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July 9, 1996

ZIP DEE, INC., Plaintiff,

The opinion of the court was delivered by: SHADUR

 This long and contentious litigation between Zip Dee, Inc. ("Zip Dee") and The Dometic Corporation ("Dometic") has continued to pose so many and varied issues as to assume almost mythic proportions. Unfortunately the myth most often called to mind, as this Court has been called upon to resolve the parties' numerous disputes, has been the fifth of the Labors of Hercules--the cleansing of the Augean Stables. Or perhaps, given the manner in which the same or closely related tasks seem to reappear frequently in somewhat altered guises, the somewhat more elegant reference should be to the punishment visited on Sisyphus.

 Let's stay with the latter. This time the boulder that this Court must push up a mountain of legal concepts is Dometic's motion under Fed. R. Civ. P. ("Rule") 56 for partial summary judgment on Zip Dee's trademark infringement claims. This District Court's General Rule ("GR") 12(M) and 12(N) *fn1" as well as the Rule 56 requirements have been complied with by both parties, so that the motion is fully briefed and ready for decision. For the reasons set forth in this memorandum opinion and order, this latest motion by Dometic is denied.

 Under familiar Rule 56 principles Dometic has the burden of establishing both the lack of a genuine issue of material fact and that it is entitled to a judgment as a matter of law ( Celotex v. Catrett, 477 U.S. 317, 322-23, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986)). Summary judgment is appropriate only if the record reveals that no reasonable jury could find for Zip Dee on its trademark infringement claims. For purposes of this motion the evidence must be "construed as favorably to [Zip Dee] as reason and the record permit" ( Williams v. Bristol-Myers Squibb Co., 85 F.3d 270, 1996 WL 280786, at *1 (7th Cir.)). So inferences will be taken in the light most favorable to nonmovant Zip Dee, but this Court is "not required to draw every conceivable inference from the record--only those inferences that are reasonable" ( Bank Leumi Le-Israel, B.M. v. Lee, 928 F.2d 232, 236 (7th Cir. 1991) and cases cited there).


 Because the lawsuit's extensive background has been set out in earlier opinions (see 900 F. Supp. 1004, 1006-08 (N.D. Ill. 1995) and 886 F. Supp. 1427, 1429-30 (N.D. Ill. 1995)), a bare review of the facts will suffice for present purposes. Nearly 30 years have passed since, back in 1967, Zip Dee obtained Patent 3,324,869 (the "'869 Patent") for a roll-up recreational vehicle ("RV") awning made of fabric but utilizing a flexible metal cover to protect it from deterioration while in storage. *fn2" Initially Zip Dee used a single sheet of flexible metal for the cover, but in 1969 it began to use an awning cover made of a series of metal slats. It is undisputed that the '869 Patent was broad enough to embrace the slatted metal cover design as well as a cover consisting of a single sheet of metal.

 Sometime after the '869 Patent expired in 1984, Dometic's predecessor A&E Systems, Inc. ("A&E") began to produce similar awnings complete with the bright and shiny mirror-like finish of the awning covers manufactured by Zip Dee. In 1986 Zip Dee sued A&E in a California District Court, claiming that A&E had both violated the '869 Patent and engaged in common law unfair competition by infringing on Zip Dee's trade dress. Two years later a jury found in Zip Dee's favor on both claims, and the court entered judgment on the verdict and enjoined A&E from further violating Zip Dee's trade dress. *fn3"

 Dometic acquired A&E in 1988 and, viewing the injunction as applicable only to RV awnings with a slatted metal cover that had a mirror-like finish, began to turn out awnings with slatted metal covers having a dull (matte) finish. Zip Dee had a different understanding: It contended that the injunction covered the overall form and shape of the awnings irrespective of the type of finish, so it instituted a contempt proceeding against Dometic. Zip Dee's take on the scope of the injunction was rejected by the California District Court, which ruled that the injunction related to the totality of Zip Dee's trade dress, expressly including the mirror-like finish. *fn4"

 Zip Dee then tried a different tack. In 1990 it filed an application with the United States Patent and Trademark Office ("Trademark Office" or simply "Office") for a trademark for the "overall configuration of a slatted cover for an awning on a recreation vehicle." Although the Office initially rejected the application, Zip Dee was eventually able to convince the Office that the product configuration was entitled to federal registration. On December 15, 1992 the Office registered Zip Dee's trademark on the slatted awning configuration. *fn5"

 Dometic advances two related arguments here in support of its motion for summary judgment. First Dometic claims that Zip Dee cannot have an enforceable trademark in the roll-up RV awnings with a slatted metal cover because that would contravene the policies underlying patent law, specifically the public's right to copy and use inventions once a patent expires. Dometic also argues that it is entitled to judgment on Zip Dee's trademark claims because the slatted awning cover is functional and therefore cannot qualify for trademark protection. Neither argument can really be addressed without first setting the stage by discussing the tension between patent and trademark policy at work here, and correspondingly the law that is to be applied.

 Policies Underlying Patent and Trademark Law

 By now it is axiomatic that the patent and trademark laws protect different interests (see Thomas & Betts Corp. v. Panduit Corp., 65 F.3d 654, 657-58 (7th Cir. 1995)). Trademark law is aimed at assisting consumers in identifying the source of goods, a goal served by granting an indefinite monopoly to the user of a particular unique symbol that connects a product with its source ( id. at 657). If a symbol is entitled to trademark protection, the holder of that mark has an exclusive right to use the symbol to identify the holder's product and can bar others from using the mark, thus protecting consumers from confusedly thinking that they are buying the manufacturer's product when they are instead purchasing an imitation. Although the granting of such a monopoly might seem counterintuitive to fundamental notions of free market competition, that misperception is dispelled by a rather straightforward explanation (id., footnote omitted):

Allowing a particular producer to monopolize a symbol in this way is no burden on competition, the theory goes, because symbols are a dime a dozen. The only value of the initially arbitrary symbol comes from its association with the producer's products and the good or bad will consumers feel toward that producer is based on the quality of those products. Because the symbol itself adds nothing to the product, consumer desire for products marketed with that symbol must derive solely from the belief that the products bearing the mark originated with the producer for whom the consumers have developed the goodwill. Therefore, the only reason a competitor would copy a mark would be to pass off his product as that of the original producer.

 So far so good. But the water gets decidedly murkier when it comes to a product configuration trademark such as the one claimed by Zip Dee here. Product configurations can be trademarked ( W.T. Rogers Co. v. Keene, 778 F.2d 334, 337 (7th Cir. 1985)) if the manufacturer can show that the configuration is either inherently distinctive or has acquired distinctiveness through secondary meaning, as well as showing the likelihood of confusion ( Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 769, 120 L. Ed. 2d 615, 112 S. Ct. 2753 (1992)). In other words, if the configuration of a product is the vehicle through which consumers connect the source with the product--playing the same role of "source signifier" that a word or symbol does in the more traditional trademark context--then that product configuration may be entitled to trademark protection if there is no conflict with the federal patent laws.

 But such conflicts do sometimes occur because of the policies underlying the patent laws, and hence the need for the "may" qualifier. Bonito Boats, Inc. v. Thunder Craft Boats, Inc., 489 U.S. 141, 146, 103 L. Ed. 2d 118, 109 S. Ct. 971 (1989) has pointed out that "from their inception, the federal patent laws have embodied a careful balance between the need to promote innovation and the recognition that limitation and refinement through imitation are both necessary to invention itself and the very lifeblood of the competitive economy." Bonito Boats, id. at 150-51 went on to describe that "careful balance":

The applicant whose invention satisfies the requirements of novelty, nonobviousness, and utility, and who is willing to reveal to the public the substance of his discovery and "the best mode...of carrying out his invention," 35 U.S.C. § 112, is granted "the right to exclude others from making, using, or selling the invention throughout the United States," for a period of 17 years. 35 U.S.C. § 154. The federal patent system thus embodies a carefully crafted bargain for encouraging the creation and disclosure of new, useful, and nonobvious advances in technology and design in return for the exclusive right to practice the invention for a period of years. "[The inventor] may keep his invention secret and reap its fruits indefinitely. In consideration of its disclosure and the consequent benefit to the community, the patent is granted. An exclusive enjoyment is guaranteed him for seventeen years, but upon expiration of that period, the knowledge of the invention inures to the people, who are thus enabled without restriction to practice it and profit by its use." United States v. Dubilier Condenser Corp., 289 U.S. 178, 186-187, 77 L. Ed. 1114, 53 S. Ct. 554 (1933).

 Essential to making that "bargain" work is the rule that the public has a federal right to copy and use the patented product once the patent has expired (id. at 165; Scott Paper Co. v. Marcalus Mfg. Co., 326 U.S. 249, 256, 90 L. Ed. 47, 66 S. Ct. 101 (1945)).

 At this point the tension between the considerations that underlie the patent laws and those that counsel granting a trademark on a product configuration comes into focus. On one hand the goal of trademark law (assisting the consumer by avoiding confusion as to a product's source) is sometimes served by allowing an indefinite monopoly on a particular product configuration. But at the same time the patent laws set out a detailed regimen of requirements that must be met before a 17-year monopoly will be conferred on an invention (via a utility patent), and when those sands run out the public has a right to engage in the slavish copying and use of the product. What happens at the intersection of those competing goals?

 One way to reconcile the potential conflict is through the requirement that a product configuration cannot be trademarked if it is functional ( Schwinn Bicycle Co. v. Ross Bicycles, Inc., 870 F.2d 1176, 1188 (7th Cir. 1989)). Functionality of a product configuration refers to "something that other producers of the product in question would have to have as part of the product in order to be able to compete effectively in the market" ( W.T. Rogers, 778 F.2d at 346). As W.T. Rogers, id. went on to say, "the feature is functional, as defined above,...only if without it other producers of the product could not compete effectively."

 So if a particular product configuration is "one that [is] costly to design around or do without, rather than one that is costly to have" ( Schwinn Bicycle, 870 F.2d at 1189), it cannot be trademarked. Qualitex Co. v. Jacobson Products Co., 131 L. Ed. 2d 248, 115 S. Ct. 1300, 1304 (1995)(citations omitted) explains why:

 But as Vornado Air Circulation Sys., Inc. v. Duracraft Corp., 58 F.3d 1498, 1506-07 (10th Cir. 1995) has recently pointed out--somewhat at odds with what has been assumed elsewhere (e.g., W.T. Rogers, 778 F.2d at 337; Kohler Co. v. Moen Inc., 12 F.3d 632, 638 (7th Cir. 1993))--functionality is really not a foolproof method of patrolling the line between the patent and trademark laws. That is because the showing required of a person seeking a patent is that an invention is useful--that it serves an identified beneficial purpose. By contrast, functionality for trademark purposes is based on competitive need--as Qualitex, 115 S. Ct. at 1304 puts it:

This Court consequently has explained that, "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," that is, if exclusive use of the feature would put competitors at a significant non-reputation-related disadvantage. *fn7"

 Thus usefulness in the patent context does not equal functionality in the trademark context. There is a gap between "functionality" and "usefulness" through which some products could fall.

 To bring this point into the real world, consider a hypothetical situation. Assume that Inventor creates a mousetrap that meets the usefulness test (as well as the other requirements) for a utility patent. For 17 years Inventor gets a monopoly on the production and sale of the mousetrap, which--although there are dozens of other competing mousetraps on the market, and although it may even cost more to produce (and so it may cost consumers more to buy)--finds a place in the market. When the patent expires Competitor begins to copy Inventor's mousetrap. Inventor (no longer able to block such copying through a patent infringement action) then sues Competitor for trademark infringement, claiming that Inventor is entitled to a product configuration trademark. *fn8"

 In that scenario the functionality defense will not protect Competitor: It does not need that particular product configuration to compete effectively in the mousetrap market, because there are many other--indeed perhaps better--ways to build a mousetrap. But to allow Inventor to have a product configuration trademark would effectively extend his utility patent into eternity, far beyond the 17 years set out in the statutory patent bargain. In such a situation functionality alone is not enough to protect the "bargain" of the patent laws from invasion by a product configuration trademark.

 To deal with that sort of problem, courts have traditionally relied on a general principle that, because there is a federal right to copy and use an invention upon expiration of a utility patent, trademark law cannot be used to provide a permanent monopoly on the same invention (e.g., Kellogg Co. v. National Biscuit Co., 305 U.S. 111, 119-20, 83 L. Ed. 73, 59 S. Ct. 109 (1938); Singer Mfg. Co. v. June Mfg. Co., 163 U.S. 169, 185-86, 41 L. Ed. 118, 16 S. Ct. 1002 (1896))). And as the just-completed discussion has shown, that general principle must apply irrespective of whether the subject of the expired patent is functional in the trademark sense.

 But this is not such an easy case, for Zip Dee's alleged product configuration trademark presents a complicating wrinkle. Zip Dee is not (contrary to Dometic's assertions) directly seeking a product configuration on the RV awning that was disclosed in the '869 Patent, nor is it directly seeking a product configuration trademark on the inventions disclosed in any of its other patents. Instead Zip Dee claims that the slatted awning cover is something that consumers use to identify a Zip Dee RV awning, and it therefore seeks a product configuration trademark so that it can bar others from using slatted covers on their RV awnings. And instead of the slatted cover having been the gravamen of any of Zip Dee's now-expired patents, it was one (but not the only) embodiment of the '869 Patent (both parties admit that), it was disclosed as part of a dependent claim in two of Zip Dee's other patents, and it has been included as part of the preferred embodiment in yet another. Thus the precise issue before this Court is whether a product configuration that played some role--dependent claim, preferred embodiment or one embodiment--in a patented invention but that was not the invention itself can be the subject of a product configuration trademark.

 That question was addressed last year in Vornado, the only case that has faced the issue squarely. There Vornado Air Systems had a live patent for a household fan that claimed a particular type of spiral grill. Its grill, the subject of a long-since-expired utility patent, could not have been independently patented because it was in the public domain as prior art (58 F.3d at 1500). It was also relevant that the spiral grill was not necessarily superior to, or cheaper to produce than, other grill designs ( id. at 1501). Some time after Vornado Air Systems got its patent for the fan, Duracraft began to produce a competing household fan that, although it did not violate Vornado's patent, used the spiral grill design. Vornado filed suit, claiming that it had a product configuration trademark on the spiral grill. Its argument was accepted by the district court, which concluded that the spiral grill was nonfunctional because other grills were readily available that would enable competitors to compete in the market for household fans (id.).

 That decision was reversed on appeal. After a lengthy review of the conflicts between the patent laws and product configuration trademarks under Lanham Act § 43(a), 15 U.S.C. § 1125(a), the Court of Appeals said, 58 F.3d at 1509-10 (citation and footnote omitted and emphasis added):

Given, then, that core patent principles will be significantly undermined if we do not allow the copying in question, and peripheral Lanham Act protections will be denied if we do, our answer seems clear. Much has been said in this and other section 43(a) cases about whether a second competitor needs to use a particular product design to compete effectively. But where Lanham Act goals are not the only ones at stake, we must also examine the degree to which a first competitor needs to use a useful product feature instead of something else--a name, a label, a package--to establish its brand identity in the first place.
It would defy logic to assume that there are not almost always many more ways to identify a product than there are ways to make it. And if one of the ways to configure the product itself has been deemed important enough to the advance of technology for the government to grant a utility patent, we must find its value as a product feature to exceed its value as a brand identifier in all but the most unusual cases.
We hold that where a disputed product configuration is part of a claim in a utility patent, and the configuration is a described, significant inventive aspect of the invention, see 35 U.S.C. § 112, so that without it the invention could not fairly be said to be the same invention, patent law prevents its protection as trade dress, even if the configuration is nonfunctional.

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