A Review of the Traditional Difference Between Trademarks and Other

As scholars, judges, and policy makers have repeated since the nineteenth century, the traditional justification for trademark protection, and in turn the protection functions of a trademarks, are based on economics.² In particular, under this traditional justification, trademarks provide consu-mers with information about the products to which they are affixed in terms of both commercial origin and predictable quality and thus reduce the so called information asymmetries; that is, the costs of collecting in-formation for consumers when and if consumers decide to make a speci-fic purchase.³ Accordingly, trademarks are protected– and trademark holders are given a right to prevent unauthorized third parties from using identical or similar signs–because in the absence of this protection, un-authorized parties could use identical or similar signs to confuse consu-mers and divert consumer demand to their products instead of those of the legitimate holders of the marks.⁴However, granting trademark pro-tection has social costs because others are no longer entitled to use the protected marks–often common words, pictures, logos, and

combina-2 See, e. g.,WILLIAMM. LANDES/RICHARDA. POSNER, Trademark Law: An Economic Perspective, 30 J. L. & Econ. 265 (1987); NICHOLAWECONOMIDES, The Economics of Trademarks, 78 Trademark Rep. 523 (1988); WILLIAMP. KRATZKE, Normative Eco-nomic Analysis of Trademark Law, 21 Mem. St. U. L. Rev. 199 (1991).See alsoIRENE

CALBOLI, Trademark Assignment «With Goodwill»: A Concept Whose Time Has Gone, 57 Fla. L. Rev. 771, 832 (2005); IRENECALBOLI, The Sunset of «Quality Con-trol» in Modern Trademark Licensing, 57 AM. U. L. Rev. 341, 396 (2007).

3 LANDES/POSNER,supranote 4, at 265–66.

4 Id.; Lanham Act § 14, 16 (U. S.); TRIPS: Agreement on Trade-Related Aspects of In-tellectual Property Rights, act. 16, Apr. 15, 1994, Marrakesh Agreement Establishing the World Trade Organization, Annex 1C, 1869 U. N. T. S. 299, 33 I. L. M. 1197 (1994), art 15 [hereinafter TRIPS Agreement].

tions thereof–or signs similar to these marks in the course of trade. The social costs of trademark protection are particularly high as trademarks can be protected for a virtually unlimited period so long as they continue to be used to distinguish goods or services in the marketplace. In particu-lar, trademarks are registered for an initial term of ten years in most jur-isdictions and can be renewed for additional increments of ten years with-out any limit in time and number of renewals.⁵Moreover, registration is not needed for legal protection in most countries and can be based on pas-sing off or unfair competition.

Because of its costs, trademark protection has been traditionally limited to preventing the unauthorized use of identical or similar signs affixed on identical or similar products when such use could lead to a likelihood of confusion on the part of consumers.⁶Only when a mark reaches the sta-tus of «well-known» or «famous» mark, or mark «with a reputation,»

does the law provide protection of the mark beyond confusion and in re-lation to dissimilar goods and services.⁷Until the beginning of the 20th century, the so-called «indictors of origin» function of trademarks was considered the only function worthy of legal protection, and «origin»

was interpreted as «manufacturing origin.»⁸ Eventually, following the changes in the economy and the growth of the practice of trademark li-censing, the law was changed to reflect that the notion of «origin» in-cluded the «sponsorship, affiliation, connection or association» with a mark.⁹ Since consumers rely on trademarks as indicators of consistent quality–that is, they expect all the products identified by a certain mark to have identical characteristics and quality–a second function was leg-ally recognized in several jurisdictions: that marks represent a mechan-ism to guarantee that the product to which they are affixed meets a con-sistent quality. Years later, a third protected function was added to the debate: trademarks’advertising function, i. e. the ability of a mark to

«sti-5 TRIPS Agreement, arts. 18; Lanham Act § 1058.

6 TRIPS Agreement, art. 15; Lanham Act § 114; Council Directive 2015/2436, art. 3, of the European Parliament and of the Council of 16 Dec. 2015 to approximate the laws of the Members States relating to trademarks [hereinafter TMD 2015] (cur-rent EU standard);

7 TRIPS Agreement, art. 16.3; TMD 2015, art. 16.

8 See generallyELMERWILLIAMHANAK, III,The Quality Assurance Function of Trade-marks, 43 Fordham L. Rev. 363; ALEX KOZINSKI, Trademarks Unplugged, 68 N.Y. U. L. REV. 960, 961 (1993).

9 KOZINSKI,supranote 8, at 961.

mulate further purchasing by the consuming public.»¹⁰The recognition of a mark’s attractive power, separate from its other functions, acknowl-edged that a mark could create goodwill on its own by influencing con-sumers through a specifically created product image.¹¹

Still, central to the scope of trademark protection is the requirement of trademark distinctiveness.¹²This requirement is the basis of each of the protected trademark functions. In particular, it is crucial that a sign is able to identify and distinguish the products to which it is affixed as originat-ing from a soriginat-ingle business source for the sign to be protected as a mark.

The language that a sign should «be able to distinguish» or should al-ready «be distinctive of» products in the marketplace is included in sev-eral of (if not all) the current legal definitions of what constitutes a mark, both under relevant international agreements and national laws.¹³The re-quirement of distinctiveness is also thesine qua nofor trademark enfor-cement. Again, a mark has to be distinctive to be protected against infrin-gement – where confusingly similar signs are used to lure consumers towards competitors’ products.¹⁴ Trademark distinctiveness is also at the core of the justification to the enhanced protection against «trade-mark dilution» for «trade-marks that are well known, famous, or have a reputa-tion in the relevant market. These marks have to be highly distinctive and this distinctiveness is precisely what qualifies them for additional protec-tion.¹⁵

10 HANAK,supranote 8, 363–64.

11 THOMASD. DRESCHER,The Transformation and Evolution of Trademarks–From Sig-nals to Symbols to Myth, 82 Trademark Rep. 301 (1992). Cf. ROBERTG. BONE, Hunt-ing Goodwill: A History of Goodwill in Trademark Law, 86 B. U. L. Rev. 547 (2006).

12 The acquisition of trademark rights is centered upon the concepts of «distinctive-ness» and «priority» and is limited to marks that are in use or are intended to be used.

SeeLanham Act § 1, 15 U. S. C. § 1051 (2006);see also Zazú Designs v. L’Oreal, S. A., 979 F.2d 499, 503 (7th Cir. 1992) («By insisting that firms use marks to obtain rights in them, the law prevents entrepreneurs from reserving brand names in order to make their rivals’marketing more costly.»);Abercrombie & Fitch Co. v. Hunting World, Inc., 537 F.2d 4, 9 (2d Cir. 1976). «[T]he more distinctive or unique the mark, the deeper is its impress upon the public consciousness, and the greater its need for protection against vitiation or dissociation from the particular product in connection with which it has been used.» FRANKI. SCHECHTER,The Rational Basis of Trademark Protection, 40 Harv. L. Rev. 813, 825 (1927).

13 TRIPS Agreement, art. 15.1 (offering the first definition of trademark); Lanham Act,

§ 115(a); TMD 2015, art. 4.1.

14 Zazú Designs, 979 F.2d at 503.

15 SCHECHTER,supranote 12, at 819. Schechter argued that a trademark has a dual

func-Accordingly, different than other types of intellectual property rights, trademark protection does not emphasize the aspect of innovation or scientific discovery of trademarks, but remains rooted in commercial concepts and on the concept of «distinctives»–the ability of traders to identify their products in the marketplace and distinguish them from si-milar products offered for sale by their competitors and third parties.

This very important characteristic qualifies trademark protection as sepa-rate from the other forms of intellectual property rights. Notably, trade-mark law does not aim at promoting innovation but rather at protecting the signaling function of the marks–the ability to distinguish and iden-tify goods and services over and over so consumers can ideniden-tify the mark and the products with a single source.

On the contrary, other types of protected intellectual property, primarily patents and copyrights, protect products and creative works, or parts of them, per se.¹⁶In particular, both patents and copyrights grant a time-bound period of exclusivity to their owners during which third parties cannot copy the products or works per se, unless a legally provided spe-cific limitation or exception applies.¹⁷ In exchange, patent owners and copyright owners have to fulfil several requirements. Patent owners must disclose, in the best mode known to those skilled in the art, the character-istics of the invention and how the invention works, so that competitors can work around the terms of the patent during the time of exclusivity to develop similar products, and so that the invention can be copied when the patent expires.¹⁸Likewise, the incentive and reward system through which an author obtains a copyright is similarly built on the idea that the temporary monopoly granted to an author is justified by the benefit of releasing the copyrighted material during the copyright terms and ulti-mately the possibility for everyone to copy once this term expires.¹⁹

tion, and a mark «is not merely the symbol of good will but often the most effective agent for the creation of good will, imprinting upon the public mind an anonymous and impersonal guaranty of satisfaction, creating a desire for further satisfactions.

The mark actuallysellsthe goods. And, self-evidently, the more distinctive the mark, the more effective is its selling power.»Id.

16 See, e.g., MARKA. LEMLEY, The Modern Lanham Act and the Death of Common Sense, 108 Yale

L. J. 1687 (1999).

17 U. S. Const. Art. I, § 8, cl. 8 (offering the basis for the protection of patents and copy-rights in the U. S.).

18 35 U. S. C. § 112.

19 17 U. S. C. § 106.

Moreover, copyright protection does not extend to independent creative works.²⁰Ultimately, whereas the patent system underscores the impor-tance of innovation and the promotion of scientific progress, the copy-right system is aimed at promotion of creative and artistic endeavors.

Yet again, both systems function differently than trademark protection in that the time-limited nature and the societal bargain beyond these in-tellectual property rights lie precisely in the fact that the exclusive rights in the products or works at issue would, in the end, expire.²¹

In addition, product design also finds protection under time-bound intel-lectual property laws. The protection of product design is particularly re-levant in the context of the topic of NTTMs. Several countries protect product design throughsui generisprotection for industrial design. This is the case, for example, in the European Union (EU), which protects in-dustrial design both under a unified system under Council Regulation (EC) No 6/2002²² as well as under harmonized national systems via the EU Design Directive 97/71/EC.²³In particular, industrial design is defined in these legislations as «the appearance of the whole or a part of a product resulting from the features of, in particular, the lines, con-tours, colours, shape, texture and/or materials of the product itself or its ornamentation.»²⁴This definition is strikingly similar, regarding the subject matter of protection, to several types of NTTMs. The terms for sui generisprotection for industrial design protection varies and is not in-ternationally harmonized. Notably, countries grant terms of protection varying between fifteen to twenty-five years.²⁵Protection is also based on the specific requirements: novelty or originality.²⁶In the United States (U. S.), product design does not enjoy protection through asui generis system but rather through a specific category of patents–the design

pa-20 17 U. S. C. § 106;Feist Publications, Inc. v. Rural Telephone Serv. Co, 499 U. S. 340 (1991).

21 See, e. g.,LAURAA. HEYMANN, Overlapping Intellectual Property Doctrines: Elec-tion of Rights versus SelecElec-tion of Remedies, 17 Stan. Tech. L. Rev. 241 (2013); VIVA

R. MOFFAT, Mutant Copyrights and Backdoor Patents: The Problem of Overlapping Intellectual Property Protection, 19 Berkeley Tech. L. J. 1473 (2004).

22 Council Regulation (EC) No. 6/2002 of Dec. 12, 2001, on Community designs O. J.

L3/1.

23 Council Directive 98/71/EC of Oct. 13, 1998, on the legal protection of designs O. J.

L289/28 [hereinafter Design Directive].

24 Design Directive, art. 11.

25 Id., art. 10.

26 Id.,arts. 4–5.

tents.²⁷Protection is again timed up to fourteen years and based on the requirement of novelty.²⁸However, product design is also protected un-der the notion of trade dress in the U. S., which enjoys the same protec-tion of trademarks and only requires proof that the design is distinctive to signal commercial origin to consumers.²⁹

Largely, it was precisely the lack of the availability ofsui generis protec-tion for product design via an industrial design system in the U. S.– gen-erally less costly and time-consuming than the application for a design patent–that led to the push for protecting product design under the um-brella of trademark law as trade dress. Pushes to include product designs and product features under the protection of trademark law have also emerged in Europe and several other countries worldwide based on the obvious benefits of trademark protection vis a vis to design patents or in-dustrial design. In particular, the former protection has the advantage of permitting a potentially perpetual protection for designs under the non-time-bound protection granted to trademarks. As for all trademarks, it also extends to non-registered trade dress.

Yet, again, as I elaborate in the following Section, this situation has been made possible by transposing the notion of distinctiveness–which gen-erally applies to traditional marks that are usually attached (as logos, pic-tures, names, words, etc.) onto the products to distinguish them, but are separable from the product designs–to the product design themselves or to aesthetic product features that are integral parts of the products.

Because these products or their aesthetic features are now deemed to be distinctive in a trademark sense (in that they can indicate the commer-cial origin of the products), they could also be protected (and possibly be registered) as shapes or other types of NTTMs under trademark law.Yet, the large majority of these signs remain product designs and their protec-tion should have remained confined to the applicaprotec-tion of the protecprotec-tion for industrial designs or design patents regardless of the fact that these product designs or aesthetic feature can also be found to be distinctive.³⁰

27 35 U. S. C. § 171.See e. g.,SARAHBURSTEIN, Is Design Patent Examination Too Lax?, 33 Berkeley Tech. L. J. 607 (2018).

28 35 U. S. C. § 171.

29 See Wal-Mart Stores, Inc., v. Samara Brothers, Inc.,529 U. S. 205 (2000);Qualitex Co. v. Jacobson Prods. Co., 514 U. S. 159 (1995);Two Pesos, Inc. v. Taco Cabana, Inc., 505 U. S. 763, 765 (1992);In re Slokevage, 441 F.3d 957 (Fed. Cir. 2006);Rock

& Roll Hall of Fame & Museum, Inc. v. Gentile Prods., 134 F.3d 749 (6th Cir. 1998).).

30 Seethe critique elaborated in this respect by GUSTAVOGHIDINI, The Protection of

As noted by commentators, both thesui generisregimes for industrial de-sign and dede-sign patent law are focused on encouraging advances in dede-sign, as encapsulated in the requirement of novelty as the condition for protec-tion.³¹Both these regimes grant strong rights during the life of the pro-duct design, yet these rights expire within a reasonable amount of time.

After this time has passed, any interested party may copy the design and aesthetic features at issue. Instead, to turn to trademark law in this context upsets this balance and grants a monopoly under trademark law that is difficult to justify under the traditional framework of intellec-tual property law.³²