Written by Alesha M. Dominique and Sofia Castillo

On April 8th, the U.S. Court of Appeals for the Federal Circuit, in In re Forney Industries, Inc., held that multicolor marks can be inherently distinctive when used on product packaging.

In 2014, Forney Industries (“Forney”), a company that manufactures tools and accessories for welding and machining, applied to register a multicolor mark for its packaging and labels consisting of a black banner immediately followed by the color yellow, progressively fading into red. The trademark examining attorney refused to register the multicolor mark after concluding it was not inherently distinctive, and required that Forney Industries submit “sufficient proof of acquired distinctiveness.” The Trademark Trial and Appeal Board (TTAB) affirmed the refusal, and Forney appealed to the Federal Circuit.

The Federal Circuit reversed the TTAB’s decision and held that a color mark used on product packaging can be inherently distinctive, depending upon the character of the color design.  The Federal Circuit also reversed the TTAB’s holding that product packaging marks that employ color cannot be inherently distinctive in the absence of a well-defined peripheral shape or border. In reaching its holding, the Federal Circuit examined and reconciled seminal Supreme Court cases on color marks, Two Pesos v. Taco Cabana, 505 U.S. 763 (1992), Qualitex Co. v. Jacobson Products Co., 514 U.S. 159 (1995) and Walmart v. Samara, 529 U.S. 205 (2000).

The Federal Circuit explained that in Two Pesos, the Supreme Court held that an inherently distinctive trade dress is entitled to protection without a showing of secondary meaning. Further, in Qualitex, the Supreme Court held that a color alone can be used as a trade dress when the color “has attained secondary meaning and therefore identifies and distinguishes a particular brand.” The Federal Circuit reasoned that “although Qualitex implied that a showing of acquired distinctiveness may be required before a trade dress mark based on color alone can be protectable, it did not expressly so hold.”  Further, in Walmart, the Supreme Court found that the use of distinctive product packaging “is most often to identify the source of the product[.]”

Accordingly, because Forney is attempting to register a color mark for product packaging, the correct inquiry for the TTAB on remand is to determine whether Forney’s proposed mark is inherently distinctive pursuant to the applicable criteria established in Seabrook Foods, Inc. v. Bar-Well Foods Ltd., 568 F.2d 1342 (C.C.P.A. 1977).

In re Forney Industries, Inc. is a significant development for startups and well-established businesses seeking to expand their brand assets to include protection for multicolor marks on product packaging, rather than waiting until after secondary meaning has been established.