Jose Felgueroso
Abogado | Attorney
The Partial Coating of a Chocolate Snack is not Protectable as a Trademark
info@josefelgueroso.com
2021-04-19
In January, the United States Court of Appeals for the Third Circuit held that the design of a partially-coated chocolate snack is functional and not protectable as a trademark. The Court of Appeals found that, among other useful purposes, the partial coating prevented the chocolate from melting on the consumer's hand. Because trademark law does not protect a product's useful features, the Court of Appeals concluded that a competitor was free to copy the snack's design.
Facts
Ezaki Glico is a Japanese company that started selling Pocky, a thin stick-shaped snack partially covered with chocolate, in the United States in 1978. The uncoated area of the snack serves as a handle. The company obtained a utility patent and two trademarks related to a stick-shaped chocolate snack.
Source: Court of Appeals
In 1983, a company called Lotte introduced a similar stick-shaped, partially-coated snack.
Ezaki Glico sued Lotte for trademark infringement and unfair competition under federal and state law. The federal district court granted summary judgment for Lotte, because it found that Pocky's design is functional and has no protection under trademark law. Ezaki Glico appealed to the Court of Appeals.
The Judgment
A product's trade dress consists of the product's packaging and design. If a product's design is arbitrary or ornamental, it can serve to identify the source of the product and can be protected under trademark law, potentially for an unlimited number of years. On the other hand, useful designs can be protected by a utility patent for a limited number of years.
If a product's design is functional, it cannot be registered as a trademark and competitors are free to copy it in the absence of a utility patent. A functional design is a useful design. The focus is not on the product or a feature, but rather on the particular shape of a feature that affects the cost, quality, or manufacturing efficiency of the product.
The following factors indicate that a feature is functional:
- the feature makes the product work better;
- the manufacturer touts in its marketing the usefulness of the feature;
- a utility patent exists for the feature; or
- the product can only be designed in a few ways.
Ezaki Glico registered two trademarks related to Pocky: one for an "elongated rod containing biscuit or the like, partially covered with chocolate," and another one for "biscuit sticks, covered with chocolate or cream and almonds."
The Court of Appeals determined that Pocky's design is useful. The uncoated handle prevented the chocolate from melting on the consumer's hand. In addition, the stick shape allowed consumers to eat it without opening their mouths widely, made sharing the sticks easy, and enabled the packing of many sticks in one box. The Court of Appeals found that Ezaki Glico promoted Pocky's useful features in its ads, touting the convenient handle and the portable design.
The Court of Appeals also held that the existence of alternative designs for chocolate snacks did not affect the functionality of Pocky's features.
In short, the Court of Appeals concluded that Pocky's design is functional, because it prevents chocolate from getting on the consumer's hands, among other useful features. As a result, trademark law does not protect Pocky's design and Ezaki Glico's competitors are free to copy it.
Ezaki Glico's Utility Patent
A utility patent can be evidence of the functionality of a feature. Utility patents protect new and useful inventions for a period of 20 years. The test for determining whether a feature is useful in patent law is similar to the test for determining whether a feature is functional under trademark law. If the central innovation of the patent is the essential feature of the trade dress, the feature is functional.
Ezaki Glico has a utility patent for a "Stick-shaped snack and method for producing the same." The Court of Appeals found that the central innovation of the patent is not Pocky's useful feature, because the patent concerns mainly the manufacturing of a stick-shaped snack. As a result, the Court of Appeals concluded that the utility patent was irrelevant to this case.
Effects of the Functionality Doctrine
The functionality doctrine of trademark law seeks to prevent trade-dress protection from becoming a back-door patent. Utility patents protect useful innovations, whereas trademark law protects identifications of source. If trademark law protected useful features, the term of protection could be unlimited, overriding the limited term of protection for useful features under utility patents.