Case Briefs

Wal-Mart Stores, Inc. v. Samara Brothers, Inc.

Case(s): Wal-Mart Stores, Inc. v. Samara Brothers, Inc., 529 U.S. 205 (2000)

Samara Brothers, Inc., designs and manufactures a line of children’s clothing. Wal-Mart Stores, Inc., contracted with a supplier to manufacture outfits based on photographs of Samara garments. After discovering that Wal-Mart and other retailers were selling the so-called knockoffs, Samara filed suit, accusing Wal-Mart of infringement of unregistered trade dress under section 43(a) of the Trademark Act of 1946 (Lanham Act).

District Court Decision & Second Circuit Appeal

Following a jury trial, the jury found for Samara on all of its claims. Wal-Mart then renewed a motion for judgment as a matter of law on Samara Brothers’ claims of violations of the Copyright Act, 17 U.S.C. s. 101 et seq., s. 43(a) of the Lanham Act, 15 U.S.C. s. 1125(a), and New York deceptive trade and unfair competition laws, claiming that there was insufficient evidence to support a conclusion that Samara’s clothing designs could be legally protected as distinctive trade dress for purposes of section 43(a). The District Court denied the motion in July 1997 and awarded Samara relief.

Wal-Mart appealed to the Second Circuit, arguing that the district court erred in: (1) failing to set aside the verdict on the Lanham Act claim;  (2) refusing to give Wal-Mart’s requested jury instruction on labels in the clothes;  (3) declining to find the state law claims preempted by the Copyright Act;  and (4) rejecting the assertion that certain of Samara’s copyrights are invalid as a matter of law.

The appeals court affirmed the denial of the motion, concluding that “copyrights depicting familiar objects, such as the hearts, daisies, and strawberries in Samara’s copyrights are entitled to very narrow protection. It is only the virtually identical copying […] which will result in a successful claim of infringement of familiar objects.”

Supreme Court Decision

The Supreme Court granted certiorari, and held in a decision dated March 22, 2000 that in “a section 43(a) action for infringement of unregistered trade dress, a product’s design is distinctive, and therefore protectible, only upon a showing of secondary meaning. The fact that product design almost invariably serves purposes other than source identification not only renders inherent distinctiveness problematic; it also renders application of an inherent-distinctiveness principle more harmful to other consumer interests.”

Specifically, SCOTUS found that …

(a) In addition to protecting registered trademarks, the Lanham Act, in section 43(a), 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.” The breadth of the confusion-producing elements actionable under section 43(a) has been held to embrace not just word marks and symbol marks, but also “trade dress”-a category that originally included only the packaging, or “dressing,” of a product, but in recent years has been expanded by many Courts of Appeals to encompass the product’s design. These courts have correctly assumed that trade dress constitutes a “symbol” or “device” for Lanham Act purposes. 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 (i. e., marks whose intrinsic nature serves to identify their particular source) and marks that have acquired distinctiveness through secondary meaning (i. e., marks whose primary significance, in the minds of the public, is to identify the product’s source rather than the product itself). This Court has held, however, that applications of at least one category of mark-color-can never be inherently distinctive, although they can be protected upon a showing of secondary meaning. Qualitex Co. v. Jacobson Products Co.

 (b) Design, like color, is not 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’s 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. With product design, as with color, consumers are aware of the reality that, almost invariably, that feature is intended not to identify the source, but to render the product itself more useful or more appealing.

(c) Two Pesos, Inc. v. Taco Cabana, Inc., does not foreclose the Court’s conclusion, since the trade dress there at issue was restaurant decor, which 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 the 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.