Source: https://www.mediainstitute.org/2011/09/22/copyright-trademark-and-the-ninth-circuits-flirtations-with-aesthetic-functionality/
Timestamp: 2019-04-24 08:02:29+00:00

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Patents, copyrights OR trademarks – that’s easy. Patents, copyrights, AND trademarks – that’s more difficult. Vexing issues often arise when a party claims that the same thing or same interest is protected by more than one form of intellectual property. Our general rule is that more than one form of intellectual property (IP) can apply to the same intangible. That’s because the different forms of IP serve different purposes and have different eligibility criteria; often when two kinds of IP seem to protect the same thing, they actually protect different interests related to the intangible.
Most of the time the frontier between copyright and trademark is peaceful – and when there is any awkwardness, trademark principles often prevail. For example, trademark law unquestionably protects slogans – short phrases of the sort to which black-letter copyright denies protection. Same for titles: absolutely no protection under copyright, but protection is often claimed and sometimes deserved under trademark law.
And that goes to the best way to patrol the frontier between trademark and copyright when trademark is claimed to protect something that is expressly not protected by copyright: Courts must be rigorous in demanding that the plaintiff establish that it really has been using the visual element (or any original expression) as an indicator of source. This is how courts have rightly turned back claims of trademark protection for public domain characters3 and publicly visible buildings.4 A recent example of this sort of problem is Fleischer Studios v. A.V.E.L.A. Inc.,5 a dispute over the character Betty Boop. The Fleischer litigation initially produced a disastrously reasoned opinion in February 2011, which the U.S. Court of Appeals for the Ninth Circuit had the good sense to withdraw six months later. But as we will see, the panel’s new decision may create its own problems.
Betty Boop Belongs to Whom?
Fleischer Studios was an entity formed by the family of Betty Boop’s creator, Max Fleischer, to regain and then exploit the rights to his iconic character. Unfortunately for the Fleischer heirs, their recovery of the rights to Betty Boop may have been incomplete.6 Both the trial court and the court of appeals majority concluded that Fleischer had not established ownership of copyright rights to assert against A.V.E.L.A. The trial court also concluded that Fleischer had not provided timely evidence that it owned either registered or common-law rights in Betty Boop as a trademark.
The appeal of the trademark ruling could have been decided easily on this single point – lack of evidence at trial of trademark rights, whether registered or through secondary meaning as an indicator of source. Alternatively, the appellate court could have decided the matter on “whether the fractured ownership of the Betty Boop copyright precludes Fleischer from asserting a trademark claim.”7 As we will see, this may turn out to be the most important issue in the case: If multiple, unrelated, uncoordinated parties held copyrights in different Betty Boop works – and if these various parties were exploiting these copyrights – then it would very likely follow that no one copyright owner could truly be using Betty Boop as an indicator of source.
But instead of a ruling on one of those grounds, Judge Clifford Wallace’s February opinion embarked on a mistaken “aesthetic functionality” analysis. Claiming that all the other trademark arguments raised by the parties “were mooted by controlling precedent that neither party cited,” Wallace concluded that there could be no TM claim against the defendant because “A.V.E.L.A. is not using Betty Boop as a trademark, but instead as a functional product” and that the Betty Boop name and image “were functional aesthetic components of the [defendant’s] product, not trademarks.” In short, A.V.E.L.A. was recognized to have an “aesthetic functionality” defense.
This second part of International Order of Job’s Daughters has been so roundly attacked over the years that it was reasonable to think the doctrinal mistake was, as one commentator recommended, “buried.”9 In the February Fleischer Studios opinion, this doctrinal error crept back from the crypt. Although the panel withdrew this opinion in August – after a small hailstorm of criticism – it is important to understand how the panel’s misunderstanding of aesthetic functionality in its February opinion threatened to substantially undermine trademark rights.
The court’s most obvious mistake was to use the aesthetic functionality doctrine as a defense. “Aesthetic” functionality arose as an off-shoot of regular functionality: just as a design feature could confer a manufacturing or consumer advantage that we would not want controlled through a trademark, some aesthetic element of a product or its packaging might confer a “non-reputational” advantage that we would not want protected by a trademark. In a classic example, the color blue is aesthetically functional in relation to sleep products because blue is tranquil and reminds us of night – we would not want to give someone a trademark in that color for nighttime medicine.
A finding of functionality (aesthetic or otherwise) should be a complete bar to trademark protection over that element; functionality analysis goes to whether, given our public policy objectives, we want to protect plaintiff’s claimed interests at all. Functionality doctrine has never been about whether the defendant is engaged in some privileged use; it’s not about how the defendant uses the features claimed as a trademark.
Among variations on the “trademark use” defense, aesthetic functionality is particularly misguided because it would be so disruptive of modern trademark law. The interlocking C’s of Chanel’s logo are aesthetically attractive – as are a whole variety of sports logos like the emblems for O’Neill, Quiksilver, and Rip Curl. Capt’n Crunch and Buzz Lightyear certainly have aesthetic appeal to little boys. In fact, if an aesthetic functionality defense comes into play whenever a trademarked image may also “be merchandised for its own intrinsic utility to consumers,” then a vast array of trademarks are thrown into jeopardy.
The initial Ninth Circuit decision – filed on Feb. 23, 2011 – was withdrawn on Aug. 19. The panel’s new opinion is completely silent on aesthetic functionality – meaning that the court of appeals needed a new basis to dispose of the trademark claims.
From a logical standpoint, the mere fact of fractured ownership is not, by itself, conclusive evidence of a lack of secondary meaning. There must be something more. In Universal, that something more was the evidence of extensive use and licensing of similar images by other companies, the oddly defined trademark that was legally carved out from other images of the same character, the widespread confusion….
Unlike the facts in Universal, those at issue here merely show that more than one entity owns rights to use Betty Boop-related intellectual property….
This reasoning seems prudent and yet raises a new problem for the frontier between copyrights and trademarks. Judge Wallace’s opinion implies that Fleischer Studios could establish common-law trademark rights in Betty Boop despite the fragmented copyright ownership. And that could mean that some owners of Betty Boop works who do not exploit their copyrights over a period of time might find themselves unable to commercialize their works because of Fleischer’s trademark rights. In the rare cases when this occurs, it could pose a real dilemma; at a minimum this sort of reasoning could be particularly unfair for individual artists or heirs who inherit copyrighted materials and do not immediately exploit them.
Both of the Fleischer Studios opinions – February and August – offer us cautionary tales on policing the frontier between trademarks and copyrights.
But, again, the right answer to that issue is that courts must be vigilant in demanding proof of the fictional character’s use as a true designation of source. When that actually happens – as when Toucan Sam adorns every box of Kellogg’s Froot Loops or Tinkerbell flies around the opening of every Disney film – the character deserves the full array of trademark protection and, yes, it might never fall into the public domain. As Judge Wallace’s February opinion noted, the real concern for us – and for the court in Dastar – is when a trademark “action is essentially a substitute for a copyright infringement action.” When the plaintiff is engaged in bona fide use of a character as a trademark, the infringement action is not a “substitute” for a copyright claim and there is no tension with copyright’s policy objectives.
The new Aug. 19, 2011 opinion in Fleischer Studios avoided any discussion of aesthetic functionality – and any limitations on trademark rights driven, expressly or implicitly, by concerns about copyright policy. But the new opinion offers a dilemma in the opposite direction – a potential (although rare) situation in which new trademark rights developed through establishment of secondary meaning could prevent copyright owners from exploiting pre-existing works. This possibility would arise when a family of related copyrighted works is owned by different people, some of whom exploit the works and some of whom do not. The party that exploits its copyrighted works might able to establish secondary meaning in visual images from the works (such as characters), making it later difficult or impossible for the other copyright owners to bring their works back into the market.
Someday, some court may have to sort through this dilemma, although one possible way out – familiar to trademark students – would be to permit the exploitation of the copyrighted works owned by others with clear notice to the consumer as to the “source” of those works and a conscientious effort to ensure that no aspect of the marketing contributes to consumer confusion.21 That might not be ideal from the trademark perspective, but a company that develops secondary meaning in an image knowing that others have different intellectual property rights in that image would certainly be inviting that sort of compromise.
1. “A Diamond Is Forever” is the original DeBeers slogan that dates from 1947, see http://www.prnewswire.co.uk/cgi/news/release?id=12285. In 2000, Advertising Age magazine named “A Diamond Is Forever” the best advertising slogan of the 20th century. After many decades of use, it is now the subject of USPTO registration number 3376133, registered on Jan. 29, 2008. The plural version, “Diamonds Are Forever,” became the title of the seventh James Bond film (1971) and a hit theme song for the film sung by Shirley Bassey. Bassey’s classic became the subject of a remix project issued in 2001 including Groove Armada, the Propellerheads, and Kurtis Mantronik. Perhaps some slogans are forever.
2. Of course, a patent does not per se claim a market “advantage” over the products or processes that have preceded the invention, but such advantage is implied by the combination of patent law’s utility and non-obviousness requirements.
3. Silverman v. CBS, Inc., 870 F.2d 40 (2d Cir. 1989), cert. denied, 492 U.S. 907 (1989) (CBS had no trademark rights in characters Amos ’n’ Andy where many Amos ’n’ Andy shows had fallen into public domain).
6. Max Fleischer had transferred the Betty Boop character and cartoons to Paramount, which had subsequently seemed to sell off the assets, but in one contract in the chain of title Paramount seemed to retain rights to the character, although it had transferred various “photoplays”; the trial court concluded that Fleischer Studios failed to establish an unbroken chain-of-title to the copyright for the Betty Boop character.
7. Feb. 23 Opinion at 1122.
8. 633 F.2d 912, 208 USPQ 718 (9th Cir. 1980), cert. denied, 452 U.S. 941, 101 S. Ct. 3086, 69 L.Ed.2d 956, 213 USPQ 1056 (1981).
9. Fletcher, The Defense of ‘Functional’ Trademark Use, 75 Trademark Rep. 249 (1985). J. Thomas McCarthy concurs that “the notion of a defensive type of aesthetic functionality is bad law, poor policy, and provides no coherent rules.” McCarthy on Trademarks and Unfair Competition (4th edition), § 7:82. See also W.T. Rogers Co., Inc. v. Keene, 778 F.2d 334, 340 (7th Cir. 1985) (it would be unreasonable to deny trademark protection for a symbol simply because it was valued intrinsically by consumers as well as being an identifier of source); Brunswick Corp. v. Spinit Reel Co., 832 F.2d 513, 518 (10th Cir. 1987); Alpha Tau Omega v. Pure Country, 2004 WL 3391781 (S.D. Ind. 2004).
10. Feb. 23 Opinion at 1124.
11. Commentators advocating the “trademark use” requirement include Stacey L. Dogan & Mark A. Lemley, Grounding Trademark Law Through Trademark Use, 92 Iowa L. Rev. 1669 (2007); Margreth Barrett, Internet Trademark Suits and the Demise of ‘Trademark Use,’ 39 U.C. Davis L. Rev. 371 (2006); Eric Goldman, Deregulating Relevancy in Internet Trademark Law, 54 Emory L.J. 507 (2005).
12. Graeme Dinwoodie & Mark Janis, Confusion Over Use: Contextualism in Trademark Law, 92 Iowa L. Rev. 1597 (2007).
13. Rescuecom Corp. v. Google Inc., 562 F.3d 123; 2009 U.S. App. LEXIS 7160 (2d Cir. 2009).
14. Feb. 23 Opinion at 1123.
15. Deborah Cohn, Mere Ornamentation & Aesthetic Functionality: Causing Confusion in the Betty Boop Case? 101 Trademark Reporter (July-August 2011), available to INTA members at http://www.inta.org/TMR/Pages/vol101_no4_a2.aspx.
16. Au-Tomotive Gold, Inc. v. Volkswagen of America, Inc., 457 F.3d 1062 (9th Cir. 2006), cert. denied, 127 S. Ct. 1839 (2007) (concluding that the doctrine does not permit a maker of key chains and other auto accessories to use the VOLKSWAGEN trademark on those items without authorization).
17. Aug. 19 Opinion at para. 14, 11049.
18. Dastar Corp. v. Twentieth Century Fox Film Corp., 539 U.S. 23, 25–26 (2003). For my own critique of the Dastar decision, see Justin Hughes, American Moral Rights and Fixing the Dastar Gap, 2007 Utah L. Rev. 659 (December 2007).
19. Feb. 23 Opinion at 1124.
20. Id. Fleischer Studios is also part of an uptick in interest in making some kind of “trademark use” a requirement for infringement. As to this broader interest – from defendants, commentators, and a few courts – Professor Mark McKenna is almost certainly correct that the real issue in the “trademark use” debate is finding a way to “divorce the scope of trademark rights from consumer understanding in at least some circumstances.” Mark P. McKenna, Trademark Use and the Problem of Source, 2009 U. Ill. L. Rev. 773.
21. For example, in American Waltham Watch Co. v. United States Watch Co., 173 Mass. 85, 87 (Mass. 1899), Holmes allowed the defendant to put the word “Waltham” on its watches as the place of manufacture, but recognized that the plaintiff “may put later comers to the trouble of taking such reasonable precautions as are commercially practicable to prevent their lawful names and advertisements from deceitfully diverting the plaintiff’s custom.” See also Kellogg Co. v. National Biscuit Co., 305 U.S. 111, 120 (1938) (Kellogg can market shredded wheat in pillow shape that has fallen out of patent protection, but “[f]airness requires that it be done in a manner which reasonably distinguishes its product from that of the plaintiff.”); Champion Spark Plug Co. v. Sanders, 331 U.S. 125 (1947) (truthful information about the product could be retained as long as it does not deceive the public).

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