Caution must be exercised in advertising and marketing materials when the brand owner desires ownership of non-traditional trademarks such as product configurations (here and here), trade dress, and single color marks too.

In our ongoing effort to raise the awareness of marketing types to pitfalls that can kill non-traditional trademark rights, a recent decision from the Fifth Circuit Court of Appeals in Poly-America, L.P. v. Stego Industries, LLC, provides a painful lesson to a brand owner that touted the functional or utilitarian benefits of the the color yellow.

While the color yellow is almost certain to raise the question of functionality when it is sought as a trademark for safety-related goods (given the color’s well-embedded meaning of caution), there are other non-safety contexts where yellow still must be part of the public domain for any competitor to use, as this case illustrates.

The Poly-America case specifically ruled on the validity of Stego Industries’ federal trademark registration for the color yellow as applied to the entirety of “plastic sheeting used in the construction industry as a vapor barrier and as a vapor retarder.” Here is a specimen of use submitted to the USPTO by Stego, depicting the goods in a website photograph:

This past summer the Northern District of Texas issued a decision ruling Stego’s yellow color trademark invalid under the functionality doctrine. In doing so, the district court used Stego’s advertising against it in finding the color yellow functional and “essential to the use” of a vapor barrier because the yellow color is “the reason the device works”:

“Stego Wrap vapor barrier is yellow for a reason. First, the natural extrusion of Stego Wrap polyolefin plastic & additives is a clear plastic much like visquene or poly. Bright yellow dye is added to distinguish Stego Wrap from poly laminates. Second, most vapor retarders are black poly laminates. Black poly absorbs tremendous heat creating very hot jobsite conditions for laborers. Third, punctures or tears (although unlikely) can be seen and easily repaired in our bright yellow membrane.”

Surprisingly, the USPTO issued the yellow color trademark registration back in 2003, despite the fact that the above quote appeared in a Stego advertisement among the more than 100 pages of argument and evidence Stego submitted to overcome the USPTO’s initial functionality refusal.

Nevertheless, the functionality evidence relied upon by Poly-America was found sufficient to reverse the presumption of validity normally associated with a federal registration:

“Indeed, in its marketing and advertising materials, Stego has openly promoted these utilitarian benefits — high visual contrast and low heat absorption –of its trademarked yellow. In one “advertorial,” published in late 2006 or early 2007, Stego explains that the “two key reasons” why its vapor barrier is yellow are: “It’s easier for contractors to see damaged areas and it draws less heat on-site. . . .”

The district court went on to explain it’s determination that yellow is functional for vapor barrier products:

“On balance, the evidence proves that yellow — as a bright, light color –provides utilitarian benefits, both in hot climates and where the underlying soil is of a darker hue, by absorbing less heat and contrasting well with the underlying soil and overlaying rebar. Indeed, Stego’s own representatives testified that color can be added to vapor barrier to increase or decrease its heat absorption, and/or enhance its visual contrast with the underlying soil. And logic dictates that yellow, as a color, offers these utilitarian benefits in some circumstances. Stego attempts to minimize this fact by arguing that no one color works best in all circumstances because some soils are light and some contractors place sand layers underneath the vapor barrier, and the absorption of heat might be beneficial in some cases because it can help warm a job site and increase the likelihood that the tape used on the seams will adhere to the vapor barrier in cold climates. The court is not persuaded. Even if true, these facts would not negate yellow’s de jure functionality.”

Just last week, the Fifth Circuit Court of Appeals, affirmed the judgement of the district court “for essentially the same reasons given by the district court.”

Here’s my question: Are there others in the industry with vapor barrier products also having a “bright, light color”? If so, we should talk.

Last, if you noticed red tape on the yellow vapor barrier (shown in the Stego photo above), and you’re wondering about its trademark status, let’s just say the USPTO issued a red light.