Opinion ID: 525591
Heading Depth: 2
Heading Rank: 2

Heading: Trade Dress Infringement Claim

Text: 26 Allied's second claim is that S & H's postcard mailers infringed upon the trade dress of Allied's mailers in violation of section 43(a) of the Lanham Act, 15 U.S.C. Sec. 1125(a). Trade dress refers to the image and overall appearance of a product. Blue Bell Bio-Medical, 864 F.2d at 1256; Falcon Rice Mill, 725 F.2d at 337 n. 1. The Lanham Act prohibits a party from passing off its goods or services as those of a competitor by employing a substantially similar trade dress which is likely to confuse consumers as to the source of the product. Blue Bell Bio-Medical, 864 F.2d at 1256; Sno-Wizard Mfg., Inc. v. Eisemann Products Co., 791 F.2d 423, 425-26 (5th Cir.1986); Chevron, 659 F.2d at 703. 27 We have held that a court must follow a two-step analysis in determining whether there has been an infringement of trade dress under the Lanham Act. First, the court must determine whether the trade dress is protected under the Act. This first inquiry encompasses three issues: (1) distinctiveness, (2) secondary meaning, and (3) functionality. Blue Bell Bio-Medical, 864 F.2d at 1256; Sno-Wizard, 791 F.2d at 425; Sicilia Di. R. Biebow & Co. v. Cox, 732 F.2d 417, 425 (5th Cir.1984). 28 A trade dress is functional and therefore not entitled to protection if it consists of a design or feature superior or optimal in terms of engineering, economy of manufacture, or accomodation of utilitarian function or performance. Sicilia, 732 F.2d at 429. A design that merely assists in a product or configuration's utility is not functional and may be protected. Id. The ultimate inquiry in determining the functionality of a trade dress is whether protection of the configuration will hinder competition or impinge upon the rights of others to compete effectively in the sale of goods. Id. 29 If a trade dress is not functional, it is entitled to protection if it is distinctive or has acquired a secondary meaning such that the consuming public associates the trade dress with a particular source. 6 Proof of secondary meaning is not required if a trade dress is sufficiently distinctive of itself to identify the producer, Sicilia, 732 F.2d at 426, as when the dress consists of fanciful or arbitrarily-selected features which do not serve simply to describe the product or [to] assist in its effective packaging. Chevron, 659 F.2d at 702. 30 If a court determines that the trade dress is protected--because it is non-functional and is either distinctive or has acquired secondary meaning, the court must then determine whether the trade dress has been infringed. Infringement is shown by demonstrating that the substantial similarity in trade dress is likely to confuse consumers. Blue Bell Bio-Medical, 864 F.2d at 1256; Sno-Wizard, 791 F.2d at 428; Chevron, 659 F.2d at 703; Sun-Fun Products, Inc. v. Suntan Research & Development, Inc., 656 F.2d 186, 192 (5th Cir.1981). Although evidence of actual confusion on the part of consumers is patently the best evidence of likelihood of confusion, Chevron, 659 F.2d at 704, it is not necessary to demonstrate actual confusion in order to prevail on a trade dress infringement claim. Sun-Fun Products, 656 F.2d at 191; Sicilia, 732 F.2d at 433. Rather, a likelihood of confusion may be determined by considering a number of factors or digits of confusion, including: 31 similarity of products, identity of retail outlets and purchasers, identity of advertising media, type (i.e., strength) of trademark or trade dress, defendant's intent, similarlity [sic] of design, and actual confusion. In addition, it is often appropriate to consider the degree of care exercised by purchasers: confusion is more likely, for example, if the products in question are 'impulse' items or are inexpensive. 32 Blue Bell Bio-Medical, 864 F.2d at 1260; Sno-Wizard, 791 F.2d at 428; Sun-Fun Products, 656 F.2d at 189. 33 In the instant case, the district court found that the mailers used by S & H were virtually identical to those used by Allied, that the use of the mailers had been profitable to S & H, and that Allied and S & H were likely to mail their promotions to the same group of consumers. The district court further found that the substantial similarity between the two mailers had resulted in [a]ctual confusion on the part of consumers. 34 The district court was correct in noting that likelihood of confusion is central to determining whether a trade dress has been infringed, and we agree that there is sufficient evidence in this case to conclude that there is a substantial likelihood that Allied would prevail on this point. 7 However, the district court failed to make the threshold determination that Allied's trade dress was protected under the Act. A plaintiff's trade dress must rise to the level of trademark protectability before likelihood of confusion becomes relevant. Sicilia, 732 F.2d at 425. S & H has asserted vigorously that Allied's mailer is not distinctive; that the mailer had not acquired secondary meaning to consumers; and that the configuration of the mailer is functional such that Allied may not prevent its competitors from employing a similar format. Although the district court states in the background section of its opinion that Allied's postcards are distinctive, it does not expressly address this issue in its legal analysis of the trade dress infringement claim, nor does the court address the questions of functionality or secondary meaning. It is therefore unclear whether the district court would conclude that the postcard format was sufficiently distinctive, in a legal sense, to make the latter two inquiries unnecessary. 35 Allied again argues that because the district court found that there was a substantial likelihood that Allied would prevail on the merits of the Lanham Act claim, this court may presume that the district court determined that its trade dress was protected. 36 We must again decline Allied's invitation to evaluate the district court's decision on the basis of presumed findings of fact and conclusions of law. Whatever we may think of the strength of S & H's arguments, we do not think that questions such as distinctiveness, functionality, or secondary meaning should be addressed in the first instance by an appellate court. See Inverness, 819 F.2d at 51 (district court decision granting a preliminary injunction in trade dress infringement action was inadequate under Rule 52(a) where the district court found a likelihood of confusion between the litigants' products but failed to address secondary meaning and functionality); see also Central Gulf Steamship Corp. v. International Paper Co., 477 F.2d 907, 908 (5th Cir.1973) (remanding case to district court for formal findings of fact and conclusions of law in support of decision to grant preliminary injunction). 37 We agree that the appropriate procedure in this situation is to remand the case to the district court for an explanation of its decision. Inverness, 819 F.2d at 51. Because we cannot say at this point in time that the district court committed reversible error, we will leave the preliminary injunction in place on the condition that the district court issue a supplementary opinion making the findings of fact and conclusions of law required by this opinion not later than two months after the issuance of this court's mandate. The district court's opinion should address S & H's defenses to both the copyright and trade dress claims as well as S & H's claim of laches. We do not address these questions in more detail here because they have been thoroughly briefed by the parties. 38 Upon issuance of the district court's opinion, the appellant should supplement the record. It will not be necessary to file a new notice of appeal. The Clerk of this court will then establish an abbreviated briefing period for supplemental briefs addressed to the issues raised by the district court's supplemental opinion. 8 39 As a final point, we note that we have previously declined to fault a district court for issuing a preliminary injunction despite the existence of a plausible defense. Dallas Cowboys Cheerleaders, 600 F.2d at 1188. In that case, however, the defendant had made only a passing reference to a potentially strong defense that the allegedly infringing poster was a parody of the plaintiffs' copyrighted original. We emphasized, moreover, that the district court had expressed willingness to hold the trial on the merits within two weeks' time. 40 In contrast, the defendants in this case presented several well-developed defenses below and the trial on the merits was originally scheduled to begin more than a year after the preliminary injunction was issued. It has now been continued until June of 1990--nearly two years after the entry of the original injunction. While we do not construe Rule 52(a) to require a district court in granting or denying a preliminary injunction to address every nuance of the parties' arguments with the same detail as it would following a full trial on the merits, the district court must at least make clear that it has considered plausible defenses which are fully briefed and argued by defendants. While a preliminary injunction may be appropriate even in the face of potentially significant defenses, it is frequently desirable in such cases to expedite the trial on the merits. See 11 C. Wright & A. Miller, Federal Practice & Procedure Sec. 2950, at 484 (1973 & Supp.1988).