Ogosport LLC v. Maranda Enterprises LLC

Filing 93

ORDER signed by Chief Judge Charles N Clevert, Jr on 3/2/2012 granting 55 Motion for Summary Judgment. (cc: all counsel) (nts)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF WISCONSIN
OGOSPORT LLC,
Plaintiff,
v.

Case No. 10-C-0155

MARANDA ENTERPRISES LLC,
Defendant.
DECISION AND ORDER GRANTING DEFENDANT’S MOTION FOR SUMMARY
JUDGMENT (DOC. 55)
OgoSport, LLC, a developer, manufacturer and distributor of toys and sports related
equipment, brought this action against Maranda Enterprises, LLC alleging trade dress
infringement pursuant to section 43(a) of the Lanham Act, 15 U.S.C. § 1124(a) and
common law unfair competition. Specifically, OgoSport charges that Maranda’s “Spring
Ring” infringes the trade dress of its “OgoDisk” product.
Maranda moves for summary judgment asserting that OgoSport is not entitled to
trade dress protection. In accordance with the following discussion, that motion will be
granted.
I. Summary Judgment Standard
Summary judgment is proper if the depositions, documents or electronically stored
information, affidavits or declarations, stipulations, admissions, interrogatory answers or
other materials show that there is no genuine dispute of material fact and the moving party
is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a), (c); Celotex Corp. v.
Catrett, 477 U.S. 317, 322 (1986).

The moving party bears the initial burden of

demonstrating it is entitled to summary judgment. Celotex, 477 U.S. at 323. Once this

burden is met, the nonmoving party must designate specific facts to support or defend
each element of its cause of action, showing that there is a genuine issue for trial. Id. at
322-24. In analyzing whether a question of fact exists, the court construes the evidence
in the light most favorable to the party opposing the motion. Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 255 (1986).
The mere existence of a factual dispute does not defeat a summary judgment
motion; there must be a genuine issue of material fact for the case to survive. Id. at 24748. “Material” means that the factual dispute must be outcome-determinative under
governing law. Contreras v. City of Chicago, 119 F.3d 1286, 1291 (7th Cir. 1997). Failure
to support any essential element of a claim renders all other facts immaterial. Celotex, 477
U.S. at 323. To establish that a question of fact is “genuine,” the nonmoving party must
present specific and sufficient evidence that, if believed by a jury, would support a verdict
in its favor. Anderson, 477 U.S. at 249.
In most instances where a trademark is at issue, “functionality is an issue of fact.”
Modern Fence Techs., Inc. v. Qualipac Home Improvement Corp., 726 F. Supp. 2d 975,
987-988 (E.D. Wis. 2010) citing Serv. Ideas, Inc. v. Traex Corp., 846 F.2d 1118, 1123 (7th
Cir. 1988). In appropriate cases, however, the court may find that the functionality of a
claimtrademark is subject to resolution on a summary judgment motion. Franek v.
Walmart, 2009 U.S. Dist. LEXIS 20361 (N.D. Ill. Mar. 13, 2009) (internal citations omitted).
Moreover, TrafFix Devices, Inc. v. Mktg Displays, Inc., 532 U.S. 23 (2001) makes it clear
that when an expired utility patent or a patent application gives rise to the strong
evidentiary inference of functionality, trademark issues may be ripe for resolution on a
summary judgment motion.
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II. Facts
In late 2004, plaintiff introduced the “OgoDisk,” a throwing and catching product.
It is shaped like a saucer and the center of the disk has a flexible surface that can be used
to bounce a ball upon. The OgoDisk is available in three sizes: twelve-inch; fifteen-inch;
and eighteen-inch. The outer-ring texture is either smooth or dimpled. “OgoSport” appears
on the outer ring. The claimed trade dress for the OgoDisk includes the sloping contour
of the outer ring member; the relative proportions of the outer ring member, beading
member and trampoline member; and the relatively contrasting colors and values (i.e.,
lightness and darkness) of the outer member, beading member and trampoline member.
The material that secures the fabric to the recreational disk is referred to as beading, and
notably, “OgoSport nowhere claims beading as its trade dress.” (Pl’s opposition brief at
7.)
The founders of OgoSport filed an application in the United States Patent and
Trademark Office (“USPTO”) seeking to patent the design for a “sport activity device.”
Application No. 11/242,474. The application describes it as follows::
It is a primary object of the present invention to provide a sports activity
device that may be used as a flying disk. It is another object of the present
invention to provide a sports activity device that may be used to launch and
catch objects such as balls.
The first claim of the application states:
A sports activity device, alternatively playable as a device for launching and
catching a ball or similar object and as a tossable flying disc, said device
comprising: a toroidal section, said toroidal section being comprised of an
outer shell and an inner portion, said inner portion being accessible by
means of a closing mechanism; a flexible material attached to said toroidal
section so as to create an uninterrupted planar surface that stretches across
the toroidal section, wherein said flexible material is attached to the
uppermost portion of said toroidal section.
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Upon review by a patent examiner, the USPTO rejected the patent application because the
claims were found to be already in the public domain and obvious in light of the prior art.
This rejection was not final. Nevertheless, because OgoSport’s founders failed to timely
reply, the application was abandoned.
In 2009, OgoSport filed an application for trade dress protection of the OgoDisk.
In its application, Ogosport stated: “the mark consists of product configuration trade dress
comprising a generally circular product having an outer ring, a middle ring comprising
beading and a central planar circular surface.” Application Serial No. 77899107. On
March 30, 2010, the USPTO refused registration of the trade dress because: “the applied
for mark . . . appears to be a functional design for such goods.” As evidence, the USPTO
referenced “similar flying discs.” Additionally, the application was refused registration
because the mark “consists of a nondistinctive product design” that is not registerable on
the Principal Register without sufficient proof of acquired distinctiveness.
OgoSport argued against the initial refusal and in response, on January 3, 2011, the
USPTO issued a second refusal. The USPTO trademark examiner concluded that the
mark is functional and that the wording “sloping contour of the outer ring member”
describes a functional feature and that “disks and catching toys have outer and inner ring
members and/or have outer ring members that are more or less contoured.” Moreover, the
refusal stated that “trampoline member” describes features that are functional and that the
functionality of such trampoline member is supported by the claims in an expired utility
patent.
This examiner further opined that OgoSport’s claimed trade dress was not inherently
distinctive and that evidence of acquired distinctiveness was not sufficient. He supported
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his finding with specific references to the “many other multi-colored disc shaped toys.” In
regard to OgoSport’s claim that the “relatively contrasting colors and values of the outer
member, beading member and trampoline” are worthy of tradedress protection, the
examiner stated that, “inasmuch as the mark shown on the drawing page is a black and
white drawing, applicant’s reference to contrasting colors in the description is not
appropriate.” Like the previous decision, the refusal was not final.
OgoSport filed this action claiming that Maranda is engaging in trade dress
infringement and common law unfair competition. Its request for a preliminary injunction
was denied for failure to demonstrate a likelihood of success on the merits. Maranda then
moved to dismiss the case under Rule 12(b)(6). However upon Maranda’s request, that
motion was converted to a motion for summary judgment.
III. Analysis
The Seventh Circuit has defined trade dress as “the total image of a product,
including such features as size, shape, color, color combinations, texture, graphics, or even
particular sales techniques. Roulo v. Russ Berrie & Co., 886 F.2d 931, 935 (7th Cir. 1989)
cert. denied, 493 U.S. 1075 (1990). Trade dress infringement is proven if: (1) the plaintiff's
trade dress is inherently distinctive or has acquired secondary meaning; and (2) the
defendant's trade dress is confusingly similar, engendering a likelihood of confusion in the
marketplace. See Id.
“Even if plaintiff establishes both a protectable trade dress and a likelihood of
confusion, it cannot prevail if defendant shows that plaintiff's trade dress is merely
functional.” Turtle Wax, Inc. v. First Brands Corp., 781 F. Supp. 1314, 1318 (N.D. Ill. 1991)
citing Schwinn Bicycles Co. v. Ross Bicycles, Inc., 870 F.2d 1176, 1189 (7th Cir. 1989);
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See also Wal-Mart Stores v. Samara Bros., 529 U.S. 205, 209 (finding that trade dress is
not protected if it is functional). For trade dress not registered on the principal register, the
person who asserts trade dress protection has the burden of proving that the matter sought
to be protected is not functional. TrafFix Devices, 532 U.S. at 29, citing 15 U.S.C. §
1125(a)(3).
The functionality doctrine seeks to promote competition by preventing trademark law
from inhibiting legitimate alternatives by allowing a producer to control a useful product
feature. Qualitex Co. v. Jacobson Prods. Co., 514 U.S. 159, 169 (1995). Thus, the
rationale for the doctrine is the public interest in preventing a monopoly. Publ’ns Int’l, Ltd.
v. Landoll, Inc., 164 F.3d 337, 339 (7th Cir. 1998), cert. denied 526 U.S. 1088 (1999). This
policy is reflected in the Lanham Act, which provides that functionality is an affirmative
defense to infringement. 15 U.S.C. § 1115(b)(8).
A product feature is functional if it is essential to the use or purpose of the article or
if it affects the cost or quality of the article, TrafFix Devices, 532 U.S. at 32, and if it is
costly to design around or do without. Schwinn Bicycle Co. v. Ross Bicycles, Inc., 870
F.2d 1176, 1189 (7th Cir. 1989). Functionality is determined by a feature's usefulness.
Jay Franco & Sons, Inc. v. Franek, 615 F.3d 855, 858 (7th Cir. 2010). Thus, a design that
enables a product to operate is functional and it may not be trademarked. Id. at 857.
Notably, “a feature that merely accommodates a useful function is not enough.” Serv.
Ideas, Inc. v. Traex Corp., 846 F.2d 1118, 1123 (7th Cir. Wis. 1988) quoting LeSportsac,
Inc. v. K-Mart Corp., 754 F.2d 71, 76 (2d Cir. 1985).
OgoSport submits that Miranda’s arguments in support of summary judgment
dissects its trade dress as a “fictional collection of mini trade dresses,” rather than
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considering the trade dress as a whole. Moreover, OgoSport contents it is the “‘ensemble
of many different things that make up the asserted trade dress consistently with Two
Pesos.” (Pl’s opposition brief at 6.)
In National Van Lines, the plaintiff was engaged in the nation-wide business of
moving household goods by motor van. Nat’l Van Lines, Inc. v. Dean, 288 F.2d 5, 7 (7th
Cir. 1961). The plaintiff’s claimed composite service mark consisted of its shield, stripes
and company name whereas the defendant’s mark was comprised of the outline of a map,
stripes and company name. Id. The district court held that the plaintiff had no exclusive
right in the use of the stripes per se in connection with moving services.” Id. at 9. On
appeal, the Seventh Circuit stated that “ . . . it does not follow that [the plaintiff] may dissect
its mark and claim a monopoly in its use of ventricle stripes . . .” and that “[u]nder such
circumstances . . . [the mark] must be considered in its entirety, not by separating its
component parts.” Similarly, OgoSport asserts that, under Two Pesos v. Taco Cabana,
505 U.S. 763, 765 n. 1 (U.S. 1992), analyzing individual elements of its trade dress is
improper because “product trade dress comprises the overall look of a product, not any
single element of the claimed product trade dress in isolation.”
In National Van Lines and Two Pesos, the issue was whether there was
infringement, without regard to functionality. Here, unlike the aforementioned cases, the
court must assess the functionality of OgoSport’s asserted trade dress. In doing so, the
courts has to engage in an analysis of the product’s elements within the context of the
whole product, in accordance with Two Pesos. See TrafFix Devices, 532 U.S. at 33
(acknowledging that in Two Pesos the court at the outset made the explicit analytic
assumption that the trade dress features in question were not functional, and that the trade
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dress in those cases did not bar competitors from copying functional product design
features).
In TrafFix Devices, the plaintiff asserted trade dress for its temporary road signs
comprised of a dual-spring design, four legs, a base, an upright and a sign. Id. at 34. The
Supreme Court held that the dual-spring design feature of the road signs was functional
because it was necessary to the operation of the devices. Id. Because this essential
feature was functional, the court ruled that the entire product was functional.

Id.

Accordingly, other courts within the Seventh Circuit have analyzed a product’s design as
a whole and considered the functionality of the various design elements. See Specialized
Seating, Inc. v. Greenwich Indus., L.P., 472 F. Supp. 2d 999, 1011 (N.D. Ill. 2007);
Minemeyer v. B-Roc Reps, Inc, 678 F. Supp. 2d 691 (N.D. Ill 2009). Therefore, the court
will consider the elements of the OgoDisk’s asserted trade dress within the context of the
ensemble of the product’s elements.
Various factors are relevant to whether a product feature is functional: the existence
of a utility patent; the originator’s description of the product through advertising; alternative
designs; and designs resulting from comparatively simple or cheap manufacturing
methods. Specialized Seating, Inc. v. Greenwich Indus., L.P., 472 F. Supp. 2d 999, 1011
(N.D. Ill. 2007); see also In Re Morton-Norwich Products, Inc., 671 F.2d 1332 (Fed. Cir.
1982). Taking such factors into account, this court finds that OgoSport’s abandoned patent
application is strong evidence that the asserted trade dress is functional. In TrafFix, the
court stated:
A prior patent, we conclude, has vital significance in resolving the trade dress
claim. A utility patent is strong evidence that the features therein claimed are
functional. If trade dress protection is sought for those features, the strong
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evidence of functionality based on the previous patents adds great weight to
the statutory presumption that features are deemed functional until proved
otherwise by the party seeking trade dress protection. Where the expired
patent claimed the features in question, one who seeks to establish trade
dress protection must carry the heavy burden of showing that the feature is
not functional.
TrafFix Devices, 532 U.S. at 29-30 (emphasis added). Similarly,
“An abandoned patent application should be considered . . . because an
applied-for utility patent that never issued has evidentiary significance for the
statements and claims made in the patent application concerning the
utilitarian advantages, just as an issued patent has evidentiary significance.”
Valu Eng'g, Inc. v. Rexnord Corp., 278 F.3d 1268, 1279 (Fed. Cir. 2002).
OgoSport’s founders filed a patent application for the company’s “sport activity
device.” As stated in the amended complaint, OgoSport seeks trade dress protection for
a “sports disk product.” U.S. Patent Application No. 20060073758 (filed Apr. 6, 2006) In
the earlier patent application, OgoSport’s founders asserted that the sport activity device
has “a toroidal section . . . compris[ing] of an outer shell and an inner portion ... [and] a
flexible material attached to said toroidal that create[s] an uninterrupted planar surface that
stretches across the toroidal section.” Id. Similarly, OgoSport describes the OgoDisk as
having a “product configuration trade dress comprising a generally circular product having
an outer ring, a middle ring comprising beading and a central planar circular surface.” Id.
Based upon the asserted claims, figures, and description in the patent application, it is
evident that when OgoSport’s founders filed a patent application for the sport activity
device, they were attempting to patent the OgoDisk. Hence, the utility patent application
is strong evidence that the features therein claimed are functional. Moreover, OgoSport’s
Patent Application No.11/242,474 and two applications for trade dress protection were
refused by the USPTO. While courts are not bound by such determinations of the USPTO,
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they should show deference to the expertise of the examiners in assessing the functionality
of claimed trade dress. See George & Co., LLC v. Imagination Entm't Ltd., 575 F.3d 383,
395 (4th Cir. 2009).
Regardless of an assertion that the features claimed in OgoSport’s patent
application are not the same features at issue in the present action and thus the founders’
patent application is not evidence of functionality, this court holds that the OgoDisk is
functional in light of third-party patents. Third-party patents are relevant evidence of
function when the patent discloses the utilitarian advantages of the applied-for product.
See In Re Dietrich, 91 USPQ2d 1622, 16267 (T.T.A.B. 2009). As noted by the USPTO’s
trademark examiner in a second refusal to file the asserted trade dress on the Federal
Register, “. . . U.S. Patent Nos. 4,2241,533 and 5,261,846 support the determination that
the applied for mark is functional . . . .” Further,
[t]he applied for mark includes “a trampoline member” and “outer ring
member. The ‘533 patent describes a toy made of similarly trampoline-like
flexible sheet material that is loose and dishes upwardly in flight and is
supported and shaped by a similarly outer ring member resilient perimeter.
The ‘846 patent describes a disk toy having a similar central circular portion,
peripheral edge, and rim connect to the edge.
Elements of OgoSport’s asserted trade dress as a whole are present in the aforementioned
utility patents. As such, the referenced prior art is strong evidence of functionality.
The burden of establishing that the asserted trade dress is not functional rests upon
OgoSport. 15 U.S.C. § 1125(a)(3); TrafFix Devices, 532 U.S. at 29. However, “where the
design is functional . . . there is no need to proceed further to consider if there is a
competitive necessity for the feature.” TrafFix Devices, 532 U.S. at 33.

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OgoSport relies upon the testimony of Kevin Williams to sustain its burden of
establishing evidence non-functionality. Williams testified at the preliminary injunction
hearing that the asserted trade dress serves no function. To support this claim, he
identified alternative designs that do not utilize OgoSport’s asserted trade dress and
OgoSport introduced into evidence several commercially available competitive disks having
different proportions. However, “[o]nce a product feature is found functional based on
other considerations, there is no need to consider the availability of alternative designs
because the feature cannot be given trade dress protection merely because there are
alternative designs available.” Valu Eng'g, 278 F.3d at1276 (interpreting the impact of
TrafFix Devices, 532 U.S. at 33 on In Re Morton, 671 F.2d at 1332). In this case, evidence
of alternative designs fails to raise a material factual issue.

Moreover, neither the

testimony of Mr. Williams nor the presence alternative designs explain why or how the
product is not functional.
The sloped out ring member of the design is essential to the use and purpose of the
OgoDisk inasmuch as it is obvious that the product is intended to be held in the hand and
tossed; the sloping contour of the outer ring facilitates that objective. With regard to the
relative proportions of the outer ring member, beading member and trampoline member,
the court notes that the proportions of a flying disk affect the functionality of the product.
Such proportions of the flying disk are essential to its use or purpose, and therefore, they
are functional.
Where functionality is established, “whether [a] . . . design has acquired secondary
meaning need not be considered.” TrafFix Devices, 532 U.S. at 33. Therefore, because
this court holds that the sloping contour of the outer ring member and the relative
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proportions of the outer ring member, beading member and trampoline member are
functional, the court need not analyze whether OgoSport’s asserted trade dress is
inherently distinctive and acquired secondary meaning.
That the Disk's design elements include “the relatively contrasting colors and values
(i.e., lightness and darkness) of the out member, beading member and trampoline” does
not make the product distinctive or make the combination nonfunctional. The USPTO’s
trademark examiner observed that the “applicant’s reference to the contrasting colors ...
raises the question as to whether applicant is claiming more than one mark and/or is
claiming a possible phantom mark for an unlimited number of color combinations.” A mark
that contains a changeable element, such as the relatively contrasting colors in this case,
is unregisterable. See In re Int’l Flavors & Fragerances, 183 F.3d 1361, 1366 (Fed. Cir.
1999). Thus, the court holds that the OgoDisk's relatively contrasting colors, assessed
within the context of the claimed trade dress ensemble, is over broad and lacks the
requisite specificity and distinctiveness that warrants trade dress protection.
Now, therefore,
IT IS ORDERED that defendant’s motion for summary judgment is granted and the
case is dismissed.
Dated at Milwaukee, Wisconsin, this 2nd day of March, 2012.

BY THE COURT

/s/ C. N. Clevert, Jr.
C. N. CLEVERT, JR.
CHIEF U. S. DISTRICT JUDGE

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