Decorations for Generations, Inc. v. Home Depot Usa, Inc.

NOTE: Pursuant to Fed. Cir. R. 47.6, this disposition
is not citable as precedent. It is a public record.

United States Court of Appeals for the Federal Circuit

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DECORATIONS FOR GENERATIONS, INC.,

Plaintiff-Cross Appellant,

v.

HOME DEPOT USA, INC.,

Defendant-Appellant,

and

INTERNATIONAL BUSINESS CORPORATION and MUTUAL ALLIED, LTD.,

Defendants-Appellants,

and

MARK LU,

Defendant.

__________________________

DECIDED: March 8, 2005
__________________________

Before LOURIE, Circuit Judge, ARCHER, Senior Circuit Judge, and PROST, Circuit
Judge.

PROST, Circuit Judge.

The appellants, Home Depot USA, Inc. (Home Depot), International Business

Corporation (IBC) and Mutual Allied, Ltd. (MA), appeal the District Court for the Eastern

District of California’s denial of their motion for judgment notwithstanding the verdict.
Decorations for Generations, Inc. v. Home Depot USA, Inc., No. CIV-S-01-0284 DFL

PAN (E.D. Cal. Sep. 22, 2003) (District Court Opinion). Because the jury’s verdict

finding that the appellants infringed the trade dress of the appellee, Decorations for

Generations, Inc. (DFG), was not supported by substantial evidence, we reverse the

district court’s denial of judgment notwithstanding the verdict.

BACKGROUND

Since 1990, DFG has manufactured a steel Christmas tree stand. DFG chief

executive officer James Boucher designed the stand in 1988 out of scrap steel parts

that he had in his garage. As designed by Boucher and sold by DFG, the stand is

comprised of a one-foot steel pipe (intended to contain the tree base), a six-inch square

plate of flat steel (that serves as a base), and four legs protruding from the corners of

the base and made of 24-inch long steel bars. The stand also includes four screws that

are meant to secure the tree by fitting into apertures that are evenly spaced around the

steel pipe component. In order to evoke Christmas colors, DFG’s stand was colored

green and red, with the base and body of the stand colored green and the rim of the

stand covered by a red plastic covering.

In 1990, Mr. Boucher applied for a design patent for his Christmas tree stand. In

November of 1992, he was granted U.S. Design Patent No. Des. 330,875 based on that

application.

DFG began selling Mr. Boucher’s stand during the holiday season of 1989. In

1993, after receiving outside suggestions, it began selling the stand in an open-topped

white box. Since the modification of the display box, the DFG stand has sold in the

same configuration.

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 In 1999, Home Depot designed a heavy-duty Christmas tree stand whose design

was roughly similar to DFG’s stand. Home Depot had arranged through IBC to have the

stand manufactured by MA in China. When Home Depot later discovered that DFG’s

stand was covered by a design patent, it developed another design for its tree stand in

order to avoid infringing the DFG patent.1

In February of 2001, DFG sued Home Depot, MA and IBC for infringement of its

design patent, trade dress infringement under the Lanham Act and unfair competition

under common law and California statute. In September 2002, at the summary

judgment stage of litigation, the district court granted summary judgment to the

appellants on DFG’s patent infringement claim.2 In May of 2003, a jury trial on DFG’s

trade dress and unfair competition claims was held.

Before the jury returned its verdict, the defendants submitted motions for

judgment as a matter of law (JMOL) to the district court. The district court declined to

consider the defendants’ motions in light of the jury’s impending verdict. After the jury

returned its verdict finding for DFG on its trade dress and unfair competition claims and

awarded lost profits, compensatory damages and punitive damages to DFG, the

defendants moved for judgment notwithstanding the verdict. The district court sustained

the jury verdicts on trade dress infringement and unfair competition but reduced the

jury’s compensatory and punitive damages verdicts.

1
Between 1993 and 1999, several other manufacturers made and sold
Christmas stands that were similar to the DFG stand. Those manufacturers are not
parties to this action.
2
DFG is not appealing the district court’s grant of summary judgment on the
design patent claim in this appeal.

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 The defendants timely appealed the district court’s denial of their motion for

judgment notwithstanding the verdict. MA and IBC also appeal the district court’s unfair

competition verdict.3 DFG cross-appeals the district court’s reduction of the jury’s

punitive damage award against Home Depot as well as its determination that pre-

judgment interest is not available for Lanham Act violations.4 Because the district

court’s jurisdiction was based in part on 28 U.S.C. § 1338, we have jurisdiction to hear

this appeal under 28 U.S.C. § 1295(a)(1).

DISCUSSION

A. Standard of Review and Choice of Law

For procedural issues not unique to patent law, we apply the standard of review

of the circuit from which the case originates. Sjolund v. Musland, 847 F.2d 1573, 1576

(Fed. Cir. 1988). In the United States Court of Appeals for the Ninth Circuit, a jury

verdict and a denial of a motion for judgment notwithstanding the verdict are reviewed

for substantial evidence. Leatherman Tool Group, Inc. v. Cooper Indus., Inc., 199 F.3d

1009, 1011 (9th Cir. 1999).

For substantive issues not related to patent law, we also apply the law of the

Ninth Circuit. See e.g., Nobelpharma AB v. Implant Innovations, 141 F.3d 1059, 1067

(Fed. Cir. 1998). Because the issues on appeal concern trade dress law, the Ninth

Circuit’s precedent controls for the purposes of this appeal. See Keystone Retaining

3
As the district court noted, the unfair competition claim asserted against
MA and IBC is predicated on a violation of the Lanham Act. Since we find that there
was no Lanham Act violation in this case, the unfair competition claim in this case
becomes moot.
4
Because we reverse the jury’s trade dress verdict, we deny DFG’s cross-
appeals as moot.

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Wall Sys., Inc. v. Westrock, Inc., 997 F.2d 1444, 1447-48 (Fed. Cir. 1993) (applying the

law of the Ninth Circuit in evaluating a trade dress infringement claim).

B. The General Law of Trade Dress

As a concept, trade dress is closely related but not identical to trademark. Like

trademark, trade dress derives its legal protection from § 43(a) of the Lanham Act. But

unlike trademark, trade dress is intended to protect product packaging or design that

has come to be associated by consumers with a specific manufacturer or producer. For

example, while a two-dimensional symbol or drawing may be considered a trademark,

three-dimensional product designs or packaging may, under the right circumstances, be

considered trade dress.

The first inquiry in determining whether a product’s design can be protected as

trade dress under § 43(a) of the Lanham Act is into the functional aspects of the design,

with the parties asserting Lanham Act trade dress claims having to first “establish the

nonfunctionality of the design feature.” Wal-Mart Stores, Inc. v. Samara Bros., Inc., 529

U.S. 205, 214 (2000). Nonfunctionality is required because the buying public “should

not be deprived of the benefits of competition with regard to the utilitarian and esthetic

purposes that product design ordinarily serves.” Id. at 213. Furthermore, because

functional aspects of a product’s design may gain protection in the form of a patent,

trade dress is an inappropriate vehicle through which to protect them. As the Supreme

Court observed:

The functionality doctrine prevents trademark law, which
seeks to promote competition by protecting a firm’s
reputation, from instead inhibiting legitimate competition by
allowing a producer to control a useful product feature. It is
the province of patent law, not trademark law, to encourage
invention by granting inventors a monopoly over new product

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 designs or functions for a limited time, 35 U.S.C. §§ 154,
173, after which competitors are free to use the innovation. If
a product's functional features could be used as trademarks,
however, a monopoly over such features could be obtained
without regard to whether they qualify as patents and could
be extended forever (because trademarks may be renewed
in perpetuity).

Qualitex Co. v. Jacobson Prods. Co., 514 U.S. 159,164-65 (1995).

The second inquiry in determining whether trade dress protection is available to a

product’s design is whether or not the product design has achieved secondary meaning

in the minds of consumers. Samara Bros., 529 U.S. at 216. Secondary meaning exists

when “in the minds of the public, the primary significance of [the product design] is to

identify the source of the product rather than the product itself.” Id. at 211 (quoting

Inwood Labs., Inc. v. Ives Labs., Inc., 456 U.S. 844, 851 n. 11 (1982)). Put another

way, “A plaintiff’s trade dress acquires secondary meaning when the purchasing public

associates the dress with a particular source.” Vision Sports, Inc. v. Melville Corp., 888

F.2d 609, 615 (9th Cir. 1989).

The likelihood of consumer confusion between protected trade dress and

allegedly infringing trade dress is only considered once the trade dress in question has

been established to be protected trade dress (i.e., it is non-functional and it has

achieved secondary meaning in the minds of consumers). In the absence of a product

design’s non-functionality or secondary meaning, likelihood of consumer confusion is

irrelevant because without establishing both non-functionality and secondary meaning a

plaintiff asserting a product design trade dress infringement claim cannot prevail. See,

e.g., Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 769 (1992) (holding that to

establish a claim for trade dress infringement, secondary meaning, non-functionality and

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likelihood of confusion must all be shown); Talking Rain Beverage Co. v. S. Beach

Beverage Co., 349 F.3d 601, 603 (9th Cir. 2003) (holding the same).

C. Trade Dress Law in the Ninth Circuit

Our review of the district court’s decision turns on the issue of secondary

meaning. While the Supreme Court laid out the broad outlines of product design trade

dress law in Samara Bros., the Ninth Circuit has further defined the factors to be

considered in making secondary meaning determinations. They include: whether actual

purchasers associate the plaintiff’s trade dress with the plaintiff’s products; the degree

and manner of the plaintiff’s use of the trade dress; whether the use of the trade dress

has been exclusive; and proof of copying. Vision Sports, 888 F.2d at 615; see also,

Levis Strauss & Co. v. Blue Bell, Inc., 778 F.2d 1352, 1358 (9th Cir. 1985) (en banc).

Other Ninth Circuit precedent identifies actual confusion as an indicator of secondary

meaning.5 Am. Scientific Chem., Inc. v. Am. Hospital Supply Corp., 690 F.2d 791, 793

(9th Cir. 1982).

D. DFG’s Trade Dress Infringement Claims

The district court identified six factors to be considered in a secondary meaning

analysis:

(1) purchaser perception; (2) degree and manner of
advertising; (3) demonstrated utility of trade dress in
increasing sales product; (4) length of time and

5
Evidence of actual confusion in the secondary meaning context is not to
be mistaken for the independent likelihood of confusion inquiry that a court must
undertake before finding trade dress infringement. In its jury instructions, the district
court itself underscored this point in issuing different instructions for evidence of actual
confusion under the secondary meaning analysis and the likelihood of confusion
analysis.

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 exclusivity of use; (5) intentional copying by defendants;
(6) evidence of actual confusion.

District Court Opinion at 8-9.

Regarding the first three secondary meaning factors, the district court found that

DFG had offered “little or no evidence” at trial. District Court Opinion at 9. We concur

with that conclusion. The district court also found, however, that substantial evidence

supported a finding that the presence of the last three factors had been established by

DFG. We agree with the district court that the fourth factor was supported by

substantial evidence but disagree with its conclusion that the fifth and sixth factors were

likewise supported by substantial evidence. We discuss these latter three factors in

turn.

1. Length of Time and Exclusivity of Use

The district court determined that the length of time and exclusivity of use factor

in a secondary meaning analysis had been supported by substantial evidence at trial.

The defendants argue that because the DFG stand was only in stores five to six weeks

a year for only several years, DFG could not satisfy the length of time component of this

factor. Furthermore, they assert that because similar stands were being sold in that

time period, DFG could not show exclusivity of use at trial.

DFG has been selling its tree stand in roughly the same configuration since the

1993 holiday season. Thus, at the time of suit in 1999, DFG had been selling its tree

stand in approximately the same configuration for six years. Even though DFG’s stand

was on display and on sale for only a limited number of weeks out of each year, as the

district court said, “[that] is a sufficient amount of time, year after year, to support a jury

finding” on this factor. We concur.

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 In addition, the district court found that substantial evidence would support a

jury’s finding of exclusive use for DFG given that the competing stands prominently

displayed their brand names and were different in overall appearance from the DFG

stand. Though this is a close question, the evidence introduced at trial was substantial

enough to support a jury’s finding that DFG had exclusive use of its tree stand design.

Thus, we find that there was substantial evidence introduced at trial to support

the district court’s finding that this factor in the secondary meaning analysis was

satisfied.

2. Intentional Copying of Protected Trade Dress

Before the jury rendered its verdict, the district court declined to specifically

instruct the jury that copying functional elements of DFG’s tree stand was no trade

dress infringement. After the jury’s verdict, the district court found only that “[t]here was

considerable evidence that defendants intentionally copied [DFG’s] protectible [sic]

trade dress.” District Court Opinion at 12.

Regarding intentional copying, it is the copying of non-functional elements of a

product’s design that can yield an inference of secondary meaning. Copying functional

elements of a competitor’s design is not a violation of the Lanham Act. Fuddruckers,

Inc. v. Doc’s B.R. Others, Inc., 826 F.2d 837, 844-45 (9th Cir. 1987). We find that the

copied elements of DFG’s tree stand that were identified as being non-functional by the

district court (i.e., the colors, the plastic rim, and the display box) were, in fact, utilitarian

in nature. Furthermore, the key issue in any secondary meaning analysis is whether or

not the consuming public has come to associate a certain product design with a certain

manufacturer—not whether the defendant engaged in any copying whatsoever. As one

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district court in the Ninth Circuit correctly stated, “A defendant’s conduct, whether

legitimate or reprehensible, has only a tenuous connection to the perceptions of

consumers and should not relieve a plaintiff of its burden of showing that it has

successfully imbued its design with secondary meaning.” Continental Lab. Prods., Inc.

v. Medax Int’l, Inc., 114 F. Supp. 2d 992, 1012-13 (S.D. Cal. 2000). The only copying

relevant to the intentional copying factor in a secondary meaning analysis is the copying

of protected trade dress. While there was evidence introduced that supported the

conclusion that the defendants had indeed copied utilitarian features of DFG’s tree

stand, there was no evidence introduced that the defendants intentionally copied

protected trade dress that had been perceived by consumers as originating from a

particular manufacturer. Accordingly, we also find that there is no substantial evidence

to support a jury finding that the defendants intentionally copied DFG’s protected trade

dress.

3. Actual Customer Confusion

Finally, on the issue of actual customer confusion, the district court asserted that

even though DFG had presented no evidence of confusion on the part of actual

consumers, it did present evidence of confusion on the part of Home Depot and DFG

employees and associates. The court held that this evidence of confusion could have

allowed the jury to infer that actual consumers were also confused. District Court

Opinion at 12.

DFG indeed presented no evidence of actual customer confusion at trial. As the

district court noted, the only evidence of confusion shown by DFG at trial related to the

confusion of Home Depot and DFG employees. It is clear from Ninth Circuit precedent

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that the key question in determining actual confusion for the purposes of a secondary

meaning inquiry is whether consumers or “the relevant buying public” are actually

confused. See Japan Telecom, Inc. v. Japan Telecom Am., Inc., 287 F.2d 866, 874

(9th Cir. 2002) (confusion on the part of the buying public is the key to an actual

confusion inquiry). We are aware of no precedent in the Ninth Circuit that would allow

the confusion of “the relevant buying public” to be inferred by testimony from company

employees or associates. The evidence presented at trial by DFG only shows that a

few Home Depot and DFG employees and associates may have been confused as to

the origins of the tree stands at issue in this case. That evidence is not substantial

evidence of actual customer confusion. We therefore disagree with the district court’s

finding that substantial evidence supported the jury’s finding that this factor had been

satisfied.

In sum, with regards to our secondary meaning analysis, given that the only

factor supported by substantial evidence and established by DFG is the length of time

and exclusivity of use of the DFG product design, we find that substantial evidence does

not support the finding that the DFG tree stand had established secondary meaning in

the minds of consumers.6

6
Since we conclude that substantial evidence does not support the jury’s
finding that the DFG tree stand had established secondary meaning in the minds of
consumers, we decline to address whether substantial evidence supported the jury’s
finding that certain aspects of the tree stand are non-functional.

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 CONCLUSION

Because the jury’s finding that the DFG tree stand design had established

secondary meaning in the minds of consumers was not supported by substantial

evidence, we reverse the jury’s verdict of trade dress infringement. Accordingly, MA

and IBC’s appeal regarding the jury’s unfair competition verdict and DFG’s cross-

appeals are denied as moot.

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