Tone Brothers, Inc. v. Sysco Corporation
28 F.3d 1192 (1994)
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Rule of Law:
Experimentation directed to the functional features of a product that also contains an ornamental design may negate what would otherwise be considered an invalidating 'public use' under 35 U.S.C. § 102(b). Additionally, a product's trade dress may be protectable if it is inherently distinctive or has acquired secondary meaning, and extensive private labeling does not automatically preclude a finding of secondary meaning.
Facts:
- Around 1981, Tone Brothers, Inc. (Tone) conceived of and designed a new, clear plastic container for its spices, which featured an oval depression on each side as a hand grip.
- In June 1981, more than a year before filing a patent application, a consultant for Tone, James Degen, conducted a 'disaster check' study with a prototype of the container.
- As part of the study, Degen showed the prototype to ten dietetics students at Mundelein College to evaluate its functional features, such as grip and ease of shaking/spooning, not its aesthetic appeal. The students were not under a confidentiality agreement.
- In September 1982, Tone filed a design patent application for the container and began selling spices in it. The patent was issued in January 1985.
- Sysco Corporation (Sysco) was a wholesale distributor that sold Tone's spices in Tone's containers under the Sysco private label until March 1988.
- Between 1982 and 1988, about 90% of Tone's containers sold in the institutional food service channel were under approximately one hundred different private labels for various distributors.
- Beginning in 1985, while still distributing for Tone, Sysco began developing its own clear plastic spice container.
- After its distribution arrangement with Tone ended in March 1988, Sysco began using its new, similar container for its spices.
Procedural Posture:
- Tone Brothers, Inc. sued Sysco Corporation in the U.S. District Court for the Southern District of Iowa.
- The complaint alleged design patent infringement, trade dress infringement under the Lanham Act, and infringement under Iowa state law.
- Sysco moved for summary judgment on the federal claims.
- The district court granted summary judgment for Sysco, holding the design patent was invalid under the 'public use' bar and the trade dress was not protectable because it was not inherently distinctive and had not acquired secondary meaning.
- The district court then dismissed Tone's state law claims for lack of subject matter jurisdiction.
- Tone appealed the district court's grants of summary judgment to the U.S. Court of Appeals for the Federal Circuit.
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Issue:
Did the district court err in granting summary judgment by holding, as a matter of law, that a design was in 'public use' due to pre-application functional testing and that its trade dress was unprotectable due to private labeling arrangements?
Opinions:
Majority - Schall, J.
Yes. The district court erred in granting summary judgment because genuine issues of material fact exist for both the patent and trade dress claims. For the patent claim, the court held for the first time that experimentation on the functional aspects of a product embodying an ornamental design can negate a 'public use' bar to patentability. The court distinguished this case, involving a functional 'disaster check' with a small, controlled group, from prior precedent like In re Mann, which involved displaying a design for commercial purposes at a trade show. The totality of the circumstances must be considered to determine if the use was for a bona fide experimental purpose. For the trade dress claim, the court found the district court made two errors. First, it failed to recognize that under Two Pesos, Inc. v. Taco Cabana, Inc., an inherently distinctive trade dress is protectable without a showing of secondary meaning, and evidence that Tone's container was the first of its kind created a factual issue on this point. Second, the district court gave too much weight to private labeling in dismissing the claim for secondary meaning, as a consumer survey and the 'anonymous source' rule created a genuine issue of fact as to whether consumers associated the container's shape with a single, albeit unknown, manufacturer.
Analysis:
This decision clarifies and expands the 'experimental use' exception to the public use bar for design patents, establishing that testing a design's functional features, not just its ornamental aspects, can prevent invalidation. This provides inventors with greater flexibility to conduct pre-application product testing. In trade dress law, the opinion reinforces that inherent distinctiveness is an independent basis for protection and significantly limits the negative impact of private labeling on establishing secondary meaning. By emphasizing the 'anonymous source' rule, the court protects manufacturers who supply products for private labelers, affirming that the product's unique physical appearance can still function as a source indicator separate from the brand name on the label.
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