Vornado Air Circulation Systems, Inc. v. Duracraft Corp.

• Citation: 58 F.3d 1498,35 U.S.P.Q.2d 1332
• Decision Date: 05 July 1995
• Docket Number: No. 94-3191,94-3191
• Parties: , 35 U.S.P.Q.2d 1332 VORNADO AIR CIRCULATION SYSTEMS, INC., a Kansas corporation, Plaintiff-Appellee, v. DURACRAFT CORPORATION, Defendant-Appellant.
• Court: United States Courts of Appeals. United States Court of Appeals (10th Circuit)

Page 1498

58 F.3d 1498

64 USLW 2060, 35 U.S.P.Q.2d 1332

VORNADO AIR CIRCULATION SYSTEMS, INC., a Kansas corporation, Plaintiff-Appellee, v. DURACRAFT CORPORATION, Defendant-Appellant.

No. 94-3191.

United States Court of Appeals, Tenth Circuit.

July 5, 1995.

Edward M. Prince, Cushman, Darby & Cushman, Washington, DC (Richard L. Kirkpatrick and Peter Gowdey, Cushman, Darby & Cushman, Washington, DC; Edward L. Brown, Jr., Wichita, KS; and Steven D. Gough, Todd M. Connell, and Donald N. Peterson II, Kahrs, Nelson, Fanning, Hite & Kellogg, Wichita, KS, with him on the brief), for plaintiff-appellee.

James W. Dabney, Pennie & Edmonds, New York City (Kelly D. Talcott, Carol M. Wilhelm, Michael J. Blum, Pennie & Edmonds, New York City; and Gerald Sawatzky and Jim H. Goering, Foulston & Siefkin, Wichita, KS, with him on the briefs), for defendant-appellant.

Before ANDERSON, Circuit Judge, McWILLIAMS and ALARCON ^*, Senior Circuit Judges.

STEPHEN H. ANDERSON, Circuit Judge.

INTRODUCTION

This case presents an issue of first impression in our circuit concerning the intersection of the Patent Act and the Lanham Trade-Mark Act. We must decide whether a product configuration is entitled to trade dress protection when it is or has been a significant inventive component of an invention covered by a utility patent.

After expiration of any patents or copyrights on an invention, that invention normally passes into the public domain and can be freely copied by anyone. The district court found, however, that because the spiral structure of the household fan grill in question is "nonfunctional," a status largely determined by the availability of enough alternative grill designs so that other fan manufacturers can effectively compete without it, the grill can serve as trade dress. ¹ The court held that The court's injunction effectively prevents defendant Duracraft Corp. from ever practicing the full invention embodied in the patented fans of plaintiff Vornado Air Circulation Systems, Inc., after Vornado's utility patents expire. ² For the reasons discussed below, we find this result to be untenable. We hold that although a product configuration must be nonfunctional in order to be protected as trade dress under section 43(a), not every nonfunctional configuration is eligible for that protection. Where a product configuration is a significant inventive component of an invention covered by a utility patent, so that without it the invention cannot fairly be said to be the same invention, patent policy dictates that it enter into the public domain when the utility patents on the fans expire. To ensure that result, it cannot receive trade dress protection under section 43(a). The district court's order is reversed.

the grill could be protected under Lanham Act section 43(a) against copying by competitors, because that copying was likely to confuse consumers.

BACKGROUND

History of the spiral grill designs

The product configurations at issue in this case are two household fan grills with spiral--or arcuate--vanes, produced by the plaintiff, Vornado, and the defendant, Duracraft.

The idea of using a spiral grill on a fan is not new. An arcuate vane structure for propellers "applicable to ventilators and the like" was reflected in expired U.S. Patent No. 1,062,258, a utility patent issued May 20, 1913, to G.A. Schlotter, and arcuate vanes were incorporated into a household fan guard as early as 1936, as shown by expired U.S. Patent No. 2,110,994, a utility patent issued to J.H. Cohen.

Vornado began selling its fans with spiral grills in November 1988, at a time when it was the only fan company using that type of grill. On January 9, 1989, Vornado's founders, Donald J. Moore and Michael C. Coup, applied for a utility patent on their ducted fan with a spiral grill. They asserted, among other things, that their spiral grill produced an optimum air flow, although their own tests had shown that it performed about the same as the more common straight radial grill, and later tests suggested that some other grills worked better in some respects.

Their patent application claimed a fan with multiple features, including the spiral grill. The inventive aspect of Vornado's spiral grill was that the point of maximum lateral spacing between the curved vanes was moved inboard from the grill's outer radius, so that it was at the impeller blade's point of maximum power. Vornado emphasizes that its fan grill was not patentable by itself because a spiral grill per se was already in the public domain as "prior art," a patent law term for what was already known from previous patents or other sources.

On May 22, 1990, Messrs. Moore and Coup were issued a utility patent. They subsequently applied for and on February 22, 1994, were granted a reissue patent expanding their claims, including those that involved the arcuate-shaped grill vane structure.

Vornado advertised its grill as the "Patented AirTensity ^TM Grill," although the company had no separate patent on the grill. Between January 1989 and August 1990, Vornado sold about 135,000 fans. In its advertising, the company touted the grill as a "true achievement in aerodynamic efficiency," "the result of determinant ergonomic design," with "[u]nique AirTensity ^TM vortex action," accomplishing "a high degree of safety and functionality." See Appellant's Br. at 8-10; Appellant's App. at 1831, 1977.

In August 1990, Duracraft began offering an inexpensive electric household fan called the Model DT-7 "Turbo Fan." The grill on Duracraft's Turbo Fan incorporated a spiral By November 1992, Duracraft had sold nearly one million Turbo Fans in the United States. The Turbo Fan was the company's second-largest-selling household fan product.

vane structure that was copied from Vornado's considerably more expensive fan models but was purposely designed not to infringe Vornado's patent. Apart from its look-alike grill and some aspects of the fan blade design, the Turbo Fan differed significantly from Vornado's fans in its overall configuration, its base and duct structure, its center knob, neon colors, packaging, labeling, and price. See Appellant's App. at 1190 (Mem. & Order). The box in which the Turbo Fan came had a circle cut out of the front so that the grill design showed through and was emphasized when the fan was displayed in its box.

District court's findings

Vornado sued, alleging that Duracraft had intentionally copied Vornado's grill design, but both sides agreed that the Turbo Fan did not infringe Vornado's patents. Vornado argued during the bench trial that the curved vanes in the "Patented AirTensity Grill" were legally nonfunctional, which they had to be in order to be protected as trade dress under section 43(a).

The district court found that the spiral grill was functional in a lay sense but not in a legal sense, based on our definition of trade dress functionality in terms of the competitive need to use a feature. See Brunswick Corp. v. Spinit Reel Co., 832 F.2d 513, 519 (10th Cir.1987). ³ The district court found that Vornado's grill did in fact perform a unique function in the way that it shaped the flow of air coming from the fan, but the difference in air flow produced by it as compared with other grill designs was not great enough for a customer to perceive, so it made no competitive difference. The court also noted that other feasible grill structures could easily do as well on other relevant performance tests, and the spiral grill was not shown to be cheaper to manufacture. ⁴

The district court did not find enough evidence to support a finding of aesthetic functionality, a type of functionality based on decorativeness or attractiveness, which we have previously recognized. Brunswick, 832 F.2d at 519. Nor did the district court find that Duracraft would suffer a marketing disadvantage if it could not use the spiral grill. ⁵ The court found that the grill's value lay not in its operational attributes but primarily in its appearance, which the court said suggests something about the fan's performance and creatively suggests Vornado's identity. ⁶

The court found that the grill design was nonfunctional and held that trade dress protection of nonfunctional product configurations under the Lanham Act was not incompatible Duracraft contends on appeal that the district court committed legal error in: 1) concluding that Vornado's trade dress claim was not barred by federal patent law; 2) rejecting Duracraft's statutory estoppel argument; 3) concluding that the spiral grill could be a "symbol or device" within the meaning of section 43(a); 4) enjoining the use of the spiral grill without proof of secondary meaning in any relevant market; 5) concluding that Duracraft's continued use of the spiral grill would be likely to confuse an appreciable number of persons; and in 6) issuing a nationwide injunction against continued sales of the Turbo Fan, regardless of how it might be packaged or labeled.

                with patent law.  The court further found that the grill design was a suggestive symbol combined with a device, and thus inherently distinctive, so that no showing of secondary meaning was required. 7  The court found that consumers were likely to be confused by Duracraft's use of a similar grill, and granted Vornado an injunction but no damages on the section 43(a) claim. 8
                

We have considered all of the issues raised by Duracraft, but, finding the patent law argument to be dispositive, we do not decide the other questions.

DISCUSSION

Protection of trade dress under section 43(a)

Section 43(a) of the Lanham Act, 15 U.S.C. Sec. 1125(a), provides a federal cause of action for unprivileged imitation, including trade dress infringement. Hartford House, Ltd. v. Hallmark Cards, Inc., 846 F.2d 1268, 1271 (10th Cir.), cert. denied, 488 U.S. 908, 109 S.Ct. 260, 102 L.Ed.2d 248 (1988). Trade dress features are those comprising a product's look or image. Brunswick, 832 F.2d at 517. In Hartford and...