986 F.2d 219 (8th Cir. 1993), 92-1345, Master Distributors, Inc. v. Pako Corp.

Docket Nº:92-1345.
Citation:986 F.2d 219
Party Name:25 U.S.P.Q.2d 1794 MASTER DISTRIBUTORS, INC., a New Hampshire corporation, Appellant, v. PAKO CORPORATION, a Delaware corporation; Pakor, Inc., a Minnesota corporation, Appellees.
Case Date:February 17, 1993
Court:United States Courts of Appeals, Court of Appeals for the Eighth Circuit
 
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Page 219

986 F.2d 219 (8th Cir. 1993)

25 U.S.P.Q.2d 1794

MASTER DISTRIBUTORS, INC., a New Hampshire corporation, Appellant,

v.

PAKO CORPORATION, a Delaware corporation; Pakor, Inc., a

Minnesota corporation, Appellees.

No. 92-1345.

United States Court of Appeals, Eighth Circuit

February 17, 1993

Submitted Nov. 10, 1992.

Rehearing and Rehearing En Banc

Denied April 5, 1993.

Page 220

Edward F. Fox, St. Louis, MO, argued (Donald W. Niles, Mark W. Haigh, on brief), for appellant.

David R. Fairbairn, Minneapolis, MN, argued (Thomas J. Stueber and Joseph R. Kelly, on brief), for appellee.

Before JOHN R. GIBSON and MAGILL, Circuit Judges, and VAN SICKLE, [*] Senior District Judge.

JOHN R. GIBSON, Circuit Judge.

Master Distributors, Inc. appeals from an order granting partial summary judgment to the extent MDI claims common law trademark rights in the blue color of its "Blue Max" leader splicing tape. The district court held, as a matter of law, that color alone cannot be protected as a trademark, and that even if it can be protected, the color depletion theory, which assumes that new competitors would be precluded from entering an industry once all colors are used and protected, applies to this situation. 777 F.Supp. 744, 749-50 (D.Minn.1991). We reverse and remand for further proceedings.

MDI manufactures and sells "Blue Max," a blue 1 leader splicing tape, which is used to attach undeveloped film to a leader card for photoprocessing through a minilab machine that develops the film and prints the photographs. Id. at 745. Blue Max was developed in response to the minilab industry's need for better leader splicing tape. Although leader splicing tape was traditionally black, it can be created in any color, and MDI dyed its Blue Max tape blue. Id. Blue Max is well-known and enjoys a reputation as the industry standard. Id. Both distributors and customers often order Blue Max by asking for "the blue tape" or simply for "blue." Id.

Pakor, Inc., a subsidiary of Pako Corporation, is a photographic supplies distributor, and was one of MDI's distributors with a nonexclusive right to sell Blue Max in the Midwest. Id. When MDI learned that Pakor was manufacturing and selling its own brand of blue leader splicing tape, "Pakor Blue," it brought this suit. MDI alleged infringement of its registered trademark, infringement of its common law trademark in the color blue, illegal "palming off," unfair competition, dilution of trademark,

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deceptive trade practices, false statements in advertising, and unlawful trade practices. Id. at 746. The cardboard core of the MDI tape contains the words "blue max," and the other tape core contains the words "Pakor blue" with a toll-free number. Id. at 745.

Pakor moved for partial summary judgment to the extent MDI claimed trademark rights in the blue color of its Blue Max tape. 2 Id. at 746. The district court granted Pakor's motion and dismissed Count II, alleging a common law trademark in the color blue, and Count V insofar as it claimed dilution of a common law trademark in the color blue. Id. at 750. MDI argues on appeal that the district court erred in granting summary judgment before discovery was complete, in adopting a per se rule that color alone can never achieve trademark protection, and in determining that the color depletion theory applies to the facts in this case.

Pakor urges us to affirm the district court's decision by adopting the "better, more widely-accepted rule of law, that a single color cannot function as a trademark." Pakor directs us to many decisions which support its position and distinguishes those that do not. Pakor then argues that even if a single color may be protected under certain circumstances, the district court properly applied the color depletion theory, as a "competitive need" for the color blue exists in the leader splicing tape market.

We review the district court's grant of summary judgment de novo, and will affirm only when "there is no genuine issue as to any material fact and ... the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c); McKee v. Federal Kemper Life Assur. Co., 927 F.2d 326, 328 (8th Cir.1991). We view the facts in the light most favorable to the nonmovant, and give it the benefit of all reasonable inferences. Schrader v. Royal Caribbean Cruise Line, Inc., 952 F.2d 1008, 1013 (8th Cir.1991). Therefore, we assume, for purposes of this appeal, that the color of leader splicing tape does not affect its function, that MDI can establish secondary meaning in the blue color of its tape, identifying and distinguishing it from other tapes, and that an infringing tape would confuse or mislead consumers. We must decide then (1) whether, as a matter of law, color alone cannot be afforded trademark protection, and (2) if color alone can be protected, whether the district court properly applied the color depletion theory to this case.

I.

The United States Supreme Court has never expressly denied the possibility that color can be protected as a trademark. In A. Leschen & Sons Rope Co. v. Broderick & Bascom Rope Co., 201 U.S. 166, 170-71, 26 S.Ct. 425, 426-27, 50 L.Ed. 710 (1906), overruled on other grounds, United Mine Workers v. Gibbs, 383 U.S....

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