color names on the Abercrombie spectrum

Kerr Corp. v. Freeman Manufacturing & Supply Co., 2007 WL 2344752 (N.D. Ohio)

Since the late 1970s, defendant Freeman has developed original formulas for wax products used in molding complicated products. Plaintiff Kerr sold Freeman-made color-coded, flake-form injection waxes for jewelry and optics. In 1984, the parties agreed that Freeman would engage in R&D for wax technology projects proposed in writing by Kerr. Over the next twenty years, Freeman improved seven color-coded injection wax products and developed new waxes, including “NYC Pink” injection wax. Though the term “flake” had been used by Freeman and others throughout the industry prior to these developments, Kerr trademarked “Flakes” in 1999.

Freeman began competing with Kerr; both companies claim to own the underlying formulas for various waxes. Kerr sold the colors at issue as Tuffy Green, NYC Pink, and Flex-Plast, while Freeman began marketing those colors as Tuf Guy Green, Filigree Pink, and Flexible Blue. Freeman refers to its colors as “formerly” Tuffy Green, NYC Pink, and Flex-Plast. Freeman sent letters to customers explaining the changed business relationship between itself and Kerr. Freeman also claimed in those letters that, because it no longer makes waxes for Kerr and hasn’t shared its formulas – which are difficult to reverse engineer – current Kerr waxes may not be chemically identical to Freeman/prior Kerr waxes. Still, some customers at trade fairs have continued to ask about the relationship between the two companies.

Kerr sued Freeman for infringement of Kerr’s color-coding scheme, wax color names, the flake form in which certain wax is sold, and the “Flakes” trademark. There were also claims relating to the technology resulting from the R&D agreement, and Freeman’s alleged false advertising of itself as the owner of that technology. (And here is where I would think there’s an obvious bound on Dastar. No one cares who created the technology; that was Freeman, pursuant to an agreement with Kerr. The parties and their customers care about who owns the technology, which is not the same thing at all. In any event, the court found that Freeman owned the technology and thus was not engaging in false advertising.)

The court readily dismissed Kerr’s claim to own its color scheme. Color is functional for investment waxes; some buyers prefer different colors “because they offer greater ‘readability,’ the ability to detect imperfections in wax moldings.” Some customers also prefer darker or lighter waxes, which are associated with color. Kerr’s claims over basic colors like bright red and deep blue would hamper competition. Similarly, use of the flake form of wax is functional as a matter of law. Some buyers prefer flake-form wax for its technical advantages over other waxes.

The color names required different analysis. Interestingly, the court relied on Qualitex, which is about color itself as protectible trade dress, to analyze these color names, starting from the proposition that color is “virtually always descriptive.” Qualitex itself doesn’t say “virtually” but requires secondary meaning all the time – ORANGE brand computers might be arbitrary, but orange-colored computers would still have to show secondary meaning to be protected as a mark. Anyway, the court found the product names “Super Pink,” “Aqua Green,” “Ruby Red,” and “Turquoise” to be merely descriptive and require evidence of “non-functional secondary meaning.”

The court ruled that Kerr’s ads for “Super Pink” and the like aren’t “intended to identify Kerr as the seller, but rather serve the function of identifying the type of wax being sold.” It would be reasonable for both parties to decide to make a new color, say silver, and advertise it as Silver Injection Wax. Buyers would naturally have to ask “whose silver injection wax?” and only other marks – such as “Kerr’s” – could answer that question. Thus, “these color names are prevented from carrying a secondary meaning because they are descriptive, functional elements of the trade dress of the products.”

This is clearly the right result, but the method has a bit of weirdness to it because the ordinary term for what the court is describing is “genericity.” Although genericity (also formerly known as the condition in which a term is the “common descriptive” name of an article) and functionality serve essentially the same purpose, the tests for them differ. When it comes to unregistered trade dress, plaintiffs have the burden of establishing nonfunctionality, whereas a genericity finding usually requires the defendant to submit a substantial amount of evidence. In general, American law fears that plaintiffs overclaim rights in trade dress, often with an anticompetitive result, but sees no such systematic problem with claims to generic terms. A color name is a core generic term for this type of product, but the court didn’t engage in the ordinary steps for evaluating genericity (dictionary definitions, competitors’ uses, etc.).

Kerr had a few color names that weren’t generic. “Tuffy Green” and “NYC Pink” were “partially arbitrary.” The court also said “tuffy” “suggests resiliency,” which makes it suggestive, but also called the terms “fanciful,” so let’s just say it wasn’t all that concerned with the Abercrombie spectrum – the point is, these are inherently distinctive names.

The court thought this case was especially complicated because the underlying green and pink wax products are the same, as opposed to Nike versus Reebok shoes. I think the court meant that the underlying products are commodities, as opposed to items for which tastes might differ, but I’m not sure what makes that a harder case if we don’t care about whether source is material to consumers, as trademark law generally doesn’t. But that consideration, along with Freeman’s use of its house mark on “Tuf Guy Green” and Freeman’s clarifying letters to customers, meant that the issue of likely confusion was for the jury. “NYC Pink” and “Filigree Pink,” however, were too different to cause confusion. (Notes: The court didn’t consider the effect of “formerly” on the analysis, which could lead to confusion about source or sponsorship of the color formerly known as NYC Pink; its general analysis of the effect of Freeman’s clarifications on sophisticated purchasers would apply. Also, Flex-Plast Blue and Flexible Blue dropped out of the analysis somehow; I’m guessing they’re more like the green than the pink and that summary judgment should be denied.)

There was evidence that customers “asked Kerr employees who Freeman was and why it was selling the flake-form and colored waxes Kerr had long sold.” But this was not the type of confusion with which the Lanham Act is concerned. Indeed, this is evidence that consumers recognized a difference between Kerr and Freeman as direct competitors. Freeman used its website and messages to existing customers to explain that its waxes used to be sold under a third party private label (Kerr) but now would be sold exclusively under the Freeman label. This is the kind of explanation that can clarify matters and guard against confusion. Here we face a tradeoff: it may be that some people will be confused by this literally true explanation of the complicated relationship between the parties. But saying nothing, or disclaiming any relationship between the two, would also risk misleadingness, maybe harming a different set of consumers who want the exact wax Kerr used to sell.

Separately, Kerr’s registered trademark “Flakes” was shown to be generic, through industry use and dictionary definitions. The court ordered it cancelled.

It’s pretty clear that the court was not steeped in trademark law. Sometimes this can produce decisions refreshingly free from doctrinal encrustations; sometimes it can produce error. The court’s apparent concern for whether source was material to consumers is probably error, but arguably trademark law would make more sense if it did consider materiality, as false advertising law does.