Wal-Mart Stores Inc. v. Samara Bros. Inc. - Opinion Announcement

Argument of Speaker

Mr. Speaker: The opinion of the Court in No. 99-150, Wal-Mart Stores Inc. versus Samara Brothers will be announced by Justice Scalia.

Argument of Justice Scalia

Mr. Scalia: This case comes to us on writ of certiorari the United States Court of Appeals for the Second Circuit.

Respondent Samara Brothers designs and manufactures a line of children’s clothing.

Petitioners Wal-Mart Stores contracted with the supplier to manufacture outfits based on photographs of Samara’s garments.

After discovering that Wal-Mart and other retailers were selling the so-called knockoffs, Samara brought this action for, among other things, infringement of unregistered trade dress under Section 43(a) of the Trademark Act of 1946, known as the Lanham Act.

The jury found for Samara, Wal-Mart then renewed a motion for judgment as a matter of law, claiming that there was insufficient evidence to support a conclusion that Samara’s clothing designs were protected by section 43(a), since they were neither inherently distinctive nor had acquired distinctiveness through secondary meaning, concepts that I will explain shortly.

The District Court denied the motion and awarded Samara relief.

The Second Circuit affirmed the denial.

We reverse.

Section 43(a) of Lanham Act gives a producer a cause of action for the use by any person of “any symbol or device likely to cause confusion as to the origin of his or her goods.”

Section 43(a) has been read to protect not just word marks, such as Nike and symbol marks such as Nike’s swoosh symbol, but also trade dress, a category that originally included only packaging or dressing of a product.

But in recent years this has been expanded by many Courts of Appeals to encompass the product’s design.

Although section 43(a) does not explicitly require a producer to show that its trade dress is distinctive, courts have universally imposed that requirement, since without distinctiveness, the trade dress would not “cause confusion as to origin,” as section 43(a) requires.

In evaluating distinctiveness, courts have differentiated between marks that are inherently distinctive, such as the word mark “Kodak” in Kodak film, which by its nature connotes nothing except the source of the product, and marks that have acquired distinctiveness through secondary meaning.

Such as the word mark, “tasty” in Tasty Bread which has a primary meaning of its own, but has come through usage to be identified by consumers with a particular brand of bread.

We have previously held however that applications of at least one category of mark, color can never be inherently distinctive, but can only be protected upon a showing of secondary meaning.

It seems to us that design like color, cannot be inherently distinctive.

The attribution of inherent distinctiveness to certain categories of word marks and product packaging derives from the fact that the very purpose of attaching a particular word to a product, or encasing it in a distinctive package is most often to identify the product source.

Where it is not reasonable to assume consumer predisposition to take an affixed word or packaging as indication of source, inherent distinctiveness will not be found.

Which is why, the Lanham Act does not allow product descriptive terms, such as “tasty” in Tasty Bread or geographically descriptive terms, such as “Georgia” in Georgia Peaches, to be registered without a showing of secondary meaning.

In this regard, in the expectations that arouses in consumers, we think product design is like color.

Consumers are aware of the reality that almost invariably, even the most unusual of product designs, such as a cocktail shaker shaped like a penguin is intended not to identify the source, but to render the product itself more useful or more appealing.

This factor not only renders inherent distinctiveness most unlikely, it also renders a finding of inherent distinctiveness harmful to other consumer interests.

Consumers should not be deprived of the benefits of competition with regard to the utilitarian and aesthetic purposes that product design serves by a rule of law that facilitates plausible threats of suit against new entrants.

We conclude therefore that product design cannot be inherently distinctive, but to achieve protection under Section 43(a) must be shown to have acquired secondary meaning.

Contrary to respondents assertion, this conclusion is not foreclosed by our decision in Two Pesos, Inc. versus Taco Cabana, Inc., which found inherent distinctiveness in the trade dress, the décor of a particular restaurant.

In our view, restaurant décor does not constitute product design, but rather product packaging or else some “tertium quid” that is akin to product packaging and has no bearing on the present case.

While distinguishing, Two Pesos might force courts to draw difficult lines between product design and product packaging trade dress, the frequency and difficulty of having to distinguish between those two, will be much less than the frequency and difficulty of having to decide when a product design is inherently distinctive.

To the extent there are close cases, courts should err on the side of caution and classify ambiguous trade dress as product design, thereby requiring secondary meaning.

The Court's decision is unanimous.