1 IN THE SUPREME COURT OF THE UNITED STATES 2 - - - - - - - - - - - - - - - -X 3 TRAFFIX DEVICES, INC., : 4 Petitioner : 5 v. : No. 99-1571 6 MARKETING DISPLAYS, INC. : 7 - - - - - - - - - - - - - - - -X 8 Washington, D.C. 9 Wednesday, November 29, 2000 10 The above-entitled matter came on for oral 11 argument before the Supreme Court of the United States at 12 10:03 a.m. 13 APPEARANCES: 14 JOHN G. ROBERTS, JR., ESQ., Washington, D.C.; on behalf of 15 the Petitioner. 16 LAWRENCE G. WALLACE, ESQ., Deputy Solicitor General, 17 Department of Justice, Washington, D.C.; on behalf of 18 the United States, as amicus curiae, supporting the 19 Petitioner. 20 JOHN A. ARTZ, ESQ., Southfield, Michigan; on behalf of the 21 Respondent. 22 23 24 25 1 1 C O N T E N T S 2 ORAL ARGUMENT OF PAGE 3 JOHN G. ROBERTS, JR., ESQ. 4 On behalf of the Petitioner 3 5 ORAL ARGUMENT OF 6 LAWRENCE G. WALLACE, ESQ. 7 On behalf of the United States, as amicus curiae, 8 supporting the Petitioner 17 9 ORAL ARGUMENT OF 10 JOHN A. ARTZ, ESQ. 11 On behalf of the Respondent 22 12 REBUTTAL ARGUMENT OF 13 JOHN G. ROBERTS, JR., ESQ. 14 On behalf of the Petitioner 51 15 16 17 18 19 20 21 22 23 24 25 2 1 P R O C E E D I N G S 2 (10:03 a.m.) 3 CHIEF JUSTICE REHNQUIST: We'll hear argument 4 now in Number 99-1571, Traffix Devices, Inc. v. Marketing 5 Displays, Inc. 6 Mr. Roberts. 7 ORAL ARGUMENT OF JOHN G. ROBERTS, JR. 8 ON BEHALF OF THE PETITIONER 9 MR. ROBERTS: Thank you, Mr. Chief Justice, and 10 may it please the Court: 11 The president and founder of Marketing Displays, 12 Incorporated, MDI, invented a new type of sign stand, one 13 with a dual-spring design that allowed the stand to resist 14 the wind. MDI patented that invention and, for the term 15 of its patents, MDI labeled its sign stands as patent- 16 protected to warn of copiers, touted in its trade 17 literature the benefit of its, quote, patented dual- 18 spring design, end quote, and when another company, 19 Windproof, tried to market a copy of MDI's patented stand, 20 MDI sued it for patent infringement and won. 21 But then MDI's patents expired, as under the 22 Constitution all patents eventually must. Sometime 23 thereafter, Traffix Devices, the petitioner, copied MDI's 24 stand, added some improvements of its own, and marketed a 25 competing version. No longer armed with its patents, MDI 3 1 tried a new tack to exclude competition. It claimed that 2 the configuration of its stand, the same dual-spring 3 design that it had touted as patent-protected during the 4 term of the patents, was protected as trade dress and 5 could not be copied. 6 QUESTION: Mr. Roberts, how do we determine what 7 the patent covers? Does it -- I mean, I can look at it, 8 but I'm still not sure. I think in the record, in the 9 material here, we have a copy. Does it include in this 10 case the legs and the whole structure, or just the dual 11 spring, and how do we normally determine what the patent 12 covers? 13 MR. ROBERTS: Well, in this case, of course, 14 it's easy to determine that the patent covers this 15 particular sign stand because MDI labeled that sign stand 16 as patent-protected. 17 QUESTION: The whole thing? 18 MR. ROBERTS: The whole sign stand, yes. 19 QUESTION: Legs, spring, and all? 20 MR. ROBERTS: And all, but in its trade 21 literature, for example, it focused on the dual-spring 22 design. That is what makes the invention work. That's 23 what allows it to resist the wind, and it said, this is 24 our patented dual-spring design and, of course, it not 25 only labeled the stands but in its trade literature, and 4 1 in the Windproof case it sued when somebody made an exact 2 replica, the same replica that Traffix Devices -- 3 QUESTION: So under your view of the case, if 4 the legs that the patentee had had a very special color, 5 like the John Deere green or something, that could be 6 copied after the patent ran? Because I notice -- 7 MR. ROBERTS: Well -- 8 QUESTION: -- in the pictures the legs were 9 orange in your client's stand and aluminum in the other. 10 MR. ROBERTS: Well, incidental ornamentation 11 that is not part of what the patent protects does not give 12 rise to the right to copy. There should be an exact 13 symmetry. Whatever the patent had protected as part of 14 the patent bargain, the public has the right to copy. 15 Now, the color of the legs probably would not 16 have been claimed in the patent, and wouldn't have been 17 part of the invention, and therefore it would not give 18 rise to a right to copy that color. 19 QUESTION: In any event, they're different in 20 this -- if I'm looking at the right diagrams the -- your 21 client has a different -- has the orange color. 22 MR. ROBERTS: Well, it depends on which stand is 23 involved. The steel stand is one color and the aluminum 24 stand is another, but in terms of what they claimed in the 25 patent as -- the part that makes the invention work, it's 5 1 not the legs that made this invention. It's not the sign. 2 It is the dual-spring design. That's what they said was 3 patented. When they marketed this, when they had the 4 exclusive right to do so, they focused on that in their 5 trade literature, said this is our patented dual-spring 6 design, and that is the same claim they now raise in their 7 trade dress assertion. 8 QUESTION: But Mr. Roberts, didn't the court of 9 appeals say, at least as I understood it to say, okay, the 10 dual springs Traffix could have, but you have to devise 11 some kind of other stand, curved legs, or a double stand. 12 I thought that's -- 13 MR. ROBERTS: It said we -- it said we basically 14 had to design around their stand. Now, if they said, you 15 could use three springs or four springs, I guess it would 16 never end, five springs, or you could put a little skirt 17 around the springs so people wouldn't see them, or, as 18 Your Honor points out, if you're going to use the springs 19 you have to change something else so it doesn't look like 20 it. 21 But that's not what this Court's cases have 22 held. What the Court has said, Singer and Kellogg and 23 Sears, is that the public has the right to copy the 24 patented invention in precisely the form in which it was 25 practiced, and that's critically important. The idea of 6 1 designing around what had previously been patented is a 2 significant hindrance to competition, and this case is a 3 good example. 4 When we copied the sign we added an important 5 improvement of our own, the step-and-drop leg. Under 6 MDI's stand you have to bend over and pull the pins out. 7 Under ours, you just step and the legs come out. 8 Now, if the rule were the rule that the 9 respondents are arguing for, we would have had to add that 10 new improvement to some different sign stand, but the 11 right to copy attaches to the product as it was practiced 12 during the term of the patent. We don't have to design 13 around their superior stand -- that's why it succeeded in 14 getting the patent -- to add improvements of our own. 15 QUESTION: Does it depend in part on how we 16 define functionality under the trade dress inquiry? 17 MR. ROBERTS: We think there is a freestanding 18 right to copy from an expired patent, that it doesn't 19 depend upon what functionality is. 20 QUESTION: And you think that there can never be 21 a trade dress protection in some aspect of an expired 22 patented item? 23 MR. ROBERTS: If the item was simply incidental 24 ornamentation -- one of their amici used the example, if 25 you're patenting a chair and the drawing shows a purple 7 1 bow. Well, we don't think there's a right to copy the 2 purple bow, because the purple bow is not covered. That's 3 not the invention. 4 QUESTION: So there could be a trade dress in an 5 expired patented item. 6 MR. ROBERTS: In the item itself, yes, but not 7 in the subject of the patent. 8 QUESTION: And I suppose that depends on how we 9 define functionality, in a sense. 10 MR. ROBERTS: Functionality I think leads to the 11 same place that we come to from looking at patent law, if 12 you define functionality as it has traditionally been 13 defined, as turning on usefulness. 14 If functional -- if functional means useful, 15 then our case comes out the same way, because you have to 16 be useful to get a patent, and if it's been the subject of 17 a patent, the feature has been useful, therefore it's 18 functional, therefore it's not eligible for trade dress 19 protection. 20 QUESTION: Justice O'Connor's question suggests 21 this to me. You're arguing for the rule that you maintain 22 here so that you will not have to litigate functionality. 23 MR. ROBERTS: Exactly, and functionality -- 24 QUESTION: But why isn't functionality 25 sufficient protection, particularly in this case? 8 1 MR. ROBERTS: Functionality is sufficient if 2 functionality means useful, but if functionality means, as 3 the lower court said in this case, something for which 4 there is a competitive need, or for which there are not 5 available alternatives, and there's a multi-factor 6 balancing test to determine so-called legal 7 functionality -- 8 QUESTION: Well, I guess the court, the Sixth 9 Circuit pulled that out of Qualitex' opinion. 10 MR. ROBERTS: Well, we -- 11 QUESTION: The competitive need. 12 MR. ROBERTS: I don't think Qualitex opined on 13 the exact definition of functionality in this case, or it 14 was misread by the lower court. The definition in 15 Qualitex had a very important connector there. It said, a 16 useful product feature, or, and then it went on to talk 17 about competitive need, so -- 18 QUESTION: So as far as you're concerned, if 19 it's useful, then it's functional? 20 MR. ROBERTS: Period, without regard to 21 competitive need, available alternatives -- MDI's position 22 is, look, you can make a sign that stands up to the wind 23 that's just as good as our sign stand, so don't make it 24 the way we made it, but the patent, the expired patent 25 gives us the right to copy -- 9 1 QUESTION: Well, it gives you -- this -- I think 2 my question is related to Justice O'Connor's, and this is 3 a problem that I have in understanding, and maybe you can 4 help me. You have a right to copy the invention. Does it 5 follow that you have a right to copy the configuration 6 that that invention took in the hands of the patent 7 holder? 8 MR. ROBERTS: I think Justice Brandeis' opinion 9 in Kellogg answers that. Kellogg did not have to show 10 that there was no way to make or sell shredded wheat other 11 than in the pillow-shaped biscuit form that Nabisco had 12 made famous when it had its patent. It was enough that 13 that was the form in which Nabisco had practiced its 14 patent. Kellogg therefore could copy it, even though they 15 could have made shredded wheat some other way, and that's 16 important precisely because of the purpose of the patent 17 bargain to promote competition. 18 As I said, why -- if we have an improvement to 19 this sign stand, the step-and-drop legs, why should we 20 have to add it only to a very different sign stand? It's 21 the commercially proven version that the public has the 22 right to copy. That is important to enhance competition. 23 To require people, if they're going to make improvements, 24 to design around the form that the public had become 25 accustomed to, would inhibit competition, and -- 10 1 QUESTION: If we were dealing, Mr. Roberts, with 2 just the patent law, that would be one thing and, as I 3 understand it, although it's confusing, the word useful is 4 a patent term of art and functionality is a trade dress 5 term of art, but you're trying now to equate these two 6 terms in answer to questions that you've had as one and 7 the same, but they have different purposes, as I 8 understand it, in the patent law, the idea of useful, 9 trade dress, the idea of functionality. 10 You recite the old cases like Kellogg. It's 11 been argued that on the trade dress side the law has 12 evolved since those old cases, and it's now, trade dress 13 gets more protection. 14 MR. ROBERTS: Yes. You're dealing with what is 15 in the trade dress area essentially judge-made law, and it 16 has expanded in various ways, and functionality -- it 17 doesn't interfere with the patent bargain if functionality 18 means a broad range of other things, but so long as it is 19 also satisfied completely by a demonstration that it is a 20 useful product feature. 21 There may be other limitations on a trade dress 22 claim going to competitive need, available alternatives, 23 any of the various multi-factor tests, but if 24 functionality is going to serve the purpose of demarking 25 the regime of trademark and trade dress and patent law, it 11 1 must be satisfied by a showing that it is a useful product 2 feature and in our case that's significant, because you 3 can't get a utility patent as MDI had, without showing 4 that it's a useful product feature, so the fact that they 5 had a utility patent, that it covered the dual-spring 6 design, should be enough to establish functionality and 7 therefore should be enough to reject their trade dress 8 claim. 9 QUESTION: Do you agree that at least one basis 10 on which we could decide this case would simply be on the 11 basis of how expensive a concept of configuration trade 12 dress we want, because if we take your position, 13 configuration trade dress is going to be, at least in 14 formally patented matters, a pretty narrow concept, and if 15 we're going to have coherence within the concept of 16 configuration trade dress, we're going to have to make it 17 equally narrow. 18 I mean, we can't have different functionality 19 tests, I presume, and if on the other hand we find good 20 reason to think configuration trade dress is desirable, 21 then we're going to go the other way with a different 22 concept of functionality, I suppose. 23 MR. ROBERTS: I think it is the expansion of the 24 concept of configuration trade dress that has given rise 25 to this issue and the problem. If you go back to where 12 1 trademark was limited to marks on the product, of course, 2 the product could be patented, the trademark is fine. If 3 you even then go the next step, and you're talking about 4 trade dress and packaging, again, so long as it's distinct 5 from the product, there's no interference with patent. 6 But when you start saying that the configuration 7 of the product itself is entitled to protection as trade 8 dress, you bump right into the patent law, because the key 9 to the patent bargain is, if you're going to control a 10 useful product feature, as the Court said in Qualitex, 11 that's the regime of patent law, and it's no answer to 12 say, well, we're protected by patent law and when the 13 patent expires we're protected under trade dress law, 14 because that takes away the public's half of the patent 15 bargain. We're giving exclusive right to an inventor for 16 a term of years on the condition that he or she disclose 17 what the invention is, and that the public obtains a right 18 to copy it when the patent expires. 19 So yes, I mean, it is the expansion of product 20 configuration trade dress that has given rise to this 21 problem, and I would at least suggest that the Court 22 should not get on board with that expansion without 23 waiting for Congress to say something about it, 24 particularly given the fact that it so directly impinges 25 upon the central patent bargain underlying the patent 13 1 system. 2 QUESTION: Of course, Mr. Roberts, you rely 3 heavily on the patent in this case, and that's the 4 question presented. You've presented only that narrow 5 question. But I take it you would argue even if there had 6 been no patent issued in this case, no patent application, 7 that this was nevertheless functional? 8 MR. ROBERTS: Certainly, yes, and -- 9 QUESTION: The fact of the patent really is just 10 evidentiary support for the ultimate conclusion that this 11 is a functional feature. 12 MR. ROBERTS: Well, it gives rise to an 13 important distinction. In other words, having been 14 covered by the patent, another producer knows that when it 15 comes off patent he can copy it, and that's how it worked 16 in this case. Traffix Devices knew -- they were in the 17 business -- this was a patented sign stand, they couldn't 18 make it, it comes off patent, they can make it. 19 Now, if they at that point had to -- instead, if 20 respondent's position were adopted, they had to go to 21 their lawyer and say, is this legally functional, their 22 lawyer would tell them, well, it depends. There are six 23 factors in this circuit, there are eight factors in the 24 other circuit. We've got to get expert economic 25 testimony. It depends on consumer surveys. By that time 14 1 the producer says, forget it, it's not worth the candle, 2 I'll go make something else, and competition suffers. 3 QUESTION: The difficulty, I guess is, would you 4 make the test absolute, because if you make it absolute, 5 you know, you're going to get into huge litigation about 6 whether this thing in the patent was or it was not an 7 essential element, and then somebody will say, oh yeah, I 8 guess I did include it as one of the specifications in the 9 patent, but it really wasn't that important. 10 I mean, should you make it absolute never, or 11 should you allow somebody to defend on the ground that, 12 look, it wasn't that crucial to the patent, and 13 everybody's come to identify it, and please let me make an 14 exception here, and then they give some fabulous reasons. 15 Should it be absolute, or leave them a little bit of a 16 loophole? 17 MR. ROBERTS: Well, you know, a little bit of a 18 loophole suddenly expands, particularly when you have a 19 multi -- 20 QUESTION: But it goes both ways, because if you 21 allow no loophole you're going to get the same kind of 22 arguments about whether it was or was not an essential 23 part of a patent. 24 MR. ROBERTS: Well, of course, in this case it's 25 easy. The key to the invention -- 15 1 QUESTION: In this case it may be easy, but the 2 question is, what about the rule? 3 MR. ROBERTS: -- and producers all the time 4 compete all the time in the confines of patents. They 5 have to look at a patent and decide, can I make a 6 competing product or not, so it's not a new inquiry, and 7 in the typical case such as this, where you have a product 8 coming off patent, you will have the conduct of the 9 patentee, which will illuminate exactly what he thought 10 was covered. Here, we not only have the labeling and the 11 trade literature, we have the Windproof litigation. 12 Someone made the exact same sign here and he said, a-ha, 13 that infringes my patent. Well, if it did infringe his 14 patent, and the Ninth Circuit concluded it did, then the 15 public has a right to copy. 16 I'd like to reserve -- 17 QUESTION: Wasn't the exact same sign -- I 18 thought one of the points that was made was that in the 19 patent infringement case, that sign didn't look as much 20 like the Market Display signs -- 21 MR. ROBERTS: Yes. The patent displays what 22 they call a business sign, with two springs far apart. 23 The Traffix sign, the one at issue in Windproof and at 24 issue here, the springs are closely together. 25 MDI argued successfully that made no difference, 16 1 that the two closely spaced springs were covered by the 2 patent to the same extent as the farther apart springs. 3 Thank you, Your Honor. 4 QUESTION: Very well, Mr. Roberts. Mr. Wallace, 5 we'll hear from you. 6 ORAL ARGUMENT OF LAWRENCE G. WALLACE 7 ON BEHALF OF THE UNITED STATES, AS AMICUS CURIAE, 8 SUPPORTING THE PETITIONER 9 MR. WALLACE: Thank you, Mr. Chief Justice, and 10 may it please the Court: 11 Our brief is built on the premise that the 12 functionality doctrine, the traditional functionality 13 doctrine of trademark law is what makes trademark 14 protection of trade dress and other symbolic elements 15 consistent with this Court's patent law jurisprudence, as 16 synthesized and reaffirmed as recently as the Bonito Boats 17 case, but I think part of the reason the two laws 18 harmonize is because the use of functionality doctrine is 19 to limit the scope of protection of the device. 20 Its traditional function was to bar the holder 21 of a patent or other utilitarian device, even if 22 nonpatented, from withdrawing that device from the public 23 domain when there's no longer the protection of the patent 24 as trade -- withdrawing it from the public domain as trade 25 dress because people have a right to practice and use as 17 1 the building blocks for further innovation whatever 2 devices are in the public domain that are utilitarian in 3 nature, including their overall configuration, but there 4 is still protection against confusing similarity through 5 requirements of labeling, packaging, avoiding palming off 6 and other misrepresentations. 7 Functionality really goes to the scope of 8 protection, and limits the scope of protection available 9 under trademark law by preventing someone from 10 monopolizing and withdrawing from the public domain 11 utilitarian features or the entire utilitarian device in 12 the absence of valid patent protection. That is the 13 domain of patent law, and one must qualify for a patent 14 and have a valid patent in order to have a legal monopoly 15 that withdraws, that prevents others from using the 16 device, but there -- as I say, these other protections are 17 still available as well as the ability to exclude 18 ornamental or incidental features. That is what to us 19 harmonizes the two statutory schemes. 20 The traditional understanding of functionality 21 was not an artificial concept. It was the ordinary 22 meaning of the word. What enables the device to function 23 is what is functional. That was reflected in a very terse 24 quotation we have in a footnote on page 17 of our brief by 25 Representative Lanham himself, when someone raised 18 1 concerns about whether the trademark law might result in 2 compromising of the public's right to use useful 3 inventions, and he said -- 4 QUESTION: Mr. Wallace, may I ask if you would 5 answer the question that Justice Stevens posed to Mr. 6 Roberts in the same way? That is, the definition you're 7 now giving us as functional sounds like you would come out 8 the same way on this alleged trade dress infringement, 9 even if there had never been any patent in the picture, 10 because this sign, all the ingredients are functional. 11 There's no purple bow on it. 12 MR. WALLACE: That is absolutely correct. We 13 would come out the same way as we were -- I think this 14 Court's decision in Bonito Boats is an example of that, 15 because there was no patent shown in the record, as the 16 court noted, of the boat hull that they said could not be 17 copied. 18 QUESTION: So your position is the utilitarian 19 feature of the patent is a conclusive presumption in a 20 trade dress suit where functionality would otherwise be at 21 issue? 22 MR. WALLACE: With regard to the scope of 23 protection, that others cannot be excluded from using 24 something utilitarian. 25 As we compressed our brief down to our allotted 19 1 30 pages we carefully preserved a quotation on page 11 2 that you can see at the top of the page from the 1917, or 3 1911, excuse me, Seventh Circuit decision because it 4 states the common sense of it. If you have utilitarian 5 features that didn't even meet the standard for getting a 6 patent, they should not be given a perpetual monopoly in 7 contrast to what was then the 17-year monopoly that you 8 could get if you met the criteria for patentability. 9 The other protections available against 10 confusing similarity make the need for a right to exclude 11 imitation of trade dress relatively unimportant compared 12 to the policies this Court has reiterated at least since 13 1896 in the Singer case about the need for utilitarian 14 features to be used as building blocks and to be in the 15 public domain except for the limited period of time in 16 which they are protected by a valid and unexpired patent, 17 and we understand this Court's decision in Qualitex to 18 mean much the same thing. 19 The difficulty has arisen because an alternative 20 test of functionality has also become appropriate as the 21 scope of trademark protection has extended to matters that 22 don't have utilitarian features to them. We point 23 particularly to the protection of color as an example, 24 where there is relevance to looking at competitive need 25 in -- we give an example in our brief of an orange-colored 20 1 can of soda. 2 There were other amicus submissions in the 3 Qualitex case in which people were making claims that 4 raised issues that went quite beyond what was involved in 5 the press pad that was at issue in Qualitex. One of them, 6 for example, involved orange-colored sprinkler system 7 piping. Well, it raised other questions. I don't say the 8 result would necessarily be different, but one would have 9 to examine whether a competitor who wanted to compete for 10 replacing a portion of the piping would be disadvantaged 11 if he couldn't match the color of it. 12 It was a different case from the Federal 13 Circuit's Corning, Owens-Corning case involving the pink- 14 colored insulation, because that goes behind the wall and 15 people don't see it. The orange coloring in some contexts 16 connotes danger, and perhaps there is marketing 17 significance to that. 18 But the mistake that I think some of the courts 19 of appeals have made, including the Sixth Circuit in this 20 case, is to say that that is now the exclusive approach, 21 and you wind up with multi-factored tests that don't 22 really give an adequate guidance to what the law is. 23 A very good example is found on page 17 of the 24 light green amicus brief filed by the International 25 Trademark Association in this case, in which they speak 21 1 approvingly of various multi-factored tests that the 2 courts of appeals have adopted in this area, which leaves 3 open what this Court in its salutary opinion in Wal-Mart 4 v. Samara Brothers referred to as the plausible threat of 5 litigation which can discourage competitors and become an 6 impediment to the benefits that consumers would get from 7 competition, and to have tests of this kind applied to 8 displace the traditional approach to functionality would 9 be very detrimental to competitors for the very reasons 10 the Court has recognized in the cases synthesized in the 11 Bonito Boats opinion. 12 QUESTION: Mr. Wallace, I'm not sure what your 13 proposal is, that we use the simple test for what, for 14 useful features -- 15 MR. WALLACE: That -- 16 QUESTION: -- whether or not they are patented, 17 and the more complex test for -- for what? 18 MR. WALLACE: Both -- either test can show that 19 something is functional, whichever one suits the needs of 20 the particular factual situation. 21 QUESTION: Thank you, Mr. Wallace. 22 Mr. Artz, we'll hear from you. 23 ORAL ARGUMENT OF JOHN A. ARTZ 24 ON BEHALF OF THE RESPONDENT 25 MR. ARTZ: Mr. Chief Justice, and may it please 22 1 the Court: 2 This Court granted certiorari due to a conflict 3 between regional courts of appeals on one issue, and that 4 is whether or not the visual image and appearance of a 5 product -- with a product whose operation and performance 6 was covered by a utility patent, can still be protected as 7 trade dress under section 43(a) of the Lanham Act. The 8 imposition of any per se rule, whether the Government's 9 rule or Traffix rule, which says it cannot be protected in 10 my opinion is unnecessary, unjustified, and unworkable. 11 It's unnecessary because there are already 12 adequate rules in place, the trade dress rules and 13 functionality that have been referred to already. It's 14 unjustified because it would cause harm to the public's 15 right not to be confused or deceived. Those are paramount 16 in trade dress and trademark cases under the Lanham Act. 17 That's a touchstone of the Lanham Act. It would also -- 18 QUESTION: It's a touchstone of patent law that 19 an expired patent can be copied, so we really do have to 20 make the two doctrines mesh well. 21 MR. ARTZ: Yes. 22 QUESTION: And the concern we have is with this 23 expanded competitive need test that some of the lower 24 courts have begun employing, and I am quite interested to 25 know how you think the two doctrines can fit neatly 23 1 together, because in an ideal world a trade dress could 2 not cover something that was covered by a patent that's 3 now expired. 4 MR. ARTZ: Well, Justice O'Connor, the mediating 5 factor between the two is the functionality test, in my 6 opinion. There's -- you've got the patent laws, you've 7 got the trademark laws and the Lanham Act, two federal 8 laws -- 9 QUESTION: And it's possible that some of the 10 courts have lowered the bar too much on the functionality 11 inquiry. I mean, I think that's what we need to look at. 12 MR. ARTZ: Well, in the Qualitex case, the 13 Qualitex gave a specific definition of functionality, and 14 remember now, in 1998-1999, Congress made some amendments 15 to the trademark act, or Lanham Act, and in this they 16 specifically mentioned functionality several times. 17 They added it to the fact that you can't have 18 functional trademarks -- you can't have trademark that's 19 functional but if it's nonfunctional you can, and they 20 knew about the Vornado case at that time because it was 21 decided in 1995, and that's the Tenth Circuit, and there's 22 a lot of flurry of activity in the intellectual property 23 bar because of that, so all that was before Congress when 24 it amended it, and Congress did not go to any per se test 25 at that time, and so you've got two Federal laws here, and 24 1 under the Morton case and the Ruckelshaus case which are 2 cited. 3 QUESTION: Is there evidence, Mr. Artz, that 4 Congress affirmatively approved the Tenth Circuit case? 5 MR. ARTZ: No, they did not. I mean, because 6 they -- what they -- they actually -- the legislative 7 history mentions the fact that their patent expiration, 8 and people might be trying to get trademark protection 9 after the expiration of the patent, and then they go on to 10 add functionality. 11 QUESTION: Well, I -- you -- I thought part of 12 your argument was that the Tenth Circuit had decided this 13 case in 1995 and it was quote, before, close quote, 14 Congress at the time it made the amendments. What is the 15 purport of that? 16 MR. ARTZ: Well, what I'm saying is, in 1995 17 that Vornado case was there, and in 1998 Congress amended 18 the trademark act. Now, there's no legislative history 19 that I can see that actually mentioned the Vornado case. 20 I'm saying that it probably -- 21 QUESTION: But you're not -- you're arguing, I 22 hope, something more than post hoc ergo propter hoc. 23 MR. ARTZ: Yes. Yes, I am, Your Honor. 24 QUESTION: Would you go back to Justice 25 O'Connor, which I thought was the key question, and I 25 1 didn't -- 2 MR. ARTZ: Yes. 3 QUESTION: -- hear the answer. I mean, I know 4 Qualitex. I'm surprised not at your reading, because 5 that's your job, but I'm pretty surprised at the Tenth 6 Circuit, the court, which -- I learned you read the whole 7 case, what the context is not just a sentence taken out of 8 context, so I obviously thought that Qualitex was about a 9 doctrine called aesthetic functionality. 10 I thought, on page 165 where the court quotes 11 the tradition, what's in quotes, the definition, a product 12 feature is functional if it is essential to the use or 13 purpose of this article, all in quotes, or if it affects 14 the cost or quality of the article, okay, end of the 15 matter. Now it adds, because that's what happens to be 16 relevant to aesthetic functionality, that is, if exclusive 17 use of the feature would put competitors at a significant 18 nonreputational disadvantage. That last clause is 19 relevant to what happens to be the subject of this case, 20 called aesthetic functionality. 21 MR. ARTZ: Yes, Your Honor. 22 QUESTION: Two pages later, in case that wasn't 23 clear, the case quotes Restatement Third about aesthetic 24 functionality and says, in respect to aesthetic 25 functionality, i.e., color, quote, the ultimate test is 26 1 whether the recognition of trademark rights would 2 significantly hinder competition, all right. 3 MR. ARTZ: Yes. 4 QUESTION: But nothing in the case -- 5 MR. ARTZ: No. 6 QUESTION: -- purports to change any earlier 7 test in respect to anything else -- 8 MR. ARTZ: Well, that's -- 9 QUESTION: -- or even change anything there, so 10 as I read the case that seemed to be its reading, which 11 would say in this case, which isn't about aesthetic 12 functionality, we apply what is the traditional test. 13 MR. ARTZ: Well, every case which has actually 14 looked at functionality actually has come up with the 15 result that the Sixth Circuit did, the Seventh Circuit 16 did -- 17 QUESTION: Maybe, but I thought the place you 18 look for a test is in the Supreme Court opinions, and in 19 the Supreme Court opinions, Qualitex quotes the 20 traditional test. It didn't make it up. 21 MR. ARTZ: That's correct. 22 QUESTION: It said, in general terms a product 23 feature is functional if it is essential to the use or 24 purpose of this article, or it affects the cost or quality 25 of the article. That's all in quotes. The rest is 27 1 explanation as applied here. 2 So if we take that as the test, why isn't that 3 the test? 4 MR. ARTZ: Well, the Supreme Court goes on in 5 the Qualitex case and says, that is -- that is, if 6 exclusive use of the feature would put competitors at a 7 significant nonreputational related disadvantage. 8 QUESTION: Well, that was my question. My 9 question was as to that add-on, doesn't that have to do 10 with an explanation of the test as relevant to the issue 11 before the Court in Qualitex -- 12 MR. ARTZ: I think that -- 13 QUESTION: -- namely, aesthetic functionality, 14 which is an aspect of quality I think people could argue 15 about. 16 MR. ARTZ: I think that is the test, Your Honor, 17 whether or not -- 18 QUESTION: The test in the case of aesthetic 19 functionality? 20 MR. ARTZ: Yes. 21 QUESTION: Fine. Is this a case of aesthetic 22 functionality? 23 MR. ARTZ: I believe it is, yes. 24 QUESTION: Aesthetic? It involves color? 25 MR. ARTZ: It involves how things look, the 28 1 appearance, visual -- 2 QUESTION: Everything in design involves how 3 things look. 4 MR. ARTZ: Okay. 5 QUESTION: I mean, that's -- 6 MR. ARTZ: Well, it's aesthetic in that sense, 7 but it's not -- it doesn't involve color, no, it does not. 8 It's not like the color that was allowed in the Qualitex 9 case, but I think that is the test. 10 QUESTION: It involves size and shape, and this 11 discussion about Qualitex and aesthetic functionality 12 doesn't get into what effect the patents, if any, has on 13 functionality, and in your view does the patent -- your 14 having had a patent, building up goodwill, free, over 20 15 years, nobody can compete with that, so if you've got 16 secondary meaning it's because you have been able to keep 17 everybody off. 18 We've been dealing with cases in your discussion 19 where there was no patent in the picture. How should the 20 fact that there was a patent bear on the inquiry that was 21 made in cases where there was no patent? 22 MR. ARTZ: Justice Ginsburg, I think that the 23 case, Midwest case by the Federal Circuit, the Thomas & 24 Betts case of the Seventh Circuit, our case, Sixth 25 Circuit, and the Sunbeam case, Fifth Circuit, all apply 29 1 the proper test. There are different forms of 2 intellectual property laws, or IP laws, as I call them, 3 you've got five different basically Federal laws on 4 intellectual property, patents, copyrights, trademarks, 5 trade dress, unfair competition. They're all separate and 6 distinct. 7 The fact that you have a patent on something, 8 that is different than whether or not you can have a trade 9 dress on something. Patent would be relevant in the sense 10 that under this commercial necessity test, if there's only 11 one way to make that product, that was look and 12 experience, then it's functional, and so in that sense the 13 functionality test would apply and the patent, if it says 14 something about the functionality, that would be relevant 15 to the functionality test in the trade dress area, but 16 they're separate and distinct, and they always have. 17 Design patents, for example -- 18 QUESTION: They may be separate and distinct, 19 but they bear upon one another, and there seems to be 20 something horribly unfair about allowing someone who has 21 acquired a secondary meaning in the trade dress only 22 because of the patent -- let's say the shape of a Coca- 23 Cola bottle. 24 I mean, you know, if that wasn't patented, 25 somebody else could have come out with the same shape 30 1 bottle as soon as it -- you know, as soon as the first 2 ones came off the line they could say, gee, that's a nice- 3 looking bottle, and they could have copied it, but you 4 couldn't copy it because it was patented, and therefore, 5 by reason of the patent, for 17 years Coca-Cola acquires a 6 secondary meaning. Anyone who sees that bottle would say, 7 it's Coca-Cola. 8 Then, when the patent expires, Coca-Cola in 9 effect extends the patent by parlaying what was the design 10 patent into what is now trade dress protection, because 11 they say, well, gee, everybody knows that that's a Coca- 12 Cola bottle, but the only reason they know is because 13 you've been given a monopoly for 17 years, and it doesn't 14 seem right to enable you to extend that monopoly 15 indefinitely. The only reason you acquired the secondary 16 meaning was because of the patent. That's unlike other 17 companies that get secondary meanings without a patent. 18 Doesn't there seem any incompatibility with the patent law 19 to you? 20 MR. ARTZ: No, I don't think it's unfair at all, 21 Your Honor. I think they're separate and distinct. 22 I agree that perhaps, if you have this 17-year 23 monopoly on this patent, that might help you on the trade 24 dress area with respect to secondary meaning, but then, of 25 course, just as we found here, the functionality test, the 31 1 fact that you had a patent on it actually hurts you. It 2 might be a wash between those two. 3 The trade dress has three separate and distinct 4 tests. You have to show it's distinctive -- in other 5 words, it has secondary meaning -- and the public 6 recognizes it as something which comes from a certain 7 source. It's a source identifier. You have to show it's 8 nonfunctional. However, trademark law has been amended, 9 which specifically says you have that burden of proof if 10 it's unregistered. You have to show it's nonfunctional. 11 Under the Qualitex case in my opinion you have to show 12 whether it's competitive necessity, then you've got to 13 show whether there's a likelihood of confusion. 14 You may have a product that looks exactly the 15 same as yours, but if you can't show there's a likelihood 16 of confusion, you don't win. You need all three of those 17 tests in the trade dress area. 18 QUESTION: There's a problem -- 19 QUESTION: Well, it's the second that we're 20 arguing about, I think. I think it's the second, when you 21 have to show that it's functional, and I find it hard to 22 think that it's not functional when you have a patent on 23 it. You only give patents to things that are functional. 24 MR. ARTZ: I think functionality, Your Honor, 25 legal functionality is really a misnomer, like I believe 32 1 in the Wal-Mart case the secondary meaning was looked at 2 as being a misnomer. It was really acquired meaning, 3 acquired meaning afterwards. Legal functionality really 4 is a misnomer. 5 Every product has a function. The Coke bottle 6 has a function, obviously. It's useful, has a purpose. 7 It's got a flat bottom so it doesn't tip over. It's got a 8 narrow waist so you can grab it, a narrow spout so you can 9 drink it easier, it's clear so you can see it. Those are 10 all functional, useful, purposeful. 11 QUESTION: Aesthetic functionality isn't 12 conceivably in this case. They're the ones that argue 13 functionality, not you. They're the ones that say that 14 the product is functional. They're not saying that the 15 functionality of your product arises from the way it 16 looks. They're not saying, like color, it warns people 17 that the boat's black. 18 They're saying that the functionality of the 19 product is that the springs prevent it from twisting in 20 the wind. Now, that isn't a claim of aesthetic 21 functionality, and I don't see how you could even closely 22 claim that it is. 23 MR. ARTZ: Well, I think the functionality test 24 that's been developed in Qualitex applies to any type of 25 trade dress -- 33 1 QUESTION: Ah, wait. I thought what you said 2 is, you agreed with me before that Qualitex is talking 3 about aesthetic functionality, that we apply the normal 4 test without that little add-on, but we apply Restatement 5 Three, the aesthetic functionality test, which is the add- 6 on, where they make the claim that the reason this product 7 is functional is because of the way it looks, i.e., the 8 pipes are painted orange as a warning, which is not their 9 claim in this case. 10 Am I -- now, where am I wrong in that? 11 MR. ARTZ: I think the test that's set forth in 12 Qualitex that Your Honor says is for just aesthetic 13 functionality applies in every functionality test. I 14 think that's the difference. 15 QUESTION: So then the pages written at 169 and 16 170, and trying to explain just what we're driving at are 17 sort of beside the point. 18 MR. ARTZ: Yes. It says in general terms a 19 product feature is functional and cannot serve if, and 20 then you say it's essential to use or purpose. I mean, 21 that's broad and ambiguous. Everything has a use or 22 purpose, and then you say, if it affects the cost or 23 quality. Virtually everything affects the cost or 24 quality, so it seems to me the only objective test you 25 have here, because it relates to competitors and 34 1 consumers, is whether or not it puts competitors at a 2 significant disadvantage in the marketplace. 3 QUESTION: Can we apply that test, because I'm 4 having a little trouble connecting to the real world and 5 the device before us and these multi-factor tests and even 6 what you've just been saying. 7 Tell me what it is in your formerly patented 8 device that Traffix can copy now that the patent has 9 expired. Can it make a sign with those two coil springs 10 adjacent to each other? 11 MR. ARTZ: Yes, it can, Your Honor. 12 QUESTION: If you could describe to me what it 13 can copy and what it must change I would have a more 14 secure handle on what your case is. 15 MR. ARTZ: Our trade dress, Your Honor, it's 16 really a combination of five features. It's got your X- 17 shaped legs, a narrow base, a pair of upright vertical 18 coil springs, an upright attached to that, as well as this 19 diamond-shaped sign above it, and I have a model of it 20 that actually shows what it is here. This is in the 21 record before the court of appeals. 22 Now, they could change any one of those. They 23 could keep the coil springs if they change some other 24 configuration to make it look different, to give it a 25 visual -- different visual appearance. Like, right now, 35 1 even the vice president and their technical expert say 2 that when they see a sign like this one driving along the 3 road, they know it comes from Marketing Displays. They 4 know it's a Windmaster. 5 QUESTION: But there aren't that many things to 6 adjust. I mean, one of the things about Qualitex and the 7 green/gold you could have tan/silver, any number of 8 combinations that would serve that purpose, but for that 9 road sign that's not going to blow in the wind you have to 10 have those springs, and you have to have some kind of 11 base, and there aren't that many variations. 12 QUESTION: And the law requires the shape of the 13 sign. I mean, in many States that shape of a sign 14 indicates a certain type of warning, so what's left? 15 There's nothing left but the legs, and -- 16 MR. ARTZ: You have -- 17 QUESTION: And your friend over there says that 18 they changed the legs. They did change the legs. 19 MR. ARTZ: Now -- 20 QUESTION: Somebody who sees their legs say, 21 gee, it has the -- what do you call them -- step-down 22 legs, or whatever it is, so the one thing it seemed to me 23 that they could have changed, they did change. 24 MR. ARTZ: No, they kept the same visual 25 appearance and image, Your Honor. 36 1 This was what the patent covered with a product 2 such as this. They could have gone to something like 3 this, with a wide base, a pair of springs way apart, they 4 could have gone to straight legs like this, they could 5 have gone to an upright like this, rather than this, and 6 attached the sign to it. 7 This is what the patent covered. This is what 8 was shown in the patent. This is only found to infringe, 9 under the doctrine of equivalents, which took several 10 years and several thousands of dollars for MDI to prove 11 it, and that's the problem with a per se test. 12 QUESTION: Because that one in your right hand 13 probably works better. 14 MR. ARTZ: I think so. 15 (Laughter.) 16 QUESTION: Yes, and that's why they wanted to 17 copy it, and not something that worked less well. 18 MR. ARTZ: Well, the thing here is a competitive 19 necessity test. I think it's important, because there are 20 really, like, eight competitors in this marketplace, MDI, 21 Traffix, and six others. Six others all came up with sign 22 stands which looked different. They have different spring 23 mechanisms in particular. There's flat springs, 24 horizontal spring, there's a torsion spring, and so 25 Traffix said, I had to copy MDI's, yet all the other 37 1 competitors made their own design. They came up with sign 2 stands which look different. They have different visual 3 appearance. So there are seven types of sign stands out 4 there, MDI's, six others, and then Traffix'. 5 QUESTION: You know, I have to confess that 6 I'm -- I find it a little difficult to imagine that most 7 motorists are looking at what -- the legs of the sign 8 instead of the message on the sign. 9 (Laughter.) 10 QUESTION: I find it hard to believe that people 11 really identify with two legs or three. I don't have the 12 slightest idea how many legs there were on most of the 13 signs I've looked at when I was driving along. 14 QUESTION: I've been looking in the last week. 15 It's very interesting. 16 (Laughter.) 17 QUESTION: I gather you don't care about the 18 motorists. You just care about the highway purchasing 19 departments. 20 MR. ARTZ: That's it, yes. 21 QUESTION: Right? 22 MR. ARTZ: It does -- confusion as to the 23 purchaser, who the relevant purchasers -- 24 QUESTION: You couldn't care less about the 25 motorists. You just want to sell the signs. 38 1 (Laughter.) 2 QUESTION: Could I ask you a question about the 3 patent part? I'd like to ask you about the patent part, 4 and will you assume for purpose of this that Qualitex is 5 about color, which is a matter that doesn't easily fit 6 within the terms, you know, purpose, use, cost or quality, 7 and suppose here we're dealing with something that does 8 easily fit within those terms, all right, so keep Qualitex 9 out of it. 10 Now, assuming that that's so, what would be 11 wrong -- and they come in and they say, look, these 12 springs are part of the function. They're part of the 13 function. They're essential to the use, these springs, in 14 this way. 15 Now, should there be an absolute presumption 16 that if you one day said -- I'm not saying what you did 17 say, but we'll assume this. If you one day said in the 18 patent application, I have a great idea here, and my idea 19 is to have two springs just like this, and then later on, 20 when it's expired, they say, that was the heart of it. It 21 was useful. Should the fact that you said that one day in 22 the patent be the end of the matter, nobody ever looks 23 further? 24 There is a -- what the Government said here is 25 where as an expired utility patent discloses that the 39 1 feature alleges trade dress contributes to the operation 2 of the formerly patented device, the feature must be 3 considered function. Now, that's the Government's 4 suggestion. 5 MR. ARTZ: Okay. 6 QUESTION: All right. Now, you can of course 7 argue that wasn't essential, et cetera, but my problem's a 8 general one, leaving this case out of it. Should that be 9 the test? 10 MR. ARTZ: No, it should not be the test. 11 QUESTION: Because? 12 MR. ARTZ: Because I think what you say in the 13 patent could be relevant, and the patent obviously is 14 going to be put into every trade dress case, and that is 15 one of the reasons I think that trade dress tests, that 16 their absolute test is unworkable, because in every 17 trademark case now what you're going to have is, a 18 defendant's going to run out and scour the 5 million 19 expired patents, find one which has a claim which may read 20 on this trade dress, accused trade dress and say, a-ha, 21 it's dedicated to the public on this other, somebody 22 else's patent. 23 See, one of the things that -- 24 QUESTION: It would seem to me that would be, 25 even under your rule, a -- well, maybe not under your, but 40 1 under the Government's rule, quite an appropriate thing to 2 do, to show that there is functionality that the patent 3 office has recognized. 4 MR. ARTZ: Well, again I don't want you to 5 confuse legal functionality with something that's useful 6 in purpose, because legal functionality is different. 7 It's a legal test. It means, as in the Qualitex case, I 8 believe, or it means what is competitive necessity to use 9 it, and just now, recently, in the 1998-1999, Congress 10 made amendments to the Lanham Act and it did not go for an 11 absolute test. It did not go for a test for use or 12 purpose. What it did, it just said, if it's -- you know, 13 burden of proof of functionality is going to be on the 14 party saying it's nonfunctional. 15 QUESTION: Mr. Artz -- 16 MR. ARTZ: Yes. 17 QUESTION: -- I hadn't realized it, you are not 18 complaining about their use of the double spring feature. 19 That's not the complaint. You said they could have -- 20 MR. ARTZ: No. 21 QUESTION: -- used the double springs if they 22 had put them separate -- 23 MR. ARTZ: Yes. 24 QUESTION: -- separately and apart. 25 MR. ARTZ: -- possibly, in a bit different 41 1 visual image and appearance, Your Honor. 2 QUESTION: And the double springs next to each 3 other was not part of your original patent application -- 4 MR. ARTZ: No, it was not. 5 QUESTION: -- that they were originally apart. 6 MR. ARTZ: That's right. 7 QUESTION: So the issue, really, is simply the 8 functionality of putting the springs close together. 9 Now, what if putting the springs close 10 together -- it would have nothing to do with the patent, 11 but what if putting the springs close together makes the 12 sign more stable? 13 MR. ARTZ: Actually, technically it would make 14 it less stable. It would make it easier, more easy to 15 twist. 16 QUESTION: Okay, but if it made it more stable, 17 then you would acknowledge that they could copy even that 18 feature, the unpatented feature? 19 MR. ARTZ: No. They have an improvement in 20 performance that they say is more stable, but it doesn't 21 mean that they can still copy it if it's part of our trade 22 dress. 23 There's a -- the -- our trade dress has a number 24 of features, as I mentioned before. It's not just the 25 coil springs. They could use coil springs close together 42 1 as long as they change the base, or change the legs, or 2 change something which gave it a different visual 3 appearance to the public. 4 One of the touchstones here of the trademark 5 Lanham Act is to prevent confusion of the public, the 6 public buying this. You don't want to confuse or deceive 7 the public, which this does -- 8 QUESTION: Well, the public isn't buying it. 9 It's highway departments that are buying it. The public 10 isn't buying this sign, is it? 11 MR. ARTZ: That's the relevant public for this 12 purpose, Your Honor, yes. 13 QUESTION: Yeah, it's the highway department 14 purchasers. 15 MR. ARTZ: That's correct. 16 QUESTION: And doesn't the State typically 17 regulate the shape of the sign, as Justice Scalia asked 18 you? 19 MR. ARTZ: Yes. 20 QUESTION: I mean, diamond shape indicates a 21 certain kind of warning, does it not? 22 MR. ARTZ: Correct. 23 QUESTION: So they can use that shape and color, 24 presumably. That's necessary. 25 MR. ARTZ: Yes, I agree, Your Honor. 43 1 QUESTION: So what are we arguing about, the 2 legs? 3 MR. ARTZ: The -- yes, legs, the shape, the 4 base, and the springs, and then the upright. It's a 5 single upright, too. This doesn't have the single upright 6 because it's a small model. 7 QUESTION: Well, what is the base, after you get 8 through with the legs, and the upright, and the springs? 9 MR. ARTZ: Uh-huh. 10 QUESTION: I mean, could you -- you indicate, 11 what are we arguing about, the legs and the base. 12 MR. ARTZ: There's no -- I don't think there's 13 any doubt that these have a different visual appearance. 14 One has a wide base, one has a narrow base, one has 15 straight legs, one has X-shaped legs. 16 QUESTION: So when you say base, that really is 17 another way of saying the legs? 18 MR. ARTZ: No, it's what the legs are attached 19 to. It would be this -- this part in between the legs, 20 and here are the bases. It's what the legs are connected 21 to. 22 QUESTION: But obviously you're holding up one 23 that's a rectangle, so it makes sense to have the posts on 24 either side, as opposed to the diamond shape, where it 25 makes sense to have it in the middle. I mean, you're not 44 1 showing us an equivalent-shaped sign. 2 MR. ARTZ: Well, this, under the doctrine of 3 equivalents, this was held to be an infringement. But 4 right, individual appearance, I think they are different, 5 and so from a trade dress standpoint these are two 6 different products. 7 QUESTION: Well, you're willing to fight out 8 the -- I gather you're willing to fight out the 9 functionality battle as to whether putting the two springs 10 right next to each other instead of apart is a functional 11 matter. You're willing -- are you willing to combat on 12 that ground? 13 MR. ARTZ: Well, I -- whether it's useful, has a 14 purpose, I mean, if that's functionality -- 15 QUESTION: Whether it's functional within the 16 meaning of the trade dress restriction. 17 MR. ARTZ: Well then the answer, I agree -- I 18 think is no, because is there a competitive necessity to 19 have them together? The answer is no. 20 QUESTION: Okay, but you would agree that that 21 inquiry would be addressed to the spacing of the springs. 22 MR. ARTZ: Only -- 23 QUESTION: Even if we think that the use of 24 double springs is automatically no basis for giving you 25 trade dress protection, since you had patented the double 45 1 springs, you hadn't patented whether they were close 2 together or far apart and so whether putting them close 3 together, as your opponent did, is a violation of trade 4 dress protection would depend upon whether putting them 5 close together is functional within the meaning of trade 6 dress law, right? 7 MR. ARTZ: It's whether or not their whole 8 visual appearance, of a combination of five features, is 9 functional in the competitive necessity test. That's 10 why -- 11 QUESTION: I thought you a minute ago 12 acknowledged that if the two springs were closer together 13 it would be less wind-resistant than otherwise, which 14 seems to me demonstrates it has some functional 15 significance whether they're close or not. If one is a 16 -- better resistant to the wind than the other, doesn't -- 17 isn't that functional, isn't that enough to prove 18 functionality? 19 MR. ARTZ: Not the legal functionality test -- 20 QUESTION: Not under all these tests, but why 21 shouldn't it be enough? 22 The Government argues that the competitive need 23 is a sufficient proof but not a necessary proof of it as a 24 defense to the trade dress argument. 25 MR. ARTZ: Well, the problem you have, Your 46 1 Honor, is that tests -- either the Government's test or 2 Traffix' test is going to be unworkable, because you could 3 have company A that makes this product, or comes up with 4 this idea, company B. Company A gets a patent on it, goes 5 17 years. 6 Company B doesn't get a patent, and gets trade 7 dress protection on it, and yet company A for some reason 8 doesn't sue them, but when this patent expires, that means 9 all the trade dress that company B has developed over all 10 those years is shot. It's out the window, because it 11 happens to be the subject of a patent. 12 See, that's a problem with this per se test that 13 they're saying. 14 QUESTION: I don't -- I thought as a factual 15 matter that there are five features in your patent, 16 including the legs, all the other things of appearance, 17 but the district court found that there are a lot of other 18 competitors that have every one of those features, so it's 19 not unique but for the spaced-apart coil springs, so that 20 all were -- is that true? 21 MR. ARTZ: That's true. 22 QUESTION: All right, so all we're talking 23 about -- and then I thought also as a factual matter that 24 somebody before the patent expired used those two spaced- 25 apart springs in that narrow configuration that your 47 1 finger's on right now. 2 MR. ARTZ: Uh-huh. 3 QUESTION: And you sued them, and it was found 4 in your claim, in your view, those spaced-apart that much, 5 not wide apart, violated your patent, and you won. 6 MR. ARTZ: Well, the patent covered some other 7 things other than that. They had to have initial 8 compression along the coils of the spring. They also had 9 to meet a certain geometric relationship with the center 10 of gravity -- 11 QUESTION: But they didn't get out of it -- they 12 didn't get out of your patent, because the springs were 13 close together rather than being far apart. 14 MR. ARTZ: Well, that's the doctrine of 15 equivalents, and -- 16 QUESTION: Yeah. 17 MR. ARTZ: -- one language of the claim which 18 calls for spaced-apart springs, and then we -- 19 QUESTION: That's right. 20 MR. ARTZ: It was equivalent from a patent 21 standpoint whether two springs together were the 22 equivalent of two springs spaced apart. 23 QUESTION: That's right, so I -- 24 MR. ARTZ: That was that issue. 25 QUESTION: Yeah. 48 1 MR. ARTZ: That's only one of several issues in 2 that patent case, and the fact that the others happened to 3 use this coil spring, they used the other parts, that 4 shows you that you can change one or two parts of this 5 particular trade dress and comes up -- have something that 6 looks completely different. In that case, the competitors 7 made a flat spring, they had a horizontal spring, they put 8 two springs at 45-degree angles, you could change the 9 legs, you could change the upright -- all of those might 10 give a different visual impression. That's what the Sixth 11 Circuit said. 12 See, the district court in this case 13 concentrated on just the two springs, and the Sixth 14 Circuit said that was not proper because it's the overall 15 appearance, visual, visual and image of the product which 16 really controls. You can't look at one -- 17 QUESTION: But it seems to me if the different 18 spacing is the functional -- is a functional equivalent 19 for patent law, then it seems to me that the spacing of 20 the spring is part of your patent protection. 21 MR. ARTZ: All right. 22 QUESTION: As well as the nature of the springs, 23 and so the square stand is no different for purposes of 24 the issue in this case than the diamond-shaped stand. 25 MR. ARTZ: As long as you don't confuse the 49 1 patent law with the trade dress law, Your Honor, two 2 separate and distinct, but from a patent law standpoint 3 you're right, but not from the trade dress standpoint. 4 There's another -- right now we're looking at 5 the public domain, and the difference is where it comes 6 from. If it comes from a patent, it's given special 7 recognition. You can't use it for the trade dress, but if 8 it doesn't, then you can use it. Now, that to me is not a 9 real consistent -- not a real consistent argument. 10 You also have the fact that as -- where do you 11 look at the trade dress and this functionality, look at 12 one patent, look at two patents, what if there are several 13 patents that show it. 14 You know, what if you don't even own the 15 patents? What if we were just a licensee and asserted it? 16 What if you didn't own it? Would that make a difference, 17 or if a third party owns the patent. There are several 18 things, questions we raise at the back of our brief that 19 Traffix and the Government really can't answer. They 20 really do admit that if someone is the subject matter of 21 one patent by one person, and it expires, somebody else's 22 trade dress will expire. 23 I mean, right now we also have a situation where 24 they're trying to get special protection for utility 25 patents, which is different than, for example, for design 50 1 patents. Or, talk about something being nonfunctional, 2 design patenting in which having this right, as you 3 mentioned before, of an exclusive period of 14 years 4 develop secondary meaning. 5 There's no question whatsoever that courts do 6 allow parties to get trade dress protection in such a 7 matter of design patents, and there you've got this 8 secondary meaning over 14 years in which you've used it 9 exclusively, and that goes to the look and appearance of 10 the product, but there's no problem with having trade 11 dress protection afterwards because it isn't functional, 12 so why should utility patents be treated any differently? 13 And as I said initially, there are different 14 areas of intellectual property law, you have different 15 standards, different tests, different remedies. You know, 16 in trade dress law you have -- in trademark law you have 17 much different remedies to protect the public and 18 consumers. Here -- 19 QUESTION: Thank you, Mr. Artz. 20 MR. ARTZ: Thank you, Your Honor. 21 QUESTION: Mr. Roberts, you have 2 minutes 22 remaining. 23 REBUTTAL ARGUMENT OF JOHN G. ROBERTS, JR. 24 ON BEHALF OF THE PETITIONER 25 MR. ROBERTS: Thank you, Your Honor. 51 1 There was until this morning no dispute that 2 moving the springs closer together was functional. If you 3 look at petition appendix page 54a, there is the 4 explanation from MDI's chief engineer that doing so makes 5 the sign more compact and weighs less, very important if 6 you're ferrying these things up and down the highway, and 7 also makes it less expensive to manufacture. 8 As far as the two different sign stands, the 9 diamond one with the closely spaced springs, joint 10 appendix page 236, MDI said that those signs, even though 11 the other one was depicted in their patent, that the 12 closely spaced springs were, quote, slavish copies from 13 the standpoint of function of the sign stand described and 14 claimed in the Sartesian patents. 15 Third, that is the form in which they practiced 16 their patent, the closely spaced springs. Kellogg, 17 Singer, Sears, that line of cases gives Traffix Devices 18 and any member of the public the right to copy the patent 19 in the form in which it was practiced. That is critically 20 important to maintain competition. Whether you begin with 21 patent law and the right to copy from an expired patent, 22 or trade dress law and the definition of functionality 23 that focuses on usefulness, is it a useful product figure, 24 you come to the same point. Traffix Devices had the right 25 to copy the MDI sign stand when it came off patent, and it 52 1 did so. It did so in the way Bonito Boats explains 2 enhances competition, imitation and refinement through 3 imitation by adding an improvement of its own that made a 4 more competitive product better for highway safety 5 departments. 6 Thank you, Your Honor. 7 CHIEF JUSTICE REHNQUIST: Thank you, Mr. 8 Roberts. The case is submitted. 9 (Whereupon, at 11:03 a.m., the case in the 10 above-entitled matter was submitted.) 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 53