278 F.3d 1268 (Fed. Cir. 2002), 00-1565, Valu Enginerring Inc v. Rexnord Corp

Docket Nº:00-1565, -1566 (Opposition nos. 94,922, 94,937, and 94,946)
Citation:278 F.3d 1268
Party Name:VALU ENGINEERING, INC., Appellant, v. REXNORD CORPORATION, Cross-Appellant.
Case Date:January 23, 2002
Court:United States Courts of Appeals, Court of Appeals for the Federal Circuit

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278 F.3d 1268 (Fed. Cir. 2002)




00-1565, -1566 (Opposition nos. 94,922, 94,937, and 94,946)

United States Court of Appeals, Federal Circuit

January 23, 2002

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Appealed from: United States Patent and Trademark Office, Trademark Trial and Appeal Board

Darrell L. Olson, Knobbe, Martens, Olson & Bear, LLP, of Newport Beach, California, argued for appellant. With him on the brief was Steven J. Nataupsky.

David R. Cross, Quarles & Brady LLP, of Milwaukee, Wisconsin, argued for cross-appellant. With him on the brief was Jennifer A. Lazewski.

Before NEWMAN, BRYSON, and DYK, Circuit Judges.

DYK, Circuit Judge.


Valu Engineering, Inc. ("Valu") appeals a decision of the Trademark Trial and Appeal Board ("Board") sustaining Rexnord Corporation's ("Rexnord") opposition to registration of Valu's cross-sectional designs of conveyor guide rails as trademarks on the Principal Register. Rexnord Corp. v. Valu Eng'g, Inc., No. 94,922, slip op. (TTAB May 9, 2000). Rexnord cross-appeals the Board's denial of Rexnord's claims that registration should be denied because of Valu's alleged inequitable conduct. Because the Board correctly concluded that Valu's cross-sectional designs of conveyor guide rails are de jure functional, we affirm the Board's refusal to register Valu's designs and dismiss Rexnord's cross-appeal as moot.


On February 25, 1993, Valu filed three applications seeking registration of conveyor guide rail configurations in ROUND, FLAT, and TEE cross-sectional designs as trademarks on the Principal Register. Conveyor guide rails are rails positioned along the length of the sides of a conveyor to keep containers or objects that are traveling on the conveyor from falling off the conveyor. Valu's ROUND, FLAT, and TEE cross-sectional designs are shown below.

[Reference Source Material]

For each cross-sectional design, Valu asserted a claim of acquired distinctiveness under 15 U.S.C. § 1052(f). In each application, Valu specified the goods1 in connection Page 1272

with which Valu uses the marks in commerce as "Conveyor Guide Rails." The Examining Attorney approved the applications. Rexnord timely filed Opposition Nos. 94,922, 94,937, and 94,946, which the Board consolidated.

Rexnord alleged that all three guide rail designs were de jure functional and thus unregistrable; that the applied-for marks were invalid because Valu was a licensee and not the owner of the designs at the time the applications were filed; and that the applied-for marks were invalid because Valu engaged in inequitable conduct before the Examining Attorney. The focus of the opposition as concerns functionality was on the "wet" areas of bottling and canning plants. Such areas are considered "wet" because the machinery, including conveyor guide rails, is frequently washed with disinfectants containing bactericides, such as chlorine, for sanitation and product spillage. Because these washing solutions are corrosive, the machinery in the wet areas are usually formed of noncorrosive materials, such as stainless steel and plastic.

The Board concluded that Valu's cross-sectional shapes were functional and not registrable, and sustained Rexnord's opposition on May 9, 2000. Rexnord, slip op. at 63-64. The Board analyzed the functionality of Valu's guide rail configurations by applying the factors outlined by this court's predecessor in In re Morton-Norwich Products, Inc., 671 F.2d 1332, 1340-41, 213 USPQ 9, 15-16 (CCPA 1982). The Board focused its functionality analysis on the utilitarian advantages of Valu's guide rail configurations as they are used in a particular application, i.e., the so-called "wet areas" of bottling and canning plants, and as they are composed of particular materials, i.e., stainless steel and plastic. The Board determined that all four Morton-Norwich factors weighed in favor of a finding of functionality. Specifically, the Board found that: an abandoned utility patent application filed by Valu but rejected under 35 U.S.C. § 103 "disclose[d] certain utilitarian advantages of [Valu's] guide rail designs, and that those advantages . . . result from the shape of the guide rail designs," Rexnord, slip op. at 12; Valu's advertising materials "tout the utilitarian advantages of [Valu's] guide rail design[s]," id. at 23; the "limited number of basic guide rail designs . . . should not be counted as 'alternative designs'" because they are "dictated solely by function," id. at 30; and Valu's guide rail designs "result[] in a comparatively simple or cheap method of manufacturing," id. at 41. Accordingly, the Board sustained Rexnord's opposition and refused to register Valu's guide rail designs.

The Board denied Rexnord's inequitable conduct claims, concluding that Rexnord failed to prove that Valu's statement that it never applied for a utility patent was fraudulent, id. at 46-47, or material to the examination of Valu's application, id. at 48, that Rexnord failed to prove by clear and convincing evidence that Valu committed fraud by failing to disclose a trade journal article, id. at 52, and that Rexnord failed to prove by clear and convincing evidence that Valu's president's claim of ownership of the applied-for marks was fraudulent, id. at 56. This timely appeal followed.

The primary issue on appeal is whether the Board erred in confining its functionality Page 1273

analysis to a particular use, rather than considering all potential uses for the marks. In light of our disposition of this case, we do not address Rexnord's cross-appeal concerning the Board's rejection of its inequitable conduct claims.



Jurisdiction and Standard of Review

We have jurisdiction over this appeal pursuant to 28 U.S.C. § 1295(a)(4)(B) and 15 U.S.C. § 1071(a).

Functionality is a question of fact, Morton-Norwich, 671 F.2d at 1340, 213 USPQ at 15, and depends on the totality of the evidence, In re Owens-Corning Fiberglass Corp., 774 F.2d 1116, 1120, 227 USPQ 417, 419 (Fed. Cir. 1985). We uphold the Board's factual findings unless they are unsupported by substantial evidence. Dickinson v. Zurko, 527 U.S. 150, 165 (1999); In re Gartside, 203 F.3d 1305, 1315, 53 USPQ2d 1769, 1775 (Fed. Cir. 2000); Recot, Inc. v. M.C. Becton, 214 F.3d 1322, 1327, 54 USPQ2d 1894, 1897 (Fed. Cir. 2000) (holding that Board findings of fact are reviewed under the "substantial evidence" standard). Legal issues are reviewed without deference. Action Temp. Servs., Inc. v. Labor Force, Inc., 870 F.2d 1563, 1566, 10 USPQ2d 1307, 1310 (Fed. Cir. 1989).



Beginning at least with the decisions in Kellogg Co. v. National Biscuit Co., 305 U.S. 111, 119-120 (1938), and Morton-Norwich, 671 F.2d at 1336-37, 213 USPQ at 11-12, the Supreme Court and this court's predecessor have held that a mark is not registrable if the design described is functional, because "patent law, not trade dress law, is the principal means for providing exclusive rights in useful product features." Elmer v. ICC Fabricating, 67 F.3d 1571, 1580, 36 USPQ2d 1417, 1423 (Fed. Cir. 1995). The First Circuit likewise has noted that "[t]rademark and trade dress law cannot be used to evade the requirements of utility patents, nor the limits on monopolies imposed by the Patent Clause of the Constitution." I.P. Lund Trading ApS v. Kohler, 163 F.3d 27, 38, 49 USPQ2d 1225, 1232 (1st Cir. 1998). Commentators share this view: "trademark law cannot properly make an 'end run' around the strict requirements of utility patent law by giving equivalent rights to exclude." J. Thomas McCarthy, 1...

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