI had not "proffered sufficient evidence which
would enable a reasonable trier of fact to find that MDI's vertical
dual-spring design is non-functional." Id. at 276. Summary judgment
was entered against MDI on its trade dress claims.

The Court of Appeals for the Sixth Circuit reversed the trade dress ruling.
200 F.3d 929 (1999). The Court of Appeals held the District Court had erred
in ruling MDI failed to show a genuine issue of material fact regarding
whether it had secondary meaning in its alleged trade dress, 200 F.3d at 938,
and had erred further in determining that MDI could not prevail in any
event because the alleged trade dress was in fact a functional product
configuration, 200 F.3d at 940. The Court of Appeals suggested the
District Court committed legal error by looking only to the dual-spring
design when evaluating MDI's trade dress. Basic to its reasoning was the
Court of Appeals' observation that it took "little imagination to conceive
of a hidden dual-spring mechanism or a tri or quad-spring mechanism that
might avoid infringing [MDI's] trade dress."  Ibid. The Court of Appeals
explained that "if TrafFix or another competitor chooses to use [MDI's]
dual-spring design, then it will have to find some other way to set its
sign apart to avoid infringing [MDI's] trade dress." Ibid. It was not
sufficient, according to the Court of Appeals, that allowing exclusive use
of a particular feature such as the dual-spring design in the guise of trade
dress would "hinder competition somewhat." Rather, "exclusive use of a
feature must 'put competitors at a significant non-reputation-related
disadvantage' before trade dress protection is denied on functionality
grounds." Ibid. (quoting Qualitex Co. v. Jacobson Products Co., 514 U.S.
159, 165, 131 L. Ed. 2d 248, 115 S. Ct. 1300 (1995)). In its criticism of
the District Court's ruling on the trade dress question, the Court of
Appeals took note of a split among Courts of Appeals in various other
Circuits on the issue whether the existence of an expired utility patent
forecloses the possibility of the patentee's claiming trade dress
protection in the product's design.  200 F.3d at 939. Compare Sunbeam
Products, Inc. v. West Bend Co., 123 F.3d 246 (CA5 1997) (holding that
trade dress protection is not foreclosed), Thomas & Betts Corp. v.
Panduit Corp., 138 F.3d 277 (CA7 1998) (same), and Midwest Industries,
Inc. v. Karavan Trailers, Inc., 175 F.3d 1356 (CA Fed 1999) (same),
with Vornado Air Circulation Systems, Inc. v. Duracraft Corp., 58 F.3d
1498, 1500 (CA10 1995) ("Where a product configuration is a significant
inventive component of an invention covered by a utility patent . . .
it cannot receive trade dress protection"). To resolve the conflict,
we granted certiorari.  530 U.S. 1260 (2000).


II


It is well established that trade dress can be protected under federal
law. The design or packaging of a product may acquire a distinctiveness
which serves to identify the product with its manufacturer or source;
and a design or package which acquires this secondary meaning, assuming
other requisites are met, is a trade dress which may not be used in a manner
likely to cause confusion as to the origin, sponsorship, or approval of the
goods. In these respects protection for trade dress exists to promote
competition. As we explained just last Term, see Wal-Mart Stores, Inc.
v. Samara Brothers, Inc., 529 U.S. 205, 146 L. Ed. 2d 182, 120 S. Ct. 1339
(2000), various Courts of Appeals have allowed claims of trade dress
infringement relying on the general provision of the Lanham Act which
provides a cause of action to one who is injured when a person uses
"any word, term name, symbol, or device, or any combination thereof . . .
which is likely to cause confusion . . . as to the origin, sponsorship,
or approval of his or her goods." 15 U.S.C. 1125 (a)(1)(A). Congress
confirmed this statutory protection for trade dress by amending the
Lanham Act to recognize the concept. Title 15 U.S.C. 1125(a)(3) (1994 ed.,
Supp. V) provides: "In a civil action for trade dress infringement under
this chapter for trade dress not registered on the principal register, the
person who asserts trade dress protection has the burden of proving that the
matter sought to be protected is not functional." This burden of proof gives
force to the well-established rule that trade dress protection may not be
claimed for product features that are functional. Qualitex, 514 U.S. at
164-165;  Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 775, 120 L.
Ed. 2d 615, 112 S. Ct. 2753 (1992). And in Wal-Mart, supra, we were
careful to caution against misuse or over-extension of trade dress. We
noted that "product design almost invariably serves purposes other
than source identification." 529 U.S. at 213.

Trade dress protection must subsist with the recognition that in many
instances there is no prohibition against copying goods and products. In
general, unless an intellectual property right such as a patent or copyright
protects an item, it will be subject to copying. As the Court has explained,
copying is not always discouraged or disfavored by the laws which preserve
our competitive economy.  Bonito Boats, Inc. v. Thunder Craft Boats, Inc.,
489 U.S. 141, 160, 103 L. Ed. 2d 118, 109 S. Ct. 971 (1989). Allowing
competitors to copy will have salutary effects in many instances. "Reverse
engineering of chemical and mechanical articles in the public domain
often leads to significant advances in technology." Ibid.

The principal question in this case is the effect of an expired patent
on a claim of trade dress infringement. A prior patent, we conclude, has
vital significance in resolving the trade dress claim. A utility patent is
strong evidence that the features therein claimed are functional. If trade
dress protection is sought for those features the strong evidence of
functionality based on the previous patent adds great weight to the statutory
presumption that features are deemed functional until proved otherwise by the
party seeking trade dress protection. Where the expired patent claimed the
features in question, one who seeks to establish trade dress protection must
carry the heavy burden of showing that the feature is not functional, for
instance by showing that it is merely an ornamental, incidental, or
arbitrary aspect of the device.

In the case before us, the central advance claimed in the expired utility
patents (the Sarkisian patents) is the dual-spring design; and the
dual-spring design is the essential feature of the trade dress MDI now seeks
to establish and to protect. The rule we have explained bars the trade dress
claim, for MDI did not, and cannot, carry the burden of overcoming the strong
evidentiary inference of functionality based on the disclosure of the
dual-spring design in the claims of the expired patents.

The dual springs shown in the Sarkisian patents were well apart (at either
end of a frame for holding a rectangular sign when one full side is the
base) while the dual springs at issue here are close together (in a frame
designed to hold a sign by one of its corners). As the District Court
recognized, this makes little difference. The point is that the springs are
necessary to the operation of the device. The fact that the springs in this
very different-looking device fall within the claims of the patents is
illustrated by MDI's own position in earlier litigation. In the late 1970's,
MDI engaged in a long-running intellectual property battle with a company
known as Winn-Proof.  Although the precise claims of the Sarkisian patents
cover sign stands with springs "spaced apart", U.S. Patent No.  3,646,696,
col. 4; U.S. Patent No. 3,662,482, col. 4, the Winn-Proof sign stands
(with springs much like the sign stands at issue here) were found to
infringe the patents by the United States District Court for the District
of Oregon, and the Court of Appeals for the Ninth Circuit affirmed the
judgment.  Sarkisian v. Winn-Proof Corp., 697 F.2d 1313 (1983). Although
the Winn-Proof traffic sign stand (with dual springs close together) did
not appear, then, to infringe the literal terms of the patent claims
(which called for "spaced apart" springs), the Winn-Proof sign stand was
found to infringe the patents under the doctrine of equivalents, which
allows a finding of patent infringement even when the accused product does
not fall within the literal terms of the claims.  697 F.2d at 1321-1322; see
generally Warner-Jenkinson Co. v. Hilton Davis Chemical Co., 520 U.S. 17,
137 L. Ed. 2d 146, 117 S. Ct. 1040 (1997). In light of this past ruling
-- a ruling procured at MDI's own insistence -- it must be concluded the
products here at issue would have been covered by the claims of the expired
patents.

The rationale for the rule that the disclosure of a feature in the claims
of a utility patent constitutes strong evidence of functionality is well
illustrated in this case. The dual-spring design serves the important
purpose of keeping the sign upright even in heavy wind conditions; and,
as confirmed by the statements in the expired patents, it does so in a
unique and useful manner. As the specification of one of the patents
recites, prior art "devices, in practice, will topple under the force
of a strong wind." U.S. Patent No. 3,662,482, col. 1. The dual-spring
design allows sign stands to resist toppling in strong winds. Using a
dual-spring design rather than a single spring achieves important
operational advantages. For example, the specifications of the patents
note that the "use of a pair of springs . . . as opposed to the use of
a single spring to support the frame structure prevents canting or 
twisting of the sign around a vertical axis," and that, if not prevented,
twisting "may cause damage to the spring structure and may result in
tipping of the device." U.S. Patent No.  3,646,696, col. 3. In the course
of patent prosecution, it was said that "the use of a pair of spring
connections as opposed to a single spring connection . . . forms an
important part of this combination" because it "forces the sign frame to
tip along the longitudinal axis of the elongated ground-engaging members."
App. 218. The dual-spring design affects the cost of the device as well;
it was acknowledged that the device "could use three springs but this
would unnecessarily increase the cost of the device." App. 217. These
statements made in the patent applications and in the course of procuring
the patents demonstrate the functionality of the design. MDI does not
assert that any of these representations are mistaken or inaccurate, and
this is further strong evidence of the functionality of the dual-spring
design.


III


In finding for MDI on the trade dress issue the Court of Appeals gave
insufficient recognition to the importance of the expired utility patents,
and their evidentiary significance, in establishing the functionality of
the device. The error likely was caused by its misinterpretation of trade
dress principles in other respects. As we have noted, even if there has
been no previous utility patent the party asserting trade dress has the
burden to establish the nonfunctionality of alleged trade dress features.
MDI could not meet this burden. Discussing trademarks, we have said
"'in general terms, a product feature is functional,' and cannot serve as
a trademark, 'if it is essential to the use or purpose of the article or
if it affects the cost or quality of the article.'" Qualitex, 514 U.S. at
165 (quoting Inwood Laboratories, Inc. v. Ives Laboratories, Inc.,
456 U.S. 844, 850, n. 10, 72 L. Ed. 2d 606, 102 S. Ct. 2182 (1982)).
Expanding upon the meaning of this phrase, we have observed that a
functional feature is one the "exclusive use of [which] would put
competitors at a significant non-reputation-related disadvantage."
514 U.S. at 165. The Court of Appeals in the instant case seemed to
interpret this language to mean that a necessary test for functionality is
"whether the particular product configuration is a competitive necessity."
200 F.3d at 940.  See also Vornado, 58 F.3d at 1507 ("Functionality,
by contrast, has been defined both by our circuit, and more recently by
the Supreme Court, in terms of competitive need"). This was incorrect as
a comprehensive definition. As explained in Qualitex, supra, and Inwood,
supra, a feature is also functional when it is essential to the use or
purpose of the device or when it affects the cost or quality of the device.
The Qualitex decision did not purport to displace this traditional rule.
Instead, it quoted the rule as Inwood had set it forth. It is proper to
inquire into a "significant non-reputation-related disadvantage" in cases
of aesthetic functionality, the question involved in Qualitex. Where the
design is functional under the Inwood formulation there is no need to
proceed further to consider if there is a competitive necessity for the
feature. In Qualitex, by contrast, aesthetic functionality was the
central question, there having been no indication that the green-gold
color of the laundry press pad had any bearing on the use or purpose
of the product or its cost or quality.

The Court has allowed trade dress protection to certain product features
that are inherently distinctive.  Two Pesos, 505 U.S. at 774. In Two Pesos,
however, the Court at the outset made the explicit analytic assumption
that the trade dress features in question (decorations and other features
to evoke a Mexican theme in a restaurant) were not functional. 505 U.S.
at 767, n. 6. The trade dress in those cases did not bar competitors from
copying functional product design features. In the instant case, beyond
serving the purpose of informing consumers that the sign stands are made
by MDI (assuming it does so), the dual-spring design provides a unique and
useful mechanism to resist the force of the wind. Functionality having
been established, whether MDI's dual-spring design has acquired secondary
meaning need not be considered.

There is no need, furthermore, to engage, as did the Court of Appeals,
in speculation about other design possibilities, such as using three or
four springs which might serve the same purpose.  200 F.3d at 940. Here, the
functionality of the spring design means that competitors need not explore
whether other spring juxtapositions might be used. The dual-spring design
is not an arbitrary flourish in the configuration of MDI's product; it is
the reason the device works. Other designs need not be attempted.

Because the dual-spring design is functional, it is unnecessary for
competitors to explore designs to hide the springs, say by using a box or
framework to cover them, as suggested by the Court of Appeals. Ibid. The
dual-spring design assures the user the device will work. If buyers are
assured the product serves its purpose by seeing the operative mechanism
that in itself serves an important market need. It would be at
cross-purposes to those objectives, and something of a paradox, were
we to require the manufacturer to conceal the very item the user seeks.

In a case where a manufacturer seeks to protect arbitrary, incidental, or
ornamental aspects of features of a product found in the patent claims,
such as arbitrary curves in the legs or an ornamental pattern painted on
the springs, a different result might obtain. There the manufacturer could
perhaps prove that those aspects do not serve a purpose within the terms
of the utility patent. The inquiry into whether such features, asserted
to be trade dress, are functional by reason of their inclusion in the
claims of an expired utility patent could be aided by going beyond the
claims and examining the patent and its prosecution history to see if
the feature in question is shown as a useful part of the invention. No such
claim is made here, however. MDI in essence seeks protection for the
dual-spring design alone. The asserted trade dress consists simply of
the dual-spring design, four legs, a base, an upright, and a sign. MDI
has pointed to nothing arbitrary about the components of its device or
the way they are assembled. The Lanham Act does not exist to reward
manufacturers for their innovation in creating a particular device; that
is the purpose of the patent law and its period of exclusivity. The Lanham
Act, furthermore, does not protect trade dress in a functional design
simply because an investment has been made to encourage the public to
associate a particular functional feature with a single manufacturer or
seller. The Court of Appeals erred in viewing MDI as possessing the right
to exclude competitors from using a design identical to MDI's and to
require those competitors to adopt a different design simply to avoid
copying it. MDI cannot gain the exclusive right to produce sign stands
using the dual-spring design by asserting that consumers associate it
with the look of the invention itself. Whether a utility patent has expired
or there has been no utility patent at all, a product design which has
a particular appearance may be functional because it is "essential to the
use or purpose of the article" or "affects the cost or quality of the
article".  Inwood, 456 U.S. at 850, n. 10.

TrafFix and some of its amici argue that the Patent Clause of the
Constitution, Article I, Section 8, clause 8, of its own force, prohibits
the holder of an expired utility patent from claiming trade dress
protection. Brief for Petitioner 33-36; Brief for Panduit Corp. as Amicus
Curiae 3; Brief for Malla Pollack as Amicus Curiae 2. We need not resolve
this question. If, despite the rule that functional features may not be
the subject of trade dress protection, a case arises in which trade dress
becomes the practical equivalent of an expired utility patent, that will
be time enough to consider the matter. The judgment of the Court of Appeals
is reversed, and the case is remanded for further proceedings consistent
with this opinion.


It is so ordered.